What changed in this filing

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Item 1. Financial Statements

2024-10-30 compared with 2024-08-01 · 223 added, 180 removed, 688 unchanged (37% of the section changed)

2 unchanged sentences

Condensed Consolidated Statements of Operations (Unaudited)

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions, except per share data 2024 2023 2024 2023

18 unchanged sentences

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

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

6 unchanged sentences

Derivative instruments:

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

Unrealized gain (loss), net of tax provision (benefit) of $( 0.4 ), $( 0.1 ), $( 0.5 ), and $( 0.8 )

( 1.6 ) ( 0.1 ) ( 1.8 ) ( 2.5 )

5 unchanged sentences

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

0.1 — 0.1 0.1

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

0.1 — 0.1 0.1

Other comprehensive income (loss), net of tax provision (benefit) of $( 0.3 ), $ 0.2 , $ 0.0 , and $( 0.1 )

4 unchanged sentences

Condensed Consolidated Balance Sheets

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

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

Assets (Unaudited)

42 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Six Months Ended June 30,

Nine Months Ended September 30,

In millions 2024 2023

12 unchanged sentences

Goodwill impairment charge 349.1 —

CTO supply contract termination charges 100.0 —

Other non-cash items 9.4 20.9

3 unchanged sentences

Prepaid and other current assets 8.9 ( 5.8 )

Planned major maintenance outage ( 2.8 ) ( 9.9 )

Accounts payable ( 62.4 ) 20.6

5 unchanged sentences

CTO resales cash outflow, net ( 45.0 ) —

CTO supply contract termination cash outflow ( 50.0 ) —

Changes in other operating assets and liabilities, net 1.2 ( 6.6 )

3 unchanged sentences

Proceeds from sale of strategic investment — 31.5

Purchase of strategic investment — ( 2.4 )

Other investing activities, net 1.2 ( 1.1 )

14 unchanged sentences

$ 153.5 $ 94.2

(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.

(1) Includes restricted cash of $ 18.0 million and $ 9.7 million and cash and cash equivalents of $ 135.5 million and $ 84.5 million at September 30, 2024 and 2023, respectively.

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

3 unchanged sentences

Purchases of property, plant, and equipment in accounts payable 2.2 6.1

Leased assets obtained in exchange for new finance lease liabilities — 0.2

Leased assets obtained in exchange for new operating lease liabilities 5.5 26.0

2 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Description of Business

1 unchanged sentence

Through a diverse team of talented and experienced people, we develop, manufacture, and bring to market solutions that are largely renewably sourced and help customers solve complex problems while making the world more sustainable.

Our products are used in a variety of demanding applications, including adhesives, agrochemicals, asphalt paving, bioplastics, coatings, elastomers, lubricants, pavement markings, oil exploration and production, and automotive components.

We operate in three reportable segments:

23 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

opportunities and potential future cash flows.

The guidance is effective beginning with our 2025 fiscal year.

Early adoption is permitted and we are currently evaluating the potential impact of adopting this new guidance on our Condensed Consolidated Financial Statements and related disclosures.

The guidance is effective beginning with our 2025 fiscal year Form 10-K.

We are currently evaluating the potential impact of adopting this new guidance on our Condensed Consolidated Financial Statements and related disclosures.

Disaggregation of Net Sales

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

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

6 unchanged sentences

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

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

11 unchanged sentences

Contract Asset

September 30,

In millions 2024 2023

7 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Fair Value Measurements

3 unchanged sentences

In millions Level 1 (1)

June 30, 2024

September 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 $ 16.0 million and $ 14.9 million at June 30, 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 $ 16.7 million and $ 14.9 million at September 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 June 30, 2024, and December 31, 2023.

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

Strategic Investments

Equity Method Investments

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.

The aggregate carrying value of all strategic equity method investments totaled $ 15.4 million and $ 16.0 million at September 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 September 30, 2024 and December 31, 2023, respectively.

As of September 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.

During the first quarter of 2023, we sold a strategic equity method investment for $ 31.5 million, resulting in a $ 19.3 million gain, recorded within "Other (income) expense, net" on the condensed consolidated statements of operations.

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

We recognized an additional $ 0.1 million gain associated with the equity method investment sale during the second quarter of 2024.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 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 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.

The aggregate carrying value of all measurement alternative investments where fair value is not readily determinable totaled $ 71.9 million and $ 83.2 million at September 30, 2024 and December 31, 2023, respectively.

During the first and third quarters of 2024, the company identified triggering events indicating that investments being accounted for under the measurement alternative may be impaired.

For the three and nine months ended September 30, 2024, the company recognized an impairment of $ 6.7 million and $ 11.5 million, respectively, recorded in Other (income) expense, net on the condensed consolidated statements of operations.

Restricted Investment

7 unchanged sentences

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 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.

At September 30, 2024 and December 31, 2023, the carrying value of our restricted investment was $ 81.1 million and $ 79.1 million, net of an allowance for credit losses of $ 0.2 million and $ 0.2 million, and included restricted cash of $ 17.5 million and $ 15.4 million, respectively.

The fair value at September 30, 2024 and December 31, 2023 was $ 79.8 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

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

September 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 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.

At September 30, 2024 and December 31, 2023, the carrying value of finance lease obligations was $ 100.3 million and $ 101.1 million, respectively, and the fair value was $ 104.0 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 obligation, using Level 2 inputs.

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 $ 852.9 million and $ 821.4 million as of June 30, 2024 and December 31, 2023, respectively.

The carrying value, excluding debt issuance fees, of our variable interest rate debt was $ 851.6 million and $ 821.4 million as of September 30, 2024 and December 31, 2023, respectively.

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

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.

At September 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 $ 516.9 million and $ 494.6 million, respectively, based on Level 2 inputs.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Inventories, net

In millions June 30, 2024 December 31, 2023

In millions September 30, 2024 December 31, 2023

Raw materials $ 106.8 $ 128.3

5 unchanged sentences

Property, Plant, and Equipment, net

In millions June 30, 2024 December 31, 2023

In millions September 30, 2024 December 31, 2023

Machinery and equipment $ 1,287.8 $ 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 $ 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.

This resulted in $ 59.2 million and $ 92.6 million of additional expense for the three and nine months ended September 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

4 unchanged sentences

Foreign currency translation — ( 0.3 ) 8.8 8.5

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

September 30, 2024 $ 4.3 $ — $ 182.6 $ 186.9

Annual Goodwill Test

We conduct a required annual review of goodwill for potential impairment at October 1st, or sooner if events or changes in circumstances indicate that the fair value of a reporting unit is below its carrying value.

Our reporting units are our operating segments, i.e., Performance Materials, Performance Chemicals, and Advanced Polymer Technologies ("APT").

If the carrying value of a reporting unit that includes goodwill exceeds its fair value, which is determined using both the income approach and market approach, goodwill is considered impaired.

During the second quarter of 2024, as further described below under the section titled:

Goodwill Impairment Charge, we recorded a full impairment of our Performance Chemicals reporting unit goodwill.

The remaining balance of our goodwill, as disclosed in the table above, is primarily related to our APT reporting unit.

There have been no events or changes in circumstances during the third quarter that have required interim testing of our goodwill for impairment.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

September 30, 2024

We are currently testing our remaining goodwill balance as part of our required annual October 1st goodwill impairment testing.

The preliminary results have calculated that our APT reporting unit headroom, defined as the percentage difference between the fair value of a reporting unit and its carrying value, is between 10 and 15 percent.

Since the fair value of our APT reporting unit is higher than the carrying value, we have concluded that no impairment to goodwill is necessary.

Our analysis includes significant assumptions such as revenue growth rate, Earnings before Interest, Taxes, Depreciation and Amortization ("EBITDA") margin, and discount rate, which are judgmental, and variations in any assumptions could result in materially different calculations of fair value.

Goodwill Impairment Charge

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.

5 unchanged sentences

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

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.

revenue growth rate, 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.

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

Other Intangible Assets

6 unchanged sentences

Foreign currency translation 7.9 3.3 3.3 14.5

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

September 30, 2024 $ 275.4 $ 95.9 $ 93.1 $ 464.4

Accumulated Amortization

5 unchanged sentences

Foreign currency translation ( 2.6 ) ( 1.0 ) ( 1.6 ) ( 5.2 )

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

September 30, 2024 $ ( 88.1 ) $ ( 35.5 ) $ ( 42.2 ) $ ( 165.8 )

Other intangibles, net $ 187.3 $ 60.4 $ 50.9 $ 298.6

2 unchanged sentences

(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.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

September 30, 2024

(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 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.

This resulted in zero and $ 22.1 million of additional expense for the three and nine months ended September 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 June 30, 2024 December 31, 2023

In millions September 30, 2024 December 31, 2023

Performance Materials $ 1.3 $ 1.5

2 unchanged sentences

Other intangibles, net $ 298.6 $ 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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

10 unchanged sentences

Foreign Currency Exchange Risk Management

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.

As of September 30, 2024, there were $ 2.9 million open foreign currency derivative contracts.

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

Commodity Price Risk Management

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.

As of September 30, 2024, we had 1.6 million and 0.4 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 September 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 September 30, 2024 and December 31, 2023, was a net asset (liability) of $( 0.1 ) million and $( 0.9 ) million, respectively.

Interest Rate Risk Management

During the three months ended September 30, 2024, we entered into a floating-to-fixed interest rate swap with a notional amount of $ 200.0 million to manage the variability of cash flows in the interest rate payments associated with our existing Secured Overnight Financing Rate ("SOFR") based interest payments, effectively converting $ 200.0 million of our floating rate debt to a fixed rate.

In accordance with the terms of this instrument, we receive floating rate interest payments based upon one-month U.S.

dollar SOFR and in return are obligated to pay interest at a fixed rate of 3.84 percent until August 2026.

The fair value of the interest rate swap was an asset (liability) of $( 1.7 ) million and zero at September 30, 2024 and December 31, 2023, respectively.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

Effect of Cash Flow and Net Investment Hedge Accounting on AOCI

September 30, 2024

Effect of Cash Flow 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 June 30,

Three Months Ended September 30,

2024 2023 2024 2023

2 unchanged sentences

Natural gas contracts ( 0.3 ) ( 0.3 ) ( 0.8 ) ( 1.2 ) Cost of sales

Interest rate swap contracts ( 1.7 ) — — — Interest expense, net

Total $ ( 2.0 ) $ ( 0.2 ) $ ( 0.8 ) $ ( 1.4 )

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,

Nine Months Ended September 30,

2024 2023 2024 2023

2 unchanged sentences

Natural gas contracts ( 0.7 ) ( 3.3 ) ( 2.3 ) ( 2.2 ) Cost of sales

Interest rate swap contracts ( 1.7 ) — — — Interest expense, net

Total $ ( 2.3 ) $ ( 3.3 ) $ ( 2.3 ) $ ( 2.9 )

2 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 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 June 30, 2024, or December 31, 2023.

June 30, 2024

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

September 30, 2024

In millions Level 1 (1)

1 unchanged sentence

$ — $ 0.1 $ — $ 0.1

Natural gas contracts (4)

Total assets $ — $ 0.2 $ — $ 0.2

1 unchanged sentence

$ — $ 0.1 $ — $ 0.1

Natural gas contracts (5)

Interest rate swap contracts (6)

Total liabilities $ — $ 2.0 $ — $ 2.0

13 unchanged sentences

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

(6) Included within "Other liabilities" on the condensed consolidated balance sheets.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Debt, including Finance Lease Obligations

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

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

In millions, except percentages September 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 $ 2.0 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.

(1) Letters of credit outstanding under the revolving credit facility were $ 2.6 million and $ 2.5 million and available funds under the facility were $ 244.4 million and $ 259.5 million at September 30, 2024 and December 31, 2023, respectively.

(2) The weighted average interest rate associated with our revolving credit facility, exclusive of any floating-to-fixed interest rate instrument, was 6.80 percent and 6.36 percent for the period ended September 30, 2024 and December 31, 2023, respectively.

(3) As of September 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 $ 81.1 million and $ 79.1 million as of September 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 5.50 percent and 5.61 percent for the period ended June 30, 2024 and December 31, 2023, respectively.

(4) The interest rate associated with our accounts receivable securitization program was 5.47 percent and 5.61 percent for the period ended September 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 June 30, 2024.

We were in compliance with all covenants under the indenture as of September 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 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.

As calculated per the credit agreement, our net leverage for the four consecutive quarters ended September 30, 2024 was 3.0 , and our actual interest coverage for the four consecutive quarters ended September 30, 2024 was 5.0 .

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

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

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

14 unchanged sentences

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

Net income (loss) — — — ( 107.2 ) — — ( 107.2 )

Other comprehensive income (loss) — — — — 34.0 — 34.0

Common stock issued 17 — — — — — —

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

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

Share repurchase program — — — — — — —

Share-based compensation plans — — 3.1 — — — 3.1

Balance at September 30, 2024 43,622 $ 0.4 $ 174.7 $ 555.4 $ ( 3.5 ) $ ( 512.5 ) $ 214.5

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

September 30, 2024

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

16 unchanged sentences

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

Net income (loss) — — — 25.2 — — 25.2

Other comprehensive income (loss) — — — — ( 20.4 ) — ( 20.4 )

Common stock issued 13 — — — — — —

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

Share-based compensation plans — — ( 1.0 ) — — 1.0 —

Balance at September 30, 2023 43,443 $ 0.4 $ 162.6 $ 1,119.1 $ ( 53.9 ) $ ( 509.5 ) $ 718.7

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Accumulated other comprehensive income (loss)

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

21 unchanged sentences

Ending balance $ 0.6 $ 0.5 $ 0.6 $ 0.5

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

Total AOCI ending balance at September 30 $ ( 3.5 ) $ ( 53.9 ) $ ( 3.5 ) $ ( 53.9 )

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Reclassifications of accumulated other comprehensive income (loss)

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

19 unchanged sentences

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 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.

During the three and nine months ended September 30, 2024, we repurchased no common stock.

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

During the three and nine months ended September 30, 2023, we repurchased zero and $ 92.1 million, inclusive of $ 0.8 million excise tax, in common stock, representing zero and 1,269,373 shares of our common stock at a weighted average cost per share of zero 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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

4 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

Restructuring Charges

2 unchanged sentences

Performance Chemicals' repositioning $ 5.1 $ 15.5 $ 65.0 $ 85.6

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

Three Months Ended September 30, 2024 $ 5.1 $ 15.5 $ 65.0 $ 85.6

Other $ 1.5 $ — $ — $ 1.5

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

Three Months Ended September 30, 2023 $ 1.5 $ — $ — $ 1.5

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

1 unchanged sentence

Performance Chemicals' repositioning $ 8.2 $ 27.9 $ 121.8 $ 157.9

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

Nine Months Ended September 30, 2024 $ 8.2 $ 27.9 $ 121.8 $ 157.9

Other $ 8.9 $ 0.1 $ 2.6 $ 11.6

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

Nine Months Ended September 30, 2023 $ 8.9 $ 0.1 $ 2.6 $ 11.6

_______________

(1) Primarily represents costs associated with contract terminations, plant and equipment decommissioning charges and other miscellaneous exit costs.

(1) Primarily represents costs associated with CTO supply contract terminations, plant and equipment decommissioning charges and other miscellaneous exit costs.

(2) Primarily represents property, plant and equipment and finite-lived intangible asset write-downs, accelerated depreciation and amortization, and impairment charges on certain assets, which were or are to be disposed of or abandoned.

2 unchanged sentences

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-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.

These actions increased 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 focused 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.

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 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.

Additionally, in July 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.

This action included the closure of the Crossett Facility, as well as additional corporate and business cost reduction actions.

We ceased production at the Crossett Facility in the third quarter of 2024.

The actions referenced above, when combined with other targeted workforce reduction initiatives during 2023 and 2024, resulted in the reduction of Ingevity's global workforce by 23 percent.

Specific to Performance Chemicals, the reduction represented approximately 40 percent of the reportable segment's workforce.

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We expect to incur aggregate charges of approximately $ 350 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.

This is an increase of approximately $ 100 million from prior expectations due to the closure of the Crossett Facility.

Total expected charges now consist of approximately $ 250 million in asset-related charges, approximately $ 25 million in severance and other employee-related costs, and approximately $ 75 million in other restructuring costs, including decommissioning, dismantling and removal charges, and CTO supply contract termination costs.

Through September 30, 2024,

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

we have incurred $ 297.0 million associated with these actions, including $ 250.8 million of non-cash asset-related charges and $ 46.2 million of charges to be settled in cash.

As of September 30, 2024, $ 41.0 million of the charges to be settled in cash have been paid and all non-cash charges have been incurred.

In total, we expect approximately $ 100 million of cash charges, including approximately $ 10 -$ 15 million during the fourth quarter of 2024 and approximately $ 20 -$ 25 million during 2025.

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.

As a result, we recorded $ 3.8 million and $ 6.3 million of non-cash, lower of cost or market, inventory charges during the three and nine months ended September 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 statements 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.

The DeRidder Plant closure, and the corresponding reduction in 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 the 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.

For the three and nine months ended September 30, 2024, we have incurred $ 0.8 million and $ 50.8 million, respectively, of CTO resale losses, which are recorded as Other (income) expense, net on the condensed consolidated statements of operations.

As of July 1, 2024, we terminated the CTO supply contract that resulted in these excess CTO volumes.

As consideration for the termination of the CTO supply contract, we made a cash payment in the amount of $ 50.0 million on July 1, 2024, and an additional cash payment in the amount of $ 50.0 million in early October, 2024.

The total charge of $ 100.0 million was recorded within Other (income) expense, net on the condensed consolidated statements of operations for the nine months ended September 30, 2024.

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.

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 $ 5.0 million in additional costs as we liquidate the excess CTO volumes on hand as of September 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.

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.

Restructuring and Other (Income) Charges, net Reserves

The following table ( in millions ) shows a roll forward of restructuring reserves that will result in cash spending, the majority of which relate to the Performance Chemicals' repositioning.

Balance at Change in Cash Balance at

12/31/2023 (1)

Payments Other (3)

6/30/2024 (1)

$ 8.2 19.1 ( 22.9 ) ( 0.1 ) $ 4.3

_______________

(1) Included in "Accrued expenses" on the condensed consolidated balance sheets.

(2) Includes severance and other employee-related costs, exited leases, contract terminations and other miscellaneous exit costs.

Any asset write-downs including accelerated depreciation and impairment charges are not included in the above table.

(3) Primarily foreign currency translation adjustments.

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.

In April 2023, we implemented the feedstock transition of the Crossett Facility.

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

During the three and nine months ended September 30, 2024, we incurred charges of zero .

During the three and nine months ended September 30, 2023, we incurred charges of $ 11.8 million and $ 18.4 million, respectively.

North Charleston plant transition

2 unchanged sentences

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

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 and nine months ended September 30, 2024, we incurred charges of $ 1.3 million and $ 4.9 million, respectively.

During the three and nine months ended September 30, 2023, we incurred charges of $ 9.8 million and $ 12.7 million, respectively.

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 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.

September 30, 2024

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 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.

During the three and nine months ended September 30, 2024, we incurred charges of zero .

During the three and nine months ended September 30, 2023, we incurred charges of $ 1.5 million and $ 6.7 million, respectively.

Restructuring and Other (Income) Charges, net Reserves

The following table shows a roll forward of restructuring reserves that will result in cash spending, the majority of which relate to the Performance Chemicals' repositioning.

Balance at Change in Cash Balance at

In millions 12/31/2023 (1)

Payments Other (3)

9/30/2024 (1)

Performance Chemicals' repositioning

Severance and other employee-related costs $ 7.3 8.2 ( 11.1 ) ( 0.1 ) $ 4.3

Other charges (income) 0.9 27.9 ( 27.9 ) — 0.9

Restructuring 8.2 36.1 ( 39.0 ) ( 0.1 ) 5.2

Other (income) charges, net — 4.9 ( 4.9 ) — —

Restructuring and Other (income) charges, net reserves $ 8.2 41.0 ( 43.9 ) ( 0.1 ) $ 5.2

_______________

(1) Included in "Accrued expenses" on the condensed consolidated balance sheets.

(2) Includes severance and other employee-related costs, exited leases, CTO supply contract terminations and other miscellaneous exit costs.

Any asset write-downs including accelerated depreciation and impairment charges are not included in the above table.

(3) Primarily foreign currency translation adjustments.

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

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

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

11 unchanged sentences

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

September 30, 2024

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

Three Months Ended June 30,

Three Months Ended September 30,

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

6 unchanged sentences

Goodwill impairment (3)

349.1 57.0 — —

Other tax only discrete items

— ( 0.5 ) — ( 0.8 )

Total discrete items 96.1 29.7 1.4 2.7

Consolidated operations, before discrete items $ ( 41.8 ) $ ( 1.0 ) $ 33.5 $ 9.6

33.5 % 23.8 %

Six Months Ended June 30,

Nine Months Ended September 30,

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

15 unchanged sentences

(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.

(4) Decrease in EAETR for the three months ended September 30, 2024, as compared to September 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.

While consolidated operations before discrete items are expected to be in overall losses driven by expenses incurred in the U.S., tax impacts from profitable foreign operations exceed the overall tax benefit incurred in the U.S., resulting in a large reduction to the three months ended September 30, 2024 EAETR.

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

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.

(5) Specific to the nine months ended September 30, 2024, while consolidated operations before discrete items are expected to be in overall losses driven by expenses incurred in the U.S., tax impacts from profitable foreign operations exceed the overall tax benefit incurred in the U.S., creating a negative EAETR.

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

At September 30, 2024 and December 31, 2023, we had deferred tax assets of $ 10.9 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 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

As of September 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

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.

September 30, 2024

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 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 six months ended June 30, 2024.

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

Commitments and Contingencies

17 unchanged sentences

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

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.

As of September 30, 2024, nothing has occurred in the post-trial proceedings to warrant any change to our conclusions as disclosed within our Annual Report on Form 10-K for the year ended December 31, 2023.

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 September 30, 2024 and the charge was included within Other (income) expense, net on the condensed 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

June 30, 2024

September 30, 2024

Segment Information

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

25 unchanged sentences

( 0.8 ) — ( 50.8 ) —

CTO supply contract termination charges (7)

( 100.0 ) — ( 100.0 ) —

Gain (loss) on strategic investments (8)

6 unchanged sentences

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, 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.

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, CTO supply contract termination charges, and pension and postretirement settlement and curtailment income (charges), net.

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

September 30, 2024

(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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

3 unchanged sentences

Restructuring and other (income) charges, net $ 86.9 $ 24.6 $ 162.8 $ 49.4

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

June 30, 2024

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

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

Refer to Note 7 for more information.

1 unchanged sentence

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.

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,

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

5 unchanged sentences

(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.

(6) For the three and nine months ended September 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.

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

Refer to Note 11 for more information.

4 unchanged sentences

Strategic Investments , for more information.

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

Three Months Ended September 30, Nine Months Ended September 30,

In millions 2024 2023 2024 2023

3 unchanged sentences

(Gain) loss on strategic investments $ 6.7 $ ( 0.1 ) $ 11.4 $ ( 19.3 )

INGEVITY CORPORATION

Notes to the Condensed Consolidated Financial Statements

September 30, 2024

Earnings (Loss) per Share

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

Three Months Ended September 30, Nine Months Ended September 30,

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

9 unchanged sentences

_______________

(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

(1) For the three and nine months ended September 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.

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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2024 2023 2024 2023

Average number of potential common shares - antidilutive 250 491 250 400

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