Financial Analysis

Acquisition of Business We account for acquisitions 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 and have included the results of operations of the acquired business in our Consolidated Statements of Income from the date of acquisition. We develop the allocation of the purchase price of an acquired company to the tangible and intangible assets acquired and liabilities assumed using estimates of fair value. On October 1, 2025, we completed the acquisition of Mars TopCo, LLC, the ultimate parent company of Calca Solutions, LLC (Calca) for $218 million. Calca has one manufacturing facility in Louisiana and is the nation's leading producer of Ultra Pure and high-purity hydrazine - essential, mission-critical propellants that enable advanced aerospace and defense applications. Calca's products are integral to in-space propulsion systems for satellites, space probes, and other vehicles that operate in the most demanding environments. For more than 70 years, Calca has supplied high-purity hydrazine to the U.S. Department of War's Defense Logistics Agency - Energy. This acquisition was funded by cash on hand and borrowings under our revolving credit facility. Acquisition-related charges totaling $1 million consisted primarily of legal and professional fees and are included in selling, general, and administrative expenses i …

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Commitments and Contingencies Legal Matters We are involved in legal proceedings that are incidental to our business and may include administrative or judicial actions. Some of these legal proceedings involve governmental authorities and relate to environmental matters. For further information, see Environmental below. While it is not possible to predict or determine with certainty the outcome of any legal proceeding, we believe the outcome of any of these proceedings, or all of them combined, will not result in a material adverse effect on our consolidated results of operations, financial condition, or cash flows. Environmental We are involved in environmental proceedings and potential proceedings relating to soil and groundwater contamination, disposal of hazardous waste, and other environmental matters at several of our current or former facilities, or at third-party sites where we have been designated as a potentially responsible party. While we believe we are currently adequately accrued for known environmental issues, it is possible that unexpected future costs could have a significant impact on our consolidated financial position, results of operations, and cash flows. Our total accruals for environmental remediation, dismantling, and decontamination were approximately $12 million at June 30, 2026 and $14 million at December 31, 2025. Of the total accrual, the current portion is included in accrued expenses, and the noncurrent portion is included in other noncurrent li …

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Long-term Debt (in thousands) June 30, 2026 December 31, 2025 Senior notes - 2.70% due 2031 (net of related deferred financing costs) $ 395,833 $ 395,391 Revolving credit facility 309,000 288,000 Senior notes - 3.78% due 2029 150,000 200,000 $ 854,833 $ 883,391 Senior Notes - The 2.70% senior notes, which were issued in 2021, are unsecured with an aggregate principal amount of $400 million. The offer and sale of the notes were registered under the Securities Act of 1933, as amended. The 3.78% senior notes are unsecured and were issued in a 2017 private placement with The Prudential Insurance Company of America and certain other purchasers. We have made two principal payments of $50 million each on January 4, 2025 and January 4, 2026. We have three remaining principal payments of $50 million due January 4 of each year through 2029. We were in compliance with all covenants under all issuances of senior notes as of June 30, 2026 and December 31, 2025. Revolving Credit Facility - The revolving credit facility has a borrowing capacity of $900 million, a term of five years, and matures on January 22, 2029. The obligations under the revolving credit facility are unsecured. The average interest rate for borrowings under the revolving credit agreement was 4.8% during the first six months of 2026 and 5.3% during the year ended December 31, 2025. Outstanding borrowings under the revolving credit facility amounted to $309 million at June 30, 2026 and $288 million at December 31, 2025. Ou …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table provides information on our net sales by geographic area. Information on net sales by segment is presented in Note 4. Second Quarter Ended June 30, Six Months Ended June 30, (in thousands) 2026 2025 2026 2025 Net sales United States $ 290,373 $ 269,147 $ 547,745 $ 540,023 Europe, Middle East, Africa, India 224,677 212,895 427,295 414,571 Asia Pacific 139,737 131,488 272,942 278,924 Other foreign 92,307 84,979 168,829 165,937 Net sales $ 747,094 $ 698,509 $ 1,416,811 $ 1,399,455

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Fair Value Measurements The carrying amount of cash and cash equivalents in the Condensed Consolidated Balance Sheets, as well as the fair value, was $94 million at June 30, 2026 and $78 million at December 31, 2025. The fair value is classified as Level 1 in the fair value hierarchy. No material events occurred during the six months ended June 30, 2026 that required adjustment to the recognized balances of assets or liabilities which are recorded at fair value on a nonrecurring basis. Long-term debt We record the carrying amount of our long-term debt at historical cost, less deferred financing costs related to our outstanding senior notes. The estimated fair value of our long-term debt is shown in the table below and is based primarily on estimated current rates available to us for debt of the same remaining duration and adjusted for nonperformance risk and credit risk. The estimated fair value of our publicly traded outstanding senior notes included in the table below is based on the last quoted price closest to June 30, 2026. The fair value of our debt instruments is classified as Level 2 in the fair value hierarchy. June 30, 2026 December 31, 2025 (in thousands) Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt $ 854,833 $ 819,153 $ 883,391 $ 850,535 …

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Intangibles (Net of Amortization) and Goodwill The net carrying amount of intangibles and goodwill was $923 million at June 30, 2026 and $941 million at December 31, 2025. The gross carrying amount and accumulated amortization of each type of intangible asset and goodwill are presented in the table below. June 30, 2026 December 31, 2025 (in thousands) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortizing intangible assets Customer bases $ 399,920 $ 48,247 $ 403,310 $ 37,626 Formulas and technology 90,820 19,639 90,820 14,745 Trademarks and trade names 31,020 5,074 31,020 3,976 Backlog 19,870 2,981 19,870 1,036 Water rights 29,392 29,392 Goodwill 428,101 424,127 $ 999,123 $ 75,941 $ 998,539 $ 57,383 Of the total intangibles (net of amortization) and goodwill, $124 million is attributable to the petroleum additives segment and $799 million is attributable to the specialty materials segment. The change in the gross carrying amount between December 31, 2025 and June 30, 2026 is due to measurement period adjustments related to the Calca acquisition and foreign currency fluctuation on goodwill in the petroleum additives segment. See Note 2 for further information on the intangibles and goodwill obtained with the Calca acquisition. There is no accumulated goodwill impairment. Amortization expense was (in thousands): Second quarter ended June 30, 2026 $ 9,259 Six months ended June 30, 2026 18,573 Second quarter ended June 30, 2025 6, …

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Pension Plans and Other Postretirement Benefits The table below shows cash contributions made during the six months ended June 30, 2026, as well as the remaining cash contributions we expect to make during the year ending December 31, 2026, for our domestic and foreign pension plans and domestic postretirement benefit plan. (in thousands) Actual Cash Contributions for Six Months Ended June 30, 2026 Expected Remaining Cash Contributions for Year Ending December 31, 2026 Domestic plans Pension benefits $ 1,672 $ 1,672 Postretirement benefits 819 819 Foreign plans Pension benefits 2,531 2,915 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 Second Quarter Ended June 30, (in thousands) 2026 2025 2026 2025 Service cost $ 2,973 $ 2,858 $ 137 $ 139 Interest cost 6,369 6,201 403 413 Expected return on plan assets (16,177) (15,114) (19 …

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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, as well as propellants that enable advanced aerospace and defense applications and are integral to in-space propulsions systems for satellites and space probes. 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, as well as 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 p …

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4. Segment Information We have two reportable segments petroleum additives and specialty materials. The petroleum additives segment includes lubricant and fuel additives which are necessary for the efficient and reliable operation of vehicles and machinery. The specialty materials segment includes critical materials used in solid rocket motors for space launch and military defense applications as well as propellants that enable advanced aerospace and defense applications that are integral to in-space propulsion systems for satellites and space probes. The petroleum additives and specialty materials segments are managed separately by the president of Afton and the executive vice president, specialty materials, respectively. The All other category shown in the tables below includes the operations of the antiknock compounds business, as well as certain contracted manufacturing and related services associated with Ethyl. We have determined that our chief executive officer is the chief operating decision maker (CODM) who makes key operating decisions and assesses the performance of the reportable segments. The CODM evaluates performance based on segment operating profit and considers budgeted and forecasted variances to actual results in allocating resources to the segments. The segment accounting policies are the same as those described in Note 1 of our 2025 Annual Report. NewMarket Services expenses are billed to the companies in each of the segments and all other businesses bas …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing