Ingevity Corporation has delivered a stronger-than-expected second quarter performance, boosting its full-year 2026 earnings outlook as higher pricing, improved product mix and operational execution drove gains across its businesses.

 

The company reported second-quarter net sales of $314.1 million, down 5% year over year, primarily due to the divestiture of its Road Markings product line on April 15, 2026. Excluding the divested business, sales increased 5%, with growth across all three operating segments.

 

Ingevity posted net income from continuing operations of $39.8 million, or $1.13 per diluted share, while adjusted EBITDA from continuing operations climbed 14% to $115.0 million. Adjusted EBITDA margin expanded significantly to 36.6%, compared with 30.5% in the prior-year period.

 

“We are delivering on the commitments we set at the beginning of the year," said Ingevity President and CEO Dave Li. 

 

"Strong commercial and operational execution across our businesses drove another strong quarter, giving us the confidence to raise our full-year diluted adjusted EPS and adjusted EBITDA guidance. While our outlook for the second half remains measured given the dynamic operating environment, our results reinforce the strength of the business and the progress we're making in building a stronger, more focused Ingevity. 

 

"The completion of the Road Markings divestiture in April further demonstrates our commitment to portfolio transformation. We also continue to invest in organic growth opportunities that leverage our differentiated carbon technologies. Our recent municipal water treatment contract for PFAS filtration provides early commercial validation of our technology and demonstrates its potential to create attractive new growth opportunities in adjacent markets. 

 

"Together, these actions are creating a stronger Ingevity: a more focused company with differentiated technology, attractive organic growth opportunities, and a stronger foundation for sustainable long-term shareholder value.”

 

Ingevity’s Performance Materials segment led the quarter, with sales rising 4% to $160.6 million. Growth was fueled by higher volumes, favorable product mix and pricing actions, supported by continued consumer preference shifts from battery electric vehicles toward hybrids.

 

Segment EBITDA increased 6% to $86.1 million, while EBITDA margin improved to 53.6%, up from 52.6% a year earlier.

 

The Pavement Technologies segment reported sales of $104.2 million, down 22% due to the Road Markings divestiture. Excluding the divested product line, sales increased 3%, supported by stronger pricing and volumes, particularly in North America.

 

Segment EBITDA came in at $25.4 million, impacted by the absence of Road Markings earnings from the prior year, but partially offset by stronger pricing and volume performance in the remaining business. EBITDA margin improved to 24.4% from 21.4%.

 

The Advanced Polymer Technologies segment delivered the strongest percentage growth, with sales jumping 14% to $49.3 million. Results benefited from higher pricing, including surcharges tied to raw material and energy costs, stronger demand for higher-value derivative products and competitor supply disruptions.

 

Segment EBITDA surged to $11.2 million, compared with $2.0 million in the prior-year period, while EBITDA margin improved sharply to 22.7% from 4.6%.

 

Ingevity reported second-quarter operating cash flow of negative $15.8 million, primarily due to a $113.2 million litigation settlement payment. Excluding that payment, the company generated $89.1 million in free cash flow, an increase of $22.3 million year over year.

 

The company also repurchased approximately $35 million of shares during the quarter at an average price of $70.94 per share, with about $211 million remaining under its current repurchase authorization.

 

Net leverage improved to 2.5 times, down from 3.0 times in the same quarter last year.

 

Following the strong second-quarter performance, Ingevity raised its full-year 2026 outlook while maintaining a cautious stance on the second half of the year.

 

Ingevity said it plans to use its strong free cash flow to reduce leverage toward its long-term target range of 2.0 to 2.5 times while continuing to return capital to shareholders.

 

The company’s 2026 outlook includes full-year results from Advanced Polymer Technologies while excluding the divested Industrial Specialties product line and removing Road Markings results beginning April 15, 2026.

 

The company said the quarter reflects continued progress in reshaping Ingevity into a more focused business built around differentiated technologies, operational discipline and long-term growth opportunities.