neu-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 1-32190

NEWMARKET CORPORATION

(Exact name of registrant as specified in its charter)


Virginia		20-0812170
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

330 South Fourth Street		23219-4350
Richmond,	Virginia
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code - (804) 788-5000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, with no par value	NEU	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No x

Number of shares of common stock, with no par value, outstanding as of September 30, 2024: 9,595,011

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NEWMARKET CORPORATION

INDEX


			Page Number
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements (unaudited)
Consolidated Statements of Income - Third Quarter and Nine Months Ended September 30, 2024 and September 30, 2023			4
Consolidated Statements of Comprehensive Income - Third Quarter and Nine Months Ended September 30, 2024 and September 30, 2023			5
Condensed Consolidated Balance Sheets - September 30, 2024 and December 31, 2023			6
Consolidated Statements of Shareholders' Equity - Third Quarter and Nine Months Ended September 30, 2024 and September 30, 2023			7
Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2024 and September 30, 2023			8
Notes to Condensed Consolidated Financial Statements			9
Financial Statement Presentation			9
Acquisition of Business			9
Net Sales			11
Segment Information			12
Pension Plans and Other Postretirement Benefits			12
Earnings Per Share			13
Inventories			14
Intangibles (Net of Amortization) and Goodwill			14
Long-term Debt			15
Commitments and Contingencies			16
Other Comprehensive Income (Loss) and Accumulated Other Comprehensive Loss			17
Fair Value Measurements			17
Recent Accounting Pronouncements			18
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			19
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk			25
ITEM 4. Controls and Procedures			25
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings			27
ITEM 1A. Risk Factors			27
ITEM 5. Other Information			27
ITEM 6. Exhibits			27
SIGNATURES			28

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PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

NEWMARKET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


(in thousands, except per-share amounts)	Third Quarter Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net sales	$	724,947	$	667,150	$	2,131,911	$	2,055,069
Cost of goods sold	481,107		465,445		1,453,251		1,459,682
Gross profit	243,840		201,705		678,660		595,387
Selling, general, and administrative expenses	42,124		37,386		129,329		114,671
Research, development, and testing expenses	32,193		31,894		92,056		99,008
Operating profit	169,523		132,425		457,275		381,708
Interest and financing expenses, net	14,157		9,221		45,721		30,249

Other income (expense), net	13,805		11,278		38,304		32,881
Income before income tax expense	169,171		134,482		449,858		384,340
Income tax expense	36,849		23,235		98,184		75,886
Net income	$	132,322	$	111,247	$	351,674	$	308,454
Earnings per share - basic and diluted	$	13.79	$	11.60	$	36.66	$	32.05
Cash dividends declared per share	$	2.50	$	2.25	$	7.50	$	6.60

See accompanying Notes to Condensed Consolidated Financial Statements

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NEWMARKET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


(in thousands)	Third Quarter Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income	$	132,322	$	111,247	$	351,674	$	308,454
Other comprehensive income (loss):
Pension plans and other postretirement benefits:
Prior service credit (cost) arising during the period, net of income tax expense (benefit) of $0 in third quarter 2024, $(159) in third quarter 2023, $0 in nine months 2024, and $(159) in nine months 2023	0		(489)		0		(489)
Amortization of prior service cost (credit) included in net periodic benefit cost (income), net of income tax expense (benefit) of $(173) in third quarter 2024, $(141) in third quarter 2023, $(520) in nine months 2024, and $(482) in nine months 2023	(501)		(454)		(1,505)		(1,547)
Actuarial net gain (loss) arising during the period, net of income tax expense (benefit) of $(552) in third quarter 2024, $(239) in third quarter 2023, $(552) in nine months 2024, and $(239) in nine months 2023	(1,600)		(784)		(1,600)		(784)
Amortization of actuarial net loss (gain) included in net periodic benefit cost (income), net of income tax expense (benefit) of $(114) in third quarter 2024, $(105) in third quarter 2023, $(358) in nine months 2024, and $(342) in nine months 2023	(331)		(332)		(1,046)		(1,081)
Total pension plans and other postretirement benefits	(2,432)		(2,059)		(4,151)		(3,901)




Foreign currency translation adjustments, net of income tax expense (benefit) of $137 in third quarter 2024, $(327) in third quarter 2023, $(951) in nine months 2024, and $371 in nine months 2023	21,885		(9,966)		10,578		9,114




Other comprehensive income (loss)	19,453		(12,025)		6,427		5,213
Comprehensive income	$	151,775	$	99,222	$	358,101	$	313,667

See accompanying Notes to Condensed Consolidated Financial Statements

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NEWMARKET CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in thousands, except share amounts)	September 30, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	80,310	$	111,936

Trade and other accounts receivable, less allowance for credit losses	487,607		432,349
Inventories	534,462		456,234
Prepaid expenses and other current assets	35,250		39,051
Total current assets	1,137,629		1,039,570
Property, plant, and equipment, net	755,409		654,747
Intangibles (net of amortization) and goodwill	757,060		124,642
Prepaid pension cost	390,018		370,882
Operating lease right-of-use assets, net	73,123		70,823

Deferred charges and other assets	53,045		48,207
Total assets	$	3,166,284	$	2,308,871
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	259,434	$	231,137
Accrued expenses	82,364		76,546
Dividends payable	21,419		19,212
Income taxes payable	17,011		6,131
Operating lease liabilities	15,683		15,074

Other current liabilities	6,042		16,064
Total current liabilities	401,953		364,164
Long-term debt	1,085,006		643,622
Operating lease liabilities-noncurrent	57,617		55,058
Other noncurrent liabilities	257,422		168,966
Total liabilities	1,801,998		1,231,810
Commitments and contingencies (Note 10)
Shareholders’ equity:
Common stock and paid-in capital (with no par value; authorized shares - 80,000,000; issued and outstanding shares - 9,595,011 at September 30, 2024 and 9,590,086 at December 31, 2023)	3,201		2,130
Accumulated other comprehensive loss	(14,644)		(21,071)
Retained earnings	1,375,729		1,096,002
Total shareholders’ equity	1,364,286		1,077,061
Total liabilities and shareholders’ equity	$	3,166,284	$	2,308,871

See accompanying Notes to Condensed Consolidated Financial Statements

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NEWMARKET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)


(in thousands, except share and per-share amounts)	Common Stock and Paid-in Capital			Accumulated Other Comprehensive Loss		Retained Earnings		Total Shareholders’ Equity
	Shares	Amount
Balance at June 30, 2023	9,589,239	$	0	$	(54,757)	$	947,497	$	892,740
Net income						111,247		111,247
Other comprehensive income (loss)				(12,025)				(12,025)
Cash dividends ($2.25 per share)						(21,578)		(21,578)

Tax withholdings related to stock-based compensation	(76)	(33)						(33)
Stock-based compensation	988	1,590				2		1,592
Balance at September 30, 2023	9,590,151	$	1,557	$	(66,782)	$	1,037,168	$	971,943

Balance at June 30, 2024	9,594,110	$	2,052	$	(34,097)	$	1,267,393	$	1,235,348
Net income						132,322		132,322
Other comprehensive income (loss)				19,453				19,453
Cash dividends ($2.50 per share)						(23,987)		(23,987)


Stock-based compensation	901	1,149				1		1,150
Balance at September 30, 2024	9,595,011	$	3,201	$	(14,644)	$	1,375,729	$	1,364,286

Balance at December 31, 2022	9,702,147	$	0	$	(71,995)	$	834,402	$	762,407
Net income						308,454		308,454
Other comprehensive income (loss)				5,213				5,213
Cash dividends ($6.60 per share)						(63,457)		(63,457)
Repurchases of common stock	(119,075)	(1,857)				(41,419)		(43,276)

Tax withholdings related to stock-based compensation	(2,493)	(33)				(803)		(836)
Stock-based compensation	9,572	3,447				(9)		3,438
Balance at September 30, 2023	9,590,151	$	1,557	$	(66,782)	$	1,037,168	$	971,943

Balance at December 31, 2023	9,590,086	$	2,130	$	(21,071)	$	1,096,002	$	1,077,061
Net income						351,674		351,674
Other comprehensive income (loss)				6,427				6,427
Cash dividends ($7.50 per share)						(71,959)		(71,959)


Tax withholdings related to stock-based compensation	(1,816)	(1,118)						(1,118)
Stock-based compensation	6,741	2,189				12		2,201
Balance at September 30, 2024	9,595,011	$	3,201	$	(14,644)	$	1,375,729	$	1,364,286

See accompanying Notes to Condensed Consolidated Financial Statements

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NEWMARKET CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


(in thousands)	Nine Months Ended September 30,
	2024		2023
Cash and cash equivalents at beginning of year	$	111,936	$	68,712
Cash flows from operating activities:
Net income	351,674		308,454
Adjustments to reconcile net income to cash provided from operating activities:
Depreciation and amortization	84,894		57,665
Deferred income tax benefit	(10,468)		(16,336)


Working capital changes	(81,866)		71,900

Cash pension and postretirement contributions	(8,940)		(7,132)
Other, net	(939)		(9,335)
Cash provided from (used in) operating activities	334,355		405,216
Cash flows from investing activities:
Capital expenditures	(42,700)		(34,793)
Acquisition of business (net of $15,588 of cash acquired)	(681,479)		0



Cash provided from (used in) investing activities	(724,179)		(34,793)
Cash flows from financing activities:
Net borrowings (repayments) under revolving credit facility	191,000		(225,000)
Proceeds from term loan	250,000		0
Dividends paid	(71,959)		(63,457)
Debt issuance costs	(2,251)		0
Repurchases of common stock	0		(42,864)
Other, net	(9,758)		(4,219)
Cash provided from (used in) financing activities	357,032		(335,540)
Effect of foreign exchange on cash and cash equivalents	1,166		(1,035)
(Decrease) increase in cash and cash equivalents	(31,626)		33,848
Cash and cash equivalents at end of period	$	80,310	$	102,560

See accompanying Notes to Condensed Consolidated Financial Statements

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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Financial Statement Presentation

In the opinion of management, the accompanying consolidated financial statements of NewMarket Corporation and its subsidiaries contain all necessary adjustments for the fair presentation of, in all material respects, our consolidated financial position as of September 30, 2024 and December 31, 2023, our consolidated results of operations, comprehensive income, and changes in shareholders' equity for the third quarter and nine months ended September 30, 2024 and September 30, 2023, and our cash flows for the nine months ended September 30, 2024 and September 30, 2023. All adjustments are of a normal, recurring nature, unless otherwise disclosed. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the NewMarket Corporation Annual Report on Form 10-K for the year ended December 31, 2023 (2023 Annual Report), as filed with the Securities and Exchange Commission (SEC). The results of operations for the nine month period ended September 30, 2024 are not necessarily indicative of the results to be expected for the full year ending December 31, 2024. The December 31, 2023 condensed consolidated balance sheet data was derived from the audited financial statements included in the 2023 Annual Report but does not include all disclosures required by accounting principles generally accepted in the United States of America.

Unless the context otherwise indicates, all references to “we,” “us,” “our,” the “company,” and “NewMarket” are to NewMarket Corporation and its consolidated subsidiaries.

Supplier Finance Program

We offer our vendors a supplier finance program, which allows our vendors to receive payment from a third-party finance provider earlier than our normal payment terms would provide. NewMarket and its subsidiaries are not a party to any arrangement between our vendors and the finance provider, and there are no assets pledged as security or other forms of guarantees provided by NewMarket to the finance provider. For those vendors who opt to participate in the program, we pay the finance provider the full amount of the invoices on the normal due date. At both September 30, 2024 and December 31, 2023, the amount of confirmed invoices under the supplier finance program was not material.

2. Acquisition of Business

On January 16, 2024, we completed the acquisition of all issued and outstanding ownership units of AMPAC Intermediate Holdings, LLC, the ultimate parent company of American Pacific Corporation (AMPAC), for approximately $697 million. Based in Cedar City, Utah, AMPAC has one operating facility from which it manufactures and sells critical specialty materials primarily used in solid rocket motors for space launch and military defense applications. AMPAC is qualified on many NASA and Department of Defense programs and has been serving space launch and national defense programs for more than 60 years. The acquisition of AMPAC expands our presence in mission-critical, resilient sectors. It was funded by cash on hand and borrowings under our then existing revolving credit facility. The purchase consideration was subject to a customary post-closing adjustment for working capital, which was finalized during the second quarter of 2024.

The preliminary fair values of the assets acquired and the liabilities assumed in the AMPAC acquisition are as follows (in millions):


Cash and cash equivalents	$	16
Trade and other accounts receivable, net	6
Inventories	25
Prepaid expenses and other current assets	3
Property, plant, and equipment, net	111
Intangibles and goodwill	650
Deferred charges and other assets	5
Accounts payable	(3)
Accrued expenses	(5)
Other noncurrent liabilities	(111)
Fair value of net assets acquired	$	697

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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Identified intangible assets acquired consisted of the following (in millions):


	Fair Value		Estimated Useful Lives (in years)
Customer base	$	275	17.5
Formulas and technology	60		8
Trademarks and trade names	30		15
Water rights	29		indefinite
	$	394

As part of the acquisition, we recorded $256 million of goodwill. The goodwill recognized is attributable to increased access to mission-critical, resilient sectors with a role in global safety, security, and space exploration, as well as the value of the skilled assembled workforce of AMPAC. All of the goodwill recognized is part of the specialty materials segment, and none of the goodwill is deductible for income tax purposes.

The allocation of the purchase price of AMPAC to the tangible and intangible assets acquired and liabilities assumed was developed using preliminary estimates of fair value and based on information currently available. We are continuing to finalize the valuation of certain assets and liabilities and expect to complete our valuations within one year of the date of acquisition. Acquisition-related charges of $1 million consisted primarily of legal and professional fees and are included in selling, general, and administrative expenses in our Consolidated Statements of Income for the nine months ended September 30, 2024.

We are accounting for this acquisition using the acquisition method of accounting for business combinations under the provisions of Financial Accounting Standards Board (FASB) Accounting Standard Codification (ASC) Topic 805, Business Combinations (ASC 805) and have included the results of operations of the acquired business in our Consolidated Statement of Income from the date of acquisition, as well as in the specialty materials segment in Note 4. These results include a charge related to the sale of finished goods inventory acquired, which was recorded at fair value on the acquisition date and sold to customers from the date of acquisition through September 30, 2024. The following table presents the financial results in thousands for AMPAC from the date of acquisition through September 30, 2024 and for the third quarter ended September 30, 2024.


AMPAC	Third Quarter Ended September 30, 2024		January 16 to September 30, 2024
Net sales	$	59,094	$	114,151
Income before income tax expense	16,274		16,196

The following table presents our estimated unaudited pro forma consolidated results for the third quarter and nine months ended September 30, 2024 and September 30, 2023, assuming the acquisition of AMPAC had occurred on January 1, 2023. The unaudited pro forma information is presented for informational purposes only and is not indicative of the results of operations that would have been realized if the acquisition had been completed at the beginning of 2023, nor is it indicative of expected results for any future period. In addition, no effect is given to any future synergistic benefits that could result from the integration of AMPAC into NewMarket.

Unaudited pro forma information for the third quarter and nine months ended September 30, 2024 and September 30, 2023 includes adjustments to depreciation and amortization based upon the fair value allocation of the purchase price to AMPAC's tangible and intangible assets acquired and liabilities assumed as though the acquisition had occurred on January 1, 2023, as well as adjustments for debt-related costs and management fees. The acquisition-related costs and the charge related to the fair value adjustment to acquisition-date inventory were recognized in actual results during the third quarter and nine months ended September 30, 2024, but for the presentation below, these costs are excluded from 2024 unaudited pro forma income before income taxes and are instead reflected in 2023 pro forma income before income taxes as though they were incurred during the third quarter and nine months ended September 30, 2023.

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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


Pro Forma Supplemental Information (unaudited) (in thousands)
	Third Quarter Ended September 30,				Nine Months Ended September 30,
Consolidated	2024		2023		2024		2023
Net sales	$	724,947	$	734,100	$	2,137,011	$	2,160,279
Income before income tax expense	172,013		151,040		456,988		370,186

3. Net Sales

Our revenues are predominantly derived from the manufacture and sale of petroleum additives products. We sell petroleum additives products across the world to customers located in the North America (the United States and Canada), Latin America (Mexico, Central America, and South America), Asia Pacific, and EMEAI (Europe/Middle East/Africa/India) regions. Our petroleum additives customers primarily consist of global, national, and independent oil companies. Our petroleum additives contracts generally include one performance obligation, which is satisfied at a point in time when products are shipped, delivered, or consumed by the customer, depending on the underlying contracts.

Additionally, we have revenue from the manufacture and sale of critical specialty materials products used primarily in solid rocket motors for space launch and military defense applications. The sale of specialty materials products is predominantly to customers located in the United States, with limited amounts to customers in other countries. Our specialty materials customers are primarily contractors or subcontractors of the U.S. government. Specialty materials contracts generally include one performance obligation, which is typically satisfied at a point in time when the products are shipped from the plant site.

In limited cases, we collect funds in advance of shipping product to our customers and recognizing the related revenue. These prepayments from customers are recorded as a contract liability until we recognize the revenue. Some of our contracts also include variable consideration in the form of rebates, tiered pricing, and/or business development funds. We regularly review these and make adjustments when necessary, recognizing the full amount of any adjustment in the period identified.

The following table provides information on our net sales by geographic area. Information on net sales by segment is presented in Note 4.


	Third Quarter Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Net sales
United States	$	305,382	$	246,462	$	827,101	$	745,470
Europe, Middle East, Africa, India	201,538		200,843		612,828		607,913
Asia Pacific	136,691		129,717		441,793		433,905
Other foreign	81,336		90,128		250,189		267,781
Net sales	$	724,947	$	667,150	$	2,131,911	$	2,055,069

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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

4. Segment Information

The tables below show our consolidated segment results. The “All other” category includes the operations of the antiknock compounds business, as well as certain contracted manufacturing and related services associated with Ethyl Corporation (Ethyl).

Net Sales by Segment


	Third Quarter Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Petroleum additives
Lubricant additives	$	568,450	$	562,692	$	1,715,559	$	1,753,772
Fuel additives	94,564		101,027		294,545		293,907
Total	663,014		663,719		2,010,104		2,047,679
Specialty materials	59,094		0		114,151		0
All other	2,839		3,431		7,656		7,390
Net sales	$	724,947	$	667,150	$	2,131,911	$	2,055,069

Segment Operating Profit


	Third Quarter Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Petroleum additives	$	157,468	$	139,820	$	456,196	$	404,026
Specialty materials	15,962		0		15,967		0
All other	(93)		(764)		(1,548)		(2,761)
Segment operating profit	173,337		139,056		470,615		401,265
Corporate, general, and administrative expenses	(3,953)		(6,389)		(13,495)		(19,690)
Interest and financing expenses, net	(14,157)		(9,221)		(45,721)		(30,249)

Other income (expense), net	13,944		11,036		38,459		33,014
Income before income tax expense	$	169,171	$	134,482	$	449,858	$	384,340

5. Pension Plans and Other Postretirement Benefits

The table below shows cash contributions made during the nine months ended September 30, 2024, as well as the remaining cash contributions we expect to make during the year ending December 31, 2024, for our domestic and foreign pension plans and domestic postretirement benefit plan.


(in thousands)	Actual Cash Contributions for Nine Months Ended September 30, 2024		Expected Remaining Cash Contributions for Year Ending December 31, 2024
Domestic plans
Pension benefits	$	4,121	$	770
Postretirement benefits	1,025		342
Foreign plans
Pension benefits	3,794		1,479

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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The tables below present information on net periodic benefit cost (income) for our domestic and foreign pension plans and domestic postretirement benefit plan. The service cost component of net periodic benefit cost (income) is reflected in cost of goods sold; selling, general, and administrative expenses; or research, development, and testing expenses, according to where other compensation costs arising from services rendered by the pertinent employee are recorded on the Consolidated Statements of Income. The remaining components of net periodic benefit cost (income) are recorded in other income (expense), net on the Consolidated Statements of Income.


	Domestic
	Pension Benefits				Postretirement Benefits
	Third Quarter Ended September 30,
(in thousands)	2024		2023		2024		2023
Service cost	$	3,177	$	2,482	$	216	$	130
Interest cost	5,997		4,587		372		404
Expected return on plan assets	(14,030)		(11,510)		(191)		(182)
Amortization of prior service cost (credit)	47		127		(757)		(757)
Amortization of actuarial net (gain) loss	(367)		(376)		(71)		(55)
Net periodic benefit cost (income)	$	(5,176)	$	(4,690)	$	(431)	$	(460)


	Domestic
	Pension Benefits				Postretirement Benefits
	Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Service cost	$	9,255	$	7,799	$	485	$	390
Interest cost	17,646		13,659		1,208		1,186
Expected return on plan assets	(41,295)		(34,529)		(576)		(585)
Amortization of prior service cost (credit)	140		139		(2,271)		(2,271)
Amortization of actuarial net (gain) loss	(1,282)		(1,199)		(102)		(206)
Net periodic benefit cost (income)	$	(15,536)	$	(14,131)	$	(1,256)	$	(1,486)


	Foreign
	Pension Benefits
	Third Quarter Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Service cost	$	1,084	$	1,094	$	3,246	$	3,222
Interest cost	1,625		1,615		4,851		4,736
Expected return on plan assets	(3,371)		(2,973)		(10,020)		(8,713)
Amortization of prior service cost (credit)	35		36		105		104
Amortization of actuarial net (gain) loss	(5)		(6)		(18)		(18)
Net periodic benefit cost (income)	$	(632)	$	(234)	$	(1,836)	$	(669)

6. Earnings Per Share

We had 34,474 shares of nonvested restricted stock at September 30, 2024 and 34,071 shares of nonvested restricted stock at September 30, 2023 that were excluded from the calculation of diluted earnings per share, as their effect on earnings per share would be anti-dilutive. The nonvested restricted stock is considered a participating security since the restricted stock contains nonforfeitable rights to dividends. As such, we use the two-class method to compute basic and diluted earnings per share for all periods presented since this method yields the most dilutive result. The following table illustrates the earnings allocation method utilized in the calculation of basic and diluted earnings per share.

Table of Contents

NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


	Third Quarter Ended September 30,				Nine Months Ended September 30,
(in thousands, except per-share amounts)	2024		2023		2024		2023
Earnings per share numerator:
Net income attributable to common shareholders before allocation of earnings to participating securities	$	132,322	$	111,247	$	351,674	$	308,454
Earnings allocated to participating securities	(474)		(393)		(1,247)		(1,055)
Net income attributable to common shareholders after allocation of earnings to participating securities	$	131,848	$	110,854	$	350,427	$	307,399
Earnings per share denominator:

SEC Form 10-Q filed by NewMarket Corp