Valvoline Inc. (NYSE: VVV), a global leader in vehicle maintenance fueling the future of mobility through innovative products and services, today announced that it is accelerating its continued transformation by continuing to separate of its two business segments, Retail Services and Global Products.
“After a full review of strategic alternatives by the board of directors and senior management of Valvoline, we believe that a separation of our business segments will create significant and lasting value for our shareholders, employees and other stakeholders, and will best position Retail Services and Global Products for continued long term success, ”said Stephen F. Kirk, President of the council.
Sam mitchell, CEO, added: “Our confidence in separating these two strong companies reflects the tremendous progress we have made in our strategic transformation. Retail Services now generates more than half of our adjusted EBITDA and is growing at an exceptional rate. The separation will allow Retail Services to continue to grow and focus on operating its world-class service model. Global Products is a market-leading, cash-generating company that we believe will thrive in the future with the ability to focus and allocate capital to its own strategic priorities.
Valvoline works with its outside advisors to determine the best way to accomplish the separation. No timeline has been set for the completion of the separation, and Valvoline does not intend to disclose further developments regarding this process, unless and until its board of directors approves a transaction. or a specific action.
Valvoline will publish its financial results for fiscal year 2021 on November 3, 2021. Based on the information currently available, the company plans to report sales of $ 3 billion for fiscal year 2021, up 27% compared to the previous year. Valvoline also currently expects Adjusted EBITDA and Adjusted EPS for fiscal 2021 to be within the forecast range for each measure, as shown in the company’s earnings announcement on. August 4, 2021. In addition, based on information currently available, Retail Services ended the year with 1,595 system-wide stores, and the company estimates that Retail Services experienced same-store sales growth across the country. system in the fourth quarter and the whole year by 20% and 21%, respectively, compared to the same periods of the previous year.
Retail Services Segment Overview
The Retail Services segment serves the passenger car and light truck rapid lubricants market by United States and Canada with a wide range of preventive maintenance services and capabilities performed through Valvoline’s retail network, independent and independent franchise stores operated by the company, and Express Care stores that service vehicles with Valvoline products. Valvoline operates the second largest rapid lubrication service chain by number of stores in United States with instant Valvoline oil changeSM and the third largest rapid lubrication service chain in Canada with the brand Valvoline Great Canadian Oil Change. On the strength of its strong reputation and a loyal and growing customer base, Valvoline believes that the Retail Services activity is well positioned to pursue exceptional growth and operational excellence. Based on currently available information, the Company expects to report Retail Services segment sales of $ 1.2 billion for fiscal year 2021, an increase of 38% compared to the previous year.
Global Product Segment Overview
Present in more than 140 countries and territories, Valvoline’s Global Products segment sells lubricants and other automotive and engine care products primarily to automotive retailers, installers and original equipment manufacturers (OEMs). Valvoline has established itself as the world’s leading supplier of battery fluids to electric vehicle manufacturers, offering tailor-made products to help extend the range and efficiency of vehicles. In the United States, Valvoline is the third largest brand of motor oil in the DIY market by volume. The company is low capital intensive and stands out from the competition because of its leading brand, the quality of its products and its strong distribution partnerships. Based on the information currently available, the Company expects to report sales of the Global Products segment of $ 1.8 billion for fiscal year 2021, up 20% compared to the previous year.
Goldman Sachs & Co. LLC acts as financial advisor and Cravath, Swaine & Moore LLP acts as legal advisor to Valvoline
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