INNOSPEC INC.

RESULTS OF OPERATIONS

The Company reports its financial performance based on three reportable segments, which are Performance Chemicals, Fuel Specialties and Oilfield Services.

The following table provides sales, gross profit and operating income by reporting segment:

Three Months Ended June 30, 2026

The following table shows the changes in sales, gross profit and operating expenses by reporting segment for the three months ended June 30, 2026, and the three months ended June 30, 2025:

Performance Chemicals

The Americas volumes were lower due to some supply constraints and reduced demand for our personal care products, offset by a favorable price and product mix due to pricing improvements. Volumes in EMEA were higher due to increased demand for our personal care products, combined with a favorable price and product mix, driven by higher demand for our higher priced products. ASPAC volumes were lower due to some supply constraints and decreased demand for certain products, being offset by a favorable price and product mix, driven by higher demand for our higher priced products. EMEA and ASPAC benefited from favorable foreign currency exchange rate movements.

Gross margin: the year over year decrease of 0.2 percentage points was primarily due to negative manufacturing variances due to lower production volumes in North America, as we continue to advance our plant repairs, process improvements and upgrades following severe weather conditions in the first quarter.

Operating expenses: the year over year increase of $0.4 million was primarily due to higher provisions for performance-related remuneration accruals.

Fuel Specialties

Sales volumes in the Americas increased year over year due to increased demand from customers, being partly offset by an adverse price and product mix. Sales volumes in EMEA increased year over year due to increased demand from customers, combining with a favorable price and product mix. Sales volumes in ASPAC decreased year over year due to decreased demand from customers, being offset by a favorable price and product mix. AvGas volumes were lower than the prior year due to variations in the demand from customers, combined with an adverse customer mix. All our regions benefited from favorable foreign currency exchange rate movements.

Gross margin: the year over year decrease of 1.5 percentage points was due to an adverse sales mix in the Americas from increased sales of lower margin products, being partly offset by sales in EMEA of higher margin products.

Operating expenses: the year over year increase of $4.2 million was primarily due to adverse movements to the provisions for doubtful debts, together with increased employee-related costs, including higher provisions for performance-related remuneration accruals.

Oilfield Services

Net sales: have increased year over year by $14.6 million, driven by our DRA plant expansion and associated demand. The majority of the segment's sales are concentrated in the Americas region.

Gross margin: the year over year increase of 2.7 percentage points was due to a favorable sales mix.

Operating expenses: the year over year increase of $5.0 million was primarily due to adverse movements to the provisions for doubtful debts, together with increased operating expenses and increased employee-related costs, including higher provisions for performance-related remuneration accruals.

Other Income Statement Captions

Corporate costs: the year over year increase of $0.7 million was primarily due to higher legal and compliance expenses, together with higher information technology costs including additional amortization for our new ERP system, and higher provisions for performance-related remuneration accruals, being partly offset by lower legacy costs of closed operations and a favorable revaluation for our U.K. emissions trading scheme credits.

Adjustment to fair value of contingent consideration: is an expense in the current year of $0.1 million compared to an expense in the prior year of $0.8 million. The adjustment relates to the acquisition of QGP within our Performance Chemicals segment. The year over year decrease relates to reduced accretion, due to the reduction in the overall expected payable compared to the prior year. See Note 10 of the Notes to the Condensed Consolidated Financial Statements for additional information.

Other net income/(expense): for the three months ended June 30, 2026 was $1.1 million income compared to a $4.7 million expense in the three months ended June 30, 2025, primarily driven by the revaluation of foreign currency forward contracts, and the foreign currency translation of non-USD balances in the group.

Interest income/(expense), net: in the three months ended June 30, 2026 was $0.8 million of income compared to $2.7 million of income in the three months ended June 30, 2025, driven by lower interest rates and lower cash balances in the current year.

Income taxes: the effective tax rate was 25.0% and 26.0% in the second quarter of 2026 and 2025, respectively. The adjusted effective tax rate, once adjusted for the items set out in the following table, was 23.1% in 2026 compared with 23.3% in 2025. The 0.2% decrease in the adjusted effective rate was primarily due to the fact that a higher proportion of the Company’s profits are being generated in lower tax jurisdictions. The Company believes that this adjusted effective tax rate, a non-GAAP financial measure, provides useful information to investors and may assist them in evaluating the Company’s underlying performance and identifying operating trends. In addition, management uses this non-GAAP financial measure internally to evaluate the performance of the Company’s operations and for planning and forecasting in subsequent periods.

The following table shows a reconciliation of the GAAP effective tax charge to the adjusted effective tax charge:

Six months ended June 30, 2026

The following table shows the changes in sales, gross profit and operating expenses by reporting segment for the six months ended June 30, 2026, and the six months ended June 30, 2025:

Performance Chemicals

The Americas volumes were lower due to some supply constraints and reduced demand for our personal care products, partly offset by a favorable price and product mix due to continuing pricing improvements. Volumes in EMEA were higher, being partly offset by an adverse price and product mix driven by higher demand for our lower priced products. ASPAC volumes were lower driven by some supply constraints and decreased demand for certain products, being partly offset by a favorable price and product mix. EMEA and ASPAC benefited from favorable foreign currency exchange rate movements.

Gross margin: the year over year decrease of 2.1 percentage points was primarily due to an adverse sales mix, together with the negative manufacturing variances in North America due to lower production volumes following severe weather conditions in the first quarter.

Operating expenses: the year over year increase of $2.6 million was primarily due to adverse movements to the provisions for doubtful debts, together with increased research and development expenses and higher provisions for performance-related remuneration accruals, being partly offset by reductions for other expenses.

Fuel Specialties

Sales volumes in all our regions increased year over year due to increased demand from customers. The Americas and ASPAC were impacted by an adverse price and product mix due to higher sales of lower priced products. EMEA benefited from a favorable price and product mix due to higher sales of higher priced products. AvGas volumes were lower than the prior year due to variations in the demand from customers, being partly offset by a favorable customer mix. All our regions benefited from favorable foreign currency exchange rate movements.

Gross margin: the year over year decrease of 0.9 percentage points was due to an adverse sales mix in the Americas from increased sales of lower margin products, being partly offset by sales in EMEA of higher margin products.

Operating expenses: the year over year increase of $6.8 million was primarily due to adverse movements to the provisions for doubtful debts, together with increased operating expenses and increased employee-related costs, including higher provisions for performance-related remuneration accruals.

Oilfield Services

Net sales: have increased year over year by $14.7 million, driven by our DRA plant expansion and associated demand. The majority of the segment's sales are concentrated in the Americas region.

Gross margin: the year over year increase of 2.3 percentage points was due to a favorable sales mix.

Operating expenses: the year over year increase of $5.3 million was primarily due to adverse movements to the provisions for doubtful debts, together with increased operating expenses and increased employee-related costs, including higher provisions for performance-related remuneration accruals.

Other Income Statement Captions

Corporate costs: the year over year increase of $5.3 million was primarily due to higher legal and compliance expenses, together with higher information technology costs including additional amortization for our new ERP system, and higher provisions for performance-related remuneration accruals, being partly offset by lower legacy costs of closed operations and a favorable revaluation for our U.K. emissions trading scheme credits.

Adjustment to fair value of contingent consideration: is a credit in the current year of $4.6 million compared to an expense in the prior year of $1.5 million. The adjustment relates to the acquisition of QGP within our Performance Chemicals segment. The credit in the current year relates to a reduction in the expected payable, together with the lower accretion charge calculated on the lower expected payable. See Note 10 of the Notes to the Condensed Consolidated Financial Statements for additional information.

Other net income/(expense): for the six months ended June 30, 2026 was $3.7 million income compared to a $4.4 million expense in the three months ended June 30, 2025, primarily driven by the revaluation of foreign currency forward contracts, and the foreign currency translation of non-USD balances in the group.

Interest income/(expense), net: in the six months ended June 30, 2026 was $1.6 million of income compared to $5.1 million of income in the six months ended June 30, 2025, driven by lower interest rates and lower cash balances in the current year.

Income taxes: the effective tax rate was 23.9% and 25.8% in the first six months of 2026 and 2025, respectively. The adjusted effective tax rate, once adjusted for the items set out in the following table, was 23.0% in 2026 compared with 23.7% in 2025. The 0.7% decrease in the adjusted effective rate was primarily due to the fact that a higher proportion of the Company’s profits are being generated in lower tax jurisdictions. The Company believes that this adjusted effective tax rate, a non-GAAP financial measure, provides useful information to investors and may assist them in evaluating the Company’s underlying performance and identifying operating trends. In addition, management uses this non-GAAP financial measure internally to evaluate the performance of the Company’s operations and for planning and forecasting in subsequent periods.

The following table shows a reconciliation of the GAAP effective tax charge to the adjusted effective tax charge: