INNOSPEC INC.

Working Capital

In the nine months ended September 30, 2026, our working capital increased by $38.7 million, while our adjusted working capital increased by $80.8 million. The difference is primarily due to the exclusion of the movements for cash and cash equivalents and the movements for income taxes, being partly offset by the other movements shown in the table below.

The Company believes that adjusted working capital, a non-GAAP financial measure (defined by the Company as trade and other accounts receivable, inventories, prepaid expenses, accounts payable and accrued liabilities rather than total current assets less total current liabilities) provides useful information to investors in evaluating the Company’s underlying performance and identifying operating trends. Management uses this non-GAAP financial measure internally to allocate resources and evaluate the performance of the Company’s operations. Items excluded from working capital in the adjusted working capital calculation are listed in the table below and represent factors which do not fluctuate in line with the day-to-day working capital needs of the business.

We had a $53.3 million increase in trade and other accounts receivable, including a $3.1 million increase in allowances, which was due to increased sales and the timing of collections for different customers. Days’ sales outstanding in our Performance Chemicals segment remained unchanged at 72 days; increased from 57 days to 63 days in our Fuel Specialties segment; and increased from 64 days to 76 days in our Oilfield Services segment.

We had a $32.5 million increase in inventories, including a $0.4 million decrease in allowances, which was driven by higher levels of finished goods for our Fuel Specialties segment due to the timing of production, together with higher levels of raw materials for our Performance Chemicals and Oilfield Services segments, as the Company continues to maintain inventory levels necessary to manage the risk of potential supply chain disruption for certain key raw materials. Days’ sales in inventory in our Performance Chemicals segment increased from 65 days to 66 days; increased from 133 days to 155 days in our Fuel Specialties segment; and decreased from 83 days to 69 days in our Oilfield Services segment.

Prepaid expenses decreased $10.1 million, from $20.1 million to $10.0 million, primarily due to the cyclical expensing of prepaid invoices.

We had a $5.1 million decrease in accounts payable and accrued liabilities, which was dependent on the timing of payments for each of our reporting segments. Creditor days (including goods received not invoiced) have increased in our Performance Chemicals segment from 50 days to 53 days; decreased from 58 days to 45 days in our Fuel Specialties segment; and increased from 46 days to 55 days in our Oilfield Services segment.

Operating Cash Flows

We generated cash from operating activities of $42.2 million in the nine months ended September 30, 2026, compared to $77.9 million in the nine months ended September 30, 2025. The decrease in cash generated from operating activities compared to the prior year was primarily related to higher increases in working capital, being partly offset by the timing of income tax payments.

Cash

At September 30, 2026, and December 31, 2025, we had cash and cash equivalents of $251.9 million and $292.5 million, respectively, of which $113.6 million and $145.4 million, respectively, were held by non-U.S. subsidiaries principally in the U.K..

The decrease in cash and cash equivalents of $40.6 million for the nine months ended September 30, 2026, was primarily driven by our continued investments in capital projects, payment of our semi-annual dividend and the repurchases of our common stock, being partly offset by the cash generated from operating activities.

Debt

We continue to have available a $250.0 million multicurrency revolving credit facility.

At September 30, 2026, and December 31, 2025, we had no debt outstanding under the revolving credit facility and no obligations were outstanding under finance leases. See Note 8 of the Notes to the Condensed Consolidated Financial Statements for additional information.