Slide 1: First Quarter Fiscal 2025 Earnings
First Quarter Fiscal 2025 Earnings Lori Flees, CEO & President Mary Meixelsperger, CFO Elizabeth Clevinger, Investor Relations 02.06.2025
Slide 2: Safe Harbor: Forward-Looking Statements
SAFE HARBOR Forward-Looking Statements Certain statements herein, other than statements of historical fact, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, executing on the gro
Slide 3: 1Q 2025 Key Highlights
1Q 2025 KEY HIGHLIGHTS1 $820M 8.0% System-wide Store Sales2 System-wide Same 14% Store Sales2 Growth $414M 35 Store Additions Net Sales 14 Franchise; 21 Company 11% 39 Refranchised $103M 2,045 Adjusted EBITDA3 System Locations2 14% 8% $0.32 $39M Adjusted EPS3 Returned via Share Repurchases 10% 1. Al
Slide 4: Strategic Priorities
STRATEGIC PRIORITIES Long Runway For Delivering Shareholder Value DRIVE FULL POTENTIAL ACCELERATE NETWORK TARGET CUSTOMER & FOR OUR CORE BUSINESS GROWTH SERVICE EXPANSION Quick, Easy, Trusted 02.06.2025 || First Quarter Fiscal 2025 Earnings 4
Slide 5: 1Q 2025 Top-Line Performance
1Q 2025 TOP-LINE PERFORMANCE1 Net Sales Growth ($, Millions) +11.0% 414 373 155 net new system-wide stores YoY 1Q 1Q Balanced contribution from ticket and 2024 2025 transaction growth System-wide SSS Growth +15.2% Improvement in NOCR largest driver of 2-year Stack ticket 7.2% 8.0% 1Q 1Q 2024 2025 1.
Slide 6: 1Q 2025 Financial Drivers
1Q 2025 FINANCIAL DRIVERS1 Gross Margin SG&A Expense Adjusted EBITDA as a % of Net sales as a % of Net sales as a % of Net sales 80 bps increase YoY 40 bps increase YoY 60 bps increase YoY 28.5% 39.1% 19.6% 36.1% 36.9% 19.2% 24.2% 24.8% 17.8% 1Q 4Q 1Q 1Q 4Q 1Q 1Q 4Q 1Q 2024 2024 2025 2024 2024 2025
Slide 7: 1Q 2025 Profitability
1Q 2025 PROFITABILITY1 Adjusted Net Income Adjusted EBITDA Adjusted EPS ($, Millions) ($, Millions) 9% increase 14% increase 10% increase 42 $0.32 39 103 $0.29 90 1Q 1Q 1Q 1Q 1Q 1Q 2024 2025 2024 2025 2024 2025 • 14% operating profit growth partially • 11% topline growth combined with • Strong net i
Slide 8: 1Q 2025 Reporting Highlights
1Q 2025 REPORTING HIGHLIGHTS Balance Sheet Highlights • Debt reduction of $61M during the quarter (Millions) 1Q25 • Target leverage ratio of 2.5 – 3.5x on a rating agency Cash & Cash Equivalents $60.0 adjusted basis; at ~3.3x as of end of the quarter Total Debt $1,033.1 Cash Flow Highlights (Million
Slide 9: Delivered Q1 financial results in line with expectations
Delivered Q1 financial results in line 1 with expectations. Added 35 net new stores; closed transaction 2 to refranchise certain Texas markets. Positioned to deliver strong and durable growth in 3 fiscal year 2025 and beyond. Quick, Easy, Trusted 02.06.2025 || First Quarter Fiscal 2025 Earnings 9
Slide 10: Quick, Easy, Trusted
Quick, Easy, Trusted 02.06.2025 || First Quarter Fiscal 2025 Earnings 10
Slide 11: Fiscal Year 2025 Guidance
FISCAL YEAR 2025 GUIDANCE FY25 Outlook Same Store Sales1 Growth % 5% – 7% System-Wide Store Additions1 160 – 185 Net Revenues $1.67B – $1.73B Adjusted3 EBITDA $450M – $470M Adjusted3 EPS $1.57 – $1.67 Capital Expenditures $230M – $250M Share Repurchases2 $40M – $70M 1. For a discussion of management
Slide 12: Retail Services – Q1 System Results
RETAIL SERVICES – Q1 SYSTEM RESULTS (Preliminary and unaudited) Three months ended December 31 2024 2023 Sales information System-wide store sales - in millions (a) $ 820.3 $ 722.9 Year-over-year growth (a) 13.5 % 12.3 % Same-store sales growth (b) Company-operated 8.2 % 6.2 % Franchised (a) 7.8 % 8
Slide 13: Retail Services – Store Information
RETAIL SERVICES – STORE INFORMATION (Preliminary and unaudited) Company-operated First Quarter Fourth Quarter Third Quarter Second Quarter First Quarter 2025 2024 2024 2024 2024 Beginning of period 950 937 919 895 876 Opened 15 26 12 14 14 Acquired 6 10 6 10 5 Net conversions between company-operate
Slide 14: Reconciliation of Non-GAAP Data – Income from Continuing Operations & Diluted EPS
RECONCILIATION OF NON-GAAP DATA – INCOME FROM CONTINUING OPERATIONS & DILUTED EARNINGS PER SHARE (Preliminary and unaudited) Three months ended December 31 (in millions, except per share amounts) 2024 2023 Reported income from continuing operations $ 93.9 $ 33.9 Adjustments: Net pension and other po
Slide 15: Reconciliation of Non-GAAP Data – Q1 Adjusted EBITDA
RECONCILIATION OF NON-GAAP DATA – Q1 ADJUSTED EBITDA (Preliminary and unaudited) Three months ended December 31 (in millions) 2024 2023 Reported net revenues (a) $ 414.3 $ 373.4 Adjusted EBITDA - Continuing operations Income from continuing operations $ 93.9 $ 33.9 Add: Income tax expense 33.3 11.9
Slide 16: Reconciliation of Non-GAAP Data – Adjusted SG&A & Operating Income
RECONCILIATION OF NON-GAAP DATA – ADJUSTED SG&A & OPERATING INCOME Three months ended December 31 Selling, general and administrative expenses Operating income In millions - preliminary and unaudited 2024 2023 2024 2023 As reported $ 82.8 $ 74.5 $ 143.8 $ 62.8 Key items: Net legacy and separation-re
Slide 17: Reconciliation of Non-GAAP Data – Free Cash Flows
RECONCILIATION OF NON-GAAP DATA – FREE CASH FLOWS (Preliminary and unaudited) Three months ended (In millions) December 31 Free cash flow (a) 2024 2023 Operating cash flows from continuing operations $ 41.4 $ 21.9 Adjustments: Additions to property, plant and equipment from continuing operations (53
Slide 18: Consolidated GAAP Income Statement
CONSOLIDATED GAAP INCOME STATEMENT (Preliminary and unaudited) Three months ended December 31 (In millions, except per share amounts) 2024 2023 Net revenues $ 414.3 $ 373.4 Cost of sales 261.4 238.6 Gross profit 152.9 134.8 Selling, general and administrative expenses 82.8 74.5 Net legacy and separa
Slide 19: Use of Non-GAAP Measures
USE OF NON-GAAP MEASURES This presentation includes the following non-GAAP measures: Adjusted operating income; adjusted operating margin; adjusted selling, general, and administrative expenses; adjusted selling, general, and administrative margin; EBITDA, adjusted EBITDA, and adjusted EBITDA margin
Slide 20: Use of Non-GAAP Measures, Continued
USE OF NON-GAAP MEASURES, CONTINUED Refer to the below for descriptions of the key items that comprise the adjustments which depart from the computations in accordance with U.S. GAAP: Net pension and other postretirement plan (income) expenses: Includes several elements impacted by changes in plan a
Slide 21: Key Business Measures
KEY BUSINESS MEASURES Valvoline tracks its operating performance and manages its business using certain key measures, including system-wide, company-operated and franchised store counts; SSS; system-wide store sales; system-wise transactions; and average ticket. Management believes these measures ar