Ingevity Corp 10-Q for FY2026 Q3
Ingevity Corp (NGVT)
10-Q
2026-11-05
For: 2026-09-30
View Original
Added on
November 06, 2026
About this 10-Q
Ingevity Corp filed this 10-Q on November 5, 2026, covering the quarter ended September 30, 2026 (FY2026 Q3).
Ingevity Corporation reported net income of $49.3 million for the three months ended September 30, 2026, versus $43.5 million in 2025, while net sales declined to $305.1 million from $333.1 million. Full-year adjusted EBITDA guidance is $385 million to $395 million. AI summary
Headline figures
Quarter ended September 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $305.1M
- down 8.4% from $333.1M a year earlier
- Net income
- $49.3M
- up 13.3% from net income of $43.5M a year earlier
- Diluted EPS
- $1.41
- up 19.5% from $1.18 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________________________________
FORM 10-Q
_______________________________________________________________________
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
Commission File Number: 001-37586
__________________________________________________________________________
(Exact name of registrant as specified in its charter)
_____________________________________________________________________
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||||||||||||||
| (Address of principal executive offices) | (Zip code) | ||||||||||||||||
(Registrant’s telephone number, including area code)
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company | |||||||||||
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the Registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No x
The registrant had 33,780,725 shares of common stock, $0.01 par value, outstanding at November 3, 2026.
Ingevity Corporation
INDEX
| Page No. | ||||||||||||||
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INGEVITY CORPORATION
Condensed Consolidated Statements of Operations (Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions, except per share data | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Selling, general, and administrative expenses | |||||||||||||||||||||||
| Research and technical expenses | |||||||||||||||||||||||
| Restructuring and other (income) charges, net | |||||||||||||||||||||||
| Goodwill impairment charge | |||||||||||||||||||||||
| Long-lived asset impairment charge | |||||||||||||||||||||||
| Other (income) expense, net | |||||||||||||||||||||||
| Interest expense, net | |||||||||||||||||||||||
| Income (loss) from continuing operations before income taxes | ( | ||||||||||||||||||||||
| Provision (benefit) for income taxes on continuing operations | |||||||||||||||||||||||
| Net income (loss) from continuing operations | ( | ||||||||||||||||||||||
| Income (loss) from discontinued operations, net of income taxes | ( | ( | |||||||||||||||||||||
| Net income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
| Per share data | |||||||||||||||||||||||
| Basic earnings (loss) per share from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
| Basic earnings (loss) per share from discontinued operations | ( | ( | |||||||||||||||||||||
| Basic earnings (loss) per share | $ | $ | $ | $ | ( | ||||||||||||||||||
| Diluted earnings (loss) per share from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
| Diluted earnings (loss) per share from discontinued operations | ( | ( | |||||||||||||||||||||
| Diluted earnings (loss) per share | $ | $ | $ | $ | ( | ||||||||||||||||||
The accompanying notes are an integral part of these financial statements.
3
INGEVITY CORPORATION
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Foreign currency adjustments: | |||||||||||||||||||||||
| Foreign currency translation adjustment | ( | ||||||||||||||||||||||
Total foreign currency adjustments, net of tax provision (benefit) of | ( | ||||||||||||||||||||||
| Derivative instruments: | |||||||||||||||||||||||
Unrealized gain (loss), net of tax provision (benefit) of $( | ( | ( | ( | ( | |||||||||||||||||||
Reclassifications of deferred derivative instruments (gain) loss, included in net income (loss), net of tax (provision) benefit of $ | ( | ||||||||||||||||||||||
Total derivative instruments, net of tax provision (benefit) of | ( | ( | ( | ||||||||||||||||||||
Other comprehensive income (loss), net of tax provision (benefit) of | ( | ||||||||||||||||||||||
| Comprehensive income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
The accompanying notes are an integral part of these financial statements.
4
INGEVITY CORPORATION
Condensed Consolidated Balance Sheets (Unaudited)
| In millions, except share and par value data | September 30, 2026 | December 31, 2025 | |||||||||
| Assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance of $ | |||||||||||
| Inventories, net | |||||||||||
Restricted investment, net of allowance of | |||||||||||
| Prepaid and other current assets | |||||||||||
| Current assets of discontinued operations | |||||||||||
| Current assets | |||||||||||
| Property, plant, and equipment, net | |||||||||||
| Operating lease assets, net | |||||||||||
| Goodwill | |||||||||||
| Other intangibles, net | |||||||||||
| Deferred income taxes | |||||||||||
Restricted investment, net of allowance of $ | |||||||||||
| Strategic investments | |||||||||||
| Other assets | |||||||||||
| Noncurrent assets of discontinued operations | |||||||||||
| Total Assets | $ | $ | |||||||||
| Liabilities | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses | |||||||||||
| Accrued payroll and employee benefits | |||||||||||
| Current operating lease liabilities | |||||||||||
| Notes payable and current maturities of long-term debt | |||||||||||
| Income taxes payable | |||||||||||
| Current liabilities of discontinued operations | |||||||||||
| Current liabilities | |||||||||||
| Long-term debt including finance lease obligations | |||||||||||
| Noncurrent operating lease liabilities | |||||||||||
| Deferred income taxes | |||||||||||
| Other liabilities | |||||||||||
| Noncurrent liabilities of discontinued operations | |||||||||||
| Total Liabilities | |||||||||||
Commitments and contingencies (Note 13) | |||||||||||
| Equity | |||||||||||
Preferred stock (par value $ | |||||||||||
Common stock (par value $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive income (loss) | |||||||||||
Treasury stock, common stock, at cost ( | ( | ( | |||||||||
| Total Equity | |||||||||||
| Total Liabilities and Equity | $ | $ | |||||||||
The accompanying notes are an integral part of these financial statements.
5
INGEVITY CORPORATION
Condensed Consolidated Statements of Cash Flows (Unaudited)
| Nine Months Ended September 30, | ||||||||||||||
| In millions | 2026 (1) | 2025 (1) | ||||||||||||
| Cash provided by (used in) operating activities: | ||||||||||||||
| Net income (loss) | $ | $ | ( | |||||||||||
| Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | ||||||||||||||
| Depreciation and amortization | ||||||||||||||
| Non-cash operating lease costs | ||||||||||||||
| Deferred income taxes | ||||||||||||||
| Restructuring and other (income) charges, net | ||||||||||||||
| LIFO charge (liquidation) | ( | |||||||||||||
| Share-based compensation | ||||||||||||||
| (Gain) loss on sale of business | ( | |||||||||||||
| Goodwill impairment charge | ||||||||||||||
| Long-lived asset impairment charge | ||||||||||||||
| Litigation charges | ||||||||||||||
| Other non-cash items | ||||||||||||||
| Changes in operating assets and liabilities, net of effect of divestitures: | ||||||||||||||
| Accounts receivable, net | ( | ( | ||||||||||||
| Inventories, net | ( | |||||||||||||
| Prepaid and other current assets | ( | ( | ||||||||||||
| Accounts payable | ( | |||||||||||||
| Accrued expenses | ||||||||||||||
| Accrued payroll and employee benefits | ( | |||||||||||||
| Income taxes | ||||||||||||||
| Restructuring and other cash outflow, net | ( | ( | ||||||||||||
| Operating leases | ( | ( | ||||||||||||
| CTO resales cash inflow, net | ||||||||||||||
| Litigation settlement payment | ( | |||||||||||||
| Changes in other operating assets and liabilities, net | ( | |||||||||||||
| Net cash provided by (used in) operating activities | $ | $ | ||||||||||||
| Cash provided by (used in) investing activities: | ||||||||||||||
| Capital expenditures | $ | ( | $ | ( | ||||||||||
| Proceeds from sale of businesses | ||||||||||||||
| Proceeds from restricted investment | ||||||||||||||
| Purchase of strategic investments | ( | |||||||||||||
| Other investing activities, net | ( | |||||||||||||
| Net cash provided by (used in) investing activities | $ | $ | ( | |||||||||||
| Cash provided by (used in) financing activities: | ||||||||||||||
| Proceeds from revolving credit facility and other borrowings | $ | $ | ||||||||||||
| Payments on revolving credit facility and other borrowings | ( | ( | ||||||||||||
| Debt issuance costs | ( | |||||||||||||
| Finance lease obligations, net | ( | ( | ||||||||||||
| Tax payments related to withholdings on vested equity awards | ( | ( | ||||||||||||
| Proceeds and withholdings from share-based compensation plans, net | ||||||||||||||
| Repurchases of common stock under stock repurchase plan | ( | ( | ||||||||||||
| Net cash provided by (used in) financing activities | $ | ( | $ | ( | ||||||||||
| Increase (decrease) in cash, cash equivalents, and restricted cash | ||||||||||||||
| Effect of exchange rate changes on cash | ( | |||||||||||||
| Change in cash, cash equivalents, and restricted cash | ||||||||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | ||||||||||||||
Cash, cash equivalents, and restricted cash at end of period(2) | $ | $ | ||||||||||||
| (1) | ||||||||||||||
| (2) | Includes restricted cash of $ | |||||||||||||
| Supplemental cash flow information: | ||||||||||||||
| Cash paid for interest, net of capitalized interest | $ | $ | ||||||||||||
| Cash paid (refunded) for income taxes, net of refunds | ||||||||||||||
| Purchases of property, plant, and equipment in accounts payable | ||||||||||||||
| Leased assets obtained in exchange for new operating lease liabilities | ||||||||||||||
The accompanying notes are an integral part of these financial statements.
6
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 1: Background
Description of Business
Ingevity Corporation ("Ingevity," "the company," "we," "us," or "our") provides products and technologies that purify, protect, and enhance the world around us. 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 automotive gasoline vapor emissions control systems, food, water and chemical filtration, asphalt paving, agrochemical dispersants, bioplastics, coatings, and elastomers. We operate in three reportable segments: Performance Materials, Pavement Technologies, and Advanced Polymer Technologies (“APT”).
Reportable Segment Renaming
Industrial Specialties Divestiture
On September 3, 2025, Ingevity entered into an Asset Purchase Agreement (the "Purchase Agreement") with Mainstream Pine Products, LLC, a Delaware limited liability company ("Purchaser"), pursuant to which Purchaser agreed to purchase substantially all of the assets and assume and acquire certain of the rights and liabilities of Ingevity or its applicable affiliates that relate to or are used in connection with (a) Ingevity's industrial specialties product line (other than Ingevity's lignin dispersant and alternative fatty acid based products, pavement technologies product line and other businesses and products more fully described in the Purchase Agreement) and (b) Ingevity's North Charleston, South Carolina crude tall oil refinery (the "CTO Refinery") and Ingevity's and its affiliates' operations thereof (collectively, the "Divestiture"). We determined that, upon execution of the Purchase Agreement, the industrial specialties product line and CTO Refinery included within the Divestiture met the criteria to be classified as held for sale and that the sale represents a strategic shift that will have a major effect on Ingevity's operations and results. As such, the results of operations of the Divestiture have been reclassified and presented as discontinued operations for all periods presented. The Divestiture was completed on January 1, 2026.
Unless otherwise indicated, the information in the notes to the Condensed Consolidated Financial Statements refers only to our continuing operations and does not include discussion of balances or activity of the Divestiture. Refer to Note 16 for more information.
Basis of Consolidation and Presentation
These unaudited Condensed Consolidated Financial Statements reflect the consolidated operations of the company and have been prepared in accordance with United States Securities and Exchange Commission ("SEC") interim reporting requirements. Accordingly, the accompanying Condensed Consolidated Financial Statements do not include all disclosures required by accounting principles generally accepted in the United States of America ("GAAP") for full financial statements and should be read in conjunction with the Annual Consolidated Financial Statements for the years ended December 31, 2025, 2024 and 2023, collectively referred to as the "Annual Consolidated Financial Statements," included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Annual Report").
In the opinion of management, the Condensed Consolidated Financial Statements reflect all adjustments, including normal recurring adjustments necessary to fairly present the financial position, results of operations, and cash flows for the interim periods presented and contain adequate disclosures to make the information presented not misleading. The consolidated results of operations for interim periods are not necessarily indicative of the results expected for the full year.
7
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
The preparation of the Condensed Consolidated Financial Statements requires management to make estimates and assumptions with respect to the reported amounts of assets, liabilities, revenue, and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates.
Note 2: New Accounting Guidance
The Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC" or "Codification") is the sole source of authoritative GAAP other than SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standards Update ("ASU") to communicate changes to the Codification. We consider the applicability and impact of all ASUs. Recently issued ASUs that are not listed within this Form 10-Q have been assessed and determined to be either not applicable or are not expected to have a material impact on the Condensed Consolidated Financial Statements.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses," which is intended to enhance disclosures regarding significant expenses. The purpose of the amendment is to provide readers of the financial statements with information to better understand an entity's overall performance, assess potential future cash flows, and compare an entity's performance over time and with that of other entities. The guidance is effective beginning with our 2027 fiscal year Form 10-K. We are currently evaluating the potential impact of adopting this new guidance on our Consolidated Financial Statements and related disclosures.
In May 2026, the FASB issued ASU 2026-02, "Environmental Credits and Environmental Credit Obligations," which is intended to improve the financial accounting for and disclosure of environmental credits and environmental credit obligations. The purpose of the amendment is to provide recognition, measurement, presentation, and disclosure requirements for all entities that generate, purchase, or receive environmental credits or have a regulatory compliance obligation that may be settled with environmental credits. The guidance is effective beginning with our 2028 fiscal year Form 10-K. We are currently evaluating the potential impact of adopting this new guidance on our Consolidated Financial Statements and related disclosures.
Note 3: Net Sales
Disaggregation of Net Sales
The following table presents our Net sales disaggregated by reportable segment.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Performance Materials segment | $ | $ | $ | $ | |||||||||||||||||||
Pavement Technologies segment (1) | |||||||||||||||||||||||
| Advanced Polymer Technologies segment | |||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
_______________
(1) Includes Net sales from the divested road markings product line of zero and $12.9 million for the three and nine months ended September 30, 2026 and $35.0 million and $82.0 million for the three and nine months ended September 30, 2025. Refer to Note 16 for more information.
8
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
The following table presents our Net sales disaggregated by geography, based on the delivery address of our customer.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
North America (1) | $ | $ | $ | $ | |||||||||||||||||||
Asia Pacific (1) | |||||||||||||||||||||||
| Europe, Middle East, and Africa | |||||||||||||||||||||||
| South America | |||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
Contract Balances
The contract assets primarily relate to our rights to consideration for products produced but not billed at the reporting date. The contract assets are recognized as accounts receivable when we have an enforceable right to payment for performance completed to date and the customer has been billed. Contract liabilities represent obligations to transfer goods to a customer for which we have received consideration from our customer. For all periods presented, we had no
The following table provides information about contract assets from contracts with certain customers.
| Contract Asset | |||||||||||||||||
| September 30, | |||||||||||||||||
| In millions | 2026 | 2025 | |||||||||||||||
| Beginning balance | $ | $ | |||||||||||||||
| Contract asset additions | |||||||||||||||||
| Reclassification to accounts receivable, billed to customers | ( | ( | |||||||||||||||
Ending balance (1) | $ | $ | |||||||||||||||
_______________
(1) Included within "Prepaid and other current assets" on the condensed consolidated balance sheets.
9
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 4: Fair Value Measurements
Recurring Fair Value Measurements
The following information is presented for assets and liabilities that are recorded on the condensed consolidated balance sheets at fair value measured on a recurring basis. There were no transfers of assets and liabilities that were recorded at fair value between the three-level fair value hierarchy during the periods reported.
| In millions | Level 1(1) | Level 2(2) | Level 3(3) | Total | |||||||||||||||||||
| September 30, 2026 | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
Deferred compensation plan investments (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total assets | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
Deferred compensation arrangement (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total liabilities | $ | $ | $ | $ | |||||||||||||||||||
| In millions | Level 1(1) | Level 2(2) | Level 3(3) | Total | |||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
Deferred compensation plan investments (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total assets | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
Deferred compensation arrangement (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total liabilities | $ | $ | $ | $ | |||||||||||||||||||
_______________
(1) Quoted prices in active markets for identical assets.
(2) Quoted prices for similar assets and liabilities in active markets.
(3) Significant unobservable inputs.
(4) Consists of a deferred compensation arrangement through which we hold various investment securities recognized on our condensed consolidated balance sheets. 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 $18.7 million and $18.2 million at September 30, 2026 and December 31, 2025, respectively.
Nonrecurring Fair Value Measurements
During the second quarter of 2026, a triggering event occurred within our Advanced Polymer Technologies asset group, requiring the measurement of our Advanced Polymer Technologies long-lived assets at fair value in connection with impairment testing. These measurements are Level 3 and were determined using both market and income approaches, and a discounted value of estimated future cash flows for our long-lived assets. Refer to Note 6 and Note 7 for more information, including key assumptions.
During the year ended December 31, 2025, we measured our Advanced Polymer Technologies reporting units' goodwill and our Pavement Technologies road markings long-lived assets at fair value in connection with impairment testing. These measurements are Level 3 and were determined using both the income approach and market approach for goodwill and both quoted market prices in active markets and a discounted value of estimated future cash flows for our long-lived assets. For additional information refer to the Notes to the Consolidated Financial Statements included in the company’s Form 10-K for the year ended December 31, 2025, filed on February 26, 2026.
10
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Strategic Investments
Equity Method Investments
The aggregate carrying value of all strategic equity method investments totaled $3.3 million and $3.1 million at September 30, 2026 and December 31, 2025, respectively. There were no
As of September 30, 2026, we had approximately $2.9 million of unfunded commitments associated with a venture capital fund investment accounted for under the equity method of accounting.
Measurement Alternative Investments
The aggregate carrying value of all measurement alternative investments where fair value is not readily determinable totaled $80.0
There were no adjustments to the carrying value of the measurement alternative method investments for impairment or observable price changes for the three and nine months ended September 30, 2026.
Restricted Investment
Our restricted investment is a trust managed in order to secure repayment of the finance lease obligation associated with the Performance Materials' Wickliffe, Kentucky manufacturing plant at maturity. The trust, which is presented as Restricted investment on our condensed consolidated balance sheets, originally held long-term bonds that matured during 2026. The investments held by the trust earned interest at the stated coupon rates of the underlying bonds, and interest earned on those investments was recognized and presented as interest income on our condensed consolidated statements of operations. Following the maturity of the bonds, the proceeds are held in highly liquid securities and are treated as restricted cash. The principal received upon maturity of the bonds, together with previously reinvested interest income, is expected to be equal to or greater than the $80.0 million finance lease obligation due in January 2027.
At September 30, 2026 and December 31, 2025, the carrying value of our restricted investment was $86.6 million and $84.4 million, net of an allowance for credit losses of zero and $0.2 million, and included restricted cash of $86.6 million and $34.0 million, respectively. The fair value at September 30, 2026 and December 31, 2025 was $86.6 million and $84.0 million, respectively, based on Level 1 inputs. As a result of the obligation being due in January 2027, we have reclassified the full amount of the restricted investment to "Current assets" on the condensed consolidated balance sheet at September 30, 2026.
The following table shows the total amortized cost of our HTM debt securities by credit rating, excluding the allowance for credit losses and cash. The primary factor in our expected credit loss calculation is the composite bond rating. As the rating decreases, the risk present in holding the bond is inherently increased, leading to an increase in expected credit losses.
| HTM Debt Securities | |||||||||||||||||||||||||||||||||||||||||
| In millions | AA+ | AA- | A | A- | BBB+ | Total | |||||||||||||||||||||||||||||||||||
| September 30, 2026 | $ | $ | |||||||||||||||||||||||||||||||||||||||
| December 31, 2025 | $ | $ | |||||||||||||||||||||||||||||||||||||||
11
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Debt and Finance Lease Obligations
| In millions | September 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||
Variable interest rate debt (1) | $ | $ | |||||||||||||||||||||||||||
Fixed rate debt (2) | |||||||||||||||||||||||||||||
Finance lease obligations (3) | |||||||||||||||||||||||||||||
| Total debt including finance lease obligations | $ | $ | |||||||||||||||||||||||||||
_______________
(1) For both periods presented, the carrying value of our variable interest rate debt, including the impact of a $200.0
(2) At December 31, 2025, the carrying value of our fixed interest rate debt included the impact of a $200.0 million floating-to-fixed interest rate swap. The interest rate swap matured in August 2026 and, accordingly, was no longer outstanding at September 30, 2026. As of September 30, 2026 and December 31, 2025, the fair value of our fixed rate debt was $523.4 million and $735.7 million, respectively, based on Level 2 inputs.
(3) At September 30, 2026 and December 31, 2025, the fair value of our $80.0 million finance lease obligation associated with our Performance Materials' Wickliffe, Kentucky manufacturing site was $80.7 million and $81.4 million, respectively, based on Level 2 inputs. The fair value of all other finance lease obligations approximates their carrying values.
Note 5: Inventories, net
_______________
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Raw materials | $ | $ | |||||||||
| Production materials, stores, and supplies | |||||||||||
| Finished and in-process goods | |||||||||||
| Subtotal | |||||||||||
| Less: LIFO reserve | ( | ( | |||||||||
Inventories, net (1) | $ | $ | |||||||||
(1) The decline in 2026, as compared to 2025, was driven by the road markings product line disposition (refer to Note 16 for more information).
Note 6: Property, Plant, and Equipment, net
_______________
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Machinery and equipment | $ | $ | |||||||||
| Buildings and leasehold improvements | |||||||||||
| Land and land improvements | |||||||||||
| Construction in progress | |||||||||||
Total cost (1) | |||||||||||
| Less: accumulated depreciation | ( | ( | |||||||||
| Property, plant, and equipment, net | $ | $ | |||||||||
(1) The decline in 2026, as compared to 2025, was driven by the road markings product line disposition (refer to Note 16 for more information), and the Advanced Polymer Technologies long-lived asset impairment charge.
Long-Lived Asset Impairment Charge
We periodically evaluate whether current events or circumstances indicate that the carrying value of our long-lived assets, including intangible assets held and used, may not be recoverable. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by the long-lived asset, or the appropriate grouping of assets, is compared to carrying value to determine whether impairment exists.
12
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
As the sale process for the Advanced Polymer Technologies ("APT") reportable segment progressed during the second quarter of 2026, information obtained from potential buyers indicated that its carrying amount may not be recoverable. Accordingly, we determined that a triggering event had occurred and performed a recoverability assessment of the asset group's long-lived assets. The assessment indicated that the carrying amount was not recoverable. Accordingly, we performed an impairment analysis to assess the fair value of the asset group.
Based on the results of the quantitative analysis, which was based on both market and income approaches and a discounted value of estimated future cash flows, we concluded that the carrying value of the APT asset group exceeded its fair value. As a result, we recorded a non-cash impairment charge of $32.1 million. The charge is included within "Long-lived asset impairment charge" on the condensed consolidated statements of operations for the nine months ended September 30, 2026, and was allocated between "Property, plant, and equipment, net" and "Other intangibles, net" on the condensed consolidated balance sheet as of September 30, 2026 in the amount of $13.2 million and $18.9 million, respectively.
Note 7: Goodwill and Other Intangible Assets, net
Goodwill
| Reporting Units | |||||||||||||||||||||||
| In millions | Performance Materials | Pavement Technologies | Advanced Polymer Technologies | Total | |||||||||||||||||||
Balance as of December 31, 2025 (1) | $ | $ | $ | $ | |||||||||||||||||||
Balance as of September 30, 2026 (1) | $ | $ | $ | $ | |||||||||||||||||||
_______________
(1) Includes accumulated impairment losses of $306.6 183.8
Goodwill Impairment Charge - Advanced Polymer Technologies
During the second quarter of 2025, the announcements and subsequent modifications of international tariffs escalated global trade tensions and contributed to increased consumer uncertainty, which negatively impacted parts of our businesses, particularly APT. As a result, we conducted an analysis of the APT reporting unit’s goodwill, intangible assets, and long-lived assets.
Based on the results of the quantitative analysis, we concluded that the carrying value of the APT reporting unit exceeded its fair value. As a result, we recorded a non-cash goodwill impairment charge of $183.8 million, representing all of the goodwill associated with the APT reporting unit. The charge is included within Goodwill impairment charge on the condensed consolidated statements of operations for the nine months ended September 30, 2025.
There were no events or circumstances indicating that goodwill might be impaired as of September 30, 2026.
13
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Other Intangible Assets
| In millions | Customer contracts and relationships | Brands (1) | Developed Technology | Total | |||||||||||||||||||||||||
| Gross Asset Value | |||||||||||||||||||||||||||||
December 31, 2025 (2) | $ | $ | $ | $ | |||||||||||||||||||||||||
Retirements (3) | ( | ( | ( | ( | |||||||||||||||||||||||||
| Foreign currency translation | ( | ( | ( | ( | |||||||||||||||||||||||||
Impairment (4) | ( | ( | ( | ( | |||||||||||||||||||||||||
| September 30, 2026 | $ | $ | $ | $ | |||||||||||||||||||||||||
| Accumulated Amortization | |||||||||||||||||||||||||||||
December 31, 2025 (2) | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||
| Amortization | ( | ( | ( | ( | |||||||||||||||||||||||||
Retirements (3) | ( | ( | |||||||||||||||||||||||||||
| Foreign currency translation | |||||||||||||||||||||||||||||
Impairment (4) | |||||||||||||||||||||||||||||
| September 30, 2026 | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||
| Other intangibles, net | $ | $ | $ | $ | |||||||||||||||||||||||||
_______________
(1) Represents trademarks, trade names, and know-how.
(2) Includes accumulated impairment loss of $84.1 million related to a long-lived asset impairment charge within our divested road markings asset group for the period ended December 31, 2025.
(3) Retirements related to the divested road markings asset group. Refer to Note 16 for more information.
(4) Impairment related to the Advanced Polymer Technologies asset group. Refer to Note 6 for more information.
Intangible assets subject to amortization were attributed to our business segments as follows:
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Performance Materials | $ | $ | |||||||||
| Pavement Technologies | |||||||||||
| Advanced Polymer Technologies | |||||||||||
| Other intangibles, net | $ | $ | |||||||||
The amortization expense related to our intangible assets in the table above is shown in the table below.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Selling, general, and administrative expenses | $ | $ | $ | $ | |||||||||||||||||||
| Total amortization expense | $ | $ | $ | $ | |||||||||||||||||||
Based on the current carrying values of intangible assets, estimated pre-tax amortization expense for the next five years is as follows: $4.1 million for the remainder of 2026, 2027 - $16.5 million, 2028 - $16.5 million, 2029 - $16.5 million, and 2030 - $16.5 million. The estimated pre-tax amortization expense may fluctuate due to changes in foreign currency exchange rates.
14
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 8: Financial Instruments and Risk Management
Cash Flow Hedges
Foreign Currency Exchange Risk Management
As of September 30, 2026, there were $0.6 million open foreign currency derivative contracts. The fair value of the designated foreign currency hedge contracts was a net asset (liability) of zero
Commodity Price Risk Management
As of September 30, 2026, we had 1.6 million mmBTUS (millions of British Thermal Units) in open natural gas derivative contracts, designated as cash flow hedges. As of September 30, 2026, open natural gas derivative contracts hedge a portion of forecasted transactions until November 2027. The fair value of the open natural gas derivative contracts was a net asset (liability) of $(0.6 ) million and $(0.5 ) million as of September 30, 2026 and December 31, 2025, respectively.
Interest Rate Risk Management
During the third quarter of 2024, we entered into a floating-to-fixed interest rate swap to convert a notional amount of $200.0 million of the variable, Secured Overnight Financing Rate ("SOFR") based interest component of our debt to a fixed rate. In accordance with the terms of this instrument, we received floating rate interest payments based upon one-month U.S. dollar SOFR, and in return were obligated to pay interest at a fixed rate of 3.84 percent. The interest rate swap matured in August 2026. The fair value of the interest rate swap was an asset (liability) of $(0.4 ) million at December 31, 2025.
Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Loss) ("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 September 30, | |||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| Cash flow hedging derivatives: | |||||||||||||||||||||||||||||
| Currency exchange contracts | $ | $ | $ | $ | ( | Net sales | |||||||||||||||||||||||
| Natural gas contracts | ( | ( | ( | Cost of sales | |||||||||||||||||||||||||
| Interest rate swap contracts | ( | Interest expense, net | |||||||||||||||||||||||||||
| Total | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||||||||
| 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) | ||||||||||||||||||||||||||
| Nine Months Ended September 30, | |||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| Cash flow hedging derivatives: | |||||||||||||||||||||||||||||
| Currency exchange contracts | $ | $ | ( | $ | $ | ( | Net sales | ||||||||||||||||||||||
| Natural gas contracts | ( | ( | ( | Cost of sales | |||||||||||||||||||||||||
| Interest rate swap contracts | ( | Interest expense, net | |||||||||||||||||||||||||||
| Total | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||
Within the next twelve months, we expect to reclassify $1.0 million of net gains from AOCI to income, before taxes.
15
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Fair Value Measurements
The following information is presented for derivative assets and liabilities that are recorded in the condensed consolidated balance sheets at fair value measured on a recurring basis. 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 September 30, 2026, or December 31, 2025.
| September 30, 2026 | |||||||||||||||||||||||
| In millions | Level 1(1) | Level 2(2) | Level 3(3) | Total | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
Currency exchange contracts (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total assets | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
Natural gas contracts (5) | $ | $ | $ | $ | |||||||||||||||||||
Currency exchange contracts (5) | |||||||||||||||||||||||
| Total liabilities | $ | $ | $ | $ | |||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| In millions | Level 1(1) | Level 2(2) | Level 3(3) | Total | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
Currency exchange contracts (4) | $ | $ | $ | $ | |||||||||||||||||||
| Total assets | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||
Natural gas contracts (5) | $ | $ | $ | $ | |||||||||||||||||||
Currency exchange contracts (5) | |||||||||||||||||||||||
Interest rate swap contracts (6) | |||||||||||||||||||||||
| Total liabilities | $ | $ | $ | $ | |||||||||||||||||||
_______________
(1) Quoted prices in active markets for identical assets.
(2) Quoted prices for similar assets and liabilities in active markets.
(3) Significant unobservable inputs.
(4) Included within "Prepaid and other current assets" on the condensed consolidated balance sheets.
(5) Included within "Accrued expenses" on the condensed consolidated balance sheets.
(6) Included within "Other liabilities" on the condensed consolidated balance sheets.
16
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 9: Debt, including Finance Lease Obligations
Current and long-term debt including finance lease obligations consisted of the following:
| In millions, except percentages | September 30, 2026 | December 31, 2025 | |||||||||||||||||||||
Revolving Credit Facility and other lines of credit (1)(2) | $ | $ | |||||||||||||||||||||
Finance lease obligations (3) | |||||||||||||||||||||||
Accounts receivable securitization (4) | |||||||||||||||||||||||
| Other notes payable | |||||||||||||||||||||||
| Total debt including finance lease obligations | |||||||||||||||||||||||
| Less: debt issuance costs | |||||||||||||||||||||||
| Total debt including finance lease obligations, net of debt issuance costs | |||||||||||||||||||||||
Less: debt maturing within one year (5) | |||||||||||||||||||||||
| Long-term debt including finance lease obligations | $ | $ | |||||||||||||||||||||
_______________
(1) Letters of credit outstanding under the revolving credit facility were $12.2 million and $9.0 million and available funds under the facility were $312.8 million and $474.0 million at September 30, 2026 and December 31, 2025, respectively.
(2) The weighted interest rate associated with our revolving credit facility, exclusive of any floating-to-fixed interest rate instrument, was 5.20 percent and 6.40 percent for the period ended September 30, 2026 and December 31, 2025, respectively.
(3) As of September 30, 2026 and December 31, 2025, $80.0 million of the finance lease obligations 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 investment on the condensed consolidated balance sheets in the amount of $86.6 million and $84.4 million as of September 30, 2026 and December 31, 2025, respectively. Refer to Note 4, under the section: Restricted Investment, for more information.
(4) The weighted interest rate associated with our accounts receivable securitization program was 4.76 percent and 5.51 percent for the period ended September 30, 2026 and December 31, 2025, respectively.
(5) Debt maturing within one year, inclusive of the finance lease obligation associated with our Performance Materials' Wickliffe, Kentucky manufacturing site, is included in "Notes payable and current maturities of long-term debt" on the condensed consolidated balance sheets. Refer to Note 4, under the section: Restricted Investment, for more information.
Revolving Credit Facility
On March 26, 2026, we entered into a Second Amendment and Restatement Agreement (the "Amendment"), which amends and restates our existing credit agreement, dated as of June 23, 2022.
Among other things, the Amendment decreased the aggregate amount of the commitments thereunder from $1 billion to $750 million, and extended the maturity date of our revolving credit facility by five years to March 31, 2031. However, if more than $250 million principal amount of the company’s senior unsecured notes due 2028 remain outstanding on the date that is 91 days prior to their stated maturity, the maturity of the revolving credit facility will automatically accelerate to such earlier date. Borrowings under the revolving credit facility bear interest at a rate per annum equal to, at our option, either (a) the applicable term benchmark rate, subject to a zero percent floor, or (b) a base rate, in each case, plus an applicable margin of 1.00 % to 1.75 % for term benchmark loans and zero percent to 0.75 % for base rate loans. The Amendment contains certain customary affirmative and negative covenants, representations and warranties and events of default (subject in certain cases to customary grace and cure periods).
Fees of $4.0 million were incurred to secure the Amendment. These fees have been deferred and will be amortized over the term of the facility.
17
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Debt Covenants
Our indenture contains certain customary covenants (including covenants limiting Ingevity's and its restricted subsidiaries' ability to grant or permit liens on certain property securing debt, declare or pay dividends, make distributions on or repurchase or redeem capital stock, make investments in unrestricted subsidiaries, engage in sale and lease-back transactions, and engage in a consolidation or merger, or sell, transfer or otherwise dispose of all or substantially all of the assets of Ingevity and our restricted subsidiaries, taken as a whole) and events of default (subject in certain cases to customary exceptions, as well as grace and cure periods). 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 September 30, 2026.
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. The occurrence of an uncured event of default under the credit agreement could result in all loans and other obligations becoming immediately due and payable and our revolving credit facility being terminated. The credit agreement also contains certain customary covenants, including financial covenants. 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 September 30, 2026 was 2.4 , and our actual interest coverage for the four consecutive quarters ended September 30, 2026 was 7.0 . We were in compliance with all covenants under the credit agreement at September 30, 2026.
18
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 10: Equity
| Common Stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Treasury stock | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||
| In millions, shares in thousands | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options, net | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax payments related to vested restricted stock units | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchase program | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | $ | — | $ | — | $ | $ | — | $ | — | $ | |||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options, net | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax payments related to vested restricted stock units | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchase program | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options, net | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax payments related to vested restricted stock units | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share repurchase program | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||||||||||||
19
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
| Common Stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Treasury stock | Total Equity | ||||||||||||||||||||||||||||||||||||||||||
| In millions, shares in thousands | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Tax payments related to vested restricted stock units | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | $ | — | $ | — | $ | ( | $ | — | $ | — | $ | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income (loss) | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Common stock issued | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options, net | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Tax payments related to vested restricted stock units | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share repurchase program | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
20
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Accumulated other comprehensive income (loss) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Foreign currency translation | |||||||||||||||||||||||
| Beginning balance | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Gains (losses) on foreign currency translation | ( | ||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ||||||||||||||||||||||
| Ending balance | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Derivative instruments | |||||||||||||||||||||||
| Beginning balance | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||
| Gains (losses) on derivative instruments | ( | ( | ( | ( | |||||||||||||||||||
| Less: tax provision (benefit) | ( | ( | ( | ||||||||||||||||||||
| Net gains (losses) on derivative instruments | ( | ( | ( | ( | |||||||||||||||||||
| (Gains) losses reclassified to net income | ( | ||||||||||||||||||||||
| Less: tax (provision) benefit | ( | ||||||||||||||||||||||
| Net (gains) losses reclassified to net income | ( | ||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ( | ( | ||||||||||||||||||||
| Ending balance | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Pension and other postretirement benefits | |||||||||||||||||||||||
| Beginning balance | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive income (loss), net of tax | |||||||||||||||||||||||
| Ending balance | $ | $ | $ | $ | |||||||||||||||||||
| Total AOCI ending balance at September 30 | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Reclassifications of accumulated other comprehensive income (loss) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Derivative instruments | |||||||||||||||||||||||
Currency exchange contracts (1) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Natural gas contracts (2) | ( | ( | |||||||||||||||||||||
| Total before tax | ( | ( | ( | ||||||||||||||||||||
| (Provision) benefit for income taxes | ( | ||||||||||||||||||||||
| Amount included in net income (loss) | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
_______________
(1) Included within "Net sales" on the condensed consolidated statements of operations.
(2) Included within "Cost of sales" on the condensed consolidated statements of operations.
21
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Share Repurchases
On July 25, 2022, our Board of Directors authorized the repurchase of up to $500.0 million of our common stock (the "2022 Authorization"), and rescinded the prior outstanding repurchase authorization with respect to the shares that remained unused under the prior authorization. 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 prevailing market conditions and other factors, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended.
During the three months ended September 30, 2026, we repurchased $38.9 million, inclusive of $0.4 million in excise tax, in common stock, representing 538,979 shares of our common stock at an average cost per share of $71.45 . During the nine months ended September 30, 2026, we repurchased $126.3 million, inclusive of $1.0 million in excise tax, in common stock, representing 1,804,168 shares of our common stock at an average cost per share of $69.44 . At September 30, 2026, $172.2 million remained unused under the 2022 Authorization.
During the three and nine months ended September 30, 2025, we repurchased $25.2 0.2 445,724 56.09 328.4 million remained unused under the 2022 Authorization.
Note 11: Restructuring and Other (Income) Charges, net
Detail on the restructuring charges and other (income) charges, net, is provided below.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Restructuring charges | $ | $ | $ | $ | |||||||||||||||||||
| Other (income) charges, net | |||||||||||||||||||||||
| Total Restructuring and other (income) charges, net | $ | $ | $ | $ | |||||||||||||||||||
22
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Restructuring Charges
| In millions | Severance and other employee-related costs | Other charges (income) (1) | Asset disposal charges | Total | ||||||||||||||||||||||
Performance Chemicals repositioning (2) | $ | $ | $ | $ | ||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||
| Three Months Ended September 30, 2026 | $ | $ | $ | $ | ||||||||||||||||||||||
Performance Chemicals repositioning (2) | $ | $ | $ | $ | ||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||
| Three Months Ended September 30, 2025 | $ | $ | $ | $ | ||||||||||||||||||||||
| In millions | Severance and other employee-related costs | Other charges (income) (1) | Asset disposal charges | Total | ||||||||||||||||||||||
Performance Chemicals repositioning (2) | $ | $ | $ | $ | ||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||
| Nine Months Ended September 30, 2026 | $ | $ | $ | $ | ||||||||||||||||||||||
Performance Chemicals repositioning (2) | $ | $ | $ | $ | ||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||
| Nine Months Ended September 30, 2025 | $ | $ | $ | $ | ||||||||||||||||||||||
_______________ | ||||||||||||||||||||||||||
(1) Primarily represents costs associated with plant and equipment decommissioning charges and other miscellaneous exit costs.
Restructuring and Other (Income) Charges, net Reserves
The following table, inclusive of continuing and discontinued operations, shows a roll forward of restructuring reserves that will result in cash spending, the majority of which relate to the Performance Chemicals repositioning.
| In millions | Balance at December 31, 2025 (1) | Change in Reserve (2) | Cash Payments | Other (3) | Balance at September 30, 2026 (1) | ||||||||||||||||||||||||
| Severance and other employee-related costs | $ | ( | $ | ||||||||||||||||||||||||||
| Other charges (income) | ( | ||||||||||||||||||||||||||||
| Restructuring | ( | ||||||||||||||||||||||||||||
| Other (income) charges, net | |||||||||||||||||||||||||||||
| Restructuring and Other (income) charges, net reserves | $ | ( | $ | ||||||||||||||||||||||||||
(1) Included in "Accrued expenses" on the condensed consolidated balance sheets.
(2) Includes severance and other employee-related costs, exited leases, 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.
23
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 12: Income Taxes
The effective tax rates, including discrete items, were as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Effective tax rate (1) | % | % | % | ( | % | ||||||||||||||||||
_______________
(1) The effective tax rate for the nine months ended September 30, 2025, was impacted by the goodwill impairment charge within the APT reporting unit during the second quarter of 2025. Refer to Note 7 for more information.
We determine our interim tax provision using an Estimated Annual Effective Tax Rate methodology ("EAETR"). The EAETR is applied to the year-to-date ordinary income, exclusive of discrete items. The tax effects of discrete items are then included to arrive at the total reported interim tax provision.
The determination of the EAETR is based upon a number of estimates, including the estimated annual pre-tax ordinary income in each tax jurisdiction in which we operate. As our projections of ordinary income change throughout the year, the EAETR will change period-to-period. The tax effects of discrete items are recognized in the tax provision in the period they occur. Depending on various factors, such as the item's significance in relation to total income and the rate of tax applicable in the jurisdiction to which it relates, discrete items in any quarter may materially impact the reported effective tax rate. As a global enterprise, our tax expense may be impacted by changes in tax rates or laws, the finalization of tax audits and reviews, as well as other factors. As such, there may be significant volatility in interim tax provisions.
The table below provides a reconciliation between our reported effective tax rates and the EAETR of our continuing operations.
| Three Months Ended September 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| In millions, except percentages | Before tax | Tax | Effective tax rate % impact | Before tax | Tax | Effective tax rate % impact | |||||||||||||||||
| Continuing operations | $ | $ | % | $ | $ | % | |||||||||||||||||
| Discrete items: | |||||||||||||||||||||||
Restructuring and other (income) charges, net (1) | |||||||||||||||||||||||
(Gain) loss on sale of business (2) | |||||||||||||||||||||||
Long-lived asset impairment charge (3) | |||||||||||||||||||||||
Goodwill impairment (4) | |||||||||||||||||||||||
(Gain) loss on strategic investments (5) | |||||||||||||||||||||||
Proxy contest charges (5) | |||||||||||||||||||||||
Portfolio realignment costs (5) | |||||||||||||||||||||||
Other tax only discrete items | ( | ( | |||||||||||||||||||||
| Total discrete items | ( | ||||||||||||||||||||||
| Continuing operations, before discrete items | $ | $ | $ | $ | |||||||||||||||||||
EAETR (7) | % | % | |||||||||||||||||||||
24
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
| Nine Months Ended September 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| In millions, except percentages | Before tax | Tax | Effective tax rate % impact | Before tax | Tax | Effective tax rate % impact | |||||||||||||||||
| Continuing operations | $ | $ | % | $ | ( | $ | ( | % | |||||||||||||||
| Discrete items: | |||||||||||||||||||||||
Restructuring and other (income) charges, net (1) | |||||||||||||||||||||||
(Gain) loss on sale of business (2) | ( | ( | |||||||||||||||||||||
Long-lived asset impairment charge (3) | |||||||||||||||||||||||
Goodwill impairment (4) | |||||||||||||||||||||||
(Gain) loss on strategic investments (5) | |||||||||||||||||||||||
Impairment of license agreement (5) | |||||||||||||||||||||||
Litigation charge (6) | |||||||||||||||||||||||
Portfolio realignment costs (5) | |||||||||||||||||||||||
Proxy contest charges (5) | |||||||||||||||||||||||
| Other tax only discrete items | ( | ||||||||||||||||||||||
| Total discrete items | |||||||||||||||||||||||
| Continuing operations, before discrete items | $ | $ | $ | $ | |||||||||||||||||||
EAETR (8) | % | % | |||||||||||||||||||||
_______________
(1) Refer to Note 11 for more information.
(2) Refer to Note 16 for more information.
(3) Refer to Note 6 and Note 7 for more information.
(4) Refer to Note 7 for more information.
(5) Refer to Note 14 for more information.
(6) Refer to Note 13 for more information.
(7) Decrease in EAETR for the three months ended September 30, 2026, as compared to September 30, 2025, was due to impacts of the One Big Beautiful Bill Act (“OBBB”), which was signed into law on July 4, 2025, creating an increase in the EAETR for the three-month period in 2025, as the foreign-derived deduction-eligible income (“FDDEI”) was significantly reduced due to immediate deductibility of previously amortizable expenses.
At September 30, 2026 and December 31, 2025, we had deferred tax assets of $12.9 million and $11.8 million, respectively, resulting from certain historical net operating losses from our Brazil and U.S. state tax credits for which a valuation allowance has been established. The ultimate realization of these deferred tax assets depends on the generation of future taxable income during the periods in which these net operating losses and tax credits are available to be used. 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 September 30, 2026, we cannot objectively assert that these deferred tax assets are more likely than not to be realized and therefore we have maintained a valuation allowance. We intend to continue maintaining a valuation allowance on these deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. A release of all or a portion of the valuation allowance could be possible if we determine that sufficient positive evidence becomes available to allow us to reach a conclusion that the valuation allowance will no longer be needed. A release of 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. However, the exact timing and amount of the valuation allowance release are subject to change based on the level of profitability that we are able to actually achieve.
25
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
As a result of the OBBB signed into law in 2025, significant modifications to U.S. international tax framework became effective in 2026. Based on the analysis performed by the company, the OBBB will have an impact on the FDDEI deduction. In the absence of divestitures completed by the company as of September 30, 2026, these changes would provide a benefit to the effective tax rate, but given anticipated overall taxable losses, the FDDEI benefit is negated. Additionally, OBBB increased disallowances associated with meals and entertainment expenses, further increasing the 2026 EAETR.
During 2025, we determined that the earnings of our China subsidiaries are no longer permanently reinvested due to global trade volatility. As a result of this change, we recorded deferred tax expense of $0.6 million relating to China withholding taxes for the nine months ended September 30, 2026. With the exception of China and Belgium, the company does not currently expect to repatriate cash earnings from our foreign operations to fund U.S. operations.
Pillar Two, released by the Organisation for Economic Cooperation and Development ("OECD"), went into effect on January 1, 2024. Pillar Two's intent is to create a 15% global minimum tax for all jurisdictions in which multinational enterprises operate. To date, fourteen of our reporting jurisdictions have enacted final legislation adopting Pillar Two. While we do not anticipate that this legislation will have a material impact on our tax provision or effective tax rate, we continue to monitor evolving tax legislation in the jurisdictions in which we operate. No tax impacts of Pillar Two were recorded for the quarter ended September 30, 2026.
Note 13: Commitments and Contingencies
Legal Proceedings
On July 19, 2018, we filed suit against BASF Corporation ("BASF") in the United States District Court for the District of Delaware (the "Delaware Proceeding") alleging BASF infringed Ingevity's patent covering canister systems used in the control of automotive gasoline vapor emissions (U.S. Patent No. RE38,844) (the "844 Patent"). On February 14, 2019, BASF asserted counterclaims against us in the Delaware Proceeding, alleging two claims for violations of U.S. antitrust law (one for exclusive dealing and the other for tying) as well as a claim for tortious interference with an alleged prospective business relationship between BASF and a BASF customer (the "BASF Counterclaims"). The BASF Counterclaims relate to our enforcement of the 844 Patent and our entry into several supply agreements with customers of its fuel vapor canister honeycombs. The U.S. District Court dismissed our patent infringement claims on November 18, 2020, and the case proceeded to trial on the BASF Counterclaims in September 2021.
On September 15, 2021, a jury in the Delaware Proceeding issued a verdict in favor of BASF on the BASF Counterclaims and awarded BASF damages of approximately $28.3 million, which trebled under U.S. antitrust law to approximately $85.0 million. On May 18, 2023, the court in the Delaware Proceeding entered judgment on the jury's verdict, which commenced the post-trial briefing stage. On February 13, 2024, the court in the Delaware Proceeding denied BASF's motion for pre-judgment interest on its tortious interference claim as well as our motion seeking judgment as a matter of law, or a new trial in the alternative.
26
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 14: Segment Information
Ingevity's reportable segments are (i) Performance Materials ("PM"), (ii) Pavement Technologies ("PT"), and (iii) Advanced Polymer Technologies ("APT"). Our reportable segments were determined based upon the nature of the products produced, the nature of the production process, the type of customer for the products, the similarity of economic characteristics, and the manner in which management reviews results. Segment EBITDA is the primary measure used by the chief operating decision maker ("CODM"), the CEO and President of Ingevity, to evaluate the performance of and allocate resources among our reportable segments. The CODM utilizes Segment EBITDA for each reportable segment in the annual budgeting and forecasting process. Segment EBITDA enables the CODM to compare each business and make informed and consistent resource allocation decisions.
Industrial Specialties Divestiture
The historical industrial specialties product line that is classified as discontinued operations includes only direct operating expenses which the company is no longer incurring. Indirect costs, such as those related to corporate and segment shared service functions previously allocated to the industrial specialties product line, do not meet the criteria for discontinued operations and remain reported within continuing operations in Indirect costs allocated to Divestiture. Refer to Note 1 for more information.
Corporate and other
Effective in the fourth quarter of 2025, Corporate and other costs have been excluded from segment EBITDA. These costs are recorded within "Selling, general, and administrative expenses" on our Condensed Consolidated Statements of Operations and are associated with corporate administrative functions (e.g., executive office, corporate finance, legal, human resources) and other compliance costs to operate as a NYSE listed entity. Additionally, these costs are managed at a corporate level and not directly attributable to our reportable segments. Reporting these costs separately will provide greater transparency into our segment results and cost structure. We have recast the data below to reflect the changes in our reportable segments to conform to the current year presentation.
27
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
Segment EBITDA (1)(2) | |||||||||||||||||||||||
| Performance Materials | $ | $ | $ | $ | |||||||||||||||||||
| Pavement Technologies | |||||||||||||||||||||||
| Advanced Polymer Technologies | |||||||||||||||||||||||
Total Segment EBITDA (1)(2) | |||||||||||||||||||||||
| Interest expense, net | ( | ( | ( | ( | |||||||||||||||||||
| (Provision) benefit for income taxes on continuing operations | ( | ( | ( | ( | |||||||||||||||||||
| Depreciation and amortization | ( | ( | ( | ( | |||||||||||||||||||
Gain (loss) on sale of business (3) | ( | ||||||||||||||||||||||
Restructuring and other income (charges), net (4) | ( | ( | ( | ( | |||||||||||||||||||
Goodwill impairment charge (5) | ( | ||||||||||||||||||||||
Long-lived asset impairment charge (5) | ( | ||||||||||||||||||||||
Gain (loss) on strategic investment (6) | ( | ||||||||||||||||||||||
Impairment of license agreement (7) | ( | ||||||||||||||||||||||
Proxy contest charges (8) | ( | ||||||||||||||||||||||
Portfolio realignment costs (9) | ( | ( | ( | ( | |||||||||||||||||||
Litigation charge (10) | ( | ||||||||||||||||||||||
Corporate and other (11) | ( | ( | ( | ( | |||||||||||||||||||
Indirect costs allocated to Divestiture (12) | ( | ( | |||||||||||||||||||||
| Net income (loss) from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
_______________
(1) Segment EBITDA is defined as segment net sales less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses, research and technical expenses, other (income) expense, net, excluding depreciation and amortization). We have excluded the following items from segment EBITDA: interest expense associated with corporate debt facilities, interest income, income taxes, depreciation, amortization, gain (loss) on sale of business, restructuring and other income (charges), net, goodwill impairment charges, long-lived asset impairment charges, acquisition and other-related income (costs), gain (loss) on strategic investments, impairment of license agreement, proxy contest charges, portfolio realignment costs, pension and postretirement settlement and curtailment income (charges), net, litigation charge, indirect costs allocated to Divestiture, and Corporate and other costs.
28
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
(2) Segment expenses included within the primary measure used by our CODM are included within the below table.
| Three Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||
| In millions | PM | PT | APT | PM | PT | APT | ||||||||||||||||||||||||||||||||||||||||||||
Net sales (i) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Cost of sales (ii) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Selling, general, and administrative expenses (ii) (iii) (iv) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other (income) expense, net (v) | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||
| In millions | PM | PT | APT | PM | PT | APT | ||||||||||||||||||||||||||||||||||||||||||||
Net sales (i) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Cost of sales (ii) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Selling, general, and administrative expenses (ii) (iii) (iv) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other (income) expense, net (v) | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
_______________ | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (i) Relates to external customers only. Refer to Note 3 for a reconciliation to consolidated Net sales. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (ii) Excludes Depreciation and amortization. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (iii) Includes Research and technical expenses. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (iv) Excludes Corporate and other costs. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (v) We have excluded the following items from Other (income) expense, net: gain (loss) on sale of business, gain (loss) on strategic investments, impairment of license agreement, proxy contest charges, portfolio realignment costs, litigation charge, depreciation, and amortization. | ||||||||||||||||||||||||||||||||||||||||||||||||||
(3) The gain (loss) relates to the sale of our former Performance Chemicals' road markings product line on April 15, 2026. Refer to Note 16 for more information.
(4) The table below provides an allocation of these charges between our three reportable segments to provide investors, potential investors, securities analysts and others with the information, should they choose, to apply such (income) charges to each respective reportable segment for which the charges relate.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Performance Materials | $ | $ | $ | $ | |||||||||||||||||||
| Pavement Technologies | |||||||||||||||||||||||
| Advanced Polymer Technologies | ( | ||||||||||||||||||||||
Indirect costs allocated to Divestiture | |||||||||||||||||||||||
| Restructuring and other (income) charges, net | $ | $ | $ | $ | |||||||||||||||||||
29
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
(5) Charges relate to the Advanced Polymer Technologies reportable segment. Refer to Note 6 and Note 7 for more information.
(6) We exclude gains and losses from sales of strategic investments from our segment results because we do not consider such gains or losses to be directly associated with the operational performance of the segment. We believe that the inclusion of such gains or losses would impair the factors and trends affecting the historical financial performance of our reportable segments. We continue to include undistributed earnings or loss, distributions, amortization or accretion of basis differences, and other-than-temporary impairments for equity method investments that we believe are directly attributable to the operational performance of such investments, in our reportable segment results. Refer to Note 4, under the section: Strategic Investments, for more information. The charge relates to our Advanced Polymer Technologies reportable segment.
(7) Charge represents an impairment of a license agreement within the Performance Materials reportable segment.
(8) Charges represent legal and other professional service fees as well as incremental proxy solicitation costs related to a proxy contest.
(9) Charges represent professional service fees related to a review of the company's portfolio.
(10) Charge represents a litigation charge related to the BASF verdict. Refer to Note 13 for more information.
(11) Corporate and other costs is defined as costs associated with corporate administrative functions (e.g., executive office, corporate finance, legal, human resources) and other compliance costs to operate as a NYSE listed entity. Corporate and other costs also includes the corporate administrative functions' share of information technology, safety, health, accounting and human resource departments.
(12) Includes indirect costs previously allocated to the Divestiture that are not eligible for discontinued operations accounting treatment.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Cost of sales | $ | $ | $ | $ | |||||||||||||||||||
| Selling, general, and administrative expenses | |||||||||||||||||||||||
| Other (income) expense, net | |||||||||||||||||||||||
| Indirect costs allocated to Divestiture | $ | $ | $ | $ | |||||||||||||||||||
| Depreciation and amortization | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Performance Materials | $ | $ | $ | $ | ||||||||||||||||||||||
| Pavement Technologies | ||||||||||||||||||||||||||
| Advanced Polymer Technologies | ||||||||||||||||||||||||||
Indirect costs allocated to Divestiture (1) | ||||||||||||||||||||||||||
| Total depreciation and amortization | $ | $ | $ | $ | ||||||||||||||||||||||
_______________
(1) Includes indirect costs previously allocated to the Divestiture that are not eligible for discontinued operations accounting treatment.
| Capital expenditures | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Performance Materials | $ | $ | $ | $ | ||||||||||||||||||||||
| Pavement Technologies | ||||||||||||||||||||||||||
| Advanced Polymer Technologies | ||||||||||||||||||||||||||
| Total capital expenditures | $ | $ | $ | $ | ||||||||||||||||||||||
30
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
| Total assets | ||||||||||||||
| In millions | September 30, 2026 | December 31, 2025 | ||||||||||||
| Performance Materials | $ | $ | ||||||||||||
| Pavement Technologies | ||||||||||||||
| Advanced Polymer Technologies | ||||||||||||||
| Total segment assets | ||||||||||||||
Corporate and other (1) | ||||||||||||||
| Assets of discontinued operations | ||||||||||||||
| Total assets | $ | $ | ||||||||||||
_______________
(1) Assets not specifically managed as part of one specific segment are referred to as "Corporate and other."
Note 15: Earnings (Loss) per Share
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions (except share and per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net income (loss) from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
| Net income (loss) from discontinued operations | ( | ( | |||||||||||||||||||||
| Net income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
| Basic and Diluted earnings (loss) per share | |||||||||||||||||||||||
| Basic earnings (loss) per share from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
| Basic earnings (loss) per share from discontinued operations | ( | ( | |||||||||||||||||||||
Basic earnings (loss) per share (1) | $ | $ | $ | $ | ( | ||||||||||||||||||
| Diluted earnings (loss) per share from continuing operations | $ | $ | $ | $ | ( | ||||||||||||||||||
| Diluted earnings (loss) per share from discontinued operations | ( | ( | |||||||||||||||||||||
Diluted earnings (loss) per share (1) | $ | $ | $ | $ | ( | ||||||||||||||||||
Shares (in thousands) | |||||||||||||||||||||||
| Weighted average number of common shares outstanding - Basic | |||||||||||||||||||||||
| Weighted average additional shares assuming conversion of potential common shares | |||||||||||||||||||||||
Shares - diluted basis(2) | |||||||||||||||||||||||
_______________ | |||||||||||||||||||||||
(1) Earnings per share amounts shown for three and nine months ended September 30, 2026 and September 30, 2025, may not precisely recalculate due to rounding. | |||||||||||||||||||||||
(2) For the nine months ended September 30, 2025, all potentially dilutive common shares were excluded from the calculation of diluted earnings (loss) per share as we had a net loss from continuing operations for the period. | |||||||||||||||||||||||
31
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
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 September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In thousands | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Average number of potential common shares - antidilutive | |||||||||||||||||||||||
Note 16: Divestitures
Industrial Specialties Divestiture - Discontinued Operations
The Divestiture, as defined in Note 1, was completed on January 1, 2026. We received all-cash proceeds of $93.1 million, inclusive of traditional working capital adjustments, and recorded a gain of $54.0 million within "(Gain) loss on sale of business" within discontinued operations for the nine months ended September 30, 2026.
During the third quarter of 2025, the company determined that the industrial specialties product line and CTO Refinery included within the Divestiture met the criteria to be classified as held for sale and that the sale represents a strategic shift that will have a major effect on Ingevity's operations and results. As such, the results of operations of the industrial specialties product line are presented as discontinued operations.
Furthermore, in connection with the Divestiture, Ingevity entered into a series of agreements, including, but not limited to, (a) a transition services agreement, pursuant to which Ingevity provides certain transition services to Purchaser for up to a 12-month period following the closing to facilitate the transfer of purchased assets to Purchaser, (b) an intellectual property agreement, in perpetuity, pursuant to which Ingevity assigned and transferred certain intellectual property assets used in the Businesses (as defined in the Purchase Agreement) to Purchaser in connection with the Divestiture and received a license back to continue to exclusively utilize specified intellectual property in certain of Ingevity's remaining businesses, (c) a restrictive covenant agreement, subjecting Ingevity to a non-solicitation and limited non-compete obligation for a period of four years following the closing, (d) a ground lease agreement, with an initial term of 20 years and up to eight successive renewal terms of 10 years each, pursuant to which Ingevity leases certain real property used in the operations of the Divestiture and grants certain easements and licenses granting Purchaser the right to use portions of Ingevity's manufacturing facilities located at 5598 Virginia Avenue, North Charleston, South Carolina 29406 (the "Plant") necessary for the operation of the Divestiture, (e) a reciprocal plant operating agreement, with an initial term of 20 years and up to eight successive renewal terms of 10 years each, pursuant to which Ingevity and Purchaser provide each other with certain services and other arrangements supporting the operations of the CTO Refinery and the Plant and (f) an environmental indemnity agreement, which includes mutual indemnification rights and obligations for each party with respect to certain pre- and post-closing environmental losses that may arise, as well as an indemnity for environmental losses that may be incurred by either party under certain agreements between the parties in connection with the Divestiture.
32
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
The results of our discontinued operations are summarized below:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Selling, general, and administrative expenses | |||||||||||||||||||||||
| Research and technical expenses | |||||||||||||||||||||||
| Restructuring and other (income) charges, net | |||||||||||||||||||||||
(Gain) loss on sale of business (1)(2)(3) | ( | ||||||||||||||||||||||
| Other (income) expense, net | ( | ( | |||||||||||||||||||||
| Income (loss) from discontinued operations before income taxes | ( | ( | |||||||||||||||||||||
| Provision (benefit) for income taxes on discontinued operations | ( | ( | ( | ||||||||||||||||||||
| Income (loss) from discontinued operations, net of income taxes | $ | ( | $ | $ | $ | ( | |||||||||||||||||
(1) During the three months ended September 30, 2026, we incurred $0.2 million of customary purchase price adjustments.
(2) During the nine months ended September 30, 2026, the gain of $54.0 million is inclusive of $7.3 million of customary purchase price adjustments. These adjustments include a $4.7 million LIFO reserve adjustment, reflecting the impact of removing the divested industrial specialties product line inventory from the company's LIFO pool.
(3) In connection with the sale of our DeRidder, Louisiana facility during the nine months ended September 30, 2026, we extinguished a $7.8 million asset retirement obligation and recognized an $8.2 million guarantee, through June 30, 2027, related to certain environmental obligations assumed by the purchaser. The guarantee is included within "Accrued expenses" on the Condensed Consolidated Balance Sheet as of September 30, 2026, and the resulting $0.4 million loss was recognized within "(Gain) loss on sale of business" within discontinued operations for the nine months ended September 30, 2026.
33
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
The following table presents the major classes of assets and liabilities which represent those related to our industrial specialties product line, classified as held for sale and presented as discontinued operations:
| In millions | September 30, 2026 | December 31, 2025 | |||||||||
| Assets | (Unaudited) | (Unaudited) | |||||||||
| Accounts receivable, net | $ | $ | |||||||||
Inventories, net (1) | |||||||||||
| Current assets of discontinued operations | |||||||||||
| Property, plant, and equipment, net | |||||||||||
| Operating lease assets, net | |||||||||||
| Noncurrent assets of discontinued operations | |||||||||||
| Total Assets of discontinued operations | $ | $ | |||||||||
| Liabilities | |||||||||||
| Accrued payroll and employee benefits | $ | $ | |||||||||
| Current operating lease liabilities | |||||||||||
| Current liabilities of discontinued operations | |||||||||||
| Noncurrent operating lease liabilities | |||||||||||
| Noncurrent liabilities of discontinued operations | |||||||||||
| Total Liabilities of discontinued operations | $ | $ | |||||||||
_______________
(1) Reported net of LIFO Reserve of zero and $8.2 million for the periods ended September 30, 2026 and December 31, 2025, respectively.
The cash flows related to the discontinued operations have not been segregated and are included in the Condensed Consolidated Statements of Cash Flows. The following table presents significant cash flow and non-cash information for the Discontinued Operations:
| Nine Months Ended September 30, | ||||||||||||||
| In millions | 2026 | 2025 | ||||||||||||
| Cash provided by (used in) operating activities: | ||||||||||||||
| Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | ||||||||||||||
| Depreciation and amortization | $ | $ | ||||||||||||
| Restructuring and other (income) charges, net | ||||||||||||||
| LIFO charge (liquidation) | ( | |||||||||||||
| (Gain) loss on sale of business | ( | |||||||||||||
| Changes in operating assets and liabilities, net of effect of acquisitions and divestitures: | ||||||||||||||
| Restructuring and other cash outflow, net | ( | ( | ||||||||||||
| CTO resales cash inflow (outflow), net | ||||||||||||||
| Cash provided by (used in) investing activities: | ||||||||||||||
| Capital expenditures | $ | $ | ( | |||||||||||
34
INGEVITY CORPORATION
Notes to the Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Performance Chemicals' Road Markings Product Line Disposition
On April 15, 2026, we completed the sale of our former Performance Chemicals' road markings product line to PPG Industries Inc. (the "Disposition"). We received all-cash proceeds of $63.2 million, inclusive of preliminary traditional working capital adjustments, and recorded an incremental loss of $3.0 million for the three months ended September 30, 2026, which resulted in a gain of $5.6 million for the nine months ended September 30, 2026. Amounts were recorded within "Other (income) expense, net" on the Condensed Consolidated Statement of Operations.
35
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Introduction
Management's discussion and analysis of Ingevity Corporation's ("Ingevity," "the company," "we," "us," or "our") financial condition and results of operations ("MD&A") is provided as a supplement to the Condensed Consolidated Financial Statements and related notes included elsewhere herein to help provide an understanding of our financial condition, changes in financial condition and results of our operations. The following discussion should be read in conjunction with Ingevity's consolidated financial statements as of and for the year ended December 31, 2025, filed on February 26, 2026, with the Securities and Exchange Commission ("SEC") as part of the company's Annual Report on Form 10-K ("2025 Annual Report") and the unaudited interim Condensed Consolidated Financial Statements and notes to the unaudited interim Condensed Consolidated Financial Statements, which are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").
All references to notes (herein referred to as "Note") in this section refer to the notes accompanying the Condensed Consolidated Financial Statements included in Item 1 within this Form 10-Q.
Investors are cautioned that the forward-looking statements contained in this section and other parts of this Quarterly Report on Form 10-Q involve both risk and uncertainty. Several important factors could cause actual results to differ materially from those anticipated by these statements. Many of these statements are macroeconomic in nature and are, therefore, beyond the control of management. See "Cautionary Statements Regarding Forward-Looking Statements" below and at the beginning of our 2025 Annual Report.
Unless otherwise indicated, the information in MD&A refers only to our continuing operations. Refer to Notes 1 and 16 for more information.
Cautionary Statements Regarding Forward-Looking Statements
This section and other parts of this Quarterly Report on Form 10-Q contain forward-looking statements, within the meaning of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Private Securities Litigation Reform Act of 1995 that reflect our current expectations, beliefs, plans or forecasts with respect to, among other things, future events and financial performance. Forward-looking statements are often characterized by words or phrases such as "may," "will," "could," "should," "would," "anticipate," "estimate," "expect," "outlook," "project," "intend," "plan," "believe," "target," "prospects," "potential," and "forecast," and other words, terms and phrases of similar meaning. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. We caution readers that a forward-looking statement is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statement. Such risks and uncertainties include, among others, those discussed in Part I, Item 1A. Risk Factors of our 2025 Annual Report, as well as in our unaudited Condensed Consolidated Financial Statements, related notes, and the other information appearing elsewhere in this report and our other filings with the SEC. We do not intend, and undertake no obligation, to update any of our forward-looking statements after the date of this report to reflect actual results or future events or circumstances. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein, risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied by the forward-looking statements include, but are not limited to the following:
•our review of strategic alternatives for the Advanced Polymer Technologies ("APT") segment may not result in a transaction;
•any transaction we enter into, including the sale of our road markings product line and our North Charleston crude tall oil ("CTO") refinery assets and the majority of our former Performance Chemicals industrial specialties product line, may not yield the expected results or benefits;
•if the review of strategic alternatives for APT results in a transaction, we may be adversely impacted if we are unable to adjust our costs and operating structure to reflect the requirements of the business after giving effect to such transaction;
•we may be adversely affected by general global economic, geopolitical, and financial conditions beyond our control, including inflation, the Russia-Ukraine war, and the conflict in the Middle East;
36
•leadership transitions within our organization;
•we are exposed to risks related to our international sales and operations, including recent changes in tariffs and trade policies;
•adverse conditions in the automotive market have and may continue to negatively impact demand for our automotive carbon products;
•if more stringent air quality standards worldwide are not adopted, our growth could be impacted;
•we face competition from substitute products, new technologies, and new or emerging competitors;
•we may be adversely affected by a decrease in government infrastructure spending;
•adverse conditions in cyclical end markets may continue to adversely affect demand for our products;
•lack of access to raw materials upon which we depend would impact our ability to produce our products;
•the inability to make or effectively integrate future acquisitions and other investments may negatively affect our results;
•we are dependent upon third parties for the provision of certain critical operating services at several of our plants;
•we may be adversely affected by disruptions in our supply chain;
•the occurrence of natural disasters and extreme weather or other unanticipated problems such as labor difficulties (including work stoppages), equipment failure, or unscheduled maintenance and repair, which could result in operational disruptions of varied duration;
•we are dependent upon attracting and retaining key personnel;
•we are dependent on certain large customers;
•from time to time, we are and may be engaged in legal actions associated with our intellectual property rights;
•if we are unable to protect our intellectual property and other proprietary information, we may lose significant competitive advantage;
•information technology security breaches and other disruptions;
•government policies and regulations, including, but not limited to, those affecting the environment, climate change, tax policies, tariffs, the chemicals industry and subsidies or incentives that may impact key raw materials or products may adversely affect financial results; and
•losses due to lawsuits arising out of environmental damage or personal injuries associated with chemical or other manufacturing processes.
Overview
Ingevity Corporation provides products and technologies that purify, protect, and enhance the world around us. 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 automotive gasoline vapor emissions control systems, food, water and chemical filtration, asphalt paving, agrochemical dispersants, bioplastics, coatings, and elastomers. We operate in three reportable segments: Performance Materials, Pavement Technologies and Advanced Polymer Technologies.
Recent Developments and Updates
Performance Chemicals' Road Markings Product Line Disposition
On April 15, 2026, we completed the sale of our former Performance Chemicals' road markings product line to PPG Industries Inc. (the "Disposition"). We received all-cash proceeds of $63.2 million, inclusive of preliminary traditional working capital adjustments, and recorded an incremental loss of $3.0 million for the three months ended September 30, 2026, which resulted in a gain of $5.6 million for the nine months ended September 30, 2026. Amounts were recorded within "Other (income) expense, net" on the Condensed Consolidated Statement of Operations.
The transaction did not represent a strategic shift in the company's future operations and financial results and therefore is not presented as a discontinued operation.
37
Results of Operations
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net sales | $ | 305.1 | $ | 333.1 | $ | 877.2 | $ | 912.5 | |||||||||||||||
| Cost of sales | 172.3 | 199.2 | 489.0 | 538.9 | |||||||||||||||||||
| Gross profit | 132.8 | 133.9 | 388.2 | 373.6 | |||||||||||||||||||
| Selling, general, and administrative expenses | 38.1 | 44.1 | 117.8 | 129.6 | |||||||||||||||||||
| Research and technical expenses | 8.3 | 7.0 | 21.1 | 21.0 | |||||||||||||||||||
| Restructuring and other (income) charges, net | 0.2 | 1.0 | 2.4 | 10.1 | |||||||||||||||||||
Goodwill impairment charge (1) | — | — | — | 183.8 | |||||||||||||||||||
Long-lived asset impairment charge (2) | — | — | 32.1 | — | |||||||||||||||||||
| Other (income) expense, net | 3.8 | 1.2 | 21.4 | 9.5 | |||||||||||||||||||
| Interest expense, net | 13.5 | 18.4 | 43.6 | 56.4 | |||||||||||||||||||
| Income (loss) from continuing operations before income taxes | 68.9 | 62.2 | 149.8 | (36.8) | |||||||||||||||||||
| Provision (benefit) for income taxes on continuing operations | 17.8 | 21.4 | 35.5 | 34.7 | |||||||||||||||||||
| Net income (loss) from continuing operations | 51.1 | 40.8 | 114.3 | (71.5) | |||||||||||||||||||
| Income (loss) from discontinued operations, net of income taxes | (1.8) | 2.7 | 30.1 | (11.0) | |||||||||||||||||||
| Net income (loss) | $ | 49.3 | $ | 43.5 | $ | 144.4 | $ | (82.5) | |||||||||||||||
(1) Refer to Note 7 for more information.
(2) Refer to Note 6 and 7 for more information.
Q3 2026 Performance Summary
Net sales decreased eight percent from the prior year, driven by our former Performance Chemicals' road markings product line disposition on April 15, 2026. Excluding the road markings disposition, sales increased two percent from the prior year driven by higher pricing and favorable mix across the portfolio, partially offset by lower volumes in Performance Materials and Pavement Technologies.
Net sales
The table below shows the 2026 Net sales and variances from 2025:
| Change vs. prior year | |||||||||||||||||||||||||||||
| In millions | Prior year Net sales | Volume | Price/Mix | Currency effect | Current year Net sales | ||||||||||||||||||||||||
Three months ended September 30, 2026 vs. 2025 | $ | 333.1 | (40.4) | 12.8 | (0.4) | $ | 305.1 | ||||||||||||||||||||||
Nine months ended September 30, 2026 vs. 2025 | $ | 912.5 | (68.2) | 29.3 | 3.6 | $ | 877.2 | ||||||||||||||||||||||
Three Months Ended September 30, 2026 vs. 2025
The Net sales decrease of $28.0 million in 2026 was driven by a volume decrease of $40.4 million (twelve percent) and unfavorable foreign currency exchange of $0.4 million (zero percent), partially offset by favorable pricing and sales mix of $12.8 million (four percent).
38
Nine Months Ended September 30, 2026 vs. 2025
The Net sales decrease of $35.3 million in 2026 was driven by a volume decrease of $68.2 million (seven percent), partially offset by favorable pricing and sales mix of $29.3 million (three percent) and favorable foreign currency exchange of $3.6 million (zero percent).
Gross Profit
Three Months Ended September 30, 2026 vs. 2025
The gross profit decrease of $1.1 million in 2026 was driven by unfavorable sales volume of $8.0 million and increased manufacturing costs of $6.5 million. This decrease was partially offset by favorable pricing and sales mix of $12.8 million and favorable foreign currency exchange of $0.6 million.
Nine Months Ended September 30, 2026 vs. 2025
The gross profit increase of $14.6 million in 2026 was driven by favorable pricing and sales mix of $29.3 million. This increase was partially offset by increased manufacturing costs of $1.4 million, unfavorable sales volume of $12.4 million, and unfavorable foreign currency exchange of $0.9 million.
Selling, general and administrative expenses
Three Months Ended September 30, 2026 vs. 2025
SG&A was $38.1 million (12 percent of Net sales) and $44.1 million (13 percent of Net sales) for the three months ended September 30, 2026 and 2025, respectively. Overall, SG&A decreased by $6.0 million (14 percent), driven by decreased intangible amortization expense of $3.9 million, decreased spending on commercial activities of $0.2 million, and decreased variable incentive compensation of $1.9 million.
Nine Months Ended September 30, 2026 vs. 2025
SG&A was $117.8 million (13 percent of Net sales) and $129.6 million (14 percent of Net sales) for the nine months ended September 30, 2026 and 2025, respectively. Overall, SG&A decreased by $11.8 million (nine percent), driven by decreased intangible amortization expense of $9.5 million, decreased spending on commercial activities of $1.8 million, and decreased variable incentive compensation of $0.5 million.
Research and technical expenses
Three Months Ended September 30, 2026 vs. 2025
Research and technical expenses as a percentage of Net sales remained relatively consistent period over period, totaling 2.7 percent and 2.1 percent for the three months ended September 30, 2026 and 2025, respectively. Overall, Research and technical expenses increased by $1.3 million, compared to the prior year, primarily driven by an increased investment within our Performance Materials reportable segment.
Nine Months Ended September 30, 2026 vs. 2025
Research and technical expenses as a percentage of Net sales remained relatively consistent period over period, totaling 2.4 percent and 2.3 percent for the nine months ended September 30, 2026 and 2025, respectively. Overall, Research and technical expenses increased by $0.1 million, compared to the prior year.
39
Restructuring and other (income) charges, net
Three and Nine Months Ended September 30, 2026 vs. 2025
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Work force reductions and other | $ | 0.2 | $ | 0.3 | $ | 1.2 | $ | 8.0 | |||||||||||||||
| Performance Chemicals repositioning | — | 0.7 | 1.2 | 2.1 | |||||||||||||||||||
| Restructuring charges | $ | 0.2 | $ | 1.0 | $ | 2.4 | $ | 10.1 | |||||||||||||||
| Other (income) charges, net | — | — | — | — | |||||||||||||||||||
Restructuring and other (income) charges, net (1) | $ | 0.2 | $ | 1.0 | $ | 2.4 | $ | 10.1 | |||||||||||||||
_______________ | |||||||||||||||||||||||
(1) Refer to Note 11 for more information. | |||||||||||||||||||||||
Other (income) expense, net
Three and Nine Months Ended September 30, 2026 vs. 2025
_______________
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Foreign currency transaction (gain) loss | $ | — | $ | 0.2 | $ | 0.4 | $ | (1.3) | |||||||||||||||
Litigation charge (1) | — | — | 16.2 | — | |||||||||||||||||||
Impairment of license agreement (2) | — | — | 2.8 | — | |||||||||||||||||||
(Gain) loss on sale of strategic investment (2) | — | — | — | 2.5 | |||||||||||||||||||
Proxy contest charges (2) | — | — | — | 8.2 | |||||||||||||||||||
Portfolio realignment costs (2) | 1.5 | 1.1 | 7.6 | 1.1 | |||||||||||||||||||
(Gain) loss on sale of business (3) | 3.0 | — | (5.6) | — | |||||||||||||||||||
| Other (income) expense, net | (0.7) | (0.1) | — | (1.0) | |||||||||||||||||||
| Total Other (income) expense, net | $ | 3.8 | $ | 1.2 | $ | 21.4 | $ | 9.5 | |||||||||||||||
(1) Refer to Note 13 for more information.
(2) Refer to Note 14 for more information.
(3) Refer to Note 16 for more information.
40
Interest expense, net
Three and Nine Months Ended September 30, 2026 vs. 2025
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
Accounts receivable securitization (1) | $ | 0.8 | $ | 1.3 | $ | 1.9 | $ | 3.1 | |||||||||||||||
Finance lease obligations (1) | 1.8 | 1.8 | 5.4 | 5.4 | |||||||||||||||||||
Interest rate swap (2) | — | (0.2) | 0.2 | (0.7) | |||||||||||||||||||
Litigation related interest expense (3) | — | 1.4 | 2.0 | 3.9 | |||||||||||||||||||
Revolving Credit Facility and other lines of credit (1) | 6.6 | 9.5 | 21.0 | 31.2 | |||||||||||||||||||
Senior notes (1) | 5.6 | 5.6 | 16.8 | 16.8 | |||||||||||||||||||
| Other interest (income) expense, net | (1.3) | (1.0) | (3.7) | (3.3) | |||||||||||||||||||
| Total Interest expense, net | $ | 13.5 | $ | 18.4 | $ | 43.6 | $ | 56.4 | |||||||||||||||
_______________
(1) Refer to Note 9 for more information.
(2) Refer to Note 8 for more information.
(3) Refer to Note 13 for more information.
Provision (benefit) for income taxes on continuing operations
Three and Nine Months Ended September 30, 2026 vs. 2025
For the three months ended September 30, 2026 and 2025, our effective tax rate was 25.8% and 34.4%, respectively. Excluding discrete items, the effective rate was 25.3% compared to 31.6% in the three months ended September 30, 2026 and 2025, respectively. Refer to Note 12 for more information.
For the nine months ended September 30, 2026 and 2025, our effective tax rate was 23.7% and (94.3)%, respectively. Excluding discrete items, the effective rate was 25.7% compared to 25.4% in the nine months ended September 30, 2026 and 2025, respectively. Refer to Note 12 for more information.
Income (loss) from discontinued operations, net of income taxes
Three and Nine Months Ended September 30, 2026 vs. 2025
Income (loss) from discontinued operations, net of income taxes was $(1.8) million and $30.1 million for the three and nine months ended September 30, 2026, respectively. Income (loss) from discontinued operations, net of income taxes was $2.7 million and $(11.0) million for the three and nine months ended September 30, 2025, respectively. For the nine months ended September 30, 2026, the increase was driven by the gain on sale. Refer to Note 16 for more information.
Segment Operating Results
In addition to the information discussed above, the following sections discuss the results of operations for Ingevity's reportable segments. Our segments are (i) Performance Materials, (ii) Pavement Technologies and (iii) Advanced Polymer Technologies. Segment Earnings before Interest, Taxes, Depreciation and Amortization ("EBITDA") is the primary measure used by the company's chief operating decision maker to evaluate the performance of and allocate resources among our reportable segments. Segment EBITDA is defined as segment net sales less segment operating expenses (segment operating expenses consist of costs of sales, selling, general and administrative expenses, research and technical expenses, other (income) expense, net, excluding depreciation and amortization). We have excluded the following items from segment EBITDA: interest expense associated with corporate debt facilities, interest income, income taxes, depreciation, amortization, restructuring and other income (charges), net, gain (loss) on sale of business, goodwill impairment charges, long-lived asset impairment charges, acquisition and other-related income (costs), gain (loss) on strategic investments, impairment of license agreement, proxy contest charges, portfolio realignment costs, pension and postretirement settlement and curtailment income (charges), net, litigation charge, indirect costs allocated to Divestiture, and Corporate and other costs.
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In general, the accounting policies of the segments are the same as those described in the Summary of Significant Accounting Policies in the Annual Consolidated Financial Statements included in our 2025 Annual Report.
Performance Materials
Q3 2026 Performance Summary
Performance Materials Net sales were strong and nearly flat, decreasing less than one percent to $154.1 million driven by lower volumes from softness in automotive applications in China and Europe, offset by resilient North American automotive demand, supported by continued consumer preference for hybrid vehicles, and higher non-auto filtration sales driven primarily by pricing. Segment EBITDA decreased to $83.4 million as pricing actions, non-auto filtration growth and strong manufacturing performance were offset by lower volumes and higher SG&A. Segment EBITDA margin remained strong and stable at 54.1%, consistent with the prior year, demonstrating the resilient earnings power of the segment.
| In millions | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Performance Materials - Net sales | $ | 154.1 | $ | 155.0 | $ | 470.1 | $ | 455.7 | |||||||||||||||
| Segment EBITDA | $ | 83.4 | $ | 83.8 | $ | 261.5 | $ | 248.3 | |||||||||||||||
Net Sales Comparison of Three and Nine Months Ended September 30, 2026 and September 30, 2025:
| Change vs. prior year | |||||||||||||||||||||||||||||
In millions | Prior year Net sales | Volume | Price/Mix | Currency effect | Current year Net sales | ||||||||||||||||||||||||
Three months ended September 30, 2026 vs. 2025 | $ | 155.0 | (6.7) | 5.4 | 0.4 | $ | 154.1 | ||||||||||||||||||||||
Nine months ended September 30, 2026 vs. 2025 | $ | 455.7 | (1.3) | 14.3 | 1.4 | $ | 470.1 | ||||||||||||||||||||||
Three Months Ended September 30, 2026 vs. 2025
Segment net sales. The decrease of $0.9 million in 2026 was driven by a volume decline of $6.7 million (four percent), partially offset by favorable pricing and sales mix of $5.4 million (three percent) and favorable foreign currency exchange of $0.4 million (zero percent).
Segment EBITDA. The decrease of $0.4 million in 2026 was driven by volume decline of $5.0 million, increased SG&A and research and technical expenses of $3.0 million, and unfavorable foreign currency exchange and other charges of $0.5 million. The decrease was partially offset by favorable pricing and sales mix of $5.4 million and decreased manufacturing costs of $2.7 million.
Nine Months Ended September 30, 2026 vs. 2025
Segment net sales. The increase of $14.4 million in 2026 was driven by favorable pricing and sales mix of $14.3 million (three percent) and favorable foreign currency exchange of $1.4 million (zero percent). The increase was partially offset by volume decline of $1.3 million (zero percent).
Segment EBITDA. The increase of $13.2 million in 2026 was driven by favorable pricing and sales mix of $14.3 million and decreased manufacturing costs of $8.3 million. The increase was partially offset by volume decline of $0.5 million, increased SG&A and research and technical expenses of $6.6 million, and unfavorable foreign currency exchange and other charges of $2.3 million.
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Pavement Technologies
Q3 2026 Performance Summary
Pavement Technologies Net sales declined 24 percent to $106.0 million, primarily due to the April 15, 2026 divestiture of our former Performance Chemicals' road markings product line. Excluding the divestiture, Net sales increased one percent, as higher prices offset softer demand. Persistently higher asphalt costs, driven by crude oil inflation, continued to increase project costs for our customers, pressuring demand and limiting sales growth. Segment EBITDA was $19.6 million, down $7.3 million, reflecting lower volumes, the retention of dis-synergy costs largely due to the divestiture of road markings, as well as higher input and logistics costs. Segment EBITDA margin was 18.5% compared to 19.2% in the prior year.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Pavement Technologies - Net sales | $ | 106.0 | $ | 139.9 | $ | 268.5 | $ | 333.1 | |||||||||||||||
| Segment EBITDA | $ | 19.6 | $ | 26.9 | $ | 45.6 | $ | 61.5 | |||||||||||||||
Net Sales Comparison of Three and Nine Months Ended September 30, 2026 and September 30, 2025:
| Change vs. prior year | |||||||||||||||||||||||||||||||||||
In millions | Prior year Net sales | Volume | Price/Mix | Currency effect | Current year Net sales | ||||||||||||||||||||||||||||||
Three months ended September 30, 2026 vs. 2025 | $ | 139.9 | (35.2) | 1.6 | (0.3) | $ | 106.0 | ||||||||||||||||||||||||||||
Nine months ended September 30, 2026 vs. 2025 | $ | 333.1 | (69.9) | 5.1 | 0.2 | $ | 268.5 | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2026 vs. 2025
Segment net sales. The decrease of $33.9 million in 2026 was driven by a volume decline of $35.2 million (25 percent), as a result of a decrease in our divested road markings product line ($35.0 million), and unfavorable foreign currency exchange of $0.3 million (zero percent). The overall decrease was partially offset by favorable pricing and sales mix of $1.6 million (one percent) within Pavement Technologies.
Segment EBITDA. The decrease of $7.3 million in 2026 was driven by a volume decline of $3.5 million and increased manufacturing costs of $5.9 million. The decrease was partially offset by favorable foreign currency exchange and other charges of $0.3 million, favorable pricing and sales mix of $1.6 million, and decreased SG&A expenses of $0.2 million.
Nine Months Ended September 30, 2026 vs. 2025
Segment net sales. The decrease of $64.6 million in 2026 was driven by a volume decline of $69.9 million (21 percent), as a result of a decrease in our divested road markings product line ($69.1 million). The decrease was partially offset by favorable pricing and sales mix of $5.1 million (two percent) within Pavement Technologies, and favorable foreign currency exchange of $0.2 million (zero percent).
Segment EBITDA. The decrease of $15.9 million in 2026 was driven by a volume decline of $12.9 million, increased manufacturing costs of $8.6 million, and unfavorable foreign currency exchange and other charges of $0.4 million. The decrease was partially offset by favorable pricing and sales mix of $5.1 million, and decreased SG&A expenses of $0.9 million.
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Advanced Polymer Technologies
Q3 2026 Performance Summary
Advanced Polymer Technologies Net sales increased 18 percent to $45.0 million driven by higher pricing, including a price surcharge to offset increased input costs, and favorable mix toward higher-value derivative products. Segment EBITDA for the quarter increased $0.7 million to $11.7 million, primarily driven by the favorable product mix and higher pricing, partially offset by higher input costs. Segment EBITDA margin was 26.0%, down 280 basis points, as pricing surcharges helped to recover higher input costs, but carried little to no incremental margin.
| In millions | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Advanced Polymer Technologies - Net sales | $ | 45.0 | $ | 38.2 | $ | 138.6 | $ | 123.7 | |||||||||||||||
| Segment EBITDA | $ | 11.7 | $ | 11.0 | $ | 30.5 | $ | 26.6 | |||||||||||||||
Net Sales Comparison of Three and Nine Months Ended September 30, 2026 and September 30, 2025:
| Change vs. prior year | |||||||||||||||||||||||||||||
In millions | Prior year Net sales | Volume | Price/Mix | Currency effect | Current year Net sales | ||||||||||||||||||||||||
Three months ended September 30, 2026 vs. 2025 | $ | 38.2 | 1.5 | 5.8 | (0.5) | $ | 45.0 | ||||||||||||||||||||||
Nine months ended September 30, 2026 vs. 2025 | $ | 123.7 | 3.0 | 9.9 | 2.0 | $ | 138.6 | ||||||||||||||||||||||
Three Months Ended September 30, 2026 vs. 2025
Segment net sales. The increase of $6.8 million in 2026 was driven by favorable pricing and sales mix of $5.8 million (15 percent) and volume growth of $1.5 million (four percent). This increase was partially offset by unfavorable foreign currency exchange of $0.5 million (one percent).
Segment EBITDA. The increase of $0.7 million in 2026 was driven by favorable pricing and sales mix of $5.8 million, lower SG&A of $0.5 million, and volume growth of $0.5 million. The increase was partially offset by increased manufacturing costs of $6.1 million.
Nine Months Ended September 30, 2026 vs. 2025
Segment net sales. The increase of $14.9 million in 2026 was driven by favorable pricing and sales mix of $9.9 million (eight percent), favorable foreign currency exchange of $2.0 million (two percent), and volume growth of $3.0 million (two percent).
Segment EBITDA. The increase of $3.9 million in 2026 was driven by favorable pricing and sales mix of $9.9 million, lower SG&A of $1.3 million, and volume growth of $1.0 million. The increase was partially offset by increased manufacturing costs of $8.0 million, and unfavorable foreign currency exchange and other charges of $0.3 million.
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Use of Non-GAAP Financial Measures - Adjusted EBITDA from continuing operations
Ingevity has presented the financial measure, Adjusted EBITDA from continuing operations, defined below, which has not been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and has provided a reconciliation to net income, the most directly comparable financial measure calculated in accordance with GAAP. This measure is not meant to be considered in isolation nor as a substitute for the most directly comparable financial measure calculated in accordance with GAAP. Adjusted EBITDA from continuing operations is utilized by management as a measure of profitability.
We believe this non-GAAP financial measure provides management as well as investors, potential investors, securities analysts, and others with useful information to evaluate the performance of the business, because such measure, when viewed together with our financial results computed in accordance with GAAP, provides a more complete understanding of the factors and trends affecting our historical financial performance and projected future results. We believe this measure is useful because it excludes the effects of financing and investment activities as well as non-operating activities.
Adjusted EBITDA from continuing operations is defined as net income (loss) from continuing operations plus interest expense, net, provision (benefit) for income taxes, depreciation, amortization, restructuring and other (income) charges, net, goodwill impairment charges, long-lived asset impairment charges, gain (loss) on sale of business, acquisition and other-related (income) costs, litigation charge, (gain) loss on strategic investments, impairment of license agreement, proxy contest charges, portfolio realignment costs, and pension and postretirement settlement and curtailment (income) charges, net.
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This non-GAAP measure is not intended to replace the presentation of financial results in accordance with GAAP and investors should consider the limitations associated with this non-GAAP measure, including the potential lack of comparability of this measure from one company to another. A reconciliation is set forth within this section.
Reconciliation of Net Income (Loss) from Continuing Operations (GAAP) to Adjusted EBITDA from Continuing Operations (Non-GAAP) | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| In millions | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
Net income (loss) from continuing operations (GAAP) | $ | 51.1 | $ | 40.8 | $ | 114.3 | $ | (71.5) | |||||||||||||||
| Interest expense, net | 13.5 | 18.4 | 43.6 | 56.4 | |||||||||||||||||||
| Provision (benefit) for income taxes on continuing operations | 17.8 | 21.4 | 35.5 | 34.7 | |||||||||||||||||||
Depreciation and amortization (1) | 20.9 | 27.7 | 65.6 | 77.4 | |||||||||||||||||||
Restructuring and other (income) charges, net (2) | 0.2 | 1.0 | 2.4 | 10.1 | |||||||||||||||||||
Goodwill impairment charge (3) | — | — | — | 183.8 | |||||||||||||||||||
Long-lived asset impairment charge (4) | — | — | 32.1 | — | |||||||||||||||||||
(Gain) loss on sale of business (1) | 3.0 | — | (5.6) | — | |||||||||||||||||||
Litigation charge (5) | — | — | 16.2 | — | |||||||||||||||||||
Impairment of license agreement (1) | — | — | 2.8 | — | |||||||||||||||||||
(Gain) loss on strategic investment (1) | — | — | — | 2.5 | |||||||||||||||||||
Proxy contest charges (1) | — | — | — | 8.2 | |||||||||||||||||||
Portfolio realignment costs (6) | 1.5 | 1.1 | 7.6 | 1.1 | |||||||||||||||||||
Adjusted EBITDA from continuing operations (Non-GAAP) | $ | 108.0 | $ | 110.4 | $ | 314.5 | $ | 302.7 | |||||||||||||||
_______________
(1) Refer to Note 14 for more information.
(2) We regularly perform strategic reviews and assess the return on our operations, which sometimes results in a plan to restructure the business. These costs are excluded from our reportable segment results and for the purposes of calculating our non-GAAP financial performance measures. Refer to Note 11 for more information.
(3) Refer to Note 7 for more information.
(4) Refer to Note 6 and Note 7 for more information.
(5) Refer to Note 13 for more information.
(6) Charges represent professional service fees related to a review of the company's portfolio.
Adjusted EBITDA from continuing operations
Three and Nine Months Ended September 30, 2026 vs. 2025
Adjusted EBITDA from continuing operations is the sum of the EBITDA of all reportable segments, less the indirect costs allocated to Divestiture, and Corporate and other costs, and as such, the factors that impacted adjusted EBITDA from continuing operations period to period are the same factors that affected earnings discussed in the Results of Operations and Segment Operating Results sections included within this MD&A.
Current Full Year Company Outlook vs. Prior Year
We are narrowing our full-year adjusted EBITDA outlook, while maintaining the midpoint of the prior range, supported by solid year-to-date performance and increased visibility into expected results for the remainder of the year. Our outlook includes a full year of operating results from the Advanced Polymer Technologies reportable segment and excludes contributions from the divested industrial specialties product line, effective January 1, 2026, and the road markings product line beginning April 15, 2026.
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Net sales are expected to be approximately $1.1 billion for 2026. We expect Net sales in our Performance Materials reportable segment to grow low-single digits as increased pricing on certain products partially offsets the forecasted decline in global automotive production for Internal Combustion Engine ("ICE") powertrains compared to the prior year. We expect Net sales in our Pavement Technologies reportable segment, excluding the divested road markings product line beginning April 15, 2026, to grow low-single digits, reflecting demand softness from higher asphalt costs. For our Advanced Polymer Technologies reportable segment, we expect Net sales to grow low-double digits with low-single digit volume growth, reflecting the benefit of price surcharges implemented in the second and third quarters of 2026 in response to higher raw materials costs.
Adjusted EBITDA is expected to be between $385 million and $395 million for 2026. We expect our Performance Materials reportable segment to maintain segment EBITDA margins around mid-50 percent, as revenue growth is partially offset by investments in selective growth opportunities. In our Pavement Technologies reportable segment, we expect segment EBITDA margins in the mid-teens, reflecting higher input and logistics costs and the burden of dis-synergy from the divested road markings product line. We anticipate that our Advanced Polymer Technologies reportable segment EBITDA will improve versus prior year driven by volume growth, while maintaining segment EBITDA margins of around 20 percent. Corporate and other costs are expected to be consistent with 2025.
The divestitures of the industrial specialties and road markings product lines resulted in approximately $20 million of stranded costs caused by dis-synergies of scale. We expect to achieve run rate savings of approximately 75% of these costs by the end of 2026. Through the third quarter of 2026, we have eliminated on an annualized run-rate basis, approximately 65% of these costs.
Our effective tax rate is expected to be between 22 and 24 percent. We expect to recognize between $80 million and $90 million of depreciation and amortization, reflecting the divested road markings product line and asset impairments recognized in the second quarter of 2026.
A reconciliation of net income from continuing operations, to adjusted EBITDA from continuing operations, as projected for 2026 is not provided. Ingevity does not forecast net income as it cannot, without unreasonable effort, estimate or predict with certainty various components of net income. These components, net of tax, include further restructuring and other income (charges), net; additional acquisition and other-related income (costs); additional pension and postretirement settlement and curtailment (income) charges; and revisions due to legislative tax rate changes. Additionally, discrete tax items could drive variability in our projected effective tax rate. All of these components could significantly impact such financial measures. Further, in the future, other items with similar characteristics to those currently included in adjusted EBITDA from continuing operations, that have a similar impact on comparability of periods, and which are not known at this time, may exist and impact adjusted EBITDA from continuing operations.
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Liquidity and Capital Resources
The primary source of liquidity for our business is the cash flow provided by operating activities. We expect our cash flow provided by operations combined with cash on hand and available capacity under our revolving credit facility to be sufficient to fund our planned operations and meet our interest and other contractual obligations for at least the next twelve months. As of September 30, 2026, our undrawn capacity under our revolving credit facility was $312.8 million. Over the next twelve months, we expect to fund the following: debt principal repayments, interest payments, capital expenditures, income tax payments, purchases pursuant to our stock repurchase program (and related excise tax payments), and restructuring activities. In addition, we may also evaluate and consider strategic investments, joint ventures, or other transactions to create stockholder value and enhance financial performance. In connection with such transactions, or to fund other anticipated uses of cash, we may modify our existing revolving credit facility, redeem all or part of our outstanding senior notes, seek additional debt financing, issue equity securities, or some combination thereof.
Cash and cash equivalents totaled $85.4 million at September 30, 2026. We continuously monitor deposit concentrations and the credit quality of the financial institutions that hold our cash and cash equivalents, as well as the credit quality of our insurance providers, customers, and key suppliers.
Due to the global nature of our operations, a portion of our cash is held outside the U.S. The cash and cash equivalents balance at September 30, 2026 included $81.1 million held by our foreign subsidiaries. Cash and earnings of our foreign subsidiaries are generally used to finance our foreign operations and their capital expenditures. At December 31, 2025, we determined that the earnings of some of our subsidiaries are no longer permanently reinvested due to global volatility. We believe that our foreign holdings of cash will not have a material adverse impact on our U.S. liquidity. If these earnings were distributed, such amounts could be subject to U.S. federal income tax at the statutory rate less the available foreign tax credits, if any, and could potentially be subject to withholding taxes in the various jurisdictions. The potential tax implications of the repatriation of unremitted earnings are driven by facts at the time of distribution, therefore, it is not practicable to estimate the income tax liabilities that might be incurred if such cash and earnings were repatriated to the U.S. Refer to Note 12 for more information.
Debt and Finance Lease Obligations
Refer to Note 9 for a summary of our outstanding debt obligations and revolving credit facility.
Other Potential Liquidity Needs
Share Repurchases
On July 25, 2022, our Board of Directors authorized the repurchase of up to $500.0 million of our common stock (the "2022 Authorization"), and rescinded the prior outstanding repurchase authorization with respect to the shares that remained unused under the prior authorization. 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 prevailing market conditions and other factors, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Exchange Act.
During the three months ended September 30, 2026, we repurchased $38.9 million, inclusive of $0.4 million in excise tax, in common stock, representing 538,979 shares of our common stock at an average cost per share of $71.45. During the nine months ended September 30, 2026, we repurchased $126.3 million, inclusive of $1.0 million in excise tax, in common stock, representing 1,804,168 shares of our common stock at an average cost per share of $69.44. At September 30, 2026, $172.2 million remained unused under the 2022 Authorization.
During the three and nine months ended September 30, 2025, we repurchased $25.2 million, inclusive of $0.2 million in excise tax, in common stock, representing 445,724 shares of our common stock at an average cost per share of $56.09. At September 30, 2025, $328.4 million remained unused under the 2022 Authorization.
Capital Expenditures
Projected 2026 capital expenditures are expected to be between $50 and $60 million. We have no material commitments associated with these projected capital expenditures as of September 30, 2026.
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Cash flow comparison of the Nine Months Ended September 30, 2026 and 2025
| Nine Months Ended September 30, | |||||||||||
| In millions | 2026 | 2025 | |||||||||
| Net cash provided by (used in) operating activities | $ | 83.4 | $ | 234.1 | |||||||
| Net cash provided by (used in) investing activities | $ | 170.5 | $ | (42.4) | |||||||
| Net cash provided by (used in) financing activities | $ | (193.1) | $ | (168.8) | |||||||
Cash flows provided by (used in) operating activities
Cash provided by operating activities, inclusive of continuing and discontinued operations, consists of net income (loss) adjusted for non-cash items and the cash impact from changes in operating assets and liabilities (i.e., working capital). Cash provided by operating activities totaled $83.4 million for the nine months ended September 30, 2026 and was inclusive of a $113.2 million cash payment for a litigation settlement and $59.6 million of non-cash gains related to divestitures, including a $54.0 million gain related to the sale of the industrial specialties product line.
Cash provided by operating activities for the nine months ended September 30, 2026, when compared to the nine months ended September 30, 2025, decreased by $150.7 million. The decrease was driven by a $113.2 million cash payment for a litigation settlement, a net increase in trade working capital of $56.9 million (including accounts receivable, inventory, and accounts payable), increased employee compensation payments of $6.8 million, a decrease in CTO resale cash inflows of $6.2 million and decreased cash earnings of $2.2 million. Partially offsetting these cash outflows was a decrease in cash interest paid of $12.6 million, a $4.7 million decrease in cash taxes paid, and a $17.3 million decrease in spending on restructuring activities.
Cash flows provided by (used in) investing activities
Cash provided by investing activities, inclusive of continuing and discontinued operations, in the nine months ended September 30, 2026 was $170.5 million and was primarily driven by cash proceeds of $156.3 million related to the sale of the industrial specialties product line and road markings product line, and cash proceeds from the maturity of investments, now held as restricted cash and presented as restricted investments on our balance sheet (see Note 4 for more information) of $50.3 million, offset primarily by capital expenditures of $34.3 million. In the nine months ended September 30, 2026 and 2025, capital spending included the base maintenance capital supporting ongoing operations, as well as growth and cost improvement spending.
| Capital expenditure categories | Nine Months Ended September 30, | ||||||||||
| In millions | 2026 | 2025 | |||||||||
| Maintenance | $ | 22.1 | $ | 20.5 | |||||||
| Safety, health and environment | 6.1 | 8.5 | |||||||||
| Growth and cost improvement | 6.1 | 5.1 | |||||||||
| Total capital expenditures | $ | 34.3 | $ | 34.1 | |||||||
Cash flows provided by (used in) financing activities
Cash used in financing activities, inclusive of continuing and discontinued operations, in the nine months ended September 30, 2026, was $193.1 million and was primarily due to payments on our revolving credit facility and other borrowings of $999.8 million, repurchases of common stock of $125.3 million, and tax payments related to withholdings on vested equity awards of $6.3 million, partially offset by proceeds from our revolving credit facility and other borrowings of $937.0 million.
Cash used in financing activities in the nine months ended September 30, 2025 was $168.8 million and was primarily due to payments on our revolving credit facility and other borrowings of $350.0 million, and repurchases of common stock of $25.2 million, partially offset by proceeds from our revolving credit facility and other borrowings of $209.5 million.
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New Accounting Guidance
Refer to Note 2 for a full description of recent accounting pronouncements including the respective expected dates of adoption and expected effects on our Condensed Consolidated Financial Statements.
Critical Accounting Policies and Estimates
Our Condensed Consolidated Financial Statements are prepared in conformity with GAAP. The preparation of our financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We have described our accounting policies in Note 2 to our Annual Consolidated Financial Statements included in our 2025 Annual Report. We have reviewed these accounting policies, identifying those that we believe to be critical to the preparation and understanding of our financial statements. Critical accounting policies are central to our presentation of results of operations and financial condition and require management to make estimates and judgments on certain matters. We base our estimates and judgments on historical experience, current conditions and other reasonable factors. For a description of our critical accounting policies and estimates, refer to Part II, Item 7, Critical Accounting Policies and Estimates in our 2025 Annual Report. Our critical accounting policies have not substantially changed from those described in the 2025 Annual Report.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Foreign currency exchange rate risk
We have foreign-based operations, primarily in Europe, South America and Asia, which accounted for approximately 27 percent of our net sales in the first nine months of 2026. We have designated the local currency as the functional currency of our significant operations outside of the U.S. The primary currencies for which we have exchange rate exposure are the U.S. dollar versus the euro, the Japanese yen, the pound sterling, the Brazilian real, and the Chinese renminbi. In addition, certain of our domestic operations have sales to foreign customers. In the conduct of our foreign operations, we also make inter-company sales. All of this exposes us to the effect of changes in foreign currency exchange rates. Our earnings are therefore subject to change due to fluctuations in foreign currency exchange rates when the earnings in foreign currencies are translated into U.S. dollars. In some cases, to minimize the effects of such fluctuations, we use foreign exchange forward contracts to hedge firm and highly anticipated foreign currency cash flows. Our largest exposures are to the Brazilian real, the Chinese renminbi and the euro. A hypothetical 10 percent adverse change, excluding the impact of any hedging instruments, in the average Brazilian real, Chinese renminbi and euro to U.S. dollar exchange rates during the nine months ended September 30, 2026, would have decreased our net sales and income from continuing operations before income taxes by approximately $11.1 million or one percent, and $3.9 million or three percent, respectively. Comparatively, a hypothetical 10 percent adverse change, excluding the impact of any hedging instruments, in the average Brazilian real, Chinese renminbi and euro to U.S. dollar exchange rates during the nine months ended September 30, 2025, would have decreased our net sales and income from continuing operations before income taxes by approximately $10.8 million or one percent, and $3.5 million or ten percent, respectively.
Interest rate risk
During the third quarter of 2024, we entered into a floating-to-fixed interest rate swap to convert a notional amount of $200.0 million of the variable, Secured Overnight Financing Rate ("SOFR") based interest component of our debt to a fixed rate. In accordance with the terms of this instrument, we received floating rate interest payments based upon one-month U.S. dollar SOFR, and in return were obligated to pay interest at a fixed rate of 3.84 percent. The interest rate swap matured in August 2026. The fair value of the interest rate swap was an asset (liability) of $(0.4) million at December 31, 2025.
As of September 30, 2026, approximately $500.0 million of our borrowings included a variable interest rate component. The weighted average interest rate associated with our variable interest rate borrowings was 4.85 percent for the period ended September 30, 2026. A hypothetical 100 basis point increase in the variable interest rate component of our borrowings for the nine months ended September 30, 2026, would have increased our annual interest expense by approximately $5.0 million or ten percent. Comparatively, a 100 basis point increase in the variable interest rate component of our borrowings for the nine months ended September 30, 2025, would have increased our annual interest expense by approximately $4.1 million or seven percent.
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Commodity price risk
A portion of our manufacturing costs includes purchased raw materials and energy costs, which are commodities whose prices fluctuate as market supply and demand fundamentals change. Accordingly, product margins and the level of our profitability tend to fluctuate with the changes in these commodity prices.
Natural gas, both direct and indirect, is our largest form of energy costs, constituting approximately five percent of our cost of goods sold for the nine months ended September 30, 2026. Increases in natural gas costs, unless passed on to our customers, would adversely affect our results of operations. If natural gas prices increase significantly, our business or results of operations may be adversely affected. We enter into certain derivative financial instruments to mitigate expected fluctuations in market prices and the volatility to earnings and cash flow resulting from changes to the pricing of natural gas purchases. Refer to Note 8 for more information on our natural gas price risk hedging program. For the three and nine months ended September 30, 2026, a hypothetical, unhedged 10 percent increase in natural gas pricing would have resulted in an increase to cost of sales of approximately $0.7 million (40 basis points) and $2.3 million (47 basis points), respectively. Comparatively, for the three and nine months ended September 30, 2025, a hypothetical, unhedged 10 percent increase in natural gas pricing would have resulted in an increase to cost of sales of approximately $0.7 million (34 basis points) and $2.1 million (39 basis points), respectively. As of September 30, 2026, we had 1.6 million mmBTUS (millions of British Thermal Units) in open natural gas derivative contracts, designated as cash flow hedges. As of September 30, 2026, open natural gas derivative contracts hedge a portion of forecasted transactions until November 2027. The fair value of the open natural gas derivative contracts was a net asset (liability) of $(0.6) million and $(0.5) million as of September 30, 2026 and December 31, 2025, respectively.
Other market risks
Information about our other remaining market risks for the period ended September 30, 2026, does not differ materially from that discussed under Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk of our 2025 Annual Report.
ITEM 4. CONTROLS AND PROCEDURES
a) Evaluation of Disclosure Controls and Procedures
Ingevity maintains a system of disclosure controls and procedures designed to give reasonable assurance that information required to be disclosed in Ingevity's reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. These controls and procedures also give reasonable assurance that information required to be disclosed in such reports is accumulated and communicated to management to allow timely decisions regarding required disclosures.
As of September 30, 2026, Ingevity's Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), together with management, conducted an evaluation of the effectiveness of Ingevity's disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based on that evaluation, the CEO and CFO concluded that these disclosure controls and procedures are effective at the reasonable assurance level.
b) Changes in Internal Control over Financial Reporting
There have been no changes in Ingevity's internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended September 30, 2026 that materially affected, or are reasonably likely to materially affect, Ingevity's internal control over financial reporting.
51
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Information regarding certain of these matters is in Note 13 – Commitments and Contingencies within the Condensed Consolidated Financial Statements.
ITEM 1A. RISK FACTORS
Part I, Item 1A, Risk Factors of our 2025 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. 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 2025 Annual Report for the quarter ended September 30, 2026.
From time to time, we may be engaged in legal actions associated with our intellectual property rights; if we are unsuccessful, these could potentially result in an adverse effect on our financial condition and results of operations.
Intellectual property rights, including patents, trade secrets, confidential information, trademarks, trade names, and trade dress, are important to our business. We endeavor to protect our intellectual property rights in key jurisdictions in which our products are produced or used, in jurisdictions into which our products are imported, and in jurisdictions where our competitors have significant manufacturing capabilities. Our success will depend to a significant degree upon our ability to protect and preserve our intellectual property rights. However, we may be unable to obtain or maintain protection for our intellectual property in key jurisdictions and the company's patents and other intellectual property may not prevent competitors from independently developing or selling similar or duplicative products and services. Although we own and have applied for numerous patents and trademarks throughout the world, we may have to rely on judicial enforcement of our patents and other proprietary rights. Our patents and other intellectual property rights may be challenged, invalidated, circumvented, and rendered unenforceable or otherwise compromised.
Any legal actions to protect, defend or enforce our intellectual property rights could result in significant costs and diversion of our resources and our management's attention, and we may not prevail in any such other actions, which could have an adverse effect on our financial condition and results of operations. Similarly, third parties may assert claims against us and our customers and distributors alleging our products infringe upon third-party intellectual property rights. If the company is found to infringe any third-party rights, it could be required to pay substantial damages, or it could be enjoined from offering some of its products and services.
We also rely heavily upon unpatented proprietary technology, know-how, and other trade secrets to maintain our competitive position. While we maintain policies to enter into confidentiality agreements with our employees and third parties to protect our proprietary expertise and other trade secrets, these agreements may not be enforceable or, even if legally enforceable, we may not have adequate remedies for breaches of such agreements. We also may not be able to readily detect breaches of such agreements. For instance, we manufacture some of our products in China where we may be at a greater risk of a third party misappropriating our intellectual property despite the foregoing policies, procedures and agreements. The failure of our patents or confidentiality agreements to protect our proprietary technology, know-how or trade secrets could result in significantly lower revenues, reduced profit margins, or loss of market share.
52
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Issuer Purchases of Equity Securities
The following table summarizes information with respect to the purchase of our common stock during the three months ended September 30, 2026.
Publicly Announced Program (1) | |||||||||||||||||||||||
| Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs(1) | |||||||||||||||||||
| July 1-31, 2026 | 148,524 | $ | 73.29 | 148,524 | $ | 199,836,549 | |||||||||||||||||
| August 1-31, 2026 | 170,114 | $ | 72.66 | 170,114 | $ | 187,475,997 | |||||||||||||||||
| September 1-30, 2026 | 220,341 | $ | 69.27 | 220,341 | $ | 172,212,064 | |||||||||||||||||
| Total | 538,979 | 538,979 | |||||||||||||||||||||
_______________
(1) On July 25, 2022, our Board of Directors authorized the repurchase of up to $500.0 million of our common stock (the "2022 Authorization"), and rescinded the prior outstanding repurchase authorization with respect to the shares that remained unused under the prior authorization. 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 prevailing market conditions and other factors, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None of our directors or executive officers adopted terminated
53
ITEM 6. EXHIBITS
| Exhibit No. | Description of Exhibit | ||||
| Transaction Success Cash Award under the Ingevity Corporation 2025 Omnibus Incentive Plan - Michael Shukov. | |||||
| Notice of Transaction Success Cash Award to Michael Shukov. | |||||
| Rule 13a-14(a)/15d-14(a) Certification of the company's Principal Executive Officer. | |||||
| Rule 13a-14(a)/15d-14(a) Certification of the company's Principal Financial Officer. | |||||
| Section 1350 Certification of the company's Principal Executive Officer. The information contained in this Exhibit shall not be deemed filed with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the registrant under the Securities Act of 1933, as amended. | |||||
| Section 1350 Certification of the company's Principal Financial Officer. The information contained in this Exhibit shall not be deemed filed with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by the registrant under the Securities Act of 1933, as amended. | |||||
| 101 | Inline XBRL Instance Document and Related Items - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||||
| 104 | The cover page from the company's Quarterly Report on Form 10-Q formatted in Inline XBRL (included in Exhibit 101). | ||||
+ Management contract or compensatory plan or arrangement.
54
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| INGEVITY CORPORATION | |||||
| (Registrant) | |||||
| By: | /S/ PHILLIP J. PLATT | ||||
| Phillip J. Platt | |||||
| Senior Vice President and Chief Financial Officer | |||||
| (Principal Financial Officer and Duly Authorized Officer) | |||||
Date: November 5, 2026
55
Exhibit 10.1
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
Terms and Conditions
1.Terms and Conditions: This service-based cash award is made under the Ingevity Corporation 2025 Omnibus Incentive Plan (the “Plan”) and is subject in all respects to the terms of the Plan. All terms of the Plan are hereby incorporated into these terms and conditions (the “Terms and Conditions”) by reference. In the event of a conflict between one or more provisions of these Terms and Conditions and one or more provisions of the Plan, the provisions of the Plan shall govern; provided that the terms of any written individual Agreement between the Company and a Grantee approved by the Committee shall supersede these Terms and Conditions so long as the Agreement is consistent with the Plan. Each capitalized term not defined herein has the meaning assigned to such term in the Plan.
2.Confirmation of Grant: Effective as of March 4, 2026 (the “Award Date”), Ingevity Corporation (the “Company”) granted the individual whose name is set forth in the notice of grant (the “Grantee”) a transaction success cash award in an amount equal to the cash value set forth in the Grantee’s notice of grant (the “Incentive Compensation Award”). By accepting the Incentive Compensation Award, the Grantee acknowledges and agrees that: (a) the Incentive Compensation Award is subject to these Terms and Conditions and the terms of the Plan; (b) the Committee retains sole discretion to adjust the amount, or withhold payment, of the Incentive Compensation Award, based on factors relating to the sale of the Advanced Polymer Technologies segment (“APT Business”), including, but not limited to, transaction complexity, integration risk, Grantee’s role, and overall transaction outcomes; and (c) if the Closing Date (as defined below) does not occur by July 1, 2027, then this Incentive Compensation Award shall automatically terminate and be forfeited.
3.Automatic Forfeiture: The Incentive Compensation Award (including any portion of the Incentive Compensation Award that has vested but not yet been paid) will automatically be forfeited and all rights of the Grantee to the Incentive Compensation Award shall terminate under any of the following circumstances:
a.The Grantee’s employment is terminated by the Company for Cause.
b.The Grantee breaches any restrictive covenant set forth on the attached Exhibit A or in any restrictive covenants agreement between the Grantee and the Company or an affiliate.
c.The Committee requires recoupment of the Incentive Compensation Award in accordance with any recoupment policy adopted or amended by the Company from time to time.
4.Restrictive Covenants: By accepting the Incentive Compensation Award, the Grantee agrees to comply with the confidentiality, non-solicitation and non-competition covenants set forth on the attached Exhibit A. If the Grantee has a written restrictive covenants
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
agreement with the Company or one of its affiliates, the Grantee also agrees to continue to comply with the obligations under such Restrictive Covenants Agreement as a condition of grant of the Incentive Compensation Award.
5.Transferability. The Incentive Compensation Award may not be sold, transferred, assigned, pledged or otherwise encumbered or disposed; provided, however, the Company may assign the payment obligations hereunder to the Purchaser (as defined below).
6.Vesting: The Incentive Compensation Award shall vest : (a) 70% upon the closing of a sale of the APT Business (the “Closing Date”) to an unaffiliated third party (the “Purchaser”) and (b) 30% on the date that is six (6) months after the Closing Date; provided that in order to be eligible to receive the Incentive Compensation Award, the Grantee continues to be employed by the Company or the Purchaser, as applicable, through the applicable Vesting Date. Except as otherwise provided in Section 7 below, if the Grantee terminates employment prior to a Vesting Date, the remaining Incentive Compensation Award shall be forfeited and all rights of the Grantee to the remaining Incentive Compensation Award shall terminate. Each date such Incentive Compensation Award vests pursuant to this Section 6 or, if earlier, Section 7 below, is referred to herein as the applicable “Vesting Date.”
7.Termination of Employment: If, following the Closing Date and prior to the applicable Vesting Date, the Grantee’s employment is terminated by reason of death or Disability (as defined below), and the other events or circumstances outlined in Section 3 do not occur or exist, as applicable, then 100% of the remaining unvested Incentive Compensation Award shall vest upon such termination . If, following the Closing Date and prior to the applicable Vesting Date, the Grantee’s employment is involuntarily terminated by the Company or the Purchaser, as applicable, without Cause, and the other events or circumstances outlined in Section 3 do not occur or exist, as applicable, then 100% of the remaining unvested Incentive Compensation Award shall vest upon such termination. For the avoidance of doubt, transfer of employment from Company to the Purchaser in connection with the sale of the APT Business shall not be deemed to be a termination of employment for purposes of this Section. In the event that Grantee’s employment is terminated for any reason prior to the Closing Date, the Incentive Compensation Award shall be forfeited. The vested portion of the Incentive Compensation Award shall be paid as described in Section 10 below. For purposes of this Award, “Disability” means permanently and totally disabled under the terms of the Company’s qualified retirement plans.
8.Leave of Absence: In the event that a Grantee is on an approved leave of absence, the Grantee’s Incentive Compensation Award shall continue to vest in accordance with these Terms and Conditions during his or her leave of absence, subject to the Committee’s discretion.
2
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
9.Change in Control: In the event of a Change in Control, Section 14 of the Plan shall control and Section 14 of the Plan shall supersede Sections 6 and 7 of these Terms and Conditions; provided, however, in the event that, following a Change in Control in which the Incentive Compensation Award is assumed, the Grantee’s employment is terminated by reason of the Grantee’s death or Disability, the Incentive Compensation Award shall vest in full and be paid as provided in Section 10 of these Terms and Conditions. For purposes of Section 14 of the Plan, Sections 14.2(a) and (c), 14.3 and 14.4 shall be deemed to include the Incentive Compensation Award; provided, further that the Incentive Compensation Awards shall be treated the same as a then-outstanding Stock Award for purposes of Section 14(b)(i) of the Plan and shall vest in full and be paid as provided in Section 10 of these Terms and Conditions.
10.Payment: The Incentive Compensation Award shall be paid in cash. The applicable portion of the Incentive Compensation Award shall be paid as soon as practicable after the applicable Vesting Date (including without limitation for this purpose vesting upon the Grantee’s termination of employment as provided in Section 7 and Section 9), but in no event later than 30 days after the applicable Vesting Date, as determined by the Company. Notwithstanding the foregoing, to the extent that the Incentive Compensation Award is subject to Section 409A of the Internal Revenue Code, all such payments shall be made in compliance with the requirements of Section 409A of the Internal Revenue Code, including application of the six month settlement delay for any specified employee (as defined in Section 409A of the Internal Revenue Code) in the event of vesting as a result of a separation from service (as defined in Section 409A of the Internal Revenue Code).
11.Tax Withholding: Regardless of any action the Company or its affiliate takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related withholding (the “Tax Related Items”), the Grantee acknowledges that the ultimate liability for all Tax Related Items legally due by the Grantee is and remains the Grantee’s responsibility and may exceed the amount actually withheld by the Company or its affiliate. The Grantee further acknowledges that the Company and its affiliates (including the Grantee’s employer (i) make no representations or undertakings regarding the treatment of any Tax Related Items in connection with any aspect of the Incentive Compensation Award, including the grant of the Incentive Compensation Awards, and the receipt of any cash payment in connection with the Incentive Compensation Award; and (ii) do not commit to and are under no obligation to structure the terms of the Incentive Compensation Awards any aspect of the Incentive Compensation Awards to reduce or eliminate the Grantee’s liability for Tax Related Items or achieve any particular tax result. The Grantee acknowledges and agrees that all of a portion of any tax withholding obligations arising relating to the Incentive Compensation Awards may be satisfied by the Company withholding a sufficient portion of the cash otherwise payable in satisfaction of the Incentive Compensation Award.
3
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
12.No Right to Continued Employment: Unless otherwise prohibited by local law, the Grantee understands and agrees that these Terms and Conditions do not impact the right of the Company or any of its affiliates employing the Grantee to terminate or change the terms of the Grantee’s employment at any time for any reason, with or without cause.
13.Captions: Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of these Terms and Conditions.
14.Severability: In the event that any provision in these Terms and Conditions shall be held invalid or unenforceable for any reason, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of these Terms and Conditions.
4
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
Exhibit A
Restrictive Covenants
By accepting this Incentive Compensation Award, the Grantee agrees to comply with the following terms:
Confidential Information
(a)For purposes of these Terms and Conditions, the term “Confidential Information” shall mean information that the Company or any of its affiliates owns or possesses, that the Company or its affiliates have developed at significant expense and effort, that they use or that is potentially useful in the business of the Company or its affiliates, that the Company or its affiliates treat as proprietary, private or confidential, and that is not generally known to the public. Confidential Information includes, but is not limited to, information that qualifies as a trade secret under applicable law. The Grantee acknowledges that the Grantee’s relationship with the Company is one of confidence and trust such that the Grantee has in the past been, and may in the future be, privy to Confidential Information of the Company or its affiliates.
(b)The Grantee hereby covenants and agrees at all times during employment with the Company and its affiliates and thereafter to hold in strictest confidence, and not to use, any Confidential Information, except for the benefit of the Company, and not to disclose any Confidential Information to any person or entity without written authorization of the Company, except as otherwise required by law.
Non-Solicitation
(a) The Grantee covenants and agrees that during the Grantee’s employment with the Company and its affiliates, and during the 12 month period following the Grantee’s termination of employment for any reason (the “Restricted Period”), the Grantee shall not, directly or indirectly, (i) solicit, hire or attempt to hire any employee of the Company or any of its affiliates as an employee, consultant or independent contractor of the Grantee or any other person or business entity for the purpose of providing services or products competitive with those offered by the Company or any of its affiliates, or (ii) solicit any employee, consultant or independent contractor of the Company or any of its affiliates to change or terminate his or her relationship with the Company or any of its affiliates for the purpose of providing services or products competitive with those offered by the Company or any of its affiliates, unless in each case more than six months shall have elapsed between the last day of such person’s employment or service with the Company or any of its affiliates and the first date of such solicitation or hiring.
(b) The Grantee covenants and agrees that during the Grantee’s employment with the Company and its affiliates and during the Restricted Period, the Grantee shall not, either directly or indirectly:
A-1
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
(i)solicit or do business with, or attempt to solicit or do business with, any customer with whom the Grantee had material contact, or about whom the Grantee received Confidential Information within 12 months prior to the Grantee’s date of termination for the purpose of providing such customer with services or products competitive with those offered by the Company or any of its affiliates during the Grantee’s employment with the Company or its affiliates, or
(ii)encourage any customer with whom the Grantee had material contact, or about whom the Grantee received Confidential Information within 12 months prior to the Grantee’s date of termination to reduce the level or amount of business such customer conducts with the Company or any of its affiliates.
Non-Competition
(a) The Grantee covenants and agrees that during the Grantee’s employment with the Company and its affiliates and during the Restricted Period, the Grantee will not, without the Company’s express written consent, in any geographic area in which the Grantee had responsibility within the last two years prior to the Grantee’s termination of employment where the Company or its affiliates do business, directly or indirectly in the same or similar capacity to the services the Grantee performed for the Company;
(i) own, maintain, finance, operate, invest or engage in any business that competes with the businesses of the Company and its affiliates in which the Grantee was materially involved during the two years prior to the Grantee’s termination; or
(ii) provide services, as an employee, consultant, independent contractor, agent or otherwise, to any business that competes with the Company and its affiliates in businesses in which the Grantee was materially involved during the two years prior to the Grantee’s termination.
(b) Notwithstanding the foregoing, the Grantee may invest in or have an interest in entities traded on any public market, provided that such interest does not exceed five percent of the voting control of such entity.
Other Acknowledgements and Agreements
(a) The Grantee acknowledges and agrees that in the event the Grantee breaches any of the covenants or agreements contained in this Exhibit A:
(i) The Grantee shall forfeit the outstanding Incentive Compensation Award (without regard to whether the Incentive Compensation Award has vested), and the outstanding Incentive Compensation Award shall immediately terminate, and
(ii) The Company may in its discretion require the Grantee to return to the Company any cash paid to the Grantee under this Award. The Committee shall exercise the right
A-2
Ingevity Corporation
Incentive Compensation Awards
M. Shukov
(Transaction Success Cash)
of recoupment provided in this section (a)(ii) within one year after the Company’s discovery of the Grantee’s breach of the covenants or agreements contained in this Exhibit A. In addition, in the event of a breach or threatened breach of the restrictions in this Exhibit A, the Company shall be entitled to preliminary and permanent injunctive relief, in addition to any remedies available to it, to prevent such breach or threatened breach.
(c)If any portion of the covenants or agreements contained in this Exhibit A, or the application hereof, is construed to be invalid or unenforceable, the other portions of such covenants or agreements or the application thereof shall not be affected and shall be given full force and effect without regard to the invalid or unenforceable portions to the fullest extent possible. If any covenant or agreement in this Exhibit A is held to be unenforceable because of the duration thereof or the scope thereof, then the court making such determination shall have the power to reduce the duration and limit the scope thereof, and the covenant or agreement shall then be enforceable in its reduced form. The covenants and agreements contained in this Exhibit A shall survive the termination of this Incentive Compensation Award.
A-3
4920 O’Hear Street, Suite 400 North Charleston, SC 29405 | ||||||||
Exhibit 10.2
March 4th, 2026
[address]
Dear Michael,
As we move forward with the planned sale of the Advanced Polymer Technologies (“APT”) business, your leadership and sustained focus are critical to executing a successful transaction and ensuring a smooth transition.
In recognition of your role and contributions, I am pleased to share the details of a one‑time Transaction Success Incentive Compensation Award, granted under Ingevity’s 2025 Omnibus Incentive Plan. This award is intended to reflect both the importance of the work ahead and our commitment to retaining strong leadership through the sale, closing, and integration phases of the transaction.
You will receive a separate communication from E*TRADE, our plan administrator, with instructions for reviewing and accepting the award, along with access to the applicable terms and conditions.
The award consists of a cash payment of $383,000 USD payable if the APT sale closes by July 1, 2027 as follows: (i) $268,000 USD payable upon closing of the APT sale, and (ii) $115,000 USD payable six months following such closing, subject to the terms and conditions of the plan and your continued service through the applicable periods.
With your demonstrated leadership, I am confident we are well positioned to complete this transaction successfully and support our employees through the transition.
Best regards,
/s/ David H. Li
David H. Li President and CEO
Exhibit 31.1
CERTIFICATIONS
I, David H. Li, certify that:
1.I have reviewed this report on Form 10-Q of Ingevity Corporation;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| Date: | November 5, 2026 | ||||
| By: | /S/ DAVID H. LI | ||||
| David H. Li | |||||
| President and Chief Executive Officer | |||||
Exhibit 31.2
CERTIFICATIONS
I, Phillip J. Platt, certify that:
1.I have reviewed this report on Form 10-Q of Ingevity Corporation;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| Date: | November 5, 2026 | ||||
| By: | /S/ PHILLIP J. PLATT | ||||
| Phillip J. Platt | |||||
| Senior Vice President and Chief Financial Officer | |||||
Exhibit 32.1
Certification of CEO Pursuant to
18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, David H. Li, President and Chief Executive Officer of Ingevity Corporation (“the Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, based on my knowledge that:
1. the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: November 5, 2026
| /S/ DAVID H. LI | ||
| David H. Li | ||
| President and Chief Executive Officer | ||
Exhibit 32.2
Certification of CFO Pursuant to
18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Phillip J. Platt, Senior Vice President and Chief Financial Officer of Ingevity Corporation (“the Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, based on my knowledge that:
1. the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: November 5, 2026
| /S/ PHILLIP J. PLATT | ||
| Phillip J. Platt | ||
| Senior Vice President and Chief Financial Officer | ||