What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-01 compared with 2024-05-02 · 276 added, 177 removed, 592 unchanged (43% of the section changed)

2 unchanged sentences

Condensed Consolidated Statements of Operations (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions, except per share data 2024 2023 2024 2023

5 unchanged sentences

Restructuring and other (income) charges, net 13.1 19.2 75.9 24.8

Goodwill impairment charge 349.1 — 349.1 —

Acquisition-related costs ( 0.2 ) 1.8 0.1 3.7

10 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

3 unchanged sentences

Foreign currency translation adjustment ( 2.6 ) 4.0 ( 11.7 ) 14.5

Total foreign currency adjustments, net of tax provision (benefit) of zero and zero

Total foreign currency adjustments, net of tax provision (benefit) of zero for all periods

( 2.6 ) 4.0 ( 11.7 ) 14.5

Derivative instruments:

Unrealized gain (loss), net of tax provision (benefit) of $( 0.1 ) and $( 0.7 )

Unrealized gain (loss), net of tax provision (benefit) of zero , zero , $( 0.1 ), and $( 0.7 )

0.1 ( 0.1 ) ( 0.2 ) ( 2.4 )

Reclassifications of deferred derivative instruments (gain) loss, included in net income (loss), net of tax (provision) benefit of $ 0.2 , $ 0.5 , $ 0.4 , and $ 0.4

0.6 1.3 1.1 1.1

Total derivative instruments, net of tax provision (benefit) of $ 0.2 , $ 0.5 , $ 0.3 , and $( 0.3 )

0.7 1.2 0.9 ( 1.3 )

Pension & other postretirement benefits:

Reclassifications of net actuarial and other (gain) loss and amortization of prior service cost, included in net income, net of tax of zero for all periods

Total pension and other postretirement benefits, net of tax of zero for all periods

Other comprehensive income (loss), net of tax provision (benefit) of $ 0.2 , $ 0.5 , $ 0.3 , and $( 0.3 )

( 1.9 ) 5.3 ( 10.8 ) 13.3

Comprehensive income (loss) $ ( 285.6 ) $ 40.8 $ ( 350.5 ) $ 99.5

2 unchanged sentences

Condensed Consolidated Balance Sheets

In millions, except share and par value data March 31, 2024 December 31, 2023

In millions, except share and par value data June 30, 2024 December 31, 2023

Assets (Unaudited)

42 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

In millions 2024 2023

5 unchanged sentences

Deferred income taxes ( 78.6 ) ( 1.0 )

Disposal/impairment of assets 0.9 5.8

Restructuring and other (income) charges, net 75.9 24.8

3 unchanged sentences

(Gain) loss on strategic investment 4.7 ( 19.2 )

Goodwill impairment charge 349.1 —

Other non-cash items 6.6 13.3

3 unchanged sentences

Prepaid and other current assets 6.7 ( 6.5 )

Planned major maintenance outage ( 2.8 ) ( 9.9 )

Accounts payable ( 13.4 ) 27.7

2 unchanged sentences

Income taxes ( 10.8 ) 1.4

Restructuring and other spending, net ( 10.0 ) ( 5.6 )

Restructuring and other cash outflow, net ( 22.9 ) ( 24.8 )

Operating leases ( 10.7 ) ( 10.7 )

CTO resales spending, net ( 19.8 ) —

CTO resales cash outflow, net ( 45.3 ) —

Changes in other operating assets and liabilities, net 4.4 3.6

19 unchanged sentences

$ 125.3 $ 76.9

(1) Includes restricted cash of $ 16.6 million and $ 8.2 million and cash and cash equivalents of $ 88.5 million and $ 77.9 million at March 31, 2024 and 2023, respectively.

(1) Includes restricted cash of $ 17.9 million and $ 8.9 million and cash and cash equivalents of $ 107.4 million and $ 68.0 million at June 30, 2024 and 2023, respectively.

Restricted cash is included within "Prepaid and other current assets" and "Restricted investment" within the condensed consolidated balance sheets.

7 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Description of Business

27 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

opportunities and potential future cash flows.

3 unchanged sentences

The following table presents our Net sales disaggregated by reportable segment and product line.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

Performance Materials segment $ 157.2 $ 144.6 $ 302.3 $ 286.0

Performance Chemicals segment

Road Technologies product line 129.1 140.9 174.8 186.7

Industrial Specialties product line 56.4 143.1 157.7 282.9

Total $ 147.0 $ 185.6

Performance Chemicals segment $ 185.5 $ 284.0 $ 332.5 $ 469.6

Advanced Polymer Technologies segment $ 47.9 $ 53.2 $ 95.9 $ 118.8

1 unchanged sentence

The following table presents our Net sales disaggregated by geography, based on the delivery address of our customer.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

20 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Fair Value Measurements

3 unchanged sentences

In millions Level 1 (1)

March 31, 2024

June 30, 2024

Deferred compensation plan investments (4)

18 unchanged sentences

Both the asset and liability related to investment securities are recorded at fair value and are included within "Other assets" and "Other liabilities" on the condensed consolidated balance sheets, respectively.

In addition to the investment securities, we also had company-owned life insurance related to the deferred compensation arrangement recorded at cash surrender value in "Other assets" of $ 15.8 million and $ 14.9 million at March 31, 2024 and December 31, 2023, respectively.

In addition to the investment securities, we also had company-owned life insurance related to the deferred compensation arrangement recorded at cash surrender value in "Other assets" of $ 16.0 million and $ 14.9 million at June 30, 2024 and December 31, 2023, respectively.

Nonrecurring Fair Value Measurements

There were no nonrecurring fair value measurements on the condensed consolidated balance sheets during the periods ended March 31, 2024, and December 31, 2023.

There were no nonrecurring fair value measurements on the condensed consolidated balance sheets during the periods ended June 30, 2024, and December 31, 2023.

Strategic Investments

Equity Method Investments

The aggregate carrying value of all strategic equity method investments totaled $ 15.7 million and $ 16.0 million at March 31, 2024 and December 31, 2023, respectively.

During the first quarter of 2023, we sold a strategic equity method investment for $ 31.4 million, resulting in a $ 19.2 million gain, recorded within "Other (income) expense, net" on the condensed consolidated statement of operations.

There were no adjustments to the carrying value of equity method investments for impairment for the periods ended March 31, 2024 and December 31, 2023.

During 2022, we entered into an investment with a venture capital fund for $ 0.8 million, which is accounted for under the equity method of accounting.

As of March 31, 2024 and December 31, 2023, respectively, we had approximately $ 5.6 million of unfunded commitments, which we anticipate will be paid over a period of 10 years.

The carrying value of our strategic equity investment was $ 1.6 million and $ 1.7 million at March 31, 2024 and December 31, 2023 , respectively.

The aggregate carrying value of all strategic equity method investments totaled $ 15.5 million and $ 16.0 million at June 30, 2024 and December 31, 2023, respectively.

There were no adjustments to the carrying value of equity method investments for impairment for the periods ended June 30, 2024 and December 31, 2023.

As of June 30, 2024 we had approximately $ 5.6 million of unfunded commitments, associated with a venture capital fund investment accounted for under the equity method of accounting, which we anticipate will be paid over a period of 10 years from the date of the investment.

We recognized an additional $ 0.1 million gain associated with the equity method investment sale during the three months ended June 30, 2024.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Measurement Alternative Investments

The aggregate carrying value of all measurement alternative investments where fair value is not readily determinable totaled $ 78.4 million and $ 83.2 million at March 31, 2024 and December 31, 2023, respectively.

During the period ended March 31, 2024, the company identified a triggering event indicating that an investment being accounted for under the measurement alternative may be impaired.

For the three months ended March 31, 2024, the Company recognized an impairment of $ 4.8 million, recorded in Other (income) expense, net on the condensed consolidated statement of operations.

The aggregate carrying value of all measurement alternative investments where fair value is not readily determinable totaled $ 78.4 million and $ 83.2 million at June 30, 2024 and December 31, 2023, respectively.

During the first quarter of 2024, the company identified a triggering event indicating that an investment being accounted for under the measurement alternative may be impaired.

For the three and six months ended June 30, 2024, the company recognized an impairment of zero and $ 4.8 million, respectively, recorded in Other (income) expense, net on the condensed consolidated statements of operations.

Restricted Investment

1 unchanged sentence

The trust, presented as Restricted investment on our condensed consolidated balance sheets, originally purchased long-term bonds that mature through 2026.

The principal received at maturity of the bonds, along with interest income that is reinvested in the trust, are expected to be equal to or more than the $ 80.0 million finance lease obligation that is due in 2027.

The principal received at maturity of the bonds, along with interest income that is reinvested in the trust, is expected to be equal to or more than the $ 80.0 million finance lease obligation that is due in 2027.

Because the provisions of the trust provide us the ability, and it is our intent, to hold the investments to maturity, the investments held by the trust are accounted for as held to maturity ("HTM");

1 unchanged sentence

The investments held by the trust earn interest at the stated coupon rate of the invested bonds.

Interest earned on the investments held by the trust is recognized and presented as interest income on our condensed consolidated statement of operations.

Interest earned on the investments held by the trust is recognized and presented as interest income on our condensed consolidated statements of operations.

As interest from the bonds is received and as bonds mature, any proceeds not reinvested are held in highly liquid securities and treated as restricted cash.

At March 31, 2024 and December 31, 2023, the carrying value of our restricted investment was $ 79.8 million and $ 79.1 million, net of an allowance for credit losses of $ 0.1 million and $ 0.2 million, and included restricted cash of $ 16.0 million and $ 15.4 million, respectively.

The fair value at March 31, 2024 and December 31, 2023 was $ 77.2 million and $ 76.7 million, respectively, based on Level 1 inputs.

At June 30, 2024 and December 31, 2023, the carrying value of our restricted investment was $ 80.5 million and $ 79.1 million, net of an allowance for credit losses of $ 0.1 million and $ 0.2 million, and included restricted cash of $ 16.8 million and $ 15.4 million, respectively.

The fair value at June 30, 2024 and December 31, 2023 was $ 77.9 million and $ 76.7 million, respectively, based on Level 1 inputs.

The following table shows the total amortized cost of our HTM debt securities by credit rating, excluding the allowance for credit losses and cash.

3 unchanged sentences

In millions AA+ AA- A A- BBB+ Total

March 31, 2024 $ 13.3 10.4 13.2 17.0 10.0 $ 63.9

June 30, 2024 $ 13.3 10.3 13.2 17.0 10.0 $ 63.8

December 31, 2023 $ 13.3 10.4 13.2 17.0 10.0 $ 63.9

Debt and Finance Lease Obligations

At March 31, 2024 and December 31, 2023, the carrying value of finance lease obligations was $ 100.8 million and $ 101.1 million, respectively, and the fair value was $ 104.3 million and $ 105.7 million, respectively.

The fair value of our finance lease obligation associated with our Performance Materials' Wickliffe, Kentucky manufacturing site, is based on the period-end quoted market prices for the obligations, using Level 2 inputs.

At June 30, 2024 and December 31, 2023, the carrying value of finance lease obligations was $ 100.6 million and $ 101.1 million, respectively, and the fair value was $ 103.5 million and $ 105.7 million, respectively.

The fair value of all other finance lease obligations approximates their carrying values.

The carrying value, excluding debt issuance fees, of our variable interest rate debt was $ 847.6 million and $ 821.4 million as of March 31, 2024 and December 31, 2023, respectively.

The carrying value, excluding debt issuance fees, of our variable interest rate debt was $ 852.9 million and $ 821.4 million as of June 30, 2024 and December 31, 2023, respectively.

The carrying value of our variable rate debt is a reasonable estimate of the fair value.

At March 31, 2024 and December 31, 2023, the carrying value of our fixed rate debt was $ 550.0 million and $ 550.0 million, respectively, and the fair value was $ 497.3 million and $ 494.6 million, respectively, based on Level 2 inputs.

At June 30, 2024 and December 31, 2023, the carrying value of our fixed rate debt was $ 550.0 million and $ 550.0 million, respectively, and the fair value was $ 499.0 million and $ 494.6 million, respectively, based on Level 2 inputs.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Inventories, net

In millions March 31, 2024 December 31, 2023

In millions June 30, 2024 December 31, 2023

Raw materials $ 107.8 $ 128.3

5 unchanged sentences

Property, Plant, and Equipment, net

In millions March 31, 2024 December 31, 2023

In millions June 30, 2024 December 31, 2023

Machinery and equipment $ 1,277.0 $ 1,244.6

8 unchanged sentences

(1) As a result of the Performance Chemicals' repositioning, as further described in Note 11, we accelerated the depreciation of certain property, plant and equipment assets.

This resulted in $ 31.6 million of additional expense for the three months ended March 31, 2024, which is included in Restructuring and other (income) charges, net within the condensed consolidated statement of operations.

This resulted in $ 1.8 million and $ 33.4 million of additional expense for the three and six months ended June 30, 2024, respectively, which is included in Restructuring and other (income) charges, net within the condensed consolidated statements of operations.

Goodwill and Other Intangible Assets, net

2 unchanged sentences

December 31, 2023 $ 4.3 $ 349.4 $ 173.8 $ 527.5

Goodwill impairment charge — ( 349.1 ) — ( 349.1 )

Foreign currency translation — ( 0.3 ) ( 1.1 ) ( 1.4 )

March 31, 2024 $ 4.3 $ 349.3 $ 172.3 $ 525.9

There were no events or circumstances indicating that goodwill might be impaired as of March 31, 2024.

June 30, 2024 $ 4.3 $ — $ 172.7 $ 177.0

Beginning in fiscal year 2023, we began to see depressed volumes in our industrial end markets, constraining our ability to offset the continued crude tall oil (“CTO”) price inflation we were experiencing, and negatively impacting earnings and cash flow within our Performance Chemicals’ reporting unit, particularly in our industrial specialties product line.

As a result, we concluded that a triggering event occurred in the third quarter of 2023.

Our third quarter 2023 impairment analysis included significant assumptions, such as the execution of several measures in 2023 to pursue greater cost efficiency, including a reorganization to streamline certain functions and reduce ongoing costs, and expectations of decreased CTO costs beginning in the second half of 2024.

We concluded that no impairment was necessary as a result of that third quarter 2023 interim analysis or at our annual impairment test, dated October 1, 2023.

During the second quarter of 2024, our supplier provided new information regarding the cost of CTO for the second half of 2024, which significantly exceeded our forecasted costs, resulting in a triggering event for our Performance Chemicals’ reporting unit.

We performed an analysis of the reporting unit’s goodwill, intangibles, and long-lived assets.

Our analysis included significant assumptions such as:

revenue growth rate, earnings before interest, taxes, depreciation and amortization

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

("EBITDA") margin, and discount rate, which are judgmental, and variations in any assumptions could result in materially different calculations of fair value.

Our analysis reassessed the expected cash flows in light of current performance and expected lack of near term recovery in our industrial specialties product line, resulting in lower volume and profitability expectations.

As a result, the company concluded that the carrying amount of the Performance Chemicals’ reporting unit exceeded its fair value, resulting in a non-cash goodwill impairment charge of $ 349.1 million, which represents all of the goodwill within the Performance Chemicals' reportable segment.

The charge was recorded within “Goodwill impairment charge” on the condensed consolidated statements of operations for the quarter ended June 30, 2024.

Other Intangible Assets

6 unchanged sentences

Foreign currency translation ( 1.1 ) ( 0.4 ) ( 0.4 ) ( 1.9 )

March 31, 2024 $ 266.2 $ 92.0 $ 89.3 $ 447.5

June 30, 2024 $ 266.4 $ 92.2 $ 89.4 $ 448.0

Accumulated Amortization

5 unchanged sentences

Foreign currency translation 0.3 0.1 0.2 0.6

March 31, 2024 $ ( 77.6 ) $ ( 31.5 ) $ ( 35.6 ) $ ( 144.7 )

June 30, 2024 $ ( 81.4 ) $ ( 32.9 ) $ ( 38.0 ) $ ( 152.3 )

Other intangibles, net $ 185.0 $ 59.3 $ 51.4 $ 295.7

1 unchanged sentence

(1) Represents trademarks, trade names, and know-how.

(2) As a result of the Performance Chemicals' repositioning, as further described in Note 11, we retired certain customer contract and relationships, and developed technology finite-lived intangible assets.

(2) As a result of the Performance Chemicals' repositioning, as further described in Note 11, we retired certain customer contracts and relationships, and developed technology finite-lived intangible assets.

(3) As a result of the Performance Chemicals' repositioning, as further described in Note 11, we accelerated the amortization of certain customer contract and relationship finite-lived intangible assets.

This resulted in $ 22.1 million of additional expense for the three months ended March 31, 2024, and $ 37.4 million of additional expenses for the twelve months ended December 31, 2023, which is included in Restructuring and other (income) charges, net within the condensed consolidated statement of operations.

This resulted in zero and $ 22.1 million of additional expense for the three and six months ended June 30, 2024, respectively, and $ 37.4 million of additional expenses for the twelve months ended December 31, 2023, which is included in Restructuring and other (income) charges, net within the condensed consolidated statements of operations.

Intangible assets subject to amortization were attributed to our business segments as follows:

In millions March 31, 2024 December 31, 2023

In millions June 30, 2024 December 31, 2023

Performance Materials $ 1.3 $ 1.5

2 unchanged sentences

Other intangibles, net $ 295.7 $ 336.1

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

The amortization expense related to our intangible assets in the table above is shown in the table below.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

7 unchanged sentences

The estimated pre-tax amortization expense may fluctuate due to changes in foreign currency exchange rates.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

Financial Instruments and Risk Management

1 unchanged sentence

Foreign Currency Exchange Risk Management

As of March 31, 2024, there were $ 1.9 million open foreign currency derivative contracts.

The fair value of the designated foreign currency hedge contracts was a net asset (liability) of zero at March 31, 2024 and December 31, 2023, respectively.

As of June 30, 2024, there were $ 2.2 million open foreign currency derivative contracts.

The fair value of the designated foreign currency hedge contracts was a net asset (liability) of zero at June 30, 2024 and December 31, 2023.

Commodity Price Risk Management

As of March 31, 2024, we had 1.3 million and 0.1 million mm BTUS (millions of British Thermal Units) in aggregate notional volume of outstanding natural gas commodity swap contracts and zero cost collar option contracts, respectively, designated as cash flow hedges.

As of March 31, 2024, open commodity contracts hedge forecasted transactions until May 2025.

The fair value of the outstanding designated natural gas commodity hedge contracts as of March 31, 2024 and December 31, 2023, was a net asset (liability) of $( 0.5 ) million and $( 0.9 ) million, respectively.

As of June 30, 2024, we had 1.5 million and 0.9 million mm BTUS (millions of British Thermal Units) in aggregate notional volume of outstanding natural gas commodity swap contracts and zero cost collar option contracts, respectively, designated as cash flow hedges.

As of June 30, 2024, open commodity contracts hedge forecasted transactions until December 2025.

The fair value of the outstanding designated natural gas commodity hedge contracts as of June 30, 2024 and December 31, 2023, was a net asset (liability) of zero and $( 0.9 ) million, respectively.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

Effect of Cash Flow and Net Investment Hedge Accounting on AOCI

In millions Amount of Gain (Loss) Recognized in AOCI Amount of Gain (Loss) Reclassified from AOCI into Net income (loss) Location of Gain (Loss) Reclassified from AOCI in Net income (loss)

Three Months Ended March 31,

Three Months Ended June 30,

2024 2023 2024 2023

3 unchanged sentences

Total $ 0.1 $ ( 0.1 ) $ ( 0.8 ) $ ( 1.8 )

In millions Amount of Gain (Loss) Recognized in AOCI Amount of Gain (Loss) Reclassified from AOCI into Net income (loss) Location of Gain (Loss) Reclassified from AOCI in Net income (loss)

Six Months Ended June 30,

2024 2023 2024 2023

Cash flow hedging derivatives

Currency exchange contracts $ 0.1 $ ( 0.1 ) $ — $ ( 0.5 ) Net sales

Natural gas contracts ( 0.4 ) ( 3.0 ) ( 1.5 ) ( 1.0 ) Cost of sales

Total $ ( 0.3 ) $ ( 3.1 ) $ ( 1.5 ) $ ( 1.5 )

Within the next twelve months, we expect to reclassify $ 0.8 million of net gains from AOCI to income, before taxes.

1 unchanged sentence

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Fair Value Measurements

1 unchanged sentence

There were no transfers of assets and liabilities that are recorded at fair value between Level 1 and Level 2 during the periods reported.

There were no nonrecurring fair value measurements related to derivative assets and liabilities on the condensed consolidated balance sheets as of March 31, 2024, or December 31, 2023.

March 31, 2024

There were no nonrecurring fair value measurements related to derivative assets and liabilities on the condensed consolidated balance sheets as of June 30, 2024, or December 31, 2023.

June 30, 2024

In millions Level 1 (1)

2 unchanged sentences

Total assets $ — $ 0.1 $ — $ 0.1

Natural gas contracts (5)

$ — $ 0.5 $ — $ 0.5

Currency exchange contracts (5)

$ — $ 0.1 $ — $ 0.1

Total liabilities $ — $ 0.1 $ — $ 0.1

11 unchanged sentences

(3) Significant unobservable inputs.

(4) Included within "Prepaid and other current assets" on the condensed consolidated balance sheet.

(5) Included within "Accrued expenses" on the condensed consolidated balance sheet.

(4) Included within "Prepaid and other current assets" on the condensed consolidated balance sheets.

(5) Included within "Accrued expenses" on the condensed consolidated balance sheets.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Debt, including Finance Lease Obligations

Current and long-term debt including finance lease obligations consisted of the following:

In millions, except percentages March 31, 2024 December 31, 2023

In millions, except percentages June 30, 2024 December 31, 2023

Revolving Credit Facility and other lines of credit (1)(2)

10 unchanged sentences

______________

(1) Letters of credit outstanding under the revolving credit facility were $ 2.5 million and $ 2.5 million and available funds under the facility were $ 233.5 million and $ 259.5 million at March 31, 2024 and December 31, 2023, respectively.

(2) The weighted average interest rate associated with our revolving credit facility was 6.68 percent and 6.36 percent for the period ended March 31, 2024 and December 31, 2023, respectively.

(3) At March 31, 2024 and December 31, 2023, $ 80.0 million of the finance lease obligation upon maturity will be settled utilizing liquid assets that have been placed into a trust established strictly for this purpose.

The trust is presented as Restricted investments on the condensed consolidated balance sheets in the amount of $ 79.8 million and $ 79.1 million as of March 31, 2024 and December 31, 2023, respectively.

(1) Letters of credit outstanding under the revolving credit facility were $ 2.0 million and $ 2.5 million and available funds under the facility were $ 241.7 million and $ 259.5 million at June 30, 2024 and December 31, 2023, respectively.

(2) The weighted average interest rate associated with our revolving credit facility was 6.76 percent and 6.36 percent for the period ended June 30, 2024 and December 31, 2023, respectively.

(3) At June 30, 2024 and December 31, 2023, $ 80.0 million of the finance lease obligation upon maturity will be settled utilizing liquid assets that have been placed into a trust established strictly for this purpose.

The trust is presented as Restricted investments on the condensed consolidated balance sheets in the amount of $ 80.5 million and $ 79.1 million as of June 30, 2024 and December 31, 2023, respectively.

Refer to Note 4, under the section:

Restricted Investment , for more information.

(4) The interest rate associated with our accounts receivable securitization program was 5.54 percent and 5.61 percent for the period ended March 31, 2024 and December 31, 2023, respectively.

(4) The interest rate associated with our accounts receivable securitization program was 5.50 percent and 5.61 percent for the period ended June 30, 2024 and December 31, 2023, respectively.

(5) Debt maturing within one year is included in "Notes payable and current maturities of long-term debt" on the condensed consolidated balance sheets.

2 unchanged sentences

The occurrence of an event of default under the 2028 Senior Notes could result in the acceleration of the notes of such series and could cause a cross-default resulting in the acceleration of other indebtedness of Ingevity and its subsidiaries.

We were in compliance with all covenants under the indenture as of March 31, 2024.

We were in compliance with all covenants under the indenture as of June 30, 2024.

The credit agreement governing our revolving credit facility contains customary default provisions, including defaults for non-payment, breach of representations and warranties, insolvency, non-compliance with covenants and cross-defaults to other material indebtedness.

2 unchanged sentences

The revolving credit facility financial covenants require Ingevity to maintain on a consolidated basis a maximum total net leverage ratio of 4.0 to 1.0 (which may be increased to 4.5 to 1.0 under certain circumstances) and a minimum interest coverage ratio of 3.0 to 1.0.

As calculated per the credit agreement, our net leverage for the four consecutive quarters ended March 31, 2024 was 2.8 , and our actual interest coverage for the four consecutive quarters ended March 31, 2024 was 5.6 .

We were in compliance with all covenants under the credit agreement at March 31, 2024.

As calculated per the credit agreement, our net leverage for the four consecutive quarters ended June 30, 2024 was 3.3 , and our actual interest coverage for the four consecutive quarters ended June 30, 2024 was 4.8 .

We were in compliance with all covenants under the credit agreement at June 30, 2024.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

In millions, shares in thousands Shares Amount Additional paid in capital Retained earnings Accumulated

5 unchanged sentences

Common stock issued 139 — — — — — —

Exercise of stock options, net — — — — — — —

Tax payments related to vested restricted stock units — — — — — ( 2.6 ) ( 2.6 )

Share repurchase program — — — — — — —

Share-based compensation plans — — 4.3 — — — 4.3

Balance at March 31, 2024 43,585 $ 0.4 $ 169.2 $ 946.3 $ ( 35.6 ) $ ( 512.1 ) $ 568.2

Net income (loss) — — — ( 283.7 ) — — ( 283.7 )

Other comprehensive income (loss) — — — — ( 1.9 ) — ( 1.9 )

Common stock issued 20 — — — — — —

Tax payments related to vested restricted stock units — — — — — ( 0.2 ) ( 0.2 )

Share-based compensation plans — — 2.4 — — 2.4

Balance at June 30, 2024 43,606 $ 0.4 $ 171.6 $ 662.6 $ ( 37.5 ) $ ( 512.3 ) $ 284.8

In millions, shares in thousands Shares Amount Additional paid in capital Retained earnings Accumulated

10 unchanged sentences

Balance at March 31, 2023 43,408 $ 0.4 $ 158.9 $ 1,058.4 $ ( 38.8 ) $ ( 453.2 ) $ 725.7

Net income (loss) — — — 35.5 — — 35.5

Other comprehensive income (loss) — — — — 5.3 — 5.3

Common stock issued 22 — — — — — —

Share repurchase program — — — — — ( 58.7 ) ( 58.7 )

Share-based compensation plans — — 4.7 — — 1.6 6.3

Balance at June 30, 2023 43,430 $ 0.4 $ 163.6 $ 1,093.9 $ ( 33.5 ) $ ( 510.3 ) $ 714.1

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Accumulated other comprehensive income (loss)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

16 unchanged sentences

Beginning balance $ 0.5 $ 0.4 $ 0.5 $ 0.4

Amortization of actuarial and other (gains) losses, prior service cost (credits), and settlement and curtailment (income) charge reclassified to net income — 0.1 — 0.1

tax (provision) benefit — — — —

Net actuarial and other (gains) losses, amortization of prior service cost (credits), and settlement and curtailment (income) charge reclassified to net income — 0.1 — 0.1

Other comprehensive income (loss), net of tax — 0.1 — 0.1

Ending balance $ 0.5 $ 0.5 $ 0.5 $ 0.5

Total AOCI ending balance at March 31 $ ( 35.6 ) $ ( 38.8 )

Total AOCI ending balance at June 30 $ ( 37.5 ) $ ( 33.5 ) $ ( 37.5 ) $ ( 33.5 )

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

Reclassifications of accumulated other comprehensive income (loss)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

3 unchanged sentences

Natural gas contracts (2)

( 0.8 ) ( 1.5 ) ( 1.5 ) ( 1.0 )

Total before tax ( 0.8 ) ( 1.8 ) ( 1.5 ) ( 1.5 )

1 unchanged sentence

Amount included in net income (loss) $ ( 0.6 ) $ ( 1.3 ) $ ( 1.1 ) $ ( 1.1 )

Pension and other post retirement benefits

Amortization of prior service costs (2)

$ — $ 0.1 $ — $ 0.1

(1) Included within "Net sales" on the condensed consolidated statement of operations.

(2) Included within "Cost of sales" on the condensed consolidated statement of operations.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

Total before tax — 0.1 — 0.1

(Provision) benefit for income taxes — — — —

Amount included in net income (loss) $ — $ 0.1 $ — $ 0.1

______________

(1) Included within "Net sales" on the condensed consolidated statements of operations.

(2) Included within "Cost of sales" on the condensed consolidated statements of operations.

Share Repurchases

1 unchanged sentence

Shares under the 2022 Authorization may be purchased through open market or privately negotiated transactions at the discretion of management based on its evaluation of market prevailing conditions and other factors, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended.

During the three months ended March 31, 2024 and 2023, we repurchased zero and $ 33.4 million, inclusive of $ 0.2 million excise tax, in common stock, representing zero and 449,475 shares of our common stock at a weighted average cost per share of zero and $ 73.86 , respectively.

At March 31, 2024, $ 353.4 million remained unused under the 2022 Authorization.

During the three and six months ended June 30, 2024, we repurchased no common stock.

At June 30, 2024, $ 353.4 million remained unused under the 2022 Authorization.

During the three and six months ended June 30, 2023, we repurchased $ 58.7 million, inclusive of $ 0.6 million excise tax, and $ 92.1 million, inclusive of $ 0.8 million excise tax, in common stock, representing 819,898 and 1,269,373 shares of our common stock at a weighted average cost per share of $ 70.87 and $ 71.93 , respectively.

Restructuring and Other (Income) Charges, net

Detail on the restructuring charges and other (income) charges, net, is provided below.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

2 unchanged sentences

Total Restructuring and other (income) charges, net $ 13.1 $ 19.2 $ 75.9 $ 24.8

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

Restructuring Charges

2 unchanged sentences

Performance Chemicals' repositioning $ 1.0 $ 7.2 $ 1.8 $ 10.0

Three Months Ended March 31, 2024 $ 2.1 $ 5.2 $ 55.0 $ 62.3

Three Months Ended June 30, 2024 $ 1.0 $ 7.2 $ 1.8 $ 10.0

Other $ 4.4 $ — $ 2.6 $ 7.0

Three Months Ended March 31, 2023 $ 3.0 $ 0.1 $ — $ 3.1

Three Months Ended June 30, 2023 $ 4.4 $ — $ 2.6 $ 7.0

In millions Severance and other employee-related costs Other charges (income) (1)

Asset disposal charges (2)

Performance Chemicals' repositioning $ 3.1 $ 12.4 $ 56.8 $ 72.3

Six Months Ended June 30, 2024 $ 3.1 $ 12.4 $ 56.8 $ 72.3

Other $ 7.4 $ 0.1 $ 2.6 $ 10.1

Six Months Ended June 30, 2023 $ 7.4 $ 0.1 $ 2.6 $ 10.1

_______________

2 unchanged sentences

Also included, to the extent incurred, the acceleration effect of re-estimating settlement dates and revised cost estimates associated with asset retirement obligations related to asset disposal charges that are included within restructuring charges.

Performance Chemicals' Repositioning

On November 1, 2023, we announced a number of strategic actions designed to reposition our Performance Chemicals reportable segment to improve profitability and reduce the cyclicality of the company as a whole.

These actions increase our focus on growing our most profitable Performance Chemicals' product lines, such as road technologies, and accelerate our transition to non-crude tall oil ("CTO") based fatty acids.

This initiative will result in the reduction, and in some cases exit, of certain historical end-use markets of our industrial specialties product line, such as adhesives, publication inks, and oilfield, representing approximately 45 percent of our industrial specialties product line historical annualized net sales.

This initiative includes the permanent closure of our Performance Chemicals' CTO refinery and the closure of our manufacturing plant located in DeRidder, Louisiana (the “DeRidder Plant”), including the polyol production assets associated with the Advanced Polymer Technologies (“APT”) reportable segment.

As of March 31, 2024, all production at the DeRidder Plant has ceased with the APT polyol production assets being shuttered in December 2023, and the CTO refinery and other Performance Chemicals’ production assets shuttered in February 2024.

The above actions are referred to as the "Performance Chemicals' repositioning."

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

These actions increase our focus on growing our most profitable Performance Chemicals' product lines, such as road technologies, and accelerate our transition to non-CTO based fatty acids.

This initiative will focus on reducing exposure to lower margin end-use markets of our industrial specialties product line, such as adhesives, publication inks, and oilfield, representing approximately 45 percent of our industrial specialties product line historical annualized net sales.

This initiative included the permanent closure of our Performance Chemicals' CTO refinery and the closure of our manufacturing plant located in DeRidder, Louisiana (the “DeRidder Plant”), including the polyol production assets associated with the Advanced Polymer Technologies (“APT”) reportable segment.

All production at the DeRidder Plant ceased in the first quarter of 2024.

The Performance Chemicals’ repositioning initiative included additional corporate and business cost reduction actions executed in November 2023.

The Performance Chemicals' repositioning, when combined with other targeted workforce reduction initiatives during 2023, resulted in the reduction of Ingevity's global workforce by almost 20 percent, 25 percent of these reductions being employees directly associated with commercial sales activities of the soon-to-be exited and/or reduced end-use markets of our industrial specialties product line.

The actions referenced above, when combined with other targeted workforce reduction initiatives during 2023, resulted in the reduction of Ingevity's global workforce by almost 20 percent.

Specific to Performance Chemicals, the reduction represented approximately 30 percent of the reportable segment's workforce.

Expected Charges

We expect to incur aggregate charges of approximately $ 280 million associated with the Performance Chemicals' repositioning, consisting of approximately $ 185 million in asset-related charges, approximately $ 15 million in severance and other employee-related costs, and approximately $ 80 million in other restructuring costs including decommissioning, dismantling and removal charges, and contract termination costs.

Through March 31, 2024, we have incurred $ 197.6 million associated with these actions, including $ 180.2 million of non-cash asset-related charges and $ 17.4 million of charges to be settled in cash.

As of March 31, 2024, $ 13.4 million of the charges to be settled in cash have been paid.

We expect to incur aggregate charges of approximately $ 250 million associated with the Performance Chemicals' repositioning.

This is a reduction of approximately $ 30 million from prior expectations due to lower than estimated plant cleaning costs.

Total expected charges now consist of approximately $ 185 million in asset-related charges, approximately $ 15 million in severance and other employee-related costs, and approximately $ 50 million in other restructuring costs, including decommissioning, dismantling and removal charges, and contract termination costs.

Through June 30, 2024, we have incurred $ 207.6 million associated with these actions, including $ 182.0 million of non-cash asset-related charges and $ 25.6 million of charges to be settled in cash.

As of June 30, 2024, $ 21.3 million of the charges to be settled in cash have been paid.

We expect approximately $ 185 million of the total charges to be non-cash and $ 65 million to be settled in cash.

The remainder of the non-cash and 50 - 60 percent of cash charges are expected to be recognized in 2024.

Charges Related to Exited End-Market Inventory

The collective actions of workforce, operational, and regional business exits, we believe will hinder our ability to dispose of the associated inventory on hand.

As a result, we recorded $ 19.7 million and $ 2.5 million of non-cash, lower of cost or market, inventory charges during the three months ended December 31, 2023 and March 31, 2024, respectively, to adjust the carrying value of the impacted inventory to what we expect to realize upon disposal, less disposal costs.

These inventory charges are recorded to Cost of sales on the condensed consolidated statement of operations.

Since these inventory charges are directly attributable to the Performance Chemicals’ repositioning, that is, they do not represent normal, recurring expenses necessary to operate our business, we have combined these charges with the restructuring charges noted above, and have excluded such impact from the financial results of our Performance Chemicals reportable segment.

Please refer to Note 14 for more information.

CTO Resale Activity

Due to the DeRidder Plant closure and the corresponding reduced CTO refining capacity, we may be obligated, under an existing CTO supply contract, to purchase CTO volumes through 2025 at amounts in excess of required CTO volumes needed to support our current business operations.

We intend to manage our CTO volumes by reselling excess volumes (herein referred to as "CTO resales") in the open market.

Excluded from the estimated $ 280.0 million of aggregate charges relating to the Performance Chemicals' repositioning are potential costs we may incur associated with the CTO resales which, based on what we believe to be market rates today, may result in $ 50 million to $ 80 million of incremental losses in 2024.

This is updated from our previously disclosed estimate of $ 30 million to $ 80 million based on our current expectations on CTO procurement costs for 2024, which we expect to be offset by spot market CTO resales.

For the three months ended March 31, 2024, we have incurred $ 26.5 million of CTO resale losses, which are recorded as Other (income) expense, net on the condensed consolidated statement of operations.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Inventory Charges

The Company believes the collective actions of workforce, operational, and regional business exits will hinder our ability to dispose of the associated inventory on hand.

As a result, we recorded zero and $ 2.5 million of non-cash, lower of cost or market, inventory charges during the three and six months ended June 30, 2024, respectively, to adjust the carrying value of the impacted inventory to what we expect to realize upon disposal, less disposal costs.

These inventory charges are recorded to Cost of sales on the condensed consolidated statement of operations.

CTO Resale Activity

The DeRidder Plant closure, and the corresponding reduced CTO refining capacity, significantly reduced our CTO volume requirements.

However, we were obligated, under an existing CTO supply contract, to purchase CTO volumes through 2025 at amounts in excess of our required CTO volumes needed to support our business operations.

To manage this excess inventory, we sold CTO volumes (herein referred to as "CTO resales") in the open market.

For the three and six months ended June 30, 2024, we have incurred $ 23.5 million and $ 50.0 million of CTO resale losses, which are recorded as Other (income) expense, net on the condensed consolidated statements of operations.

As of July 1, 2024, as further described in Note 16, we have terminated the CTO supply contract that resulted in these excess CTO volumes.

As a result of the termination of this supply contract, the purchases under the CTO supply contract ended, effective June 30, 2024.

Therefore, we are no longer required to purchase this excess CTO volume through 2025, and as such, we expect to end our CTO resale activity by the end of 2024 and to incur no more than $ 5 million in additional costs as we liquidate the excess CTO resale volumes on hand as of June 30, 2024.

The charges we currently expect to incur in connection with these actions are subject to a number of assumptions and risks, and actual results may differ materially.

13 unchanged sentences

Other (income) charges, net

Alternative feedstock transition

In April 2023, we implemented the feedstock transition of our Crossett, Arkansas manufacturing plant (“Crossett”).

This transition converted Crossett from a CTO-based feedstock production facility to produce fatty acids from alternative plant-based feedstocks.

During the three and six months ended June 30, 2024, we incurred charges of zero .

During the three and six months ended June 30, 2023, we incurred charges of $ 6.6 million.

North Charleston plant transition

2 unchanged sentences

WestRock ceased production at their North Charleston paper mill in June 2023.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

During 2023, we executed a transition plan to separate certain critical operating services WestRock had historically provided to us such as steam, water and wastewater treatment.

During the three months ended March 31, 2024 and 2023, we incurred charges of $ 0.5 million and zero , respectively.

We expect to incur an additional $ 2 - 4 million of costs as we complete this transition in the first half of 2024.

During the three and six months ended June 30, 2024, we incurred charges of $ 3.1 million and $ 3.6 million, respectively.

During the three and six months ended June 30, 2023, we incurred charges of $ 2.9 million.

Business transformation costs

Our enterprise resource planning tool implementation and associated business transformation initiative concluded in the fourth quarter of 2023.

Costs incurred, during the three months ended March 31, 2024 and 2023, totaled zero and $ 2.5 million, respectively.

Costs incurred, during the three and six months ended June 30, 2024 totaled zero , and during the three and six months ended June 30, 2023, of $ 2.7 million and $ 5.2 million, respectively.

The effective tax rates, including discrete items, were as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Effective tax rate 15.2 % 25.6 % 16.4 % 22.9 %

10 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

The below table provides a reconciliation between our reported effective tax rates and the EAETR.

Three Months Ended March 31,

Three Months Ended June 30,

In millions, except percentages Before tax Tax Effective tax rate % impact Before tax Tax Effective tax rate % impact

5 unchanged sentences

( 0.1 ) — — —

Goodwill impairment (3)

349.1 57.0 — —

Other tax only discrete items

— ( 0.5 ) — ( 0.8 )

Total discrete items 359.0 58.9 4.4 0.2

1 unchanged sentence

33.5 % 23.8 %

Six Months Ended June 30,

In millions, except percentages Before tax Tax Effective tax rate % impact Before tax Tax Effective tax rate % impact

Consolidated operations $ ( 406.5 ) $ ( 66.8 ) 16.4 % $ 111.8 $ 25.6 22.9 %

Discrete items:

Restructuring and other (income) charges, net (1)

74.8 17.5 7.4 1.7

(Gain) loss on strategic investments (2)

4.7 1.1 ( 19.2 ) ( 4.5 )

Goodwill impairment (3)

349.1 57.0 — —

Other tax only discrete items — ( 1.4 ) — 0.5

Total discrete items 428.6 74.2 ( 11.8 ) ( 2.3 )

Consolidated operations, before discrete items $ 22.1 $ 7.4 $ 100.0 $ 23.3

34.5 % 23.3 %

_______________

(1) See Note 14 for further information.

(2) See Note 4 for further information.

(3) Increase in EAETR for three months ended March 31, 2024, as compared to March 31, 2023, is due to an overall change in the mix of forecasted earnings in various tax jurisdictions with varying rates, most notably in the U.S.

Additionally, there was a significant reduction in the foreign-derived intangible income deduction due to reduced taxable income in the U.S., which further increased the EAETR.

(3) See Note 7 for further information.

(4) Increase in EAETR for three and six months ended June 30, 2024, as compared to June 30, 2023, is due to an overall change in the mix of forecasted earnings in various tax jurisdictions with varying rates, most notably in the U.S.

Additionally, there was an elimination of the foreign-derived intangible income deduction and the addition of a minimum tax associated with the Base Erosion and Anti-Abuse Tax due to significant reductions in taxable income in the U.S., which further increased the EAETR.

The EAETR tax percentage shown may not precisely recalculate due to rounding.

At March 31, 2024 and December 31, 2023, we had deferred tax assets of $ 11.0 million and $ 11.1 million, respectively, resulting from certain historical net operating losses from our Brazil and China operations and U.S.

At June 30, 2024 and December 31, 2023, we had deferred tax assets of $ 10.5 million and $ 11.1 million, respectively, resulting from certain historical net operating losses from our Brazil and China operations and U.S.

state tax credits for which a valuation allowance has been established.

1 unchanged sentence

In evaluating the realizability of these deferred tax assets, we consider projected future taxable income and tax planning strategies in making our assessment.

As of March 31, 2024, we cannot objectively assert that these deferred tax assets are more likely than not to be realized and therefore we have maintained a valuation allowance.

As of June 30, 2024, we cannot objectively assert that these deferred tax assets are more likely than not to be realized and therefore we have maintained a valuation allowance.

We intend to continue maintaining a valuation allowance on these deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances.

A release of all or a portion of the valuation allowance could be possible, if we determine that sufficient positive evidence becomes available to allow us to reach a conclusion that the valuation allowance will no longer be needed.

A release of all or a portion of the valuation allowance could be possible if we determine that sufficient positive

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

evidence becomes available to allow us to reach a conclusion that the valuation allowance will no longer be needed.

A release of the valuation allowance would result in the recognition of certain deferred tax assets and a reduction to income tax expense for the period the release is recorded.

4 unchanged sentences

While we do not anticipate that this legislation will have a material impact on our tax provision or effective tax rate, we continue to monitor evolving tax legislation in the jurisdictions in which we operate.

No tax impacts of Pillar Two were recorded for the quarter ending March 31, 2024.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

No tax impacts of Pillar Two were recorded for the six months ended June 30, 2024.

Commitments and Contingencies

17 unchanged sentences

Final resolution of these matters could take up to 18 months.

As of March 31, 2024, nothing has occurred in the post-trial proceedings to warrant any change to our conclusions as disclosed within our 2023 Annual Report.

The full amount of the trebled jury's verdict, $ 85.0 million, is accrued in Other liabilities on the condensed consolidated balance sheet as of March 31, 2024 and the charge was included within Other (income) expense, net on the consolidated statement of operations for the year ended December 31, 2021.

As of June 30, 2024, nothing has occurred in the post-trial proceedings to warrant any change to our conclusions as disclosed within our 2023 Annual Report.

The full amount of the trebled jury's verdict, $ 85.0 million, is accrued in Other liabilities on the condensed consolidated balance sheets as of June 30, 2024 and the charge was included within Other (income) expense, net on the consolidated statements of operations for the year ended December 31, 2021.

In addition, as a result of the judgment being entered on May 18, 2023, we have started accruing for post-judgment interest at the legally mandated interest rate.

2 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

June 30, 2024

Segment Information

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

17 unchanged sentences

( 13.1 ) ( 19.2 ) ( 75.9 ) ( 24.8 )

Goodwill impairment charge (4)

( 349.1 ) — ( 349.1 ) —

Acquisition and other-related income (costs), net (5)

0.2 ( 1.8 ) ( 0.1 ) ( 4.5 )

Inventory charges (6)

— — ( 2.5 ) —

Loss on CTO resales (7)

( 23.5 ) — ( 50.0 ) —

Gain (loss) on strategic investments (8)

0.1 — ( 4.7 ) 19.2

Net income (loss) $ ( 283.7 ) $ 35.5 $ ( 339.7 ) $ 86.2

1 unchanged sentence

(1) Relates to external customers only, all intersegment sales and related profit have been eliminated in consolidation.

(2) Segment EBITDA is the primary measure used by our chief operating decision maker to evaluate the performance of and allocate resources among our operating segments.

(2) Segment EBITDA is the primary measure used by our chief operating decision maker ("CODM") to evaluate the performance of and allocate resources among our operating segments.

Segment EBITDA is defined as segment net sales less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses, research and technical expenses, other (income) expense, net, excluding depreciation and amortization).

We have excluded the following items from segment EBITDA:

interest expense associated with corporate debt facilities, interest income, income taxes, depreciation, amortization, restructuring and other income (charges), net, including inventory lower of cost or market charges associated with restructuring actions, acquisition and other-related income (costs), litigation verdict charges, gain (loss) on strategic investments, loss on CTO resales, pension and postretirement settlement and curtailment income (charges), net.

interest expense associated with corporate debt facilities, interest income, income taxes, depreciation, amortization, restructuring and other income (charges), net, inventory lower of cost or market charges associated with restructuring actions, goodwill impairment charge, acquisition and other-related income (costs), gain (loss) on strategic investments, loss on CTO resales, pension and postretirement settlement and curtailment income (charges), net.

(3) The table below provides an allocation of these charges between our three reportable segments to provide investors, potential investors, securities analysts and others with the information, should they choose, to apply such (income) charges to each respective reportable segment for which the charges relate.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

5 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

(4) The table below provides an allocation of these charges between our three reportable segments to provide investors, potential investors, securities analysts and others with the information, should they choose, to apply such (income) charges to each respective reportable segment for which the charges relate.

Three Months Ended March 31,

In millions 2024 2023

Performance Materials $ — $ —

Performance Chemicals 0.3 2.7

Advanced Polymer Technologies — —

Acquisition and other-related (income) costs, net $ 0.3 $ 2.7

(5) For the three months ended March 31, 2024, charges relate to the Performance Chemicals reportable segment.

June 30, 2024

(4) For the three and six months ended June 30, 2024, charges relate to the Performance Chemicals reportable segment.

Refer to Note 7 for more information.

(6) For the three months ended March 31, 2024, gain (loss) on strategic investments relates to a measurement alternative investment associated with the Performance Chemicals reportable segment.

For the three months ended March 31, 2023, gain (loss) on strategic investments relates to the Performance Materials segment.

We exclude gains and losses from strategic investments from our segment results, as well as our non-GAAP financial measures, because we do not consider such gains or losses to be directly associated with the operational performance of the segment.

We believe that the inclusion of such gains or losses, would impair the factors and trends affecting the historical financial performance of our reportable segments.

We continue to include undistributed earnings or loss, distributions, amortization or accretion of basis differences, and other-than-temporary impairments for equity method investments that we believe are directly attributable to the operational performance of such investments, in our reportable segment results.

Refer to Note 4, under the section:

Strategic Investments , for more information.

(7) We regularly perform strategic reviews and assess the return on our operations, which sometimes results in a plan to restructure the business.

These costs are excluded from our reportable segment results;

details of which are included in the table below.

Three Months Ended March 31,

In millions 2024 2023

Restructuring charges (1)

Other (income) charges, net (1)

Performance Chemicals' repositioning inventory charges (2)

Restructuring and other (income) charges, net $ 65.3 $ 5.6

_________________

(1) Amounts are recorded within Restructuring and other (income) charges, net on the condensed consolidated statement of operations, refer to Note 11 for more information.

(2) Amounts are recorded within Cost of sales on the condensed consolidated statement of operations, refer to Note 11 for more information.

(5) Charges represent (gains) losses incurred to complete and integrate acquisitions and other strategic investments.

Charges may include the expensing of the inventory fair value step-up resulting from the application of purchase accounting for acquisitions and certain legal and professional fees associated with the completion of acquisitions and strategic investments.

Three Months Ended March 31,

For the three and six months ended June 30, 2024 and 2023, charges relate to the Performance Chemicals reportable segment.

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

4 unchanged sentences

_________________

(1) Included in Cost of sales on the condensed consolidated statement of operations.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

March 31, 2024

(1) Included in Cost of sales on the condensed consolidated statements of operations.

(6) For the three and six months ended June 30, 2024, inventory charges represent lower of cost or market charges associated with the Performance Chemicals’ repositioning.

These charges were not allocated in the measurement of Performance Chemicals reportable segment profitability used by our CODM.

Amounts are included in Cost of sales on the condensed consolidated statements of operations.

(7) For the three and six months ended June 30, 2024, charges relate to the Performance Chemicals reportable segment.

Refer to Note 11 for more information.

(8) We exclude gains and losses from strategic investments from our segment results, as well as our non-GAAP financial measures, because we do not consider such gains or losses to be directly associated with the operational performance of the segment.

We believe that the inclusion of such gains or losses would impair the factors and trends affecting the historical financial performance of our reportable segments.

Refer to Note 4, under the section:

Strategic Investments , for more information.

Three Months Ended June 30, Six Months Ended June 30,

In millions 2024 2023 2024 2023

Performance Materials $ ( 0.1 ) $ — $ ( 0.1 ) $ ( 19.2 )

Performance Chemicals — — 4.8 —

Advanced Polymer Technologies — — — —

(Gain) loss on strategic investments $ ( 0.1 ) $ — $ 4.7 $ ( 19.2 )

Earnings (Loss) per Share

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In millions (except share and per share data) 2024 2023 2024 2023

9 unchanged sentences

_______________

(1) For the quarter ended March 31, 2024, all potentially dilutive common shares were excluded from the calculation of diluted earnings (loss) per share as we had a net loss for the period.

(1) For the three and six months ended June 30, 2024, all potentially dilutive common shares were excluded from the calculation of diluted earnings (loss) per share as we had a net loss for the period.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

The following average number of potential common shares were antidilutive, and therefore, were not included in the diluted earnings per share calculation:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

In thousands 2024 2023 2024 2023

Average number of potential common shares - antidilutive 198 473 229 346

Subsequent Event

CTO Supply Contract Termination Agreement

On July 1, 2024, we entered into a termination agreement and release (the “Termination Agreement”), to terminate our long-term crude tall oil supply agreement with GP Pine Chemicals, LLC, (“Georgia-Pacific”), as amended (the "CTO Supply Agreement"), pursuant to which we were obligated to purchase and receive CTO produced by certain Georgia-Pacific facilities.

Pursuant to the Termination Agreement, as consideration for the termination of the CTO Supply Agreement, we made a cash payment to Georgia-Pacific in the amount of $ 50.0 million on July 1, 2024 and agreed to make an additional cash payment to Georgia-Pacific in the amount of $ 50.0 million by October 15, 2024.

Crossett, Arkansas Plant Closure

On July 31, 2024, we announced plans to transition the refining of oleo-based products manufactured for our Performance Chemicals reportable segment from our Crossett, Arkansas manufacturing plant (the “Crossett Facility”) to our North Charleston, South Carolina manufacturing plant.

In connection with this action, on July 29, 2024, the Board of Directors approved the closure of the Crossett Facility, as well as additional corporate and business cost reduction actions.

We plan to close the Crossett Facility in August 2024 and will continue to evaluate options for the site.

We expect to realize net operational savings of approximately $ 20 -$ 25 million per year from the closure of the Crossett Facility, as well as annual savings of approximately $ 10 million from the corporate and business-related cost reduction actions.

We expect to realize the full benefit of these savings beginning in 2025.

As a result of these actions, Ingevity expects to incur aggregate charges of approximately $ 100 million, consisting of approximately $ 65 million in asset-related charges, approximately $ 10 million in severance and other employee-related costs, and approximately $ 25 million in other restructuring costs, which include decommissioning, dismantling and removal charges, and contract termination costs.

We expect approximately $ 65 million of the total charges to be non-cash.

The majority of non-cash charges and 50 - 60 percent of cash charges are expected to be recognized by the first half of 2025.

The charges we currently expect to incur in connection with these actions, and the timing thereof, are subject to a number of assumptions and risks, and actual results may differ materially.

We may also incur other material charges not currently contemplated due to events that may occur as a result of, or in connection with, these actions.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements