Part I, Item 1A, Risk Factors of our 2024 Annual Report sets forth information relating to important risks and uncertainties that could materially adversely affect the company’s business, financial condition and operating results.
−Removed: Except as set forth below, there have been no material changes in Ingevity's risk factors disclosed in Part I, Item 1A, Risk Factors of our 2023 Annual Report for the quarter ended September 30, 2024.
−Removed: The repositioning of our Performance Chemicals business will negatively impact the company’s net sales and may otherwise adversely affect our financial condition and results of operations during this transition period.
−Removed: On November 1, 2023 and July 31, 2024, we announced a number of strategic actions designed to further reposition our Performance Chemicals reportable segment to improve the profitability and reduce the cyclicality of the company as a whole.
−Removed: These initiatives—including the closure of our plants in DeRidder, Louisiana and Crossett, Arkansas—will focus on reducing exposure to lower margin end-use markets of our industrial specialties product line, such as adhesives, publication inks, and oilfield, approximately 45 percent of our industrial specialties product line historical annualized net sales.
−Removed: We expect to incur aggregate charges of approximately $350 million associated with the Performance Chemicals' repositioning, consisting 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.
−Removed: The company expects approximately $250 million of the total charges to be non-cash.
−Removed: The charges the company currently expects to incur in connection with these actions, and the timing thereof, are subject to a number of assumptions and risks, and the actual results may differ materially.
−Removed: The company 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.
−Removed: These actions have, and may continue to, adversely affect the company’s financial condition and results of operations.
−Removed: There may be negative impacts to our business arising out of the closure of our manufacturing facility in Crossett, Arkansas.
−Removed: On July 31, 2024, we announced our plan to close our manufacturing facility in Crossett, Arkansas (the “Crossett Facility”).
−Removed: The anticipated timing, charges, and costs of the closure of the Crossett Facility could materially differ from our estimates if the plant closure results in adverse legal or regulatory actions, if personnel required to effect the shutdown become unavailable, or we are affected by other factors not currently contemplated.
−Removed: Adverse weather conditions may impact the demand for some of our products in our road technologies product line and could negatively affect our financial condition and results of operations.
−Removed: Our road technologies business is seasonal in nature, with roughly 70 to 75 percent of revenue generated between April and September each year.
−Removed: Adverse weather conditions, which directly affect the ability to engage in paving and/or road marking activity, have had, and going forward may have, an adverse effect on sales in the road technologies product line if such conditions result in lower customer demand due to a shortened season.
+Added: Except as set forth below, there have been no material changes in Ingevity's risk factors disclosed in Part I, Item 1A, Risk Factors of our 2024 Annual Report for the quarter ended March 31, 2025.
+Added: Recent changes to tariffs could negatively impact our business.
+Added: government has imposed or announced new global tariffs, and is considering the imposition of additional tariffs.
+Added: These new tariffs have resulted in retaliatory measures imposed, announced or under consideration by certain U.S.
+Added: trading partners, most notably China.
+Added: These changes to trade policy are expected to make it more difficult or costly for us to export our products and import raw materials.
+Added: This in turn could require us to increase prices to our customers, which may reduce demand.
+Added: Such demand reduction or inability to increase customer prices may negatively impact our profitability.
+Added: The retaliatory tariff measures imposed by China, if not unwound, are expected to significantly lower our margin on Performance Materials and Performance Chemicals products sold from the United States into China.
+Added: These tariff measures may also result in decreased demand for our customers’ products that incorporate our products, and adversely affect our financial condition and results of operations.
+Added: Disruptions at any of our facilities could negatively impact our production, financial condition and results of operations.
+Added: Disruptions to any of our manufacturing operations or other facilities due to natural disasters and extreme weather, such as a hurricane, tropical storm, earthquake, tornado, severe weather, flood or fire, or other unanticipated problems such as labor difficulties, pandemics, equipment failure, cyberattacks or other cybersecurity incidents, capacity expansion difficulties or unscheduled maintenance, planned or unplanned production slowdowns and shutdowns, turnarounds and outages, could cause operational disruptions of varied duration.
+Added: Also, many of our production employees are governed by collective bargaining agreements (“CBAs”).
+Added: The CBA at our Warrington, United Kingdom Advanced Polymer Technologies manufacturing facility with GMB Union is negotiated annually and the parties operate under the prior CBA until new terms are agreed.
+Added: The CBA at our Covington, Virginia Performance Materials plant with the International Brotherhood of Electrical Workers on behalf of its affiliated Local Union 464 expired on January 15, 2025.
+Added: The parties began negotiations in the fourth quarter of 2024 and will continue to operate under the same terms and conditions while negotiations are pending.
+Added: A new CBA at our Crossett, Arkansas Performance Chemicals manufacturing facility with the International Association of Machinists and Aerospace Workers Union ("IAM") was ratified on April 3, 2025, including a Plant Closure and Termination Agreement.
+Added: Further, the CBA at our Covington, Virginia Plant with the Covington Paperworkers Union Local 675, affiliated with the Association of Western Pulp and Paper Workers will expire on December 1, 2025.
+Added: It is anticipated that the parties will begin contract renewal negotiations during the fourth quarter of 2025.
+Added: While the company has generally positive relations with its labor unions, there is no guarantee the company will be able to successfully negotiate new union contracts without work stoppages, labor difficulties or unfavorable terms.
+Added: In addition, existing CBAs may not prevent a strike or work stoppage at the applicable plant.
+Added: These types of disruptions could materially adversely affect our financial condition and results of operations to varying degrees depending upon the facility, the duration of the disruption, and our ability to shift business to another facility or find alternative sources of manufacturing capacity.
+Added: Any losses due to these events may not be covered by our existing insurance policies or may be subject to certain deductibles.
+Added: In certain cases, we have products, such as our extruded honeycomb, caprolactone, pavement preservation products, road construction products, pavement reconstruction and recycling products, and industrial specialties products, that are only made at a single site, such as our Covington, Virginia Performance Materials plant.
+Added: While we have some redundancies within the facilities that are the sole manufacturer of certain products, we have limited ability to make these products at other facilities.
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