NewMarket Corporation Q4 2009 Earnings Call Transcript

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 |  About: NewMarket Corporation (NEU)
by: SA Transcripts

NewMarket Corporation (NYSE:NEU)

Q4 2009 Earnings Call Transcript

January 29, 2010 10:00 am ET

Executives

David Fiorenza – Principal Financial Officer, VP and Treasurer

Teddy Gottwald – President and CEO

Analysts

Ian Zaffino – Oppenheimer & Company

Ivan Marcuse – KeyBanc Capital Markets

Egian Tazz [ph] – Longbow Research

Todd Vencil – Davenport & Company

Saul Ludwig – Keybanc Capital Markets

Robert Felice – J. Goldman & Company

Operator

Greetings and welcome to the NewMarket Corporation fourth quarter 2009 and year-end financial results conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Mr. David Fiorenza, Vice President, Treasurer, and Principal Financial Officer for NewMarket Corporation. Thank you. Mr. Fiorenza, you may now begin.

David Fiorenza

Thank you. Thank you for joining me to discuss our fourth quarter and total year performance. With me today is Teddy Gottwald, our CEO. As usual, I have a few planned comments after which we will open the lines for any questions.

As a reminder, some of our comments we will make today are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We believe we based our statements on reasonable expectations and assumptions within the bounds of what we know about our business and operations.

However, we offer no assurance that actual results will not differ materially from our expectations due to uncertainties and factors that are difficult to predict and beyond our control. A full discussion of these factors can be found in our most recently filed 10-K and 10-Q. We plan to file our 2009 10-K toward the end of February. Please read it for a more detailed explanation of the company’s performance.

As you know, we released earnings yesterday. The fourth quarter was another very good quarter for our business. The income for the quarter was $46.3 million or $3.03 a share compared to $19.4 million or $1.27 a share last year's fourth quarter. This quarter included a benefit to net income of $2.8 million or $0.18 a share as the amount of the unrealized loss on the interest rate swap related to Foundry Park was smaller than the September 30th valuation. Excluding this item, earnings for the quarter were $43.5 million or $2.85 a share.

Petroleum additives results were up significantly for the quarter, posting an operating profit of $65.8 million compared to $32.5 million for last year's fourth quarter. Volume shipped for the fourth quarter of this year improved 17% over the same period last year, reflecting the return in demand from the significant drop in shipments that we experienced in the last two months of 2008 related to the economic slowdown.

Shipments as measured by volume were down about 5.5% on a sequential basis comparing the fourth quarter to the third quarter. This is not an unusual variation for our business. The change in profits between the two fourth quarter periods was dominated by the improvement in volumes and higher margins, offset by higher spending in GS&A. Our profits for the fourth quarter were below that of the third quarter. The meaningful adverse impacts were lower volumes, lower margins due to higher raw material costs, and planned higher spending in GS&A. Margins for the fourth quarter were 16.4%.

Net income for the year was $162 million or $10.65 a share compared to $73 million or $4.75 a share for 2008. The net income included an unrealized loss of $7 million or $0.46 a share from recording an interest rate swap agreement related to financing on Foundry Park at fair value. Excluding this, earnings for the year were $169 million or $11.11 a share. These items are reflected separately for clarification in the Summary of Earnings schedule that's at the end of yesterday's press release.

As we all know, petroleum additives operations had a very strong performance in 2009 with operating profit improving to $280 million. The improvements were broadly based across regions and product lines. Shipments for the year were lower 9% due to lower shipments in the first half of this year, reflecting the market slowdown that occurred in late 2008 and continued through the first half of 2009.

I recently saw an industry report that stated that worldwide demand for lubricants was down about 12% on an annual comparison. Shipments in the second half of 2009 were up 6% over shipments in the second half of last year. We believe product shipments are now near more normal levels that were typical before the worldwide economic slowdown.

During the year, we continued to invest in R&D and S&A in support of our customers' programs. Total R&D for petroleum additives was $86 million in 2009 compared to $82 million for 2008. This change included about a $3 million favorable currency impact, so the actual spending increase was larger than the dollar equivalents show. The increase in R&D was across all product lines. We expect to increase our spending in R&D as our business expands in support of our customers' programs.

Our project to construct a multi-story corporate headquarters for MeadWestvaco was completed on time and under budget near the end of December. The receipt of rental income payments has begun in January. This business will be reported as a separate segment in our financials going forward. We finished the year with $99 million drawn on the construction loan and we had capital expenditures of $52 million for the year.

As you may have seen this morning, yesterday we filed an 8-K, which detailed the highlights of more permanent financing that we have secured. The full details of the loan will be in a filing that we will make in the next few days. The key characteristics of the loan are that it is five years in term with two 13-month extensions available, LIBOR plus 400 pricing with a 200 floor in LIBOR and a 15-year amortization of the loan.

The loan was made by Foundry Park LLC, which is a subsidiary of NewMarket Development Corporation and is fully guaranteed by NewMarket Corporation. The initial principal amount of the loan is $68.4 million. We used cash on hand to fund the difference between the construction loan and the amount of the new loan. We are also investigating fixing LIBOR over the five-year period via a swap. Current rates would bring the fix in the 2.7, 2.8 range which would make it 6.7, 6.8 all in if we were successful.

The excellent performance of our business this year also translated into significant improvements in our liquidity position with cash increasing to $152 million compared to $22 million at the end of last year. The cash generated by operations allowed us to repay all of the drawn debt we had on our revolver at the end of last year, which was $41.9 million. Other major uses of cash were providing for $39 million of capital expenditures, making $24 million of contributions to our pension plans and funding $16 million in dividends.

During 2009, we increased the size of our revolving facility by $45 million through increased commitments of the original parties to the loan and by the addition of other lenders. We are quite pleased with this development as it was accomplished in the most difficult lending environment that we have seen in a long time. At the end of the year, the facility's limit was $150 million with only $4 million of letter of credits written against this commitment.

Our net debt decreased from $215 million at the end of '08 to $98 million at the end of 2009, despite the debt associated with Foundry Park increasing by $56 million. We expect that capital expenditures will be in the $40 million range for 2010.

Obviously, we are quite pleased with our results for 2009. We are entering 2010 cautiously optimistic that our business has returned to more historical levels of demand. In the near term, we don't expect any macroeconomic changes in our industry dynamics that would cause margins to change significantly either up or down.

We expect to begin manufacturing and blending in the Singapore facility this year, which will greatly improve our service levels to that very important part of the world. Our plants are running full, we continue to spend heavily in R&D and expect another successful year for our petroleum additives business. We have a solid business base, a good technical offering, and an excellent team which is dedicated to our customers and our business.

Thank you for your attention. I'd now like to open the lines for any questions.

Question-and-Answer Session

Operator

Thank you, sir. (Operator Instructions). One moment please while we poll for questions. Thank you. Our first question comes from the line of Ian Zaffino with Oppenheimer & Company. Please proceed with your question.

Ian Zaffino – Oppenheimer & Company

Okay, great. Thank you very much. Dave, I know in the comments you had alluded to higher raw materials in the fourth quarter. Is that base oil you are specifically talking about because I didn’t think it went up that much in the fourth quarter?

David Fiorenza

We've seen some increases in base oil and we've seen some increases in some of our other raw materials.

Ian Zaffino – Oppenheimer & Company

So would you say it's the other raw materials that really drove this, or was it the base oil that drove it?

David Fiorenza

No. I'd probably say it's about equal.

Ian Zaffino – Oppenheimer & Company

Okay. And as far as – I guess there have been some – and we've talked about this, there has been some price increases. And I know in the past you have talked about your ability to pass that through and the timing of that pass through was becoming shorter and shorter so you are able to pass it through to the market faster and faster. Is that still the dynamics you are seeing out there and if so, what is the lag now versus, let's just say, a year ago and three years ago?

Teddy Gottwald

This is Teddy. We've taken a number of steps to try to tighten that – that lag over the last year and that has been successful in a lot of places. So it's shorter than it's been. It was a good full quarter and it's less than that now. I can't really say how much less it is, but it's tighter than it's been.

Ian Zaffino – Oppenheimer & Company

Okay. And last question would be, as you I guess poll your customers or speak to your sales force, what's the appetite out there to potentially absorb another price increase on your behalf? So if you – as you look to pass through base oil, I mean, what – what's the reception? Obviously, it's not going to be good, but is it pretty much same as it was before or is there greater resistance?

Teddy Gottwald

Well, let me answer that in a little bit of a broader way. I think that – David mentioned that volumes are returning to more of a level, kind of pre-economic crisis level. I'd kind of put that in a mid-single digit kind of volume increase for the market this year versus last year.

Along with that normalcy, we are seeing a return to raw materials and prices I think moving in a tighter bandwidth. We are seeing less of the big swings in cost and you would expect that with crude moving in a tighter band. So I think as we go into a tighter bandwidth, we are really talking about normal business operations. And so I think you have to take that into account when you consider the market's appetite for prices moving in any direction. I think we are in a more normal period now. And so I expect normal conversations between us and our suppliers and us and our customers.

Ian Zaffino – Oppenheimer & Company

Okay, super. Thank you very much.

David Fiorenza

You're welcome.

Operator

Thank you. Our next question comes from the line of Ivan Marcuse with KeyBanc Capital Markets. Please proceed with your question.

Ivan Marcuse – KeyBanc Capital Markets

Hi, guys. How are you doing?

David Fiorenza

Super.

Ivan Marcuse – KeyBanc Capital Markets

One – on the price question. So there was price increases there implemented in third – third and fourth quarter. Did you see any benefit of that in the fourth quarter or when do you expect to see that benefit? Would that be more in the first quarter?

David Fiorenza

It will be more in the first quarter.

Ivan Marcuse – KeyBanc Capital Markets

Okay. And then from a seasonality – NewMarket specific, is the first quarter – tend to be a little bit stronger than the fourth quarter historically or are they about equal?

David Fiorenza

They – it tended to be somewhat stronger, one over four.

Ivan Marcuse – KeyBanc Capital Markets

Okay. So – and then with the raw materials where they are at now, do you think the price increases – the price increase that is – that will be – that you will see the benefits in the first quarter? Do you think they will be sufficient to offset the increase in raw material costs that you've seen recently or do you think that down the road that there is likely to be another price increase?

Teddy Gottwald

I really think that the best way to answer that is by saying we are in the normal cycle now. And at any point in time, we may either be behind or ahead, but I think we are in a pretty tight range today between raw material movements and our price movements.

Ivan Marcuse – KeyBanc Capital Markets

Okay. And then in the fourth quarter, was there any sort of FX translation of receivables from a subsidiary due to the dollar strengthening or – and how did the impact the fourth quarter? Where does that flow through, if there was that effect?

David Fiorenza

FX flows through cost of goods sold. Fourth quarter to third quarter was probably $5 million ballpark adverse.

Ivan Marcuse – KeyBanc Capital Markets

Okay.

David Fiorenza

Fourth quarter to third quarter.

Ivan Marcuse – KeyBanc Capital Markets

And then David, what was the – where did working capital end up being for the year?

David Fiorenza

I will look it up and answer you in two seconds. Do you have another question?

Ivan Marcuse – KeyBanc Capital Markets

Well, that also – the cash flow of operations, I'm looking for that one also. And then when you are looking at 2010, what kind of dollar amount – assuming the dollar is – taking out the FX impact, how much more spending in R&D and SG&A do you see in 2010 over 2009?

David Fiorenza

Yes. Excluding FX, we would expect more than inflationary increase in R&D.

Ivan Marcuse – KeyBanc Capital Markets

Okay.

David Fiorenza

And on the S&A, inflation plus reach [ph] because we believe there maybe some fair amount of spending in 2010 on the reach program in Europe and that will flow its way to S&A.

Ivan Marcuse – KeyBanc Capital Markets

So where would reach be? $5 million?

David Fiorenza

In that ballpark.

Ivan Marcuse – KeyBanc Capital Markets

Okay.

David Fiorenza

It looks like working capital ended around $406 million [ph] for the year.

Ivan Marcuse – KeyBanc Capital Markets

Okay. And then what was the cash flow of operations?

David Fiorenza

I think it was $220 million [ph] or so.

Ivan Marcuse – KeyBanc Capital Markets

Around there?

David Fiorenza

Yes.

Ivan Marcuse – KeyBanc Capital Markets

And then where would, for 2010 – last question, working capital, do you think it will be – which – I know you will – I know there is a lot of different factors that go on, but what kind of – do you think it's going to be a use or source in 2010 and what's your anticipation?

Teddy Gottwald

I mean, the best thing I can tell you is what we use and we use the zero, because we know – we know we don't know.

Ivan Marcuse – KeyBanc Capital Markets

Okay. Fair enough.

David Fiorenza

All right.

Ivan Marcuse – KeyBanc Capital Markets

Thanks a lot for taking my questions.

David Fiorenza

Absolutely.

Operator

Thank you. Our next question comes from the line of Dmitry Silversteyn with Longbow Research. Please proceed with your question.

Egian Tazz – Longbow Research

Good morning, guys. This is Egian Tazz [ph] sitting here for Dmitry. Most of my questions have been answered. I just have a question on – I guess on Singapore facility. What is the timing of the startup this year? Is it going to be second half, first half?

David Fiorenza

First half.

Egian Tazz – Longbow Research

Second quarter?

David Fiorenza

That's a good assumption, yes.

Egian Tazz – Longbow Research

Okay. And could you provide a little bit more color – I guess, just follow-up questions on prices. What was the price quarter-over-quarter? Was it up, was it down, was it flat compared to fourth versus third quarter?

David Fiorenza

It was up, but not as much as raw materials went up. And that's the function of actions we took during the quarter. And as we answered previously, the main benefit of that will be seen in the first quarter.

Egian Tazz – Longbow Research

Okay. Great, thank you. And just a last question on – what are your tax rate expectations for next year?

David Fiorenza

32%, 34%. 32% if Congress passes the R&D tax credits which they have to pass every year; closer to 34% if they don't.

Egian Tazz – Longbow Research

Okay. Actually I'm sorry, one more question. On the rental income, what are your expectations for that – for the new segment?

David Fiorenza

Yes, we – we will probably start in the first quarter. It's going to have a minor impact on EPS for the new segment.

Egian Tazz – Longbow Research

Penny or two?

David Fiorenza

Yes.

Egian Tazz – Longbow Research

Okay, great. Thank you.

Operator

Thank you. Our next question comes from the line of Todd Vencil with Davenport & Company. Please proceed with your question.

Todd Vencil – Davenport & Company

Thanks. Good morning, guys.

David Fiorenza

Hi, Todd.

Todd Vencil – Davenport & Company

David, you threw out three factors on the margin decline from 3Q to 4Q; higher raws, lower volumes, and higher R&D. Can you kind of rank those? And even if you want to kind of estimate the dollar impact, that would be great.

David Fiorenza

I can't estimate the dollar impact, but volume would have been the biggest, margin would have been the second, and then GS&A would have been the third.

Todd Vencil – Davenport & Company

Okay. And you guys both – I mean, I guess this is probably a Teddy question since I think you've talked about this before, but you talked about long-run margins or margins through the cycle. David, I guess you may have pre-answered it by your comment about no macro factors that could swing your margins, but at this point Teddy, last quarter I think you said through the cycle you are looking for maybe a mid-teens kind of a margin in petroleum additives. I mean, how does that feel for you right now?

Teddy Gottwald

I'm really – Todd, I'm going to go back to what David said. We really don't see anything significant on the horizon that's going to move our margins considerably from where they've been, let's say, over the last year.

I can't be more specific than that because if you look at the last year, our margins in any quarter ranged from, I think, a low of around 15% to a high of about 23%. And there are a lot of dynamics moving the needle back and forth between those levels; volumes, mix, foreign exchange, raw material costs, and where we were on pricing, timing of some spending, lots of factors. But it netted out to a good number over the course of the year. And I don't see anything to indicate margin pressure or margin expansion from kind of the longer term – well, a 12-month average certainly. And I would be kind of disappointed if they didn’t hold up where they've been.

Todd Vencil – Davenport & Company

All right. Appreciate that. The price increases you guys have put in, have you talked about the magnitude of those increases?

David Fiorenza

No, we have not.

Todd Vencil – Davenport & Company

Would you?

David Fiorenza

No.

Todd Vencil – Davenport & Company

Fair enough. Do you have a thought you want to share for what you are thinking about raw material costs in 2010 relative to '09, how much higher or different they might be?

Teddy Gottwald

I can tell you that we are seeing costs going up right now and that’s as far ahead as I can look within the accuracy in this market. I really don't know, Todd.

Todd Vencil – Davenport & Company

Okay.

Teddy Gottwald

But there is some increase going on right now.

Todd Vencil – Davenport & Company

All right. A final question. Your big publicly traded competitor sort of reinitiated their capital plans for the next decade or whatever it is and they've talked about a new plant that they are going to break ground on later in the year. I mean, what's your – obviously, that's not going to be coming around for a while, but – I mean, do you have any thoughts on the impact that thing might have down the road?

Teddy Gottwald

Yes. I read a little bit in the industry trade about that. I think that that plan is very consistent with the one that they talked about a couple of years back. This industry will return to, let's say, a 1% to 2% kind of growth and we've all done a lot of debottlenecking over the last handful of years.

We've seen the need to add a modest amount of new capacity and we are doing that currently and have plans over time to do it more in a modest way. Their 10-year plan, I think – I can’t comment really on whether it makes sense for them, but it doesn't appear to be out of line with a combination of their prior spending and the market growth. And when we look at our view on capital spending over the next 10 years, our plan is very consistent with theirs when you consider the scale of differences between the two companies.

Todd Vencil – Davenport & Company

Got it. Okay, thanks a lot.

David Fiorenza

You're welcome.

Operator

Thank you. Our next question comes from the line of Saul Ludwig with Keybanc Capital Markets. Please proceed with your question.

Saul Ludwig – Keybanc Capital Markets

Good morning, guys. Teddy, you mentioned that the relationship between price and raw material costs should be sort of at a normal level, but at times you are slightly behind that curve and other times you are slightly ahead of that curve. Would you characterize the fourth quarter as a period where you may have been slightly behind that curve?

Teddy Gottwald

Yes.

Saul Ludwig – Keybanc Capital Markets

Would you think that was the price increases that you put in place for the first quarter with what's your guess – no one knows for sure about raw materials, but you have a guess at it. Would you think that the first quarter price increases would move that needle more toward any normal relationship between price and cost in contrast to the fourth quarter where pricing may have lagged raw material costs relative to this normal number?

Teddy Gottwald

Well, Saul, I'll answer your question, but I'll just say when you ask me about last quarter, it's easy for me to respond. When you start talking about the future, it gets cloudy.

Saul Ludwig – Keybanc Capital Markets

No one has the perfect crystal ball, Teddy. And whatever you say is a guess and it may or may not come to pass. We are just looking what's your best shot as you see it today, we are not going to shoot you if it doesn't turn out that way.

David Fiorenza

Thanks a lot for that.

Teddy Gottwald

Appreciate that, yes. Yes, I – we think that going into the quarter we were in good shape in terms of the increases, but as I mentioned, we've seen a number of announcements on some cost increases in the last couple of weeks and I don't know when those will occur. So going into the quarter, I can say we were comfortable.

Saul Ludwig – Keybanc Capital Markets

David, could you explain that comment you made earlier about the FX? Back in the third quarter, you had those dollar receivables that turned out to be a big gain. I think you made $0.75 a share in the third quarter because of just accounting on that dollar receivable in the U.K. Then you made some comment earlier about a $5 million impact in the fourth quarter. It was a plus in the third quarter. What did you mean by that impact in the fourth quarter?

David Fiorenza

I would – I thought I was answering the question of what's the differential between the third quarter and the fourth quarter on that one element and I answered that as about a $5 million adverse in 4Q versus 3Q.

Saul Ludwig – Keybanc Capital Markets

Did you – now, in the 3Q, the gain was versus 3Q a year ago. What was the impact of any receivable issues that were not of an operating nature, but more of an accounting nature, the fourth quarter versus fourth quarter?

David Fiorenza

Probably from what I'm looking at – fourth quarter to fourth quarter, right?

Saul Ludwig – Keybanc Capital Markets

That was the question.

David Fiorenza

About $3 million adverse.

Saul Ludwig – Keybanc Capital Markets

$3 million adverse? So that had nothing to do with prices and raw material costs? That was a just a hit to cost of goods because of what certain receivables that you had in dollars that became worthless?

David Fiorenza

That's correct.

Saul Ludwig – Keybanc Capital Markets

Okay. And with regard to the – this issue of nature of receivables in different countries, is this something that's going to appear every quarter, either plus or minus depending on these dollar versus the euro exchange rates?

David Fiorenza

Yes. And it has every quarter since the beginning. And over big periods of time, they always tended to push out, wash out. You win some, you lose some.

Saul Ludwig – Keybanc Capital Markets

Okay. I think you have answered that. And then just finally, you mentioned, Teddy, at the start of the year – I mean, at the start of this call, you had a 9% volume decline '09 versus '08. Would you expect your volume in '10 – again this is one of those guesses that no one knows for sure, but would you expect your volume could recover that 9% – and be up 9% and basically be back to '08 levels in '10?

Teddy Gottwald

No, I think that's probably high, Saul.

Saul Ludwig – Keybanc Capital Markets

A little high?

Teddy Gottwald

Yes.

Saul Ludwig – Keybanc Capital Markets

Okay. I appreciate that. Thank you very much, guys.

Teddy Gottwald

Thank you.

Operator

Thank you. (Operator Instructions). Our next question comes from the line of Robert Felice with J. Goldman & Company. Please proceed with your question.

Robert Felice – J. Goldman & Company

Hi, guys. Most of my questions have been answered, just one or two more. What was the absolute dollar increase in raw materials on a sequential basis from 3Q to 4Q?

David Fiorenza

You mean total that hit cost of goods sold?

Robert Felice – J. Goldman & Company

Yes.

David Fiorenza

I don't have that number with me.

Robert Felice – J. Goldman & Company

I mean, just ballparking, would you say it's kind of in that $7 million to $10 million kind of range?

David Fiorenza

I haven't broken it apart, Robert. I'm not evading your question, I just haven't done that arithmetic. I mean, I can do it, but –

Robert Felice – J. Goldman & Company

Okay. I mean, I'm just trying to in my mind build a bridge between fourth quarter operating profit and third quarter operating profit. And you mentioned the $5 million hit from FX on a sequential basis. You've got SG&A and R&D that's higher by roughly $7 million, your volume is off by 5.5%. So my rough guess is that's probably a $10 million to $12 million hit. Is it fair then to say the differential is all raw material costs?

David Fiorenza

Yes. Yes.

Robert Felice – J. Goldman & Company

Okay. Was there any change in price sequentially, either up or down, from 3Q to 4Q?

David Fiorenza

Yes. There was a small – there was a – yes, there was an increase. It wasn't as much as the raws went up.

Robert Felice – J. Goldman & Company

Okay. And then I guess, Teddy, just broadly speaking, we have talked about the opportunity to recover at least part of that 9% decline in volume from '08 to '09 and '10. You've talked about stability of margins going forward that the industry should at least be able to put through price that's sufficient to offset raw material costs – I mean, granted that at some points you will be behind that curve, as Saul mentioned, some points you will be ahead of that curve. So as we add up all these pieces, should we expect that additive profit could be in '10 versus '09?

Teddy Gottwald

That's a big question mark. And I don't have an answer for you, I'm sorry.

Robert Felice – J. Goldman & Company

Well, maybe you can characterize the dynamics that would make you feel confident that it could be up or vice versa that make you hesitant that you would be able to maintain it.

Teddy Gottwald

Yes. I do think we will see higher volumes this year, modestly higher volumes. And I don't expect our margins to be considerably different in 2010 versus last year, but I'm cautious on that. I mean, that's my hope, that's my expectation. But I just – I think there is still – we are not so far away from some pretty wild volatility in this market that I'm willing to bet that it's all behind us and nor am I confident enough in those volume numbers to see that as a sure thing.

So I think we are going to have a good year. Last year was certainly a good year and it's my expectation that we won't see any wild swings in either direction from last year's results. But who is to say?

Robert Felice – J. Goldman & Company

Okay. So it sounds like the bulk of your hesitation is really on the volatility and the raws and any temporary price cost differentials that could result given that volatility.

Teddy Gottwald

Yes, that's a safe assumption.

Robert Felice – J. Goldman & Company

Okay. Great. Thanks for taking my questions.

Teddy Gottwald

Sure.

Operator

Thank you. Our next question comes from the line of Ivan Marcuse with KeyBanc Capital Markets. Please proceed with your question.

Ivan Marcuse – KeyBanc Capital Markets

Hi, David, real quick question. Of the $36 million bridge from petroleum additives from fourth quarter of '08 to fourth quarter of '09, to make sure I'm on the same page, what is the FX price and volume breakout?

David Fiorenza

The revenue – the component of revenue?

Ivan Marcuse – KeyBanc Capital Markets

Yes.

David Fiorenza

I don't have that with me, but I would be happy to get it for you.

Ivan Marcuse – KeyBanc Capital Markets

All right. I will give you a call later then.

David Fiorenza

All right.

Operator

Thank you, gentlemen. We have no further questions at this time. I would like to turn the floor back to management.

David Fiorenza

Well, I thank everyone for joining and we will talk to you next quarter. Bye-bye.

Operator

Ladies and gentlemen, this concludes today's teleconference and you may disconnect your lines at this time. Thank you for your participation.

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