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System-wide Store Sales: Increased to $3.5 billion, marking the 19th consecutive year of growth.

Store Locations: Added 170 system-wide stores, totaling 2,180 across the US and Canada.

Adjusted EBITDA: Achieved double-digit growth, exceeding the midpoint of guidance.

Adjusted EPS: $1.59 per share, at the low end of the guidance range.

Net Sales (Q4): Grew to $454 million, a 4% increase on a reported basis and 10% when adjusted for refranchising.

System-wide Same-Store Sales Growth (Q4): Increased by 6%.

Net Sales (Fiscal Year): Grew 12% when adjusted for refranchising, reaching $1.7 billion.

Gross Margin Rate (Q4): 39.1%, flat year over year.

Adjusted EBITDA Margin (Q4): Increased 20 basis points to 28.7%.

Adjusted EBITDA (Fiscal Year): Increased 11%.

Adjusted Net Income (Fiscal Year): Increased 6%.

Leverage Ratio: Ended fiscal 2025 at 3.4 times on a rating agency-adjusted basis.

Capital Expenditures: $259 million, with about 70% for new store additions.

Breeze Acquisition: Planned to close on December 1, acquiring 162 stores for a net purchase price of $593 million.

Fiscal 2026 Outlook: System-wide same-store sales growth of 4% to 6% and overall network growth of 330 to 360 new stores.

Fiscal 2026 CapEx: Expected to be $250 million to $280 million.

Adjusted EPS (Fiscal 2026): Expected to be $1.60 to $1.70 per share.

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Release Date: November 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Valvoline Inc (NYSE:VVV) achieved a double-digit increase in system-wide store sales, reaching $3.5 billion, marking the 19th consecutive year of same-store sales growth.

The company added 170 system-wide stores in fiscal year 2025, expanding its network to 2,180 stores across the US and Canada.

Valvoline Inc (NYSE:VVV) reported double-digit growth in adjusted EBITDA, reflecting successful investments in technology and refranchising efforts.

The company demonstrated strong transaction and ticket growth, with contributions from premiumization, net pricing, and increased NOCR penetration.

Valvoline Inc (NYSE:VVV) plans to acquire 162 stores through the Breeze Autocare acquisition, which is expected to enhance long-term shareholder value and leverage existing investments.

Adjusted EPS for fiscal year 2025 came in at the low end of the guidance range at $1.59 per share.

Capital expenditures exceeded the guidance range due to the timing and mix of new store additions.

The acquisition of Breeze Autocare will increase Valvoline Inc (NYSE:VVV)'s leverage ratio to approximately 4.2 times, with an expected 18 to 24 months to return to the target leverage ratio.

The company faces higher product costs, including increased supply chain costs and reduced used oil pricing, impacting gross margins.

SG&A as a percentage of sales increased year-over-year, driven by investments in teams and technology, which offset gross margin expansion.

Q: Can you frame the revenue and EBITDA contribution from the Breeze acquisition and explain the decline in EBITDA margins for fiscal '26? A: J. Kevin Willis, CFO, explained that the core business is expected to perform well in fiscal '26. The Breeze acquisition is still in early stages, and while specific details aren't disclosed, a measured approach was taken in the outlook. The decline in EBITDA margins is partly due to the inclusion of Breeze, which has a lower margin profile initially.

Q: How does the competitive environment affect your market entry strategy, and are there any markets you avoid due to competition? A: Lori Flees, CEO, stated that Valvoline evaluates new units based on demographics, competition, and proximity to existing stores. The competitive environment is consistent, and they do not avoid any markets due to competition. The quick-lube channel has a small market share, and Valvoline continues to capture share effectively.

Q: What is the outlook for SG&A leverage in fiscal '26, and how does the Breeze acquisition impact this? A: Kevin Willis, CFO, mentioned that SG&A growth is expected to moderate, and leverage is anticipated in fiscal '26. The inclusion of Breeze makes it challenging to isolate SG&A leverage, but the company expects to lap technology investments and continue investing in growth.

Q: How do you build to the 4% to 6% same-store sales guidance, and what is the mix between traffic and ticket? A: Kevin Willis, CFO, noted a balance between transactions and ticket growth, with Q4 showing one-third from transactions and two-thirds from ticket. This balance is expected to continue in fiscal '26, with no significant changes anticipated.

Q: Can you provide more detail on the higher product cost impact and its outlook for the new fiscal year? A: Kevin Willis, CFO, explained that product costs are affected by crude oil and base oil pricing, with supply chain costs adding inflationary pressure. Used oil pricing has also been a drag. These factors are expected to continue impacting costs in fiscal '26.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.