Valvoline Reports 4% Revenue Increase to $439M in Q3 Fiscal 2025

Valvoline Inc. reported a 4% increase in net revenues for the third quarter of fiscal 2025, reaching $439.0 million compared to $421.4 million in the same period last year. The company's income from continuing operations rose 18% to $57.0 million, with diluted earnings per share increasing by 19% to $0.44. For the nine months ending June 30, 2025, net revenues totaled $1.256 billion, up from $1.184 billion in the prior year, driven by a combination of same-store sales growth of 4.9% and the addition of 163 net new stores. However, revenue growth was partially offset by a $27.4 million decrease attributed to refranchising transactions.

In terms of operational metrics, Valvoline's gross profit for the quarter increased by 6% to $177.6 million, reflecting improved service mix and pricing strategies. The gross profit margin also improved, attributed to enhanced labor efficiency and cost leverage. The company’s selling, general, and administrative expenses rose to $85.5 million, up from $77.2 million, primarily due to investments in technology and marketing to support growth initiatives. Valvoline's total assets increased to $2.562 billion as of June 30, 2025, compared to $2.439 billion at the end of the previous fiscal year.

Strategically, Valvoline has been active in expanding its retail presence, acquiring 26 service center stores for $32.3 million during the nine months ended June 30, 2025. This acquisition increased the number of company-operated service centers to 983. Additionally, the company is in the process of acquiring Breeze Autocare for $625 million, which will further enhance its footprint in the automotive maintenance sector. The acquisition is subject to regulatory approval, and Valvoline is currently addressing requirements from the Federal Trade Commission.

Valvoline's financial position remains strong, with total debt reported at $1.080 billion and cash and cash equivalents of $68.3 million as of June 30, 2025. The company has a remaining borrowing capacity of $341.5 million under its revolving credit facility. Management anticipates that the recent tax legislation, which maintains the corporate tax rate and allows for 100% bonus depreciation, will positively impact cash tax payments in the near future. Looking ahead, Valvoline aims to continue its growth trajectory through strategic acquisitions and operational efficiencies, while managing its capital allocation to enhance shareholder value.