Valvoline (VVV) Tops Q2 EPS by 9c, Revenues Beat; Raises FY21 EPS Guidance Above Consensus

Valvoline (NYSE: VVV) reported Q2 EPS of $0.46, $0.09 better than the analyst estimate of $0.37. Revenue for the quarter came in at $701 million versus the consensus estimate of $658.26 million.

"We continue to see healthy demand and loyalty to our brand from consumers and customers," said Sam Mitchell, CEO of Valvoline. "Quick Lubes had record 20% system-wide same-store sales growth and improved margins for the quarter, and International saw robust volume, top-line and earnings growth. Core North America generated top-line growth and continued to provide significant operating cash flow. This strong cash generation is a key component of our strategic transformation to a more service-driven company by funding our growth initiatives in Quick Lubes and International."

"Based on our strong results and confidence in the business, we are increasing our outlook for the year to $590 million to $610 million in adjusted EBITDA."

GUIDANCE:

Valvoline sees FY2021 EPS of $1.72-$1.82, versus the consensus of $1.65.

The guidance provided in this press release is based on current expectations, including those surrounding the ongoing COVID-19 pandemic.

"Our performance in the first half of the year has been outstanding," Mitchell said. "We are seeing continued strong momentum as we have remained focused on executing our superior in-store experience and staying connected to our customers. With Quick Lubes already representing half of our adjusted EBITDA this quarter, we are accelerating our shift to a more service-centric business."

Mitchell continued, "I have never been more optimistic about our future than I am today. We remain focused on our strategy, driving faster growth, higher margins and stronger returns as our retail services business continues to perform at a high level.

Based on our strong performance throughout the first half of the year, we are raising our fiscal 2021 guidance for adjusted EBITDA, along with our outlook for overall sales growth, same-store sales growth, adjusted EPS and free cash flow. We expect Quick Lubes to generate more than half of our adjusted EBITDA for the balance of the year and expect that this strong performance will offset any near-term margin pressure from rising raw material costs further highlighting the benefits of our multiple routes to market."

For earnings history and earnings-related data on Valvoline (VVV) click here.

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