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What changed in VALVOLINE INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of VALVOLINE INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+246 added−262 removedSource: 10-K (2025-11-21) vs 10-K (2024-11-22)

Top changes in VALVOLINE INC's 2025 10-K

246 paragraphs added · 262 removed · 193 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeDo It For Me (“DIFM”) total addressable market depicted below demonstrates the magnitude of the opportunity in the U.S. for Valvoline: (a) VIOC oil changes in fiscal year 2024 (U.S. company-operated and franchised stores) (b) Management estimates developed utilizing internal and industry data for U.S. passenger car and light truck quick lube and DIFM oil changes Business and growth strategies As a pure play automotive retail services provider and the trusted leader in preventive automotive maintenance, Valvoline is well positioned to create long-term shareholder value through executing the Company’s strategic initiatives, which include: 6 • Driving the full potential of the core business through increasing market share and improving operational efficiency in existing stores by building on Valvoline’s strong foundation in marketing, technology, and data insights. • Aggressively growing the retail footprint with company-operated store growth and an increased emphasis on franchisee store growth; and • Targeting customer and service expansion with a focus on fleet business, driving non-oil change service penetration, and meeting the needs of an evolving car parc.
Biggest changeDo It For Me (“DIFM”) total addressable market depicted below demonstrates the magnitude of the opportunity in the U.S. for Valvoline: (a) VIOC oil changes in fiscal year 2025 (U.S. company-operated and franchised stores) (b) Management estimates developed utilizing internal and industry data for U.S. passenger car and light truck DIFM oil changes Business and growth strategies As a pure play automotive retail services provider and the trusted leader in preventive automotive maintenance, Valvoline is well positioned to create long-term shareholder value through executing the Company’s strategic initiatives, which include: • Driving the full potential of the core business through strategic reinvestment and improving operational efficiency in existing stores by building on Valvoline’s strong foundation in marketing, technology, and data insights. • Deliver sustainable network growth with company-operated store expansion and accelerating the momentum of franchisee store growth; and • Innovating to meet the changing needs of customers and the car parc, targeting customer and service expansion with a focus on fleet business, and driving non-oil change service penetration. 6 Retail store development Valvoline’s network of retail service centers delivered its 19th consecutive year of system-wide same-store sales (“SSS”) growth in fiscal 2025, demonstrating the system's operational excellence.
Talent acquisition Valvoline strives to foster a workplace culture that attracts and retains top, diverse talent at every level. Valvoline's talent acquisition is based on qualifications and experiences of target employees, including "building block" traits and capabilities that support strong development early in an employee's career with the Company.
Talent acquisition Valvoline strives to foster a workplace culture that attracts and retains top, diverse talent at every level. Valvoline's talent acquisition is based on qualifications and experiences of target employees, including "building block" traits 10 and capabilities that support strong development early in an employee's career with the Company.
Additionally, the Compensation Committee of the Board of Directors (the “Board”) and senior management are actively involved in determining the Company’s total rewards strategy to help Valvoline provide a positive employee experience. The Company provides a wide variety of benefits to eligible full-time and part-time employees.
Additionally, the Compensation Committee of the Board of Directors (the “Board”) and senior management are actively involved in determining the Company’s total rewards strategy to help Valvoline provide a positive employee experience. 11 The Company provides a wide variety of benefits to eligible full-time and part-time employees.
Valvoline maintains policies and procedures to control risks and monitor compliance with applicable laws and regulations. These laws and regulations require Valvoline to obtain and comply with permits, registrations or other authorizations issued by governmental authorities. These authorities can modify or revoke the Company’s permits, registrations or other authorizations and can enforce compliance through fines, sanctions and injunctions.
Valvoline maintains policies and procedures to control risks and monitor compliance with applicable laws and regulations. These laws and regulations require Valvoline to obtain and comply with permits, registrations or other authorizations issued by governmental authorities. These authorities can modify or revoke the Company’s permits, registrations or other authorizations and can enforce 9 compliance through fines, sanctions and injunctions.
On this website, Valvoline makes available, free of charge, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to those reports, as well as any beneficial ownership 13 reports of officers and directors filed on Forms 3, 4 and 5.
On this website, Valvoline makes available, free of charge, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to those reports, as well as any beneficial ownership reports of officers and directors filed on Forms 3, 4 and 5.
In connection with the sale of Global Products, Valvoline entered into a long-term supply agreement for the purchase of substantially all lubricant and certain ancillary products for its stores from Global Products (the “Supply Agreement”).
In connection with the sale of Global Products, Valvoline entered into a long-term supply agreement for the purchase of substantially all lubricant and certain ancillary products for its stores from VGO (the “Supply Agreement”).
Additionally, Valvoline’s retail stores compete for consumers and franchisees with other major franchised brands that offer a turn-key operations management system, such as Jiffy Lube, Grease Monkey, Take 5 Oil Change, Express Oil Change, and Mr. Lube in Canada.
Additionally, Valvoline’s retail stores compete for consumers and franchisees with other major franchised brands that offer a turn-key operations management system, such as Jiffy Lube, Grease Monkey, Take 5 Oil Change, Express Oil Change, Tire Engineers, and Mr. Lube in Canada.
Competition Valvoline faces competition across its service offerings based on several key criteria, including brand recognition, product selection, quality of service, price, convenience, speed, location, and customer experience, in addition to the ability to deliver innovative services to meet evolving customer needs.
Competition Valvoline faces competition across its service offerings based on several key criteria, including brand recognition, quality of service, price, convenience, speed, location, and customer experience, in addition to the ability to deliver innovative services to meet evolving customer needs.
Valvoline owns approximately 700 domain names that are used to promote Valvoline services and provide information about the Company. Product supply and price The products used in Valvoline’s retail service delivery are principally sourced from Global Products.
Valvoline owns approximately 700 domain names that are used to promote Valvoline services and provide information about the Company. Product supply and price The products used in Valvoline’s retail service delivery are principally sourced from VGO.
The table below provides the Company's approximate distribution of employees, which includes its company-operated service center stores, central supporting teams, and excludes independent contractors: Number of employees Company-operated store employees 10,300 Central supporting team members 1,200 Total employee headcount 11,500 Valvoline seeks to attract, develop, and retain highly qualified talent as summarized further below.
The table below provides the Company's approximate distribution of employees, which includes its company-operated service center stores, central supporting teams, and excludes independent contractors: Number of employees Company-operated store employees 10,100 Central supporting team members 1,300 Total employee headcount 11,400 Valvoline seeks to attract, develop, and retain highly qualified talent as summarized further below.
Refer to Note 3 included within the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 4 10-K for additional information regarding the Global Products business, including income from discontinued operations. Unless otherwise noted, disclosures herein relate solely to the Company’s continuing operations.
Refer to Note 3 included within the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional 4 information regarding the Global Products business. Unless otherwise noted, disclosures herein relate solely to the Company’s continuing operations.
The Company’s focus on aggressive growth, including the addition of 158 net new system-wide stores in fiscal 2024, creates a critical need for talent to operate those stores. Valvoline utilizes its tools and processes to attract qualified candidates, including providing support to franchise sourcing efforts.
The Company’s focus on aggressive growth, including the addition of 170 net new system-wide stores in fiscal 2025, creates a critical need for talent to operate those stores. Valvoline utilizes its tools and processes to attract qualified candidates, including providing support to franchise sourcing efforts.
The SEC also maintains a website ( http://www.sec.gov ) that contains reports, proxy and other information and statements regarding issuers, including Valvoline, that file electronically with the SEC. Executive officers of Valvoline The following table sets forth information concerning Valvoline's executive officers as of November 19, 2024: Name Age Title Lori A.
The SEC also maintains a website ( http://www.sec.gov ) that contains reports, proxy and other information and statements regarding issuers, including Valvoline, that file electronically with the SEC. 13 Executive officers of Valvoline The following table sets forth information concerning Valvoline's executive officers as of November 18, 2025: Name Age Title Lori A.
The following summarizes the primary services Valvoline offers at most retail service center stores: 5 Valvoline’s services are offered to a wide range of vehicle types, including fleets, as shown below: Industry overview Demand for automotive aftermarket services benefits from the growing number and age of vehicles in operation as well as increasing vehicle complexity and ongoing increases in miles driven.
The following summarizes the primary services Valvoline offers at most retail service center stores: Valvoline’s services are offered to a wide range of vehicle types, serving both consumers and commercial customers, as shown below: 5 Industry overview Demand for automotive aftermarket services benefits from the growing number and age of vehicles in operation as well as increasing vehicle complexity and ongoing increases in miles driven.
This approach drove system-wide store growth of over 45% over the last five years. During this period, Valvoline added 625 net new stores to the system and expanded its service centers internationally into Canada.
This approach drove system-wide store growth of nearly 50% over the last five years. During this period, Valvoline added 718 net new stores to the system and expanded its service centers internationally into Canada.
As the quick, easy, trusted leader in automotive preventive maintenance, Valvoline is creating shareholder value by driving the full potential of its core business, accelerating network growth and innovating to meet the needs of customers and the evolving car parc.
As the quick, easy, trusted leader in automotive preventive maintenance, Valvoline is creating shareholder value by driving the full potential of its core business, delivering sustainable network growth, and continuing to innovate to meet the evolving needs of customers and the car parc.
As shown below, Valvoline operates, either directly or through its franchisees, 2,010 service center stores across the U.S. and Canada as of September 30, 2024: l Company-operated l Franchised Valvoline utilizes a three-pronged approach to grow its retail network through 1) franchisee store expansion 2) opportunistic acquisitions, and 3) new store development.
As shown below, Valvoline operates, either directly or through its franchisees, 2,180 service center stores across the U.S. and Canada as of September 30, 2025: Valvoline utilizes a three-pronged approach to grow its retail network through 1) franchisee store expansion 2) opportunistic acquisitions, and 3) new store development.
O’Daniel served as General Counsel and Corporate Secretary of Valvoline from September 2016 to January 2017 and as Lead Commercial Counsel of Valvoline from April 2014 to September 2016. Jonathan L. Caldwell has served as Valvoline's Senior Vice President and Chief People Officer since April 2020. Mr.
O’Daniel has served as Valvoline’s Senior Vice President, Chief Legal Officer and Corporate Secretary since January 2017. Ms. O’Daniel served as General Counsel and Corporate Secretary of Valvoline from September 2016 to January 2017 and as Lead Commercial Counsel of Valvoline from April 2014 to September 2016. Jonathan L.
Caldwell served as Senior Director, Human Resources of Valvoline from March 2018 to April 2020 and as Senior Director, Global Talent Management of Valvoline from October 2016 to March 2018. R. Travis Dobbins has served as Valvoline's Senior Vice President and Chief Technology Officer since March 2023. Mr.
Caldwell has served as Valvoline's Senior Vice President and Chief People Officer since April 2020. Mr. Caldwell served as Senior Director, Human Resources of Valvoline from March 2018 to April 2020 and as Senior Director, Global Talent Management of Valvoline from October 2016 to March 2018. Linwood R.
Sturgeon has served as Valvoline's Vice President, Chief Accounting Officer and Controller since March 2023. Ms. Sturgeon served as Vice President, Corporate Controller from March 2022 to February 2023; as Senior Director, Global Accounting, Reporting & Controls from October 2020 to March 2022; and as Director, Corporate Accounting of Valvoline from August 2016 to October 2020.
Sturgeon served as Vice President, Corporate Controller from March 2022 to February 2023; as Senior Director, Global Accounting, Reporting & Controls from October 2020 to March 2022; and as Director, Corporate Accounting of Valvoline from August 2016 to October 2020.
Fulcher 53 Senior Vice President and Chief Operating Officer Dione R. Sturgeon 47 Vice President, Chief Accounting Officer and Controller Lori A. Flees has served as a director and President and Chief Executive Officer of Valvoline since October 2023. Ms. Flees served as President, Retail Services of Valvoline from April 2022 to September 2023. Prior to joining Valvoline, Ms.
Sturgeon 48 Vice President, Chief Accounting Officer and Controller Lori A. Flees has served as a director and President and Chief Executive Officer of Valvoline since October 2023. Ms. Flees served as President, Retail Services of Valvoline from April 2022 to September 2023. Prior to joining Valvoline, Ms.
Workforce As of September 30, 2024, Valvoline had approximately 11,500 employees (excluding contract employees) in the U.S. and Canada, including approximately 10,500 full-time employees. Valvoline operates 950 company-owned 10 retail service center stores throughout the U.S. and Canada and supports its network of more than 2,000 stores through centralized teams.
Workforce As of September 30, 2025, Valvoline had approximately 11,400 employees (excluding contract employees) in the U.S. and Canada, including approximately 10,600 full-time employees. Valvoline operates 1,016 company-owned retail service center stores throughout the U.S. and Canada and supports its network of approximately 2,200 stores through centralized teams.
With average customer ratings that indicate high levels of service satisfaction, Valvoline and the Company’s franchise partners keep customers moving with approximately 15-minute stay-in-your-car oil changes; battery, bulb and wiper replacements; tire rotations; and other manufacturer recommended maintenance services.
With average customer ratings that indicate high levels of service satisfaction, Valvoline and the Company’s franchise partners simplify vehicle care so customers can do what drives them. This includes approximately 15-minute stay-in-your-car oil changes; battery, bulb and wiper replacements; tire rotations; and other manufacturer recommended maintenance services.
The Company operates and franchises more than 2,000 service center locations through its Valvoline Instant Oil Change SM (“VIOC”) and Valvoline Great Canadian Oil Change (“GCOC”) retail locations and supports nearly 270 locations through its Express Care TM platform.
The Company operates and franchises approximately 2,200 service center locations through its Valvoline Instant Oil Change SM (“VIOC”) and Valvoline Great Canadian Oil Change (“GCOC”) retail locations and supports over 240 locations through its Express Care TM platform.
These include: • Affordable healthcare plans (medical, prescription, dental, vision, maternity, fertility, adoption and telehealth) 12 • Life, disability, and accident insurance coverage • Health savings account (HSA) with company contributions • 401(k) retirement savings plan with generous company basic and matching contributions • Personalized employee well-being programs to support taking care of the whole employee and family • Tuition reimbursement • Paid time off, plus holiday pay, paid disability, paid maternity and family leave, and other leave programs.
These include: • Affordable healthcare plans (medical, prescription, dental, vision, maternity, fertility, adoption and telehealth) • Life, disability, and accident insurance coverage • Health savings account (HSA) with company contributions • 401(k) retirement savings plan with generous company basic and matching contributions • Broad Employee Assistance Program and advocacy resources to support both employees and their families • Tuition reimbursement • Paid time off, plus holiday pay, paid disability, paid maternity and family leave, and other leave programs.
By engaging team members early, Valvoline provides them with the necessary tools to learn and acquire new skills which increases their value as an employee and, most importantly, affords them the opportunity to advance their careers.
By engaging team members early, Valvoline provides them with the necessary tools to learn and acquire new skills which increases their value as an employee and, most importantly, affords them the opportunity to advance their careers. Valvoline has been presented with multiple awards over the years that recognize the training and development of its employees.
With the completion of the sale of Global Products, Valvoline owns the Valvoline brand for all global retail services, excluding China and certain countries in the Middle East and North Africa, while Global Products owns the Valvoline brand for all product uses globally.
With the completion of the sale of Global Products, Valvoline owns the Valvoline brand for all global retail services, excluding China and certain countries in the Middle East and North Africa, while VGO owns the Valvoline brand for all product uses globally. Valvoline partners with VGO to ensure that Valvoline's iconic brand is managed in a consistent and holistic manner.
As a result, the second half of the fiscal year ordinarily is more robust as miles driven tends to be higher. Weather conditions can modestly affect transaction volumes, and geographic variation typically limits weather impacts to specific regions.
Transaction volumes follow driving patterns of consumers, which generally trend with the length of daylight hours, North American holidays, and vacation timing. As a result, the second half of the fiscal year ordinarily is more robust as miles driven tends to be higher. Weather conditions can modestly affect transaction volumes, and geographic variation typically limits weather impacts to specific regions.
Valvoline’s retail services Valvoline operates and franchises more than 2,000 service center locations through its VIOC and GCOC retail locations and supports nearly 270 locations through its Express Care platform.
Valvoline’s retail services Valvoline operates and franchises approximately 2,200 service center locations through its VIOC and GCOC retail locations and supports over 240 locations through its Express Care platform.
Valvoline partners with Global Products to ensure that Valvoline's iconic brand is managed in a consistent and holistic manner. Valvoline trade names and service marks used in its business include Valvoline TM and Valvoline Instant Oil Change SM , among others. Valvoline is also party to arrangements that license its intellectual property to others in return for revenues.
Valvoline trade names and service marks used in its business include Valvoline SM , Valvoline Instant Oil Change SM , and VIOC SM , among others. Valvoline is also party to arrangements that license its intellectual property to others in return for revenues.
The Company offers competitive, comprehensive compensation and benefits programs designed to care for the physical, mental, emotional, social and financial well-being of its employees. The Company’s objective is to base compensation on employee position, experience, location, performance, and the labor market in order to not be influenced by factors such as gender, race, or ethnicity.
The Company offers competitive, comprehensive compensation and benefits programs designed to care for the physical, mental, emotional, social and financial well-being of its employees. The Company’s objective is to determine employee compensation based on employee position, experience, location, performance, and the labor markets in which the Company operates.
Discontinued operations On March 1, 2023, Valvoline completed the sale of its former Global Products reportable segment (currently doing business as “Valvoline Global Operations” and referred to herein as “Global Products”) to Aramco Overseas Company B.V. (the “Buyer”) (the “Transaction”).
Discontinued operations On March 1, 2023, Valvoline completed the sale of its former Global Products reportable segment (“Global Products”), now doing business as Valvoline Global Operations (“VGO”) to Aramco Overseas Company B.V. (the “Buyer”) (the “Transaction”). The operating results and cash flows associated with and directly attributed to the Global Products disposal group are reflected as discontinued operations .
Fulcher served as Vice President, Central Operations and Customer Experience Optimization from August 2022 to September 2023. Prior to joining Valvoline, Mr. Fulcher held various leadership positions at Walmart Inc., serving as Vice President Customer Strategy, Science and Journeys from October 2019 to August 2021; and Vice President Returns from February 2017 to October 2019. 14 Dione R.
Fulcher held various leadership positions at Walmart Inc., serving as Vice President Customer Strategy, Science and Journeys from October 2019 to August 2021; and Vice President Returns from February 2017 to October 2019. Dione R. Sturgeon has served as Valvoline's Vice President, Chief Accounting Officer and Controller since March 2023. Ms.
Valvoline markets through search and direct response channels, invests in advertising through social and digital media, and leverages targeted sponsorships to reach specific audiences. The Company’s modeled marketing strategies are efficient and yield strong rates of return. Valvoline leverages its digital tools to obtain customer feedback across the retail network of stores.
Techniques utilized by the Company are intended to build awareness of and create demand for its automotive preventive maintenance services. Valvoline markets through search and direct response channels, invests in advertising through video, social and digital media, and leverages targeted geographic sponsorships to reach specific audiences. The Company’s modeled marketing strategies are efficient and yield strong rates of return.
The Company is committed to the inclusion of federally-insured minority depository institutions (“MDIs”) alongside larger banks and financial institutions as part of its overall cash management strategy and has $2.6 million of its cash equivalents as of September 30, 2024 with MDIs. The Company also supports employee-led networking groups (Employee Resource Groups or “ERGs”), which are open to all employees.
Valvoline’s goal is for the Company’s workforce to reflect the diverse communities it serves. 12 The Company is committed to the inclusion of federally-insured minority depository institutions (“MDIs”) alongside larger banks and financial institutions as part of its overall cash management strategy and has $2.6 million of its cash equivalents as of September 30, 2025 with MDIs.
These trademarks have a perpetual life, are generally subject to renewal every ten years, and are among Valvoline's most protected and valuable assets.
Intellectual property Valvoline holds approximately 390 trademarks in more than 70 countries across the world, including the Valvoline and “V” brand logo trademarks. These trademarks have a perpetual life, are generally subject to renewal every ten years, and are among Valvoline's most protected and valuable assets.
Flees 54 President and Chief Executive Officer and Director Mary E. Meixelsperger 64 Chief Financial Officer Julie M. O’Daniel 57 Senior Vice President, Chief Legal Officer and Corporate Secretary Jonathan L. Caldwell 47 Senior Vice President and Chief People Officer R. Travis Dobbins 52 Senior Vice President and Chief Technology Officer Linwood R.
Flees 55 President and Chief Executive Officer and Director J. Kevin Willis 60 Senior Vice President and Chief Financial Officer Julie M. O’Daniel 58 Senior Vice President, Chief Legal Officer and Corporate Secretary Jonathan L. Caldwell 48 Senior Vice President and Chief People Officer Linwood R. Fulcher 54 Senior Vice President and Chief Operating Officer Dione R.
To both acquire and retain customers, marketing plays an important role in demonstrating the distinct experience that Valvoline offers customers, as well as providing information on locations, promotions, services offered, and wait times. Techniques utilized by the Company are intended to build awareness of and create demand for its automotive preventive maintenance services.
Marketing and customer experience Valvoline places a high priority on delivering an in-store customer experience that is quick, easy, and trusted. To both acquire and retain customers, marketing plays an important role in demonstrating the distinct experience that Valvoline offers customers, as well as providing information on locations, promotions, services offered, and wait times.
As part of the broader training curriculum, team members are required to successfully complete execution reports confirming a strong understanding of Valvoline safety measures.
As part of the broader training curriculum, team members are required to successfully complete execution reports confirming a strong understanding of Valvoline safety measures. Valvoline reinforces this training with an ongoing safety program designed to keep all employees at the store level engaged with the safety culture and focuses on mitigating the risk of incidents.
Customer feedback is frequently measured and monitored to ensure that any service issues are quickly addressed to maintain high levels of customer satisfaction. Valvoline also utilizes its digital infrastructure and technology to more efficiently interact with customers, driving customer engagement, acquisition and retention, and consistency.
Valvoline leverages its digital tools to obtain customer feedback across the retail network of stores. Customer feedback is frequently measured and monitored to ensure that any service issues are quickly addressed to maintain 8 high levels of customer satisfaction.
Valvoline also competes for Express Care operators and customers with national branded companies that offer an independent quick lube platform with a professional signage program and limited business model support. 8 Marketing and customer experience Valvoline places a high priority on delivering an in-store customer experience that is quick, easy, and trusted.
Valvoline competes with other franchisors in automotive services and across other industries on the basis of the expected return on investment and the value propositions offered to franchisees. Valvoline also competes for Express Care operators and customers with national branded companies that offer an independent quick lube platform with a professional signage program and limited business model support.
The Company's strengths in digital marketing and data analytics are leveraged to attract new and retain existing customers, including tailored marketing campaigns directed to specific customers when they are in the market for their next service. Intellectual property Valvoline holds approximately 390 trademarks in more than 70 countries across the world, including the Valvoline and “V” brand logo trademarks.
Valvoline also utilizes its digital infrastructure and technology to more efficiently interact with customers, driving customer engagement, acquisition and retention, and consistency of experience. The Company's strengths in digital marketing and data analytics are leveraged to attract new and retain existing customers, including tailored marketing campaigns directed to specific customers when they are in the market for their next service.
The Company’s customer value proposition focuses on convenience and quality service which provides the ability to leverage pricing power to raise prices while maintaining customer loyalty.
The Company’s customer value proposition focuses on convenience and quality service which provides the ability to leverage pricing power to raise prices while maintaining customer loyalty. Pricing adjustments to products sold to Valvoline's independent operators are made pursuant to their contracts and are generally based on movements in published base oil indices. Seasonality Valvoline’s business is moderately impacted by seasonality.
Dobbins served as Vice President of Information Technology of Valvoline from January 2019 to February 2023 and as Information Technology Director, Commercial Solutions from September 2016 to January 2019. Linwood R. Fulcher has served as Valvoline's Senior Vice President and Chief Operating Officer since October 2023. Mr.
Fulcher has served as Valvoline's Senior Vice President and Chief Operating Officer since October 2023. Mr. Fulcher served as Vice President, Central Operations and Customer Experience Optimization from August 2022 to September 2023. Prior to joining Valvoline, Mr.
These ERGs provide a forum to communicate and exchange ideas, build a network of relationships across the Company and pursue personal and professional development. The Company also actively sponsors events that promote diversity and inclusion across the business and its operations. Citizenship Valvoline’s citizenship efforts support social and educational needs within the communities the Company serves.
The Company also supports employee-led networking groups (Employee Resource Groups or “ERGs”), which are open to all employees. These ERGs provide a forum to communicate and exchange ideas, build a network of relationships across the Company and pursue personal and professional development.
Diversity, equity and inclusion (“DEI”) Valvoline is committed to creating an inclusive and welcoming environment for its employees and customers by fostering a strong sense of belonging, where diverse backgrounds are represented, engaged and empowered to inspire innovative ideas and decisions. Valvoline’s goal is for the Company’s workforce to represent the diverse communities served.
Diversity and inclusion Valvoline is committed to creating an inclusive and welcoming environment for its employees and customers where everyone belongs.
Mary E. Meixelsperger has served as Valvoline's Chief Financial Officer since June 2016. Prior to joining Valvoline, Ms. Meixelsperger was Senior Vice President and Chief Financial Officer of DSW Inc. from April 2014 to June 2016. In October 2024, Ms. Meixelsperger announced her plans to retire. Ms.
J. Kevin Willis has served as Valvoline's Senior Vice President and Chief Financial Officer since May 2025. Prior to joining Valvoline, Mr. Willis held various leadership positions at Ashland Inc., including serving as Senior Vice President and Chief Financial Officer from May 2013 to April 2025. Julie M.
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The operating results and cash flows associated with and directly attributed to the Global Products disposal group are reflected as discontinued operations .
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(c) Beginning in fiscal 2025, Valvoline determines SSS growth as the year-over-year change in net revenues of U.S. VIOC same stores (company-operated, franchised and the combination of these for system-wide SSS) with same stores defined as those that have been in operation within the system for at least 12 full months. Previously, SSS was determined utilizing net revenues of U.S.
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Retail store development Valvoline’s network of retail service centers delivered its 18th consecutive year of system-wide same-store sales (“SSS”) growth in fiscal 2024, demonstrating the system's operational excellence.
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VIOC stores, with new stores, including franchised conversions, excluded from the metric until the completion of their first full fiscal year in operation. Beginning with fiscal year 2022, SSS measures have been recast to conform with the current approach and all fiscal years prior to this period remain presented consistent with the former SSS approach.
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Valvoline competes with other franchisors in automotive services and across other industries on the basis of the expected return on investment and the value propositions offered to franchisees.
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The Company also actively sponsors events that promote diversity and inclusion across the business and its operations to spark engagement, increase education and drive execution. Corporate Citizenship Valvoline is committed to serving the communities where its employees live and work, by supporting employees in volunteering their time and talents and through corporate charitable efforts.
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Pricing adjustments to products sold to Valvoline's independent operators are made pursuant to their contracts and are generally based on movements in published base oil indices. 9 Seasonality Valvoline’s business is moderately impacted by seasonality. Transaction volumes follow driving patterns of consumers, which generally trend with the length of daylight hours, North American holidays, and vacation timing.
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The Company has launched Happy to Help to define its community impact work. This initiative is focused on supporting causes that impact children’s physical and mental health. For more than 15 years, one of the Company’s primary non-profit partners has been Children’s Miracle Network.
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VIOC has been presented with Training magazine’s Training APEX Award 11 times, which ranks companies that are unsurpassed in harnessing human capital and reflects the winners’ journey to attain peak performance in employee training and development and organizational success.
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In November, all company-operated stores, as well as participating franchise stores, raise money for local children’s hospitals through customer donations. Each year, the funds raised by the campaign stay local in each community to support the local children’s hospital.
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Additionally, the Company is an eleven-time recipient of the BEST Award from The Association for Talent Development, that recognizes organizations that are 11 building talent, enterprise-wide and strategically driving a talent development culture that delivers results. As an eleven-time winner of this award, the Company was also named to the association’s Best of the BEST list.
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In addition to Children’s Miracle Network, the Company supports non-profit organizations to help train more health care professionals on suicide prevention and award grants to children’s hospitals to fund mental health initiatives. These grants remodeled therapy rooms, purchased psychologically safe entertainment and sensory tools for pediatric emergency departments and more.
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Throughout the year, Valvoline supports its employees in volunteering their time and talents to give back to their communities. Valvoline employees support the United Way, Red Cross, Children’s Miracle Network, Habitat for Humanity, Big Brothers Big Sisters, and many more national and local organizations.
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Valvoline's Charitable Giving Program encourages its team members to support the communities in which they live and in which the Company operates, through hands-on service, focused generosity and the continuous pursuit of innovative and sustainable solutions.
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A major focus of Valvoline’s charitable giving programs is the annual employee giving campaign where employees are encouraged to donate to the charity of their choice.
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Valvoline’s matching program will match the donations given to the organizations that align with at least one of the Company’s fiscal 2024 giving pillars: (1) disadvantaged families and children, (2) education, (3) environment, (4) health care, and/or (5) diversity, equity and inclusion.
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Meixelsperger will continue as Chief Financial Officer until a successor is hired and will remain with the Company through a subsequent transition period. Julie M. O’Daniel has served as Valvoline’s Senior Vice President, Chief Legal Officer and Corporate Secretary since January 2017. Ms.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

51 edited+11 added−14 removed114 unchanged
Biggest changeValvoline uses information technology systems to conduct business, and a cybersecurity threat, data breach, security incident, failure of a key information technology system, or inability to enhance its capabilities could adversely affect Valvoline’s business and reputation. Valvoline relies on its information technology systems, including systems which are managed or provided by third-party service providers, to conduct its business.
Biggest changeValvoline relies on its information technology systems, including systems which are managed or provided by third-party service providers, to conduct its business. The Company’s point-of-sale platforms for company-operated and franchisee retail stores could be subject to cybersecurity threats, service outages, or data breaches.
In the event of adverse developments or stagnation in the economy or financial markets, Valvoline’s customers may defer vehicle maintenance, oil changes, or other services, may repair and maintain their vehicles themselves or be unable to obtain credit reducing their ability to spend.
In the event of adverse developments or stagnation in the economy or financial markets, Valvoline’s customers may defer vehicle maintenance, oil changes, or other services, may repair and maintain their vehicles themselves, or may be unable to obtain credit, reducing their ability to spend.
Valvoline's substantial indebtedness could adversely affect its business, results of operations and financial condition by, among other things: requiring Valvoline to dedicate a substantial portion of its cash flows to pay principal and interest on its debt, which would reduce the availability of its cash flow to fund working capital, capital expenditures, acquisitions, execution of its growth strategy and other general corporate purposes; limiting Valvoline’s ability to borrow additional amounts to fund working capital, capital expenditures, acquisitions, debt service requirements, execution of its growth strategy and other general corporate purposes; making Valvoline more vulnerable to adverse changes in general economic, industry and regulatory conditions and in its business by limiting its flexibility in planning for or reacting to changing conditions; placing Valvoline at a competitive disadvantage compared with its competitors that have less debt and lower debt service requirements; making Valvoline more vulnerable to increases in interest rates since some of its indebtedness is subject to variable rates of interest; and making it more difficult for Valvoline to satisfy its financial obligations.
Valvoline's substantial indebtedness could adversely affect its business, results of operations and financial condition by, among other things: requiring Valvoline to dedicate a substantial portion of its cash flows to pay principal and interest on its debt, which would reduce the availability of its cash flow to fund working capital, capital expenditures, acquisitions, execution of its growth strategy and other general corporate purposes; limiting Valvoline’s ability to borrow additional amounts to fund working capital, capital expenditures, acquisitions, debt service requirements, execution of its growth strategy and other general corporate purposes; making Valvoline more vulnerable to adverse changes in general economic, industry and regulatory conditions and in its business by limiting its flexibility in planning for or reacting to changing conditions; placing Valvoline at a competitive disadvantage compared with its competitors that have less debt and lower debt service requirements; making Valvoline more vulnerable to 22 increases in interest rates since some of its indebtedness is subject to variable rates of interest; and making it more difficult for Valvoline to satisfy its financial obligations.
Aspects of that risk include, among others, changes to the global economy, availability of or failure to identify acquisition targets or real estate for new stores to grow the Company’s network of retail service center stores, real estate and construction costs or delays limiting new store growth, changes to the competitive landscape, including those related to automotive maintenance recommendations and customer preferences, entry of new competitors, attraction and retention of skilled employees, failure to successfully develop and implement digital platforms to support the Company’s growth initiatives, failure to comply with existing or new regulatory requirements, failure to maintain a competitive cost structure and other risks outlined in greater detail in this “Risk Factors” section.
Aspects of that risk include, among others, changes to the global economy, availability of or failure to identify acquisition targets or real estate for new stores to grow the Company’s network of retail service center stores, real estate and construction costs or delays limiting new store growth, changes to the competitive landscape, including those related to automotive maintenance recommendations and customer preferences, entry of new competitors, attraction and retention of skilled employees, failure to successfully develop 16 and implement digital platforms to support the Company’s growth initiatives, failure to comply with existing or new regulatory requirements, failure to maintain a competitive cost structure and other risks outlined in greater detail in this “Risk Factors” section.
Similar software-induced interruptions or any security breach involving the point-of-sale or other systems within the Valvoline network could harm business operations, result in a loss of consumer confidence, or cause costs to be incurred associated with data recovery, investigation, remediation, and data breach notification obligations required under data privacy laws, which can be significant and vary by jurisdiction.
Software-induced interruptions or any security breach involving the point-of-sale or other systems within the Valvoline network could harm business operations, result in a loss of consumer confidence, or cause costs to be incurred associated with data recovery, investigation, remediation, and data breach notification obligations required under data privacy laws, which can be significant and vary by jurisdiction.
The Company’s Articles specify that the Fayette County Circuit Court of the Commonwealth of Kentucky shall be the sole and exclusive forum for any derivative action or proceeding brought on behalf of the Company, any action asserting a breach of a fiduciary duty, any action asserting a claim arising pursuant to the Kentucky Business Corporation Act, or any action asserting a claim governed by the internal affairs doctrine.
The Company’s Articles specify that the Fayette County Circuit Court of the Commonwealth of Kentucky shall be the sole and exclusive forum for any derivative action or proceeding brought on behalf of the Company, any action asserting a breach of a fiduciary duty, any action asserting a claim arising pursuant to the Kentucky Business 24 Corporation Act, or any action asserting a claim governed by the internal affairs doctrine.
However, third parties could also seek to hold Valvoline responsible for any of the liabilities that Ashland agreed to retain, and there can be no assurance that the indemnity from Ashland will be sufficient to protect Valvoline against the full amount of such liabilities, or that Ashland will be able to fully satisfy its indemnification obligations in the future.
However, third parties could also seek to hold Valvoline responsible for any 25 of the liabilities that Ashland agreed to retain, and there can be no assurance that the indemnity from Ashland will be sufficient to protect Valvoline against the full amount of such liabilities, or that Ashland will be able to fully satisfy its indemnification obligations in the future.
If Valvoline does not attract, train and retain quality employees in appropriate numbers, including key employees and management, performance could be adversely affected. Valvoline’s performance is dependent on recruiting, developing, training, and retaining quality and diverse service center employees in large numbers. Valvoline’s service centers positions are subject to high rates of turnover.
If Valvoline does not attract, train and retain quality employees in appropriate numbers, including key employees and management, performance could be adversely affected. Valvoline’s performance is dependent on recruiting, developing, training, and retaining quality and diverse service center employees in large numbers. Valvoline’s service center positions are subject to high rates of turnover.
Valvoline relies heavily upon its trademarks, domain names and logos to market its brands and to build and maintain brand loyalty and recognition. The Company’s success depends on the continued ability of Valvoline’s company-operated and franchised service center stores to use the intellectual property and on the adequate protection and enforcement of such intellectual property.
Valvoline relies heavily upon its trademarks, domain names and logos to market its brands and to build and maintain brand loyalty and recognition. The Company’s success depends on the continued ability of Valvoline’s company-operated and franchised service center stores to use the intellectual property and on the adequate 23 protection and enforcement of such intellectual property.
Any of these factors could have an adverse effect on Valvoline’s business, financial condition, results of operations, or cash flows. 21 Operating in numerous locations in the U.S. and Canada increases the scrutiny on Valvoline’s reputation for safety, quality, friendliness, trustworthy service, integrity and business ethics.
Any of these factors could have an adverse effect on Valvoline’s business, financial condition, results of operations, or cash flows. Operating in numerous locations in the U.S. and Canada increases the scrutiny on Valvoline’s reputation for safety, quality, friendliness, trustworthy service, integrity and business ethics.
This risk includes, among other things, compliance with a myriad of U.S. tax laws and regulations; franchise laws and regulations; securities laws and regulations; environmental laws and regulations; labor laws and regulations; anti-competition laws and regulations; product compliance regulations; anti-corruption and anti-bribery laws, including the Foreign Corrupt Practices Act (“FCPA”); anti-money-laundering laws; and other laws governing Valvoline’s operations.
This risk includes, among other things, compliance with a myriad of U.S. tax laws and regulations; franchise laws and regulations; securities laws and regulations; environmental laws and regulations; labor laws and regulations; anti-competition laws and regulations; anti-corruption and anti-bribery laws, including the Foreign Corrupt Practices Act (“FCPA”); anti-money-laundering laws; and other laws governing Valvoline’s operations.
Valvoline’s efforts to respond to changes in customer demand in a timely and cost-efficient manner to drive growth could be adversely affected by difficulties or delays in service innovation, including the inability to identify or gain market acceptance of new service techniques.
Valvoline’s efforts to respond to changes in customer demand in a timely and cost-efficient manner to drive growth could be adversely affected by difficulties or delays in service innovation, including the inability to identify or gain 15 market acceptance of new service techniques.
The loss or limited availability of the services of one or more key management personnel, or Valvoline’s inability to recruit and retain qualified diverse candidates in the future, 19 could, at least temporarily, have an adverse effect on Valvoline’s operating results and financial condition.
The loss or limited availability of the services of one or more key management personnel, or Valvoline’s inability to recruit and retain qualified diverse candidates in the future, could, at least temporarily, have an adverse effect on Valvoline’s operating results and financial condition.
For example, the California Consumer Privacy Act ("CCPA") applies to Valvoline's activities conducted in the state of California. Valvoline is also subject to Canada data privacy laws, such as The Personal Information Protection and Electronic Documents Act (“PIPEDA”), due to operations throughout Canada.
For example, the California Consumer Privacy Act ("CCPA") applies to Valvoline's 21 activities conducted in the state of California. Valvoline is also subject to Canada data privacy laws, such as The Personal Information Protection and Electronic Documents Act (“PIPEDA”), due to operations throughout Canada.
Valvoline also may be deemed liable for soil and/or groundwater contamination at sites to which it sent hazardous wastes for treatment or 24 disposal, notwithstanding that the original treatment or disposal activity accorded with all applicable regulatory requirements.
Valvoline also may be deemed liable for soil and/or groundwater contamination at sites to which it sent hazardous wastes for treatment or disposal, notwithstanding that the original treatment or disposal activity accorded with all applicable regulatory requirements.
However, Valvoline has limited influence over its franchisees’ operations and t he quality of franchised store operations may be diminished by a number of factors beyond the Company’s control. Val voline ’s franchisees manage their businesses independently and are responsible for the day-to-day operations of 53% of the Company’s system-wide service center stores as of September 30, 2024.
However, Valvoline has limited influence over its franchisees’ operations and t he quality of franchised store operations may be diminished by a number of factors beyond the Company’s control. Val voline ’s franchisees manage their businesses independently and are responsible for the day-to-day operations 17 of 53% of the Company’s system-wide service center stores as of September 30, 2025.
Valvoline is dependent on Global Products for its product supply and certain remaining transition services and certain indemnities have been agreed to with the Buyer, for which the Company may be negatively impacted if Global Products is unable to provide these products and services or is unable to satisfy its indemnification obligations.
Valvoline is dependent on VGO for its product supply and certain indemnities have been agreed to with the Buyer, for which the Company may be negatively impacted if VGO is unable to provide these products or is unable to satisfy its indemnification obligations.
The global macroeconomic environment could be negatively affected by, among other things, disruptions to the banking system and financial market volatility resulting from bank failures and actions to reduce inflation. The Company utilizes and maintains material balances of cash and cash equivalents, therefore is reliant on banks and financial institutions to safeguard and allow ready access to these assets.
The global macroeconomic environment could be negatively affected by, among other things, disruptions to the banking system and financial market volatility. The Company utilizes and maintains material balances of cash and cash equivalents and is therefore reliant on banks and financial institutions to safeguard and allow ready access to these assets.
Risks related to operating Valvoline's business The Company’s recently implemented enterprise resource planning (“ERP”) system has adversely impacted Valvoline’s internal controls and could continue to negatively impact the business if remedial efforts are not timely and effective. Valvoline relies upon its ERP application to assist in managing certain business processes and summarizing operational and financial results.
Risks related to operating Valvoline's business The Company’s enterprise resource planning (“ERP”) system implemented in fiscal 2024 adversely impacted Valvoline’s internal controls and could continue to negatively impact the business if remedial efforts are not effectively maintained. Valvoline relies upon its ERP application to assist in managing certain business processes and summarizing operational and financial results.
The most significant of these plans, the U.S. qualified pension plans, are estimated to be underfunded by $51.5 million as of September 30, 2024. The funded status of Valvoline's pension plans is dependent upon many factors, including returns on invested assets, the level of certain market interest rates and the discount rate used to determine pension obligations.
The most significant of these plans, the qualified pension plans, are estimated to be underfunded by $71.3 million as of September 30, 2025. The funded status of Valvoline's pension plans is dependent upon many factors, including returns on invested assets, the level of certain market interest rates and the discount rate used to determine pension obligations.
Another component of the Company’s network growth strategy is dependent on the success of recent refranchising activities taken during fiscal 2024 and planned for early fiscal 2025. Failure to achieve the expected benefits of the refranchising transactions could negatively impact the Company’s operating results and its overall long-term strategic growth objectives, including accelerating franchise store growth.
Another component of the Company’s network growth strategy is dependent on the success of recent refranchising activities. Failure to achieve the expected benefits of the refranchising transactions could negatively impact the Company’s operating results and its overall long-term strategic growth objectives, including accelerating franchise store growth.
If any of these events occur, 23 Valvoline may have to make cash payments to its pension plans to satisfy minimum funding requirements, which based on current data and assumptions, are not expected for at least the next five years. If such payments are required, it would reduce the cash available for Valvoline’s business.
If any of these events occur, Valvoline may have to make cash payments to its pension plans to satisfy minimum funding requirements, which based on current data and assumptions, are not expected in the near term. If such payments are required, it would reduce the cash available for Valvoline’s business.
Following the sale of the former Global Products reportable segment in fiscal 2023, and as part of Valvoline’s continued evolution to a standalone retail business, the Company has been in the process of separating certain business processes, information systems and applications that were previously shared to support both businesses.
Following the sale of Global Products in fiscal 2023, and as part of Valvoline’s continued evolution to a standalone retail business, the Company separated certain business processes, information systems and applications that were previously shared to support both businesses.
Valvoline’s substantial indebtedness may adversely affect its business, results of operations and financial condition. Valvoline has substantial indebtedness and financial obligations. As of September 30, 2024, Valvoline had outstanding indebtedness of $1.094 billion and available borrowing capacity of $346.8 million under its revolving 22 credit facility.
Valvoline’s substantial indebtedness may adversely affect its business, results of operations and financial condition. Valvoline has substantial indebtedness and financial obligations. As of September 30, 2025, Valvoline had outstanding indebtedness of $1.074 billion and available borrowing capacity of $341.6 million under its revolving credit facility.
An insufficient quantity of strategic acquisition targets in the marketplace with limited targets remaining, or the inability of Valvoline to successfully acquire those targets, may have a negative impact on Valvoline's ability to achieve its future growth projections.
An inability to execute these plans could have an adverse impact on Valvoline’s financial condition and results of operations. An insufficient quantity of strategic acquisition targets in the marketplace with limited targets remaining, or the inability of Valvoline to successfully acquire those targets, may have a negative impact on Valvoline's ability to achieve its future growth projections.
Risks related to Valvoline’s separation from Ashland Ashland has agreed to indemnify Valvoline for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to insure Valvoline against the full amount of such liabilities, or that Ashland’s ability to satisfy its indemnification obligation will not be impaired in the future.
However, there can be no assurance that the indemnity will be sufficient to insure Valvoline against the full amount of such liabilities, or that Ashland’s ability to satisfy its indemnification obligation will not be impaired in the future. Pursuant to the terms of the Separation Agreement and certain other agreements with Ashland, Ashland agreed to indemnify Valvoline for certain liabilities.
Specifically, the Company has $68.3 million of cash and cash equivalents as of September 30, 2024 held by various financial institutions.
Specifically, the Company has $51.6 million of cash and cash equivalents as of September 30, 2025 held by various financial institutions.
A negative public perception of Valvoline’s brands, whether justified or not, could impair its reputation, involve it in litigation, damage its brand equity and have a material adverse effect on its business.
A negative public perception of Valvoline’s brands, whether justified or not, could impair its reputation, involve it in litigation, damage its brand equity and have a material adverse effect on its business. In addition, damage to the reputation of Valvoline’s competitors or others in the automotive maintenance services industry could negatively impact Valvoline’s reputation and business.
In addition, insurance maintained by Valvoline to protect against property damage, loss of business and other related consequences resulting from catastrophic events is subject to significant retentions and coverage limitations, depending on the nature of the risk insured. This insurance may not be sufficient to cover all of Valvoline’s damages or damages to others in the event of a catastrophe.
In addition, insurance maintained by Valvoline to protect against property damage, 20 loss of business and other related consequences resulting from catastrophic events is subject to significant retentions and coverage limitations, depending on the nature of the risk insured.
While the ERP system is intended to ultimately improve and enhance business processes, its implementation resulted in disruptions to maintaining an effective internal control environment and the timely processing of invoices and billings to franchisee, independent operator and fleet customers.
While the ERP system is intended to ultimately improve and enhance business processes, its implementation resulted in disruptions, including to maintaining an effective internal control environment.
Pursuant to the Brand Agreement, Valvoline retains ownership of the Valvoline brand for generally all retail services purposes, and Global Products owns the brand for all product uses.
In connection with the sale of Global Products, Valvoline and VGO entered into a brand agreement (the “Brand Agreement”). Pursuant to the Brand Agreement, Valvoline retains ownership of the Valvoline brand for generally all retail services purposes, and VGO owns the brand for all product uses.
In addition, the anticipated benefits of Valvoline’s acquisitions may not be realized and the process of integrating an acquired company, business, or product may create unforeseen operating difficulties or expenditures. 17 Valvoline’s acquisitions, investments and strategic partnerships could also result in dilutive issuances of its equity securities, the incurrence of debt, contingent liabilities or amortization expenses, impairment of goodwill or purchased long-lived assets and restructuring charges, any of which could harm its financial condition, results of operations and cash flows.
Valvoline’s acquisitions, investments and strategic partnerships could also result in dilutive issuances of its equity securities, the incurrence of debt, contingent liabilities or amortization expenses, impairment of goodwill or purchased long-lived assets and restructuring charges, any of which could harm its financial condition, results of operations and cash flows.
Although the new ERP application is not currently utilized in the day-to-day operations of Valvoline’s retail stores and there have been no material impacts on its ability to serve customers to-date, the conversion to any new IT system, including the planned implementation of a human resources information system expected in fiscal 2025, exposes the Company to additional risks and 18 possible continued disruptions.
Although the recently-implemented ERP application has not been and is not currently utilized in the day-to-day operations of Valvoline’s retail stores and there have been no material impacts on the ability to serve customers to-date, the conversion to any new IT system and related remedial procedures for business process controls, exposes the Company to additional risks and possible continued disruptions.
Disruptions caused by pandemics, epidemics or disease outbreaks, such as COVID-19, in the United States or Canada, could materially affect Valvoline's results of operations, financial condition and forward-looking expectations. These events could impact Valvoline's business, particularly as it relates to congestion in the supply chain and related cost, as well as disruptions in the labor market.
Pandemics, epidemics or disease outbreaks may disrupt Valvoline’s business and operations, which could materially affect Valvoline’s financial condition, results of operations and forward-looking expectations. Disruptions caused by pandemics, epidemics or disease outbreaks, such as COVID-19, in the United States or Canada, could materially affect Valvoline's results of operations, financial condition and forward-looking expectations.
Additionally, turnover in other key positions can disrupt progress in implementing business strategies, result in a loss of institutional knowledge, cause greater workload demands for remaining team members and divert attention away from key areas of the business, or otherwise negatively impact the Company’s growth prospects or future operating results.
Additionally, turnover in other key positions can disrupt progress in implementing business strategies, result in a loss of institutional knowledge, cause greater workload demands for remaining team members and divert attention away from key areas of the business, or otherwise negatively impact the Company’s growth prospects or future operating results. 19 Valvoline uses information technology systems to conduct business, and a cybersecurity threat, data breach, security incident, failure of a key information technology system, or inability to enhance its capabilities could adversely affect Valvoline’s business and reputation.
In addition, competitors’ pricing decisions could compel Valvoline to decrease its prices, which could negatively affect Valvoline’s margins and profitability. Rising and volatile supply costs and supply chain constraints or disruptions could adversely affect Valvoline’s results of operations. Valvoline’s service center locations require large quantities of automotive products and supplies.
Rising and volatile supply costs and supply chain constraints or disruptions could adversely affect Valvoline’s results of operations. Valvoline’s service center locations require large quantities of automotive products and supplies.
These risk factors could cause future results to differ from those in forward-looking statements and from historical trends. These risks are not the only risks that Valvoline faces. Additional risks and uncertainties that are not presently known, or that Valvoline currently believes are not material, may also become meaningful and adversely affect Valvoline’s business.
These risk factors could cause future results to differ from those in forward-looking statements and from historical trends. These risks are not the only risks that Valvoline faces.
Valvoline has completed a significant number of acquisitions in recent years and has developed a pipeline of future viable targets expected to complement the Company’s growth initiatives.
Valvoline has completed a significant number of acquisitions in recent years and has developed a pipeline of future viable targets expected to complement the Company’s growth initiatives. Valvoline expects to continue to evaluate and enter into discussions regarding a wide array of potential strategic transactions and to continue to grow organically and through acquisitions.
If Valvoline is unable to obtain and retain product supply under commercially acceptable terms, its ability to deliver services in a competitive and profitable manner or grow its business successfully could be adversely affected. 15 Demand for Valvoline’s services could be adversely affected by spending trends, declining economic conditions, industry trends and a number of other factors, all of which are beyond its control.
If Valvoline is unable to obtain and retain product supply under commercially acceptable terms, its ability to deliver services in a competitive and profitable manner or grow its business successfully could be adversely affected.
The limited diversification of Valvoline’s operations subjects it to risks. Historically, Valvoline has been able to take advantage of its size and global reach as a combined products and services company.
The limited diversification of Valvoline’s operations subjects it to risks. Historically, Valvoline has been able to take advantage of its size and global reach as a combined products and services company. The sale of Global Products during fiscal 2023 resulted in Valvoline being a smaller, less diversified company, potentially making it more vulnerable to changing market, regulatory and economic conditions.
Valvoline management has implemented a remedial plan, as described in Item 9A, Controls and Procedures, which substantial progress has been made during fiscal 2024. However, management cannot provide any assurance that such remedial measures, or any other remedial measures taken, will be effective and identify or address all inherent risks from implementing an ERP system.
Management cannot provide any assurance that such remedial measures, or any other remedial measures taken, will be effective and identify or address all inherent risks from implementing an ERP system.
Risks related to the sale of the Global Products business Valvoline may be unable to achieve some or all of the strategic and financial benefits that it expects to achieve from the Transaction. In connection with completing the sale of its former Global Products reportable segment, Valvoline received net proceeds of $2.383 billion.
Risks related to the sale of the Global Products business Valvoline may be unable to achieve some or all of the strategic and financial benefits that it expects to achieve from the Transaction. In connection with the sale of Global Products, Valvoline expects to drive growth and shareholder value as a best-in-class, pure-play automotive retail service provider.
Valvoline is dependent on Global Products for product supply and each party is reliant on one another for the remaining transition services. Any interruption, delay, quality issue or other failure in product supply or service could 25 adversely affect the business and results of operations and result in disputes between the parties.
Any interruption, delay, quality issue or other failure in product supply could adversely affect the business and results of operations and result in disputes between the parties. As part of the sale of Global Products, the parties agreed to indemnify and reimburse one another for various matters, which include tax indemnities.
Risks related to the industries in which Valvoline operates Valvoline faces significant competition from other companies, which places downward pressure on prices and margins and may adversely affect Valvoline’s business and results of operations. Valvoline operates in a highly competitive market, competing against a wide variety of companies across the automotive services industry.
Additional risks and uncertainties that are not presently known, or that Valvoline currently believes are not material, may also become meaningful and adversely affect Valvoline’s business. 14 Risks related to the industries in which Valvoline operates Valvoline faces significant competition from other companies, which places downward pressure on prices and margins and may adversely affect Valvoline’s business and results of operations.
There is no guarantee that these indemnification arrangements will sufficiently protect Valvoline from potential exposures or liability claims from third parties, including taxing authorities. Additionally, there can be no assurance that Global Products can fulfill its indemnification obligations in the future. Valvoline could experience negative impacts on its business, financial position, and cash flows due to these risks.
Additionally, there can be no assurance that VGO can fulfill its indemnification obligations in the future. Valvoline could experience negative impacts on its business, financial position, and cash flows due to these risks. Risks related to Valvoline’s separation from Ashland Ashland has agreed to indemnify Valvoline for certain liabilities.
Certain competitors are larger than Valvoline and have greater financial resources and more diversified portfolios, leading to greater operating and financial flexibility. As a result, these competitors may be better able to withstand adverse changes in conditions within the industry, market dynamics, the price of supplies or general economic conditions.
As a result, these competitors may be better able to withstand adverse changes in conditions within the industry, market dynamics, the price of supplies or general economic conditions. In addition, competitors’ pricing decisions could compel Valvoline to decrease its prices, which could negatively affect Valvoline’s margins and profitability.
Valvoline may incur substantial additional debt from time to time to finance working capital, capital expenditures, investments or acquisitions, or for other general corporate purposes.
In addition, Valvoline expects to borrow $740 million in December 2025 to fund the purchase of the Breeze Autocare acquisition with excess proceeds being used to pay down outstanding debt. Valvoline may incur substantial additional debt from time to time to finance working capital, capital expenditures, investments or acquisitions, or for other general corporate purposes.
As part of the sale of Global Products, the parties agreed to indemnify and reimburse one another for various matters, which include tax indemnities. Each business will be responsible for taxes related to its operations, breaches of its tax covenants, and its share of transfer taxes, while Valvoline assumes responsibility for tax matters associated with the pre-closing reorganization.
Each business will be responsible for taxes related to its operations, breaches of its tax covenants, and its share of transfer taxes, while Valvoline assumes responsibility for tax matters associated with the pre-closing reorganization. There is no guarantee that these indemnification arrangements will sufficiently protect Valvoline from potential exposures or liability claims from third parties, including taxing authorities.
In addition, insurance related to these types of risks may not be available now or, if available, may not be available in the future at commercially reasonable rates. Pandemics, epidemics or disease outbreaks may disrupt Valvoline’s business and operations, which could materially affect Valvoline’s financial condition, results of operations and forward-looking expectations.
This insurance may not be sufficient to cover all of Valvoline’s damages or damages to others in the event of a catastrophe. In addition, insurance related to these types of risks may not be available now or, if available, may not be available in the future at commercially reasonable rates.
Competition is based on several key criteria, including brand recognition, quality, price, customer service, and the ability to bring innovative services to the marketplace. Competitors include international, national, regional and local automotive repair and maintenance shops, automobile dealerships, and oil change shops.
Valvoline operates in a highly competitive market, competing against a wide variety of companies across the automotive services industry. Competition is based on several key criteria, including brand recognition, quality, price, customer service, and the ability to bring innovative services to the marketplace.
In connection with the sale of Global Products in fiscal 2023, the parties entered into a Supply Agreement and an agreement for certain transition services.
In connection with the sale of Global Products in fiscal 2023, Valvoline and VGO entered into a Supply Agreement. Pursuant to the Supply Agreement, Valvoline is dependent on VGO for product supply as it purchases substantially all lubricant and certain ancillary products for its stores from VGO.
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For example, Valvoline’s supplier for air filters experienced supply constraints in fiscal 2024 leading to delivery delays to Valvoline until the supplier was able to diversify its supply chain, which impacted non-oil change revenue in the first half of fiscal 2024.
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Competitors include international, national, regional and local automotive repair and maintenance shops, automobile dealerships, and oil change shops. Certain competitors are larger than Valvoline and have greater financial resources and more diversified portfolios, leading to greater operating and financial flexibility.
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Additionally, the International Longshoreman’s Association (“ILA”) union of maritime workers contract expired on September 30, 2024 without a renewed contract negotiated until early October 2024, resulting in a brief labor strike.
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While the Company’s results did not include a material impact from new tariffs enacted in fiscal 2025, future changes in tariffs could have an adverse impact if the Company is not able to mitigate the effects.
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A more lengthy strike from the ILA could have had a negative impact on Valvoline’s suppliers resulting in an unfavorable impact to product availability and cost and negatively impacted the Company’s consolidated results of operations.
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Demand for Valvoline’s services could be adversely affected by spending trends, declining economic conditions, industry trends and a number of other factors, all of which are beyond its control.
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In addition, damage to the reputation of Valvoline’s competitors or others in the automotive maintenance services industry could negatively impact Valvoline’s reputation and business. 16 In connection with the sale of Global Products, the parties entered into a brand agreement (the “Brand Agreement”).
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Additionally, successful integration of strategic acquisitions, including the pending acquisition of Breeze Autocare, is not guaranteed and may fail to deliver anticipated benefits and synergies leading to operational disruptions and increased costs. Possibilities include challenges assimilating operations, technologies, along with products and services, as well as diverting management's focus on core operations and maintaining internal controls.
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Valvoline expects to continue to evaluate and enter into discussions regarding a wide array of potential strategic transactions and to continue to grow organically and through acquisitions. An inability to execute these plans could have an adverse impact on Valvoline’s financial condition and results of operations.
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Retaining key employees and customers is crucial and significant acquisitions can create uncertainty resulting in talent loss, customer attrition, and culture clash, which can negatively impact productivity, competitiveness and organizational alignment.
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The Company’s point-of-sale platforms for company-operated and franchisee retail stores could be subject to cybersecurity threats, service outages, or data breaches, such as the July 2024 software update by CrowdStrike Holdings, Inc., a cybersecurity technology company, which caused a global information technology outage. This incident required temporary manual processes to maintain operations.
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In addition, the anticipated benefits of Valvoline’s acquisitions may not be realized and the process of integrating an acquired company, business, or product may create unforeseen operating difficulties or expenditures.
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Although it was brief and did not have a material impact to business, Valvoline’s business was adversely impacted by the outage and slowed service.
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Valvoline management has implemented and executed a remedial plan, as described in Item 9A, Controls and Procedures, and substantial progress was made during fiscal 2025. Substantial progress towards the remediation of the material weakness has been made in fiscal 2025 through the remediation of the ITGC deficiencies and the efforts to enhance business process controls.
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Although the impact to the Company’s results of operations and financial 20 condition were not material, the recent hurricanes Beryl, Helene and Milton caused certain company-operated and franchised service center stores to temporarily pause operations for a period of time for safety and evacuations, in addition to being impacted by intermittent connectivity issues and limited damage to stores.
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Remediation of the business process control design deficiencies that aggregate to the material weakness will conclude once the controls and related documentation are consistently executed for a sufficient 18 period of time and are determined to be effective, through formal testing, which is expected to be completed in fiscal 2026.
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In these cases when the stores remain open, they often rely upon manual processes which can slow service times and minimize transactions, or in the cases where the stores have to close for a period of time, the inability to service customers until the stores are safe to operate.
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Beyond changes in customer behavior driven by economic conditions, rapid changes in the marketing landscape and the potential for OEMs to monetize or restrict access to their software and data could undermine current customer retention and acquisition strategies. These dynamics could lead to decreased customer loyalty, increased churn, and higher customer acquisition costs.
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The sale of Global Products reportable segment during fiscal 2023 resulted in Valvoline being a smaller, less diversified company, potentially making it more vulnerable to changing market, regulatory and economic conditions.
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These events could impact Valvoline's business, particularly as it relates to congestion in the supply chain and related cost, as well as disruptions in the labor market.
Removed
Valvoline focused on accelerating the return of capital to shareholders through share repurchases, reductions of debt, and investments in attractive retail service growth opportunities. In connection with the sale of Global Products and the use of the net proceeds, Valvoline expects to drive growth and shareholder value as a best-in-class, pure-play automotive retail service provider.
Added
Valvoline’s handling of consumer and employee personal data, including reliance on third-party providers, subjects the Company to various federal, state and local data privacy and protection requirements, which could lead to additional complexities and increased costs of operations.
Removed
Pursuant to the Supply Agreement, Valvoline purchases substantially all lubricant and certain ancillary products for its stores from Global Products and certain transition services remain in place, which includes limited information technology support expected to continue through early calendar year 2025.
Removed
In addition, if either party has issues or delays with finalizing the remaining transitions, Valvoline may not be able to operate its business effectively which could cause adverse effects to its financial condition, results of operations, or cash flows.
Removed
Pursuant to the terms of the Separation Agreement and certain other agreements with Ashland, Ashland agreed to indemnify Valvoline for certain liabilities.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Audit Committee receives reports and presentations from the Senior Vice President and Chief Technology Officer (“CTO”) and Senior Director of Information Security during bi-annual meetings, and as needed, on a range of topics including, but not limited to, the cybersecurity program and processes, information systems, business risk identification and mitigation strategies, strategic updates, operational matters, the evolving cybersecurity threat landscape, regulatory developments, and notable incidents or threats affecting the Company. 26 The CTO, who serves as the Chief Information Security Officer (“CISO”) for the Company, is the primary executive responsible for leading the Company’s cybersecurity risk management program and has over 25 years of experience in various technology-related roles, including responsibilities related to managing information security, developing cybersecurity strategy, and implementing cybersecurity programs.
Biggest changeThe Board of Directors receives reports and presentations from the Senior Vice President and Chief Technology and Cybersecurity Officer (“CTO”) Vice President of IT Operations & Platforms, and Senior Director of Information Security during bi-annual meetings, and as needed, on a range of topics including, but not limited to, the cybersecurity program and processes, information systems, business risk identification and mitigation strategies, strategic updates, operational matters, the evolving cybersecurity threat landscape, regulatory developments, and notable incidents or threats affecting the Company.
The IRT is also responsible for reporting incidents, following Valvoline’s Information Security Incident Response Plan (“IRP”), in accordance with legal requirements, coordinating external communications, and setting information sharing restrictions. Other departments or individuals may be engaged according to the specific nature of the incident and will operate at the direction of the IRT.
The IRT is also responsible for reporting incidents, following Valvoline’s Information Security Incident Response Plan (“IRP”), in accordance with legal requirements, coordinating external communications, and setting information sharing restrictions. Other departments or individuals may be engaged according to the specific nature of the 26 incident and will operate at the direction of the IRT.
The Audit Committee of the Board (the “Audit Committee”) oversees the Company’s enterprise risk management program. As part of this oversight, the Audit Committee has primary responsibility for overseeing risks related to cybersecurity, although the Board retains ultimate oversight over these risks. The Audit Committee reviews and discusses cybersecurity risks along with the Company’s cybersecurity programs and strategy with management.
The Audit Committee of the Board (the “Audit Committee”) oversees the Company’s enterprise risk management program. As part of this oversight, the Audit Committee has primary responsibility for overseeing risks related to cybersecurity, although the Board retains ultimate oversight over these risks.
To date, risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected the Company, including the business strategy, results of operations or financial condition, and management does not believe that such risks are reasonably likely to have such an effect over the long term. 27 However, due to evolving cybersecurity threats, and despite security measures taken, it may not be possible to anticipate, prevent, and stop future cybersecurity incidents, including attacks on information systems and data or those of relevant business partners.
To date, risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected the Company, including the business strategy, results of operations or financial condition, and management does not believe that such risks are reasonably likely to have such an effect over the long term.
Valvoline’s Senior Director of Information Security is responsible for the implementation of, and amendments to, the IRP and supporting procedures.
Valvoline’s Senior Director of Information Security is responsible for the implementation of, and amendments to, the IRP and supporting procedures. Risk management and strategy Valvoline has developed and implemented a cybersecurity risk management program designed to protect the confidentiality, integrity, and availability of its critical systems and information.
The program applies, where appropriate, to the Company’s internal and external information systems, applications, networks, and operations which includes scanning, testing, and assessments designed to identify risks from cybersecurity threats. Management across various functional teams administer the enterprise risk management program, which is designed to identify, assess, and manage top enterprise risks, including risks arising from cybersecurity threats.
This program, which is based on the National Institute of Standards and Technology (“NIST”) Cybersecurity and Privacy Frameworks, is an integrated part of the company's overall enterprise risk management process. The program applies, where appropriate, to Valvoline's internal and external information systems, applications, networks, and operations.
Removed
Risk management and strategy Valvoline has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of critical systems and information in addition to a cybersecurity incident response plan based on the National Institute of Standards (“NIST”) Cybersecurity Framework (“CSF”).
Added
The Board of Directors reviews and discusses cybersecurity risks along with the Company’s cybersecurity programs and strategy with management.
Removed
Valvoline continually evaluates and makes updates to the Company’s cybersecurity programs to align with regulatory requirements and industry best practices in order to keep company-wide training initiatives related to cybersecurity risks robust and up to date.
Added
The CTO, who serves as the Chief Information Security Officer (“CISO”) for the Company, is the primary executive responsible for leading the Company’s cybersecurity risk management program and has over 30 years of experience in various technology-related roles, including responsibilities related to managing information security, developing cybersecurity strategy, and implementing cybersecurity programs.
Added
It includes ongoing activities such as scanning, testing, and assessments intended to identify and manage risks arising from cybersecurity threats. Management, including various functional teams, is responsible for assessing, identifying, and managing material risks from cybersecurity threats. Valvoline continually evaluates and updates its cybersecurity programs to align with regulatory requirements and industry best practices.
Added
This includes keeping company-wide training initiatives related to cybersecurity risks robust and up-to-date. Valvoline's Executive Information Security and Privacy Committee provides crucial oversight for cybersecurity risk management. On a monthly basis, the committee reviews key metrics, evaluates risk tolerance, and approves strategic direction to ensure the program aligns with the company's business objectives.
Added
However, due to evolving cybersecurity threats, and despite security measures taken, it may not be possible to anticipate, prevent, and stop future cybersecurity incidents, including attacks on information systems and data or those of relevant business partners.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeValvoline believes its physical properties are suitable and adequate for the Company’s business, and none of the property owned by Valvoline is subject to any major known encumbrances. Additional information regarding lease obligations may be found in Note 6 of the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K.
Biggest changeAdditional information regarding lease obligations may be found in Note 6 of the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K. 27
In addition, Valvoline owns or leases the property associated with 950 company-operated retail service center stores under the Valvoline Instant Oil Change SM and Valvoline Great Canadian Oil Change brands throughout the United States and Canada, respectively. Valvoline’s store leases typically have initial terms of up to 15 years with renewal options, exercisable at the Company’s discretion.
In addition, Valvoline owns or leases the property associated with 1,016 company-operated retail service center stores under the Valvoline Instant Oil Change SM and Valvoline Great Canadian Oil Change brands throughout the United States and Canada, respectively. Valvoline’s store leases typically have initial terms of up to 15 years with renewal options, exercisable at the Company’s discretion.
ITEM 2. PROPERTIES Valvoline is headquartered in Lexington, Kentucky, where the Company leases approximately 135,000 square feet of office and warehouse space to support operations across its business, which excludes certain properties that the Company currently subleases to others.
ITEM 2. PROPERTIES Valvoline is headquartered in Lexington, Kentucky, where the Company leases approximately 105,000 square feet of office space to support operations across its business, which excludes certain properties that the Company currently subleases to others.
Added
Valvoline believes its physical properties are suitable and adequate for the Company’s business, and none of the property owned by Valvoline is subject to any major known encumbrances.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time, Valvoline is party to lawsuits, claims and other legal proceedings that arise in the ordinary course of business. For a description of Valvoline's legal proceedings, refer to Note 11 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K. ITEM 4.
Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time, Valvoline is party to lawsuits, claims and other legal proceedings that arise in the ordinary course of business. For a description of Valvoline's legal proceedings, refer to Note 11 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K.
Removed
MINE SAFETY DISCLOSURES Not applicable. 28 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThis graph assumes an investment in Valvoline common stock and each index were $100 on September 30, 2019 and that all dividends were reinvested. 29 Years ended September 30 Cumulative total returns 2020 2021 2022 2023 2024 Valvoline Inc. $ 88.36 $ 147.37 $ 121.61 $ 155.32 $ 201.62 S&P MidCap 400 Index $ 97.84 $ 140.58 $ 119.14 $ 137.62 $ 174.49 S&P MidCap 400 Specialty Retail Index $ 110.75 $ 187.47 $ 126.52 $ 142.05 $ 203.20 Purchases of Company common stock Valvoline has returned value to shareholders through share repurchases, the timing and amount of which will be at the discretion of the Company and based on Valvoline’s liquidity, general business and market conditions, and other factors, including alternative investment opportunities.
Biggest changeThis graph assumes an investment in Valvoline common stock and each index were $100 on September 30, 2020 and that all dividends were reinvested. 29 Years ended September 30 Cumulative total returns 2021 2022 2023 2024 2025 Valvoline Inc. $ 166.78 $ 137.63 $ 175.78 $ 228.17 $ 195.79 S&P MidCap 400 Index $ 143.68 $ 121.77 $ 140.66 $ 178.34 $ 189.26 S&P MidCap 400 Specialty Retail Index $ 169.27 $ 114.24 $ 128.26 $ 183.47 $ 179.91 Purchases of Company common stock Valvoline has returned value to shareholders through share repurchases, the timing and amount of which will be at the discretion of the Company and based on Valvoline’s liquidity, general business and market conditions, and other factors, including alternative investment opportunities.
The declaration, amount and payment of any future dividends to holders of Valvoline common stock is at the sole discretion of Valvoline's Board of Directors (the “Board”) after considering various factors, including Valvoline’s financial condition, operating results, current and anticipated cash needs, cash flows, impact on Valvoline’s effective tax rate, indebtedness, legal requirements and other factors that the Board considers relevant.
The declaration, amount and payment of any future dividends to holders of Valvoline common stock is at the sole discretion of the Board after considering various factors, including Valvoline’s financial condition, operating results, current and anticipated cash needs, cash flows, impact on Valvoline’s effective tax rate, indebtedness, legal requirements and other factors that the Board considers relevant.
Stock performance graph The following graph compares the cumulative total shareholder return on a $100 investment in Valvoline common stock, the S&P MidCap 400 Index, and the S&P MidCap 400 Specialty Retail Index for the period from September 30, 2019 to September 30, 2024.
Stock performance graph The following graph compares the cumulative total shareholder return on a $100 investment in Valvoline common stock, the S&P MidCap 400 Index, and the S&P MidCap 400 Specialty Retail Index for the period from September 30, 2020 to September 30, 2025.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market information Valvoline common stock is listed on the NYSE and trades under the symbol “VVV.” As of November 19, 2024, there were approximately 7,400 registered holders of Valvoline common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market information Valvoline common stock is listed on the NYSE and trades under the symbol “VVV.” As of November 18, 2025, there were approximately 7,060 registered holders of Valvoline common stock.
Removed
Repurchases of the Company’s common stock during the three months ended September 30, 2024 pursuant to the July 30, 2024 Board authorization to repurchase up to $400 million of common stock with no expiration date were: Fiscal period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Dollar value of shares that may yet be purchased under the plans or programs (in millions) July 1, 2024 - July 31, 2024 — $ — — $ 400.0 August 1, 2024 - August 31, 2024 70,886 $ 42.11 70,886 $ 397.0 September 1, 2024 - September 30, 2024 299,082 $ 40.75 299,082 $ 384.8 Total 369,968 $ 41.01 369,968
Added
On July 30, 2024, the Board approved an authorization to repurchase up to $400 million of common stock with no expiration date. During the second quarter of fiscal 2025, Valvoline paused share repurchase activity in anticipation of completing the Breeze Autocare acquisition.
Added
Valvoline will fund the acquisition with a new Term Loan B issuance and accelerate debt repayment after closing the Breeze Autocare acquisition to return to a ratings agency target adjusted EBITDA net leverage ratio of 2.5 to 3.5 times.
Added
As a result of the pending acquisition, the Company did not repurchase any shares of common stock during the three months ended September 30, 2025. At September 30, 2025, the Company retained authorization to repurchase up to $325.0 million of shares of common stock under the share repurchase program.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeITEM 6. RESERVED 30 Index to Management’s Discussion and Analysis of Financial Condition and Results of Operations Page Business Overview 31 Results of Operations - Consolidated Review 35 Financial Position, Liquidity and Capital Resources 40 New Accounting Pronouncements 43 Critical Accounting Estimates 44
Biggest changeITEM 6. RESERVED 30 Index to Management’s Discussion and Analysis of Financial Condition and Results of Operations Page Business Overview 31 Results of Operations - Consolidated Review 35 Financial Position, Liquidity and Capital Resources 39 New Accounting Pronouncements 42 Critical Accounting Estimates 42

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

75 edited+27 added−40 removed62 unchanged
Biggest changeAlthough Valvoline does not recognize store-level sales from franchised stores as net revenues in its Statements of Condensed Consolidated Income, management believes system-wide and franchised SSS comparisons, store counts, and total system-wide store sales are useful to assess market position relative to competitors and overall store and operating performance. 34 RESULTS OF OPERATIONS The following summarizes the results of the Company’s continuing operations for the years ended September 30: 2024 vs. 2023 (In millions) 2024 2023 $ % Net revenues $ 1,619.0 $ 1,443.5 $ 175.5 12.2 % Gross profit $ 618.8 $ 544.5 $ 74.3 13.6 % Gross profit margin 38.2 % 37.7 % 50 bps Net operating expenses $ 251.6 $ 297.3 $ (45.7) (15.4) % Percentage of net revenues 15.5 % 20.6 % (510) bps Operating income $ 367.2 $ 247.2 $ 120.0 48.5 % Operating margin 22.7 % 17.1 % 560 bps Income from continuing operations $ 214.5 $ 199.4 $ 15.1 7.6 % EBITDA (a) $ 461.4 $ 363.6 $ 97.8 26.9 % Adjusted EBITDA (a) $ 442.6 $ 380.0 $ 62.6 16.5 % Adjusted EBITDA margin (a) 27.3 % 26.3 % 100 bps (a) Refer to the “Use of Non-GAAP Measures” and Continuing operations EBITDA and Adjusted EBITDA for management’s definitions of the metrics presented above and reconciliation to the corresponding GAAP measures, where applicable.
Biggest changeRESULTS OF OPERATIONS The following summarizes the results of the Company’s continuing operations for the years ended September 30: 2025 vs. 2024 (In millions) 2025 2024 $ % Net revenues $ 1,710.3 $ 1,619.0 $ 91.3 5.6 % Gross profit $ 658.5 $ 618.8 $ 39.7 6.4 % Gross profit margin 38.5 % 38.2 % 30 bps Net operating expenses $ 268.6 $ 251.6 $ 17.0 6.8 % Percentage of net revenues 15.7 % 15.5 % 20 bps Operating income $ 389.9 $ 367.2 $ 22.7 6.2 % Operating margin 22.8 % 22.7 % 10 bps Income from continuing operations $ 214.8 $ 214.5 $ 0.3 0.1 % EBITDA (a) $ 485.7 $ 461.4 $ 24.3 5.3 % Adjusted EBITDA (a) $ 466.8 $ 442.6 $ 24.2 5.5 % Adjusted EBITDA margin (a) 27.3 % 27.3 % — bps (a) Refer to the “Use of Non-GAAP Measures” and Continuing operations EBITDA and Adjusted EBITDA for management’s definitions of the metrics presented above and reconciliation to the corresponding GAAP measures, where applicable.
Key items may consist of adjustments related to: legacy businesses, including the separation from Valvoline's former parent company, the former Global Products reportable segment, and associated impacts of related activity and indemnities; non-service pension and other postretirement plan activity; restructuring-related matters, including organizational restructuring plans, the separation of Valvoline’s businesses, significant acquisitions or divestitures, debt extinguishment and modification, and tax reform legislation; in addition to other matters that management considers non-operational, infrequent or unusual in nature.
Key items may consist of adjustments related to: legacy businesses, including the separation from Valvoline's former parent company, the former Global Products reportable segment, and the associated impacts of related activity and indemnities; non-service pension and other postretirement plan activity; restructuring-related matters, including organizational restructuring plans, the separation of Valvoline’s businesses, significant acquisitions or divestitures, debt extinguishment and modification, and tax reform legislation; in addition to other matters that management considers non-operational, infrequent or unusual in nature.
Key Business Measures Valvoline tracks its operating performance and manages its business using certain key measures, including system-wide, company-operated and franchised store counts and SSS; and system-wide store sales.
Key Business Measures Valvoline tracks its operating performance and manages its business using certain key measures, including system-wide, company-operated and franchised store counts and system-wide SSS and store sales.
NEW ACCOUNTING PRONOUNCEMENTS For a discussion and analysis of recently issued and adopted accounting pronouncements and the impact on Valvoline, refer to Note 2 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K. 43 CRITICAL ACCOUNTING ESTIMATES The preparation of Valvoline’s consolidated financial statements in conformity with U.S.
NEW ACCOUNTING PRONOUNCEMENTS For a discussion and analysis of recently issued and adopted accounting pronouncements and the impact on Valvoline, refer to Note 2 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K. CRITICAL ACCOUNTING ESTIMATES The preparation of Valvoline’s consolidated financial statements in conformity with U.S.
The Debt Tender Offer was made to comply with the requirements of the asset sale covenant under the indenture governing the 2030 Notes in connection with the sale of Global Products and Valvoline’s use of the related net proceeds.
The Debt Tender Offer was made to comply with the requirements of 40 the asset sale covenant under the indenture governing the 2030 Notes in connection with the sale of Global Products and Valvoline’s use of the related net proceeds.
Net revenues and Adjusted EBITDA trends have significantly increased over the past five fiscal years largely driven by strong system-wide same-store sales (“SSS”) growth, which benefited from increased transactions, higher average ticket, and continued non-oil change penetration, in addition to acquisitions and overall store expansion.
Net revenues and Adjusted EBITDA trends have continued to increase over the past five fiscal years largely driven by strong system-wide same-store sales (“SSS”) growth, which benefited from higher average ticket, continued non-oil change penetration and increased transactions, in addition to acquisitions and overall store expansion.
Furthermore, if actual results are not consistent with estimates or assumptions, the Company may be exposed to an impairment charge that could materially adversely impact its consolidated financial position and results of operations. There were no impairments to intangible assets recognized by the Company during fiscal 2024 or 2023.
Furthermore, if actual results are not consistent with estimates or assumptions, the Company may be exposed to an impairment charge that could materially adversely impact its consolidated financial position and results of operations. There were no impairments to intangible assets recognized by the Company during fiscal 2025 or 2024.
During fiscal three months ended September 30, 2023, the Company recognized $25.7 million of pre-tax expense to reflect its increased estimated indemnity obligation which also resulted in an income tax benefit of $29.0 million to reflect the release of valuations allowances in connection with the amendment of the Tax Matters Agreement with Valvoline’s former parent company.
During fiscal September 30, 2023, the Company recognized $25.7 million of pre-tax expense to reflect its increased estimated indemnity obligation which also resulted in an income tax benefit of $29.0 million to reflect the release of valuations allowances in connection with the amendment of the Tax Matters Agreement with Valvoline’s former parent company.
By including capital expenditures and certain other adjustments, as applicable, management is able to provide an indication of the ongoing cash being generated that is ultimately available for both debt and equity holders as well as other investment opportunities. Free cash flow includes the impact of capital expenditures, providing a supplemental view of cash generation.
By including capital expenditures, management is able to provide an indication of the ongoing cash being generated that is ultimately available for both debt and equity holders as well as other investment opportunities. Free cash flow includes the impact of capital expenditures, providing a supplemental view of cash generation.
Income tax impacts associated with the gain on the sale of Global Products were complex and included high degree of judgment due to the pre-sale restructuring transactions completed to facilitate the sale in additional to the large volume of federal, state, and international jurisdictions that were required to be evaluated and completed.
Income tax impacts associated with the gain on the sale of Global Products were complex and included a high degree of judgment due to the pre-sale restructuring transactions completed to facilitate the sale in addition to the large volume of federal, state, and international jurisdictions that were required to be evaluated.
Target asset allocation percentages as of September 30, 2024 for the qualified pension plans were 90% fixed income and 10% equity investments.
Target asset allocation percentages as of September 30, 2025 for the qualified pension plans were 90% fixed income and 10% equity investments.
As of September 30, 2024, Valvoline was in compliance with all covenants of its debt obligations and had borrowing capacity remaining of $346.8 million. Refer to Note 8 of the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional details regarding the Company’s debt instruments.
As of September 30, 2025, Valvoline was in compliance with all covenants of its debt obligations and had borrowing capacity remaining of $341.6 million. Refer to Note 8 of the Notes to Consolidated Financial Statements included in Item 8 of Part II of this Annual Report on Form 10-K for additional details regarding the Company’s debt instruments.
Variable interest rates have been assumed to remain constant through payment at the rates that existed as of September 30, 2024. (b) Includes projected benefit payments through fiscal 2034 for Valvoline’s unfunded benefit plans. Excludes benefit payments from pension plan trust funds.
Variable interest rates have been assumed to remain constant through payment at the rates that existed as of September 30, 2025. (b) Includes projected benefit payments through fiscal 2035 for Valvoline’s unfunded benefit plans. Excludes benefit payments from pension plan trust funds.
The following table illustrates the estimated impact on hypothetical pension and other postretirement expense that would have resulted from a one percentage point change in discount rates in isolation of impacts on other significant assumptions in the years ended September 30: (In millions) 2024 2023 Increase (decrease) in pension and other postretirement plan expense - 1.00% decrease in discount rates: Pension benefits Increase in benefit obligation $ 142.6 $ 126.6 Increased return on plan assets (a) (138.0) (122.0) Estimated hypothetical increase in expense 4.6 4.6 Other postretirement benefits Increase in benefit obligation 1.9 1.7 Total estimated hypothetical increase in expense $ 6.5 $ 6.3 (a) The qualified pension plans employ an investing strategy to match the duration of its obligation and investments.
The following table illustrates the estimated impact on hypothetical pension and other postretirement expense that would have resulted from a one percentage point change in discount rates in isolation of impacts on other significant assumptions in the years ended September 30: (In millions) 2025 2024 Increase (decrease) in pension and other postretirement plan expense - 1.00% decrease in discount rates: Pension benefits Increase in benefit obligation $ 129.8 $ 142.6 Increased return on plan assets (a) (125.8) (138.0) Estimated hypothetical increase in expense 4.0 4.6 Other postretirement benefits Increase in benefit obligation 1.7 1.9 Total estimated hypothetical increase in expense $ 5.7 $ 6.5 (a) The qualified pension plans employ an investing strategy to match the duration of its obligation and investments.
This estimated impact does not include increased returns of other plan assets that may also benefit from increased interest rates. 45 • Mortality — The mortality assumption for Valvoline's U.S. pension and other postretirement plans is utilizes the Society of Actuaries PRI-2012 mortality base tables and a mortality improvement scale that follows the 2024 Trustees Report of the Social Security Administration Intermediate Alternative as reflected in the MSS-2024 improvement scale.
This estimated impact does not include increased returns of other plan assets that may also benefit from increased interest rates. • Mortality — The mortality assumption for Valvoline's pension and other postretirement plans utilizes the Society of Actuaries PRI-2012 mortality base tables and a mortality improvement scale that follows the 2025 Trustees Report of the Social Security Administration Intermediate Alternative as reflected in the MSS-2025 improvement scale.
Adjusted EBITDA measures enable comparison of financial trends and results between periods where certain items may not be reflective of the Company’s underlying and ongoing operations performance or vary independent of business performance. Management uses free cash flow and discretionary free cash flow as additional non-GAAP metrics of cash flow generation.
Adjusted EBITDA measures enable comparison of financial trends and results between periods where certain items may not be reflective of the Company’s underlying and ongoing operations performance or vary independent of business performance. Management uses free cash flow and free cash flow excluding growth capital expenditures as additional non-GAAP metrics of cash flow generation.
The following are the non-GAAP measures management has included and how management defines them: • EBITDA - net income/loss, plus income tax expense/benefit, net interest and other financing expenses, and depreciation and amortization; • Adjusted EBITDA - EBITDA adjusted for the impacts of certain unusual, infrequent or non-operational activity not directly attributable to the underlying business, which management believes impacts the comparability of operational results between periods ("key items," as further described below); • Adjusted EBITDA margin - adjusted EBITDA divided by adjusted net revenues; • Adjusted net revenues - reported net revenues adjusted for key items; • Free cash flow - cash flows from operating activities less capital expenditures and certain other adjustments as applicable; and • Discretionary free cash flow - cash flows from operating activities less maintenance capital expenditures and certain other adjustments as applicable.
The following are the non-GAAP measures management has included and how management defines them: • EBITDA - net income/loss, plus income tax expense/benefit, net interest and other financing expenses, and depreciation and amortization; • Adjusted EBITDA - EBITDA adjusted for the impacts of certain unusual, infrequent or non-operational activity not directly attributable to the underlying business, which management believes impacts the comparability of operational results between periods ("key items," as further described below); • Adjusted EBITDA margin - adjusted EBITDA divided by net revenues; • Free cash flow - cash flows from operating activities less total capital expenditures, comprised of growth and maintenance, further described below; and 33 • Free cash flow excluding growth capital expenditures - cash flows from operating activities less maintenance capital expenditures.
These plans represent approximately 95% of Valvoline’s total gross pension plan obligation as of September 30, 2024 and 2023. This strategy hedges approximately 100% of the movement in liabilities related to changes in discount rates as of September 30, 2024 and 2023.
These plans represent approximately 96% and 95% of Valvoline’s total gross pension plan obligation as of September 30, 2025 and 2024, respectively. This strategy hedges approximately 100% of the movement in liabilities related to changes in discount rates as of September 30, 2025 and 2024.
The Company’s pension and other postretirement benefit costs and obligations are dependent on actuarial valuations and various assumptions that attempt to anticipate future events and are used in calculating the expense and liabilities relating to these plans. These assumptions include estimates and judgments the Company makes about discount rates, expected long-term investment return on plan assets, and mortality, among others.
The Company’s pension and other postretirement benefit costs and obligations are dependent on actuarial valuations and various assumptions that attempt to anticipate future events and are used in calculating the expense and liabilities relating to these plans. These assumptions include estimates and judgments the Company makes about discount rates and mortality, among others.
BUSINESS OVERVIEW AND PURPOSE As the quick, easy, trusted leader in automotive preventive maintenance, Valvoline is creating shareholder value by driving the full potential of its core business, accelerating network growth and innovating to meet the needs of customers and the evolving car parc.
BUSINESS OVERVIEW AND PURPOSE As the quick, easy, trusted leader in automotive preventive maintenance, Valvoline is creating shareholder value by driving the full potential of its core business, delivering sustainable network growth, and continuing to innovate to meet the evolving needs of customers and the car parc.
Free cash flow and discretionary free cash flow have certain limitations, including that they do not reflect adjustments for certain non-discretionary cash flows, such as mandatory debt repayments. 33 The non-GAAP measures used by management exclude key items.
Free cash flow and free cash flow excluding growth capital expenditures have certain limitations, including that they do not reflect adjustments for certain non-discretionary cash expenditures, such as mandatory debt repayments. The non-GAAP measures used by management exclude key items.
Summarized below are Valvoline's trends in the results of its continuing operations Net revenues, Income from continuing operations, and Adjusted EBITDA over the last five fiscal years: (a) Adjusted EBITDA is a non-GAAP measure, further described and defined within the “Use of Non-GAAP Measures” section below.
Refer to “Use of Non-GAAP Measures” and the Appendix for additional details. 32 Summarized below are Valvoline's trends in the results of its continuing operations Net revenues, Income from continuing operations, and Adjusted EBITDA over the last five fiscal years: (a) Adjusted EBITDA is a non-GAAP measure, further described and defined within the “Use of Non-GAAP Measures” section below.
Refer to “Use of Non-GAAP Measures” within this Item 7 for additional information regarding this non-GAAP measure.
Refer to “Use of Non-GAAP Measures” within this Item 7 for additional information regarding these non-GAAP measures.
Though management considers current market conditions and other relevant factors in establishing these assumptions, the actuarial assumptions used may differ materially from actual results due to changing market and economic conditions, longer or shorter life spans of participants, and differences between the actual and expected return on plan assets.
Though management considers current market conditions and other relevant factors in establishing these assumptions and year-end values, the actuarial assumptions used and ultimate asset values may differ materially from current results due to changing market and economic conditions, longer or shorter life spans of participants, and differences between the actual long-term return on plan assets.
These costs are not considered to be reflective of the underlying performance of the Company’s ongoing continuing operations. (f) Represents the results of a former Global Products business where operations were suspended during fiscal 2022. This business was not included in the sale of the Global Products business in March 2023.
This activity is not considered to be reflective of the underlying operating performance of the Company’s ongoing continuing operations. 38 (f) Represents the results of a former Global Products business where operations were suspended during fiscal 2022. This business was not included in the sale of the Global Products business in March 2023.
The table below highlights the growth over the last year: (In millions, except store count) Fiscal year 2024 Growth vs. 2023 System-wide store sales (a) $ 3,104.3 12.4 % System-wide store count (a) 2,010 8.5 % Years ended September 30 2024 2023 System-wide SSS growth (a) 6.7 % 11.9 % (a) Measures include Valvoline franchisees, which are independent legal entities.
The table below highlights the growth over the last year: (In millions, except store count) Fiscal year 2025 Growth vs. 2024 System-wide store sales (a) $ 3,453.8 11.3 % System-wide store count (a) 2,180 8.5 % Years ended September 30 2025 2024 System-wide SSS growth (a) 6.1 % 7.1 % (a) Measures include Valvoline franchisees, which are independent legal entities.
The pension plan assets generated an actual weighted-average return of 16.50% in fiscal 2024 primarily driven by the market 44 performance of the plan assets of the qualified pension plans based on the Company’s investment strategy to hedge the movement in liabilities related to changes in discount rates with investments of a matched duration that provide offsetting returns aligned with changes in interest rates.
The pension plan assets are subject to valuation risk and generated an actual weighted-average return of 2.65% in fiscal 2025 primarily driven by the market performance of the plan assets of the qualified pension plans based on the Company’s investment strategy to hedge the movement in liabilities related to changes in discount rates with investments of a matched duration that provide offsetting returns aligned with changes in interest rates.
Valvoline believes the updated mortality improvement scales provide a reasonable assessment of current mortality trends and is an appropriate estimate of future mortality projections.
Valvoline believes the updated mortality improvement scale provides a reasonable assessment of current mortality trends and an appropriate estimate of future mortality projections.
Refer to “Use of Non-GAAP Measures” for management’s definitions of the metrics presented above. 38 Continuing operations EBITDA and Adjusted EBITDA The following reconciles Income from continuing operations to EBITDA and Adjusted EBITDA for the years ended September 30: (In millions) 2024 2023 2022 2021 2020 Income from continuing operations $ 214.5 $ 199.4 $ 109.4 $ 200.1 $ 69.6 Income tax expense 69.1 37.1 34.7 59.9 53.4 Net interest and other financing expenses 71.9 38.3 69.3 108.3 92.1 Depreciation and amortization 105.9 88.8 71.4 62.1 40.5 EBITDA from continuing operations (a) 461.4 363.6 284.8 430.4 255.6 Net pension and postretirement plan expense (income) (b) 11.7 (27.6) 6.9 (128.2) (54.9) Net legacy and separation-related (income) expenses (c) (0.7) 32.8 20.5 (23.6) (30.0) Information technology transition costs (d) 10.4 3.0 2.6 — — Investment and divestiture-related (income) costs (e) (40.2) 1.1 — — 1.3 Suspended operations (f) — 7.1 0.9 (1.5) (1.3) Restructuring and related adjustments (g) — — — (0.1) 0.3 Compensated absences benefits change (h) — — — — (4.9) Adjusted EBITDA from continuing operations (a) $ 442.6 $ 380.0 $ 315.7 $ 277.0 $ 166.1 (a) EBITDA from continuing operations is defined as income from continuing operations, plus income tax expense, net interest and other financing expenses, and depreciation and amortization attributable to continuing operations.
Continuing operations EBITDA and Adjusted EBITDA The following reconciles Income from continuing operations to EBITDA and Adjusted EBITDA for the years ended September 30: (In millions) 2025 2024 2023 2022 2021 Income from continuing operations $ 214.8 $ 214.5 $ 199.4 $ 109.4 $ 200.1 Income tax expense 77.5 69.1 37.1 34.7 59.9 Net interest and other financing expenses 74.0 71.9 38.3 69.3 108.3 Depreciation and amortization 119.4 105.9 88.8 71.4 62.1 EBITDA from continuing operations (a) 485.7 461.4 363.6 284.8 430.4 Net pension and other postretirement plan expenses (income) (b) 23.6 11.7 (27.6) 6.9 (128.2) Net legacy and separation-related expenses (income) (c) 1.4 (0.7) 32.8 20.5 (23.6) Information technology costs (d) 11.5 10.4 3.0 2.6 — Investment and divestiture-related (income) costs (e) (55.4) (40.2) 1.1 — — Suspended operations (f) — — 7.1 0.9 (1.5) Restructuring and related adjustments (g) — — — — (0.1) Adjusted EBITDA from continuing operations (a) $ 466.8 $ 442.6 $ 380.0 $ 315.7 $ 277.0 (a) EBITDA from continuing operations is defined as income from continuing operations, plus income tax expense, net interest and other financing expenses, and depreciation and amortization attributable to continuing operations.
Valvoline's fiscal year ends on September 30 of each year. 31 FISCAL 2024 OVERVIEW Key operating highlights from continuing operations are presented below, each of which is discussed more fully in this Annual Report on Form 10-K: 12% Growth in Net revenues $367.2 million Operating income from continuing operations 33% Growth in Diluted EPS $3.1 billion System-wide store sales (a) $226.8 million Returned to shareholders through share repurchases $282.9 million Cash flows from operations 2,010 System-wide stores (a) with 8.5% annual growth 18 years of consecutive system-wide same-store sales growth (b) 16.5% Growth in adjusted EBITDA (c) (a) Measures include Valvoline franchisees, which are independent legal entities.
FISCAL 2025 OVERVIEW Key operating highlights from continuing operations are presented below, each of which is discussed more fully in this Annual Report on Form 10-K: 6% $389.9 million 2% Growth in Net revenues Operating income from continuing operations Growth in Diluted EPS $3.5 billion $59.8 million $307.1 million System-wide store sales (a) Returned to shareholders through share repurchases Cash flows from operations 2,180 19 years 5.5% System-wide stores (a) with 8.5% annual growth of consecutive system-wide same-store sales growth (b) Growth in adjusted EBITDA (c) (a) Measures include Valvoline franchisees, which are independent legal entities.
With average customer ratings that indicate high levels of service satisfaction, Valvoline and the Company’s franchise partners keep customers moving with approximately 15-minute stay-in-your-car oil changes; battery, bulb and wiper replacements; tire rotations; and other manufacturer recommended maintenance services.
With average customer ratings that indicate high levels of service satisfaction, Valvoline and the Company’s franchise partners simplify vehicle care so customers can do what drives them. This includes approximately 15-minute stay-in-your-car oil changes; battery, bulb and wiper replacements; tire rotations; and other manufacturer recommended maintenance services.
Valvoline’s fiscal 2024 expense, excluding actuarial gains and losses, for pension plans was determined using the spot discount rates as of the beginning of the fiscal year. The interest cost discount rates for fiscal 2024 pension expense and other postretirement expense were each 5.92%.
Valvoline’s fiscal 2025 expense, excluding actuarial gains and losses, for pension plans was determined using the spot discount rates as of the beginning of the fiscal year. The interest cost discount rates for fiscal 2025 pension and other postretirement plans were 4.65% 43 and 4.63%, respectively.
Other assumptions, including the rate of compensation increase and healthcare cost trend rate, do not have a significant impact on Valvoline's pension and other postretirement benefit plan costs and obligations based upon current plan provisions that have generally frozen benefits and limited costs. 46 Business combinations and intangible assets Description Judgments and uncertainties Effect if actual results differ from assumptions Valvoline acquired 36 service center stores during fiscal 2024 for an aggregate purchase price of $53.3 million.
Other assumptions, including the healthcare cost trend rate, do not have a significant impact on Valvoline's pension and other postretirement benefit plan costs and obligations based upon current plan provisions that have generally frozen benefits and limited costs. 44 Business combinations and intangible assets Description Judgments and uncertainties Effect if actual results differ from assumptions The Company completed multiple acquisitions during fiscal 2025 for an aggregate purchase price of $65.5 million.
Refer to the “Key Business Measures” section above for additional details on these key business measures, including management’s definitions. Net revenues Net revenues increased $175.5 million, or 12.2% over the prior year period primarily driven by improvements in volume, mix, and pricing.
Refer to the “Key Business Measures” section above for additional details on these key business measures, including management’s definitions. 35 Net revenues Net revenues increased $91.3 million, or 5.6% over the prior year period primarily attributable to higher volume, mix, and pricing.
These expenses include data conversion, temporary support, training, and redundant expenses incurred from duplicative technology platforms, which are incremental costs directly associated with technology transitions and are not considered to be reflective of the ongoing expenses of operating the Company’s technology platforms.
These expenses include data conversion, training, redundant expenses incurred from duplicative technology platforms, and temporary support, which includes consulting fees and professional services to support certain enhanced manual procedures and material weakness remediation efforts. These incremental costs are directly associated with technology transitions and are not considered to be reflective of the ongoing expenses of operating the Company’s technology platforms.
Based on current data and assumptions, the Company does not anticipate the need to satisfy any minimum funding requirements to its qualified pension plans for at least the next 5 years.
Based on current data and assumptions, the Company does not anticipate the need to satisfy any minimum funding requirements to its qualified pension plans in the near term.
Continuing operations free cash flow The following table sets forth free cash flow and discretionary free cash flow from continuing operations and reconciles cash flows from operating activities to both measures. As previously noted, free cash flow has certain limitations, including that it does not reflect adjustments for certain non-discretionary cash flows, such as mandatory debt repayments.
Continuing operations free cash flow The following table sets forth free cash flow and free cash flow excluding growth capital expenditures reconciled to cash flows from operating activities. As previously noted, these free cash flow measures have certain limitations, including that they do not reflect adjustments for certain non-discretionary cash expenditures, such as mandatory debt repayments.
Summary Valvoline’s continuing operations had cash and cash equivalents of $68.3 million, total debt of $1.1 billion, and total remaining borrowing capacity of $346.8 million as of September 30, 2024.
Summary Valvoline’s continuing operations had cash and cash equivalents of $51.6 million, total debt of $1.1 billion, and total remaining borrowing capacity of $341.6 million as of September 30, 2025.
The Company’s amortizable intangible assets were $90.3 million, net of $83.2 million of accumulated amortization as of September 30, 2024. Other intangible assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable.
The Company’s gross amortizable intangible assets and accumulated amortization were $173.9 million and $91.4 million, respectively, as of September 30, 2025. Other intangible assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable.
Net pension and other postretirement plan expense (income) Net pension and other postretirement plan income decreased $39.3 million from the prior year, primarily due to a lower current year gain on pension and other postretirement plan remeasurement of $2.4 million compared to a gain of $41.6 million in the prior year.
Net pension and other postretirement plan expenses (income) Net pension and other postretirement plan expenses increased $11.9 million from the prior year, primarily due to a loss on pension and other postretirement plan remeasurement of $26.6 million in the current year compared to a gain of $2.4 million in the prior year.
(e) Consists of activity associated with significant acquisitions, investments and divestitures, including legal, advisory and consulting fees, such as diligence costs, in addition to gains or losses recognized upon disposition and expense recognized to reduce the carrying values of investments determined to be impaired.
(e) Consists of activity directly associated with specific significant acquisitions, investments and divestitures, including professional and consulting fees for legal and advisory services, in addition to gains or losses recognized upon disposition, temporary financing costs directly associated with expected transactions, acquisition-related incentive compensation costs, and expense recognized to reduce the carrying values of investments determined to be impaired.
The weighted-average discount rate at the end of fiscal 2024 was 4.94% for the pension plans and 4.89% for the postretirement health and life plans.
The weighted-average discount rate at the end of fiscal 2025 was 5.22% for the pension plans and 5.14% for the postretirement health and life plans.
The new approach will define same stores at the beginning of the month following the completion of 12 full months in operation within the system to more closely conform with common retail practice. Net revenues are limited to sales at company-operated stores, in addition to royalties and other fees from independent franchised and Express Care stores.
VIOC stores (company-operated, franchised and the combination of these for system-wide SSS) with same stores defined at the beginning of the month following the completion of 12 full months in operation within the system. 34 Net revenues are limited to sales at company-operated stores, in addition to royalties and other fees from independent franchised and Express Care stores.
(g) Adjustments to employee termination benefits recognized over remaining employee service periods as a result of company-wide restructuring activities that are not considered reflective of the underlying operating performance of the Company’s ongoing operations.
(g) Adjustments to employee termination benefits recognized over remaining employee service periods as a result of company-wide restructuring activities that are not considered reflective of the underlying operating performance of the Company’s ongoing operations. Adjusted EBITDA increased $24.2 million, or 5.5%, for the year ended September 30, 2025 compared to the prior year.
The Company believes the accounting estimates listed below are the most critical to aid in fully understanding and evaluating the reported financial results, and require the most difficult, subjective, or complex judgments, resulting from the need to make estimates about the effects of matters that are inherently uncertain.
The Company believes the accounting estimates listed below are the most critical to aid in fully understanding and evaluating the reported financial results, and require the most difficult, subjective, or complex judgments, resulting from the need to make estimates about the effects of matters that are inherently uncertain. 42 Employee benefit obligations Description Judgments and uncertainties Effect if actual results differ from assumptions Valvoline sponsors defined benefit pension and other postretirement plans in the U.S.
Each change of $2.8 million and $2.7 million for continuing operations and consolidated income tax provisions, respectively, would impact the respective fiscal 2024 effective tax rates by one percentage point. 48
Each income tax expense change of $2.9 million would impact the fiscal 2025 effective tax rates for continuing operations and the consolidated business by one percentage point. 46
Valvoline elected to perform a quantitative impairment assessment of goodwill in 2024 and a qualitative impairment assessment of goodwill in 2023, which indicated that it was more likely than not that the fair values of the reporting unit in fiscal 2024 and 2023 were in excess of carrying amounts. 47 Income taxes Description Judgments and uncertainties Effect if actual results differ from assumptions Valvoline is subject to income taxes in the United States and international jurisdictions where its businesses operate.
Though no qualitative factors were present that indicated the existence of a potential impairment, Valvoline performed a quantitative assessment during fiscal 2024 and determined that its reporting unit had a fair value that was in excess of its carrying value. 45 Income taxes Description Judgments and uncertainties Effect if actual results differ from assumptions Valvoline is subject to income taxes in the United States and international jurisdictions where its businesses operate.
Refer to Note 10 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K for additional information regarding the Company's U.S. pension and other postretirement plans.
Refer to Note 10 of the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K for additional information regarding the Company's U.S. pension and other postretirement plans. 41 Share repurchases In July 2024, the Board approved a share repurchase authorization of $400.0 million (the “2024 Share Repurchase Authorization”), which has no expiration date.
Income from continuing operations has also followed an upward trend largely from strong top-line performance with the exception of fiscal 2022 where the decrease was primarily driven by a loss due to the remeasurement of pension and other postretirement plans, as well as higher separation-related expenses in connection with the planning and evaluation of the separation of the Company’s businesses that ultimately culminated in the sale of Global Products. 32 Results for Fiscal 2023 compared to Fiscal 2022 For comparisons of Valvoline's consolidated results of operations and cash flows for the fiscal years ended September 30, 2023 to September 30, 2022, refer to Item 7 of Part II of the Annual Report on Form 10-K for the fiscal year ended September 30, 2023, filed with the Securities and Exchange Commission on November 20, 2023.
Income from continuing operations has also followed an upward trend due to strong top-line performance, with the exception of fiscal 2022, where the decrease was primarily driven by a loss due to the remeasurement of pension and other postretirement plans, as well as higher separation-related expenses in connection with the planning and evaluation of the separation of the Company’s businesses that ultimately culminated in the sale of Global Products.
During fiscal 2024, the Company made $16.6 million in benefit payments for its non-qualified pension and other postretirement plans, consisting of $8.3 million of cash payments and $8.3 million of non-cash payments.
Pension and other postretirement plan obligations The Company makes cash and non-cash contributions and benefit payments for its pension and other postretirement plans. During fiscal 2025, the Company made $10.6 million in benefit payments for its non-qualified pension and other postretirement plans, consisting of $5.7 million of cash payments and $4.9 million of non-cash payments.
Significant assumptions the Company must review and set annually and at each measurement date related to its pension and other postretirement benefit obligations are described further below.
Significant assumptions the Company must review and set annually and at each measurement date related to its pension and other postretirement benefit obligations are described further below. The fair value of plan assets represents the current market value of assets held by irrevocable trust funds for the sole benefit of participants.
(d) Consists of expenses incurred related to the Company’s information technology transitions, primarily related to implementing stand-alone enterprise resource planning and human resource information systems during fiscal years 2023 and 2024.
(d) Consists of expenses incurred directly related to the Company’s information technology transitions, primarily efforts related to implementing stand-alone enterprise resource planning and human resource information systems that generally began in fiscal 2023 following the sale of the former Global Products reportable segment.
The Company operates and franchises more than 2,000 service center locations through its Valvoline Instant Oil Change SM (“VIOC”) and Valvoline Great Canadian Oil Change (“GCOC”) retail locations and supports nearly 270 locations through its Express Care TM platform.
The Company operates and franchises approximately 2,200 service center locations through its Valvoline Instant Oil Change SM (“VIOC”) and Valvoline Great Canadian Oil Change (“GCOC”) retail locations and supports over 240 locations through its Express Care TM platform. Valvoline's fiscal year ends on September 30 of each year.
(In millions) 2024 2023 Cash flows provided by operating activities $ 282.9 $ 353.0 Less: Maintenance capital expenditures (35.9) (29.5) Discretionary free cash flow 247.0 323.5 Less: Growth capital expenditures (188.5) (151.0) Free cash flow $ 58.5 $ 172.5 The decrease in free cash flow from continuing operations over the prior year was driven primarily by lower cash flows provided by operating activities in the current year as described above.
(In millions) 2025 2024 Cash flows provided by operating activities $ 307.1 $ 282.9 Less: Maintenance capital expenditures (66.1) (35.9) Free cash flow excluding growth capital expenditures 241.0 247.0 Less: Growth capital expenditures (193.1) (188.5) Free cash flow $ 47.9 $ 58.5 The decrease in free cash flow from continuing operations over the prior year was impacted by increased capital expenditures during the current year, which were partially offset by higher cash flows provided by operating activities in the current year as described above.
Material cash requirements and other commitments The Company's material cash requirements for the continuing operations include the following contractual obligations and commitments as of September 30, 2024: (In millions) Total Less than 1 year 1-3 years 3-5 years 5 years and more Long-term debt $ 1,099.4 $ 23.8 $ 47.5 $ 493.1 $ 535.0 Interest payments (a) 264.7 59.0 112.9 54.0 38.8 Operating lease obligations 403.6 45.9 87.5 77.1 193.1 Finance lease obligations 296.1 24.1 50.1 50.4 171.5 Employee benefit obligations (b) 73.4 7.8 17.7 15.9 32.0 Total $ 2,137.2 $ 160.6 $ 315.7 $ 690.5 $ 970.4 (a) Includes interest expense on both variable and fixed rate debt, assuming no prepayments.
Material cash requirements and other commitments The Company's material cash requirements for the continuing operations include the following contractual obligations and commitments as of September 30, 2025: (In millions) Total Less than 1 year 1-3 years 3-5 years 5 years and more Long-term debt $ 1,080.6 $ 23.8 $ 521.8 $ — $ 535.0 Interest payments (a) 191.6 52.2 82.8 38.8 17.8 Operating lease obligations 466.3 51.5 96.8 85.7 232.3 Finance lease obligations 333.5 27.6 56.2 55.9 193.8 Employee benefit obligations (b) 71.8 7.3 17.5 15.6 31.4 Total $ 2,143.8 $ 162.4 $ 775.1 $ 196.0 $ 1,010.3 (a) Includes interest on both variable and fixed rate debt, assuming no prepayments.
The prior year cash flows used in financing activities were due to net repayments on borrowings driven by the extinguishment of the $175 million Trade Receivables Facility. 41 Debt The following table summarizes Valvoline’s continuing operations debt as of September 30: (In millions) 2024 2023 2031 Notes $ 535.0 $ 535.0 2030 Notes — 600.0 Term Loan 439.4 463.1 Revolver 125.0 — Debt issuance costs and discounts (5.6) (12.0) Total debt 1,093.8 1,586.1 Current portion of long-term debt 23.8 23.8 Long-term debt $ 1,070.0 $ 1,562.3 Approximately 49% of Valvoline's outstanding borrowings as of September 30, 2024 had fixed rates, with the remainder bearing variable interest rates.
Debt The following table summarizes Valvoline’s continuing operations debt as of September 30: (In millions) 2025 2024 2031 Notes $ 535.0 $ 535.0 Term Loan 415.6 439.4 Revolver 130.0 125.0 Debt issuance costs and discounts (6.6) (5.6) Total debt 1,074.0 1,093.8 Current portion of long-term debt 23.8 23.8 Long-term debt $ 1,050.2 $ 1,070.0 Approximately 50% of Valvoline's outstanding borrowings as of September 30, 2025 had fixed rates, with the remainder bearing variable interest rates.
The following reconciles the year-over-year changes in gross profit: Gross profit margin rate improved compared to the prior year, driven by increased labor efficiency from effective management, along with lower product costs as a percentage of sales. These benefits were partially offset by business mix and higher depreciation.
These gains were partially offset by the impacts from the recent Refranchising Transactions, and increased store operating costs, including depreciation related to ongoing store investments. The following reconciles the year-over-year changes in gross profit: Gross profit margin rate improved compared to the prior year. This margin expansion reflects improved labor efficiency from effective management, along with benefits from service mix.
Net operating expenses Details of the components of Net operating expenses are summarized below for the years ended September 30: 36 Variance (In millions) 2024 2023 $ % Selling, general and administrative expenses $ 305.1 $ 264.5 $ 40.6 15.3 % Net legacy and separation-related (income) expenses (0.7) 32.8 (33.5) (102.1) % Other income, net (52.8) — (52.8) — % Net operating expenses $ 251.6 $ 297.3 $ (45.7) (15.4) % Selling, general and administrative (“SG&A”) expenses increased $40.6 million compared to the prior year period.
These gains were partially offset by the impacts from the Refranchising Transactions, and higher operating expenses, including deprecation. 36 Net operating expenses Details of the components of Net operating expenses are summarized below for the years ended September 30: Variance (In millions) 2025 2024 $ % Selling, general and administrative expenses $ 349.9 $ 305.1 $ 44.8 14.7 % Net legacy and separation-related expenses (income) 1.4 (0.7) 2.1 (300.0) % Other income, net (82.7) (52.8) (29.9) 56.6 % Net operating expenses $ 268.6 $ 251.6 $ 17.0 6.8 % Selling, general and administrative (“SG&A”) expenses increased $44.8 million compared to the prior year period.
System-wide SSS growth increased 6.7% with the majority of the gains coming from ticket growth, driven by higher non-oil change penetration, pricing adjustments, and premiumization while transaction growth accounted for the remaining balance. Year-over-year system-wide store growth of 8.5% also contributed to net revenues and volumes through the addition of 158 net new stores.
System-wide SSS growth increased 6.1% reflecting growth in average ticket from premiumization, pricing, and non-oil change service penetration, as well as higher transactions supported by an expanding customer base. Year-over-year system-wide store growth of 8.5% also contributed to net revenues and volumes through the addition of 170 net new stores.
Valvoline does not consolidate the results of operations of its franchisees. (b) Valvoline currently determines same-store sales growth as sales by U.S. VIOC stores (company-operated, franchised and the combination of these for system-wide same-store sales), with new stores, including franchised conversions, excluded from the metric until the completion of their first full fiscal year in operation.
Valvoline does not consolidate the results of operations of its franchisees. (b) Valvoline determines SSS growth as the year-over-year change in net revenues of U.S. VIOC same stores (company-operated, franchised and the combination of these for system-wide SSS) with same stores defined as those that have been in operation within the system for at least 12 full months.
Continuing operations cash flows Valvoline’s continuing operations cash flows as reflected in the Consolidated Statements of Cash Flows are summarized as follows for the years ended September 30: (In millions) 2024 2023 Cash provided by (used in): Operating activities $ 282.9 $ 353.0 Investing activities $ 136.8 $ (577.2) Financing activities $ (746.3) $ (1,565.5) Operating activities The decrease in cash flows provided by operating activities of $70.1 million from the prior year was primarily driven by changes in net working capital.
Continuing operations cash flows Valvoline’s continuing operations cash flows as reflected in the Consolidated Statements of Cash Flows are summarized as follows for the years ended September 30: (In millions) 2025 2024 Cash provided by (used in): Operating activities $ 307.1 $ 282.9 Investing activities $ (201.1) $ 136.8 Financing activities $ (112.9) $ (746.3) Operating activities The increase in cash flows provided by operating activities of $24.2 million from the prior year was primarily driven by higher cash earnings, that were moderated by the impact of the Refranchising Transactions, and lower interest payments of $22.1 million due to lower outstanding debt from the repurchase of the 2030 Senior Notes in the prior period.
Actuarial assumptions Significant assumptions the Company must review and set annually and at each measurement date related to its pension and other postretirement benefit obligations are: • Expected long-term return on plan assets — The expected long-term return on plan assets assumption reflects the long-term average rate of return plan assets are expected to earn.
Actuarial assumptions Significant assumptions the Company must review and set annually and at each measurement date related to its pension and other postretirement benefit obligations are: • Discount rate — Reflects the rates at which benefits could effectively be settled and is based on current investment yields of high-quality corporate bonds.
Plan assets are invested in equity securities, government and agency securities, corporate debt, and other non-traditional assets such as hedge funds. The investment goal of the pension plans is to achieve an adequate net investment return to provide for future benefit payments to its participants.
Valvoline’s pension plans hold a variety of investments designed to diversify risk. Plan assets are invested in equity securities, government and agency securities, corporate debt, and other non-traditional assets such as hedge funds.
Share repurchases During the year ended September 30, 2024, the Company repurchased 6.7 million shares of its common stock for a principal amount of $226.7 million, which completed the November 2022 Board authorization to repurchase up to $1.6 billion of its common stock (the “2022 Share Repurchase Authorization”).
During the year ended September 30, 2025, the Company repurchased 1.6 million shares of its common stock for $59.8 million. As of September 30, 2025, $325.0 million remained available for share repurchases under the 2024 Share Repurchase Authorization.
These changes, in addition to higher capital expenditures, resulted in lower free cash flow from the prior year. New store construction primarily drove increased capital expenditures during the current year, as the Company continues to focus the majority of its capital spend toward growth, which is expected to drive a high return on invested capital.
The Company continues to focus the majority of its capital spend toward growth, which is expected to drive a high return on invested capital.
Discretionary free cash flow includes maintenance capital expenditures, which are routine uses of cash that are necessary to maintain the Company's operations and provides a supplemental view of cash flow generation to maintain operations before discretionary investments in growth.
Free cash flow excluding growth capital expenditures includes maintenance capital expenditures, which are uses of cash that are necessary to maintain the Company's existing business operations, including i ts retail service center store network, service portfolio, and support functions.
Investing activities The increase in cash flows from investing activities of $714.0 million from the prior year was substantially driven by net proceeds from investments of $346.5 million during the current year in comparison to the net purchase of investments of $360.4 million during the prior year.
Investing activities The decrease in cash flows from investing activities of $337.9 million from the prior year was substantially driven by a decline in net proceeds from investments of $345.0 million and an increase in current year acquisition activity of $12.3 million that was partially offset by increased net proceeds from the sale of operations of $49.5 million.
Total pension and other postretirement net periodic benefit income recognized in fiscal 2024 was $11.7 million, inclusive of a $2.4 million remeasurement gain.
As of September 30, 2025, Valvoline’s net unfunded pension and other postretirement plan liabilities included in the Consolidated Balance Sheet totaled $151.7 million. Total pension and other postretirement net periodic benefit income recognized in fiscal 2025 was $23.6 million, inclusive of a $26.6 million remeasurement loss.
The Company guaranteed future lease commitments related to certain facilities in connection with the sale and disposal of certain retail stores and the Global Products business. Valvoline is obligated to perform if the buyers of the divested businesses default on the leases under the guarantees, which extend through 2037.
The Company guaranteed future payments related to certain leases assigned in connection with the Refranchising Transactions and selling Global Products. Valvoline is obligated to perform if the buyers default on the leases, which have remaining terms ranging from three months to 15 years.
Fiscal 2025 capital expenditures Valvoline is currently forecasting approximately $230 million to $250 million of capital expenditures for fiscal 2025, funded primarily from operating cash flows. Pension and other postretirement plan obligations The Company makes cash and non-cash contributions and benefit payments for its pension and other postretirement plans.
The Company has not recorded a liability for these guarantees as the likelihood of making future payments is not considered probable. Fiscal 2026 capital expenditures Valvoline is currently forecasting approximately $250 million to $280 million of capital expenditures for fiscal 2026, funded primarily from operating cash flows.
Fiscal 2024 marked the 18th consecutive year for system-wide SSS growth with 158 net store additions to the system.
Fiscal 2025 marked the 19th consecutive year for system-wide SSS growth and the addition of 170 net new stores, bringing the system to 2,180 stores.
Net interest and other financing expenses Net interest and other financing expense increased $33.6 million during fiscal 2024, primarily due to a $26.9 million decrease in interest income following the maturity of invested net proceeds from the sale of Global Products.
Interest income in the current year declined by $13.9 million from the prior year maturity of invested net proceeds from the sale of Global Products.
These benefits were partially offset by investments in SG&A expenses to support the stand-alone business and future growth. FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES Overview The Company closely manages its liquidity and capital resources.
This growth was primarily attributable to strong gross profit expansion from strong operational performance including improvements in volumes and mix, in addition to efficiencies in labor management, which more than offset the impacts from refranchising and growth investments in SG&A expenses. FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES Overview The Company closely manages its liquidity and capital resources.
The following reconciles the year-over-year changes in Net revenues: 35 Gross profit Gross profit improved 13.6% year-over-year, largely driven by strong top-line growth from higher transaction volumes, increased average ticket, and continued store expansion. These benefits were partially offset by increased store operating costs, including depreciation, as well as higher labor and material expenses.
These benefits were partially offset by reduced net revenues due to the recent Refranchising Transactions. The following reconciles the year-over-year changes in Net revenues: Gross profit Gross profit improved $39.7 million, or 6.4% year-over-year. The improvement was driven by higher volume, reflecting continued store expansion, and a favorable mix from continued traction in premiumization and non-oil change services.
Other income, net increased by $52.8 million primarily driven by a $41.8 million gain on sale of operations recognized from the sale of company-operated service center stores to franchisees and higher rental income of $1.7 million from subleasing portions of certain properties to Global Products, which only included a partial year of income in the prior year.
Other income, net increased by $29.9 million compared to the prior year primarily due the Refranchising Transactions whereby a larger gain on sale was recognized in the current year of $73.9 million compared to the prior year gains of $41.8 million.
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(c) Represents a non-GAAP measure. Refer to “Use of Non-GAAP Measures” and the Appendix for additional details.
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RECENT DEVELOPMENTS Refranchising Valvoline sold 67 company-owned stores to existing and new franchise partners through the completion of three transactions that occurred in the fourth quarter of fiscal 2024 and the first quarter of fiscal 2025 (the “Refranchising Transactions”).
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VIOC stores (company-operated, franchised and the combination of these for system-wide SSS), with new stores, including franchised conversions, excluded from the metric until the completion of their first full fiscal year in operation.
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These conversions, combined with executed development agreements, are expected to provide accelerated growth in the respective markets and deliver long-term value to shareholders. The Refranchising Transactions impact the comparability of financial results year-over-year as further discussed further below.
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Beginning in fiscal 2025, management is updating its definition of same-store sales and in connection with this change, prior periods will be recast to present SSS on a consistent basis with the new approach.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeApproximately 49% of the Company’s outstanding borrowings as of September 30, 2024 carried fixed rates. A hypothetical 100 basis point change in variable interest rates would impact the Company’s interest expense and pre-tax earnings by $5.6 million for the year ended September 30, 2024.
Biggest changeApproximately 50% of the Company’s outstanding borrowings as of September 30, 2025 carried fixed rates. A hypothetical 100 basis point change in variable interest rates would impact the Company’s interest expense and pre-tax earnings by $5.5 million for the year ended September 30, 2025.
Fiscal 2024, 2023, and 2022 all experienced high rates of inflation and Valvoline mitigates this risk by passing along price increases to its customers; however, the ability to pass on these price increases is largely dependent upon market conditions. Contracts with Valvoline’s independent operators are generally indexed to accommodate changes in material prices.
Fiscal 2025, 2024, and 2023 all experienced high rates of inflation and Valvoline mitigates this risk by passing along price increases to its customers; however, the ability to pass on these price increases is largely dependent upon market conditions. Contracts with Valvoline’s independent operators are generally indexed to accommodate changes in material prices.
The impacts from currency exchange have not been material to Valvoline’s continuing operations, and the Company will continue to monitor its exposure to determine if changes in its business and operations may warrant undertaking strategies to minimize currency exchange risk. 49
The impacts from currency exchange have not been material to Valvoline’s continuing operations, and the Company will continue to monitor its exposure to determine if changes in its business and operations may warrant undertaking strategies to minimize currency exchange risk. 47
Exposure to credit risk is managed by selecting highly-rated financial institutions as counterparties to transactions and monitoring procedures. As of September 30, 2024, there was not a significant concentration of credit risk related to financial instruments.
Exposure to credit risk is managed by selecting highly-rated financial institutions as counterparties to transactions and monitoring procedures. As of September 30, 2025, there was not a significant concentration of credit risk related to financial instruments.
Decreases in the fair value of plan assets and discount rates increase net pension and other postretirement plan expense and can also result in requirements to make contributions to the plans. Pension and other postretirement plans were underfunded by $136.6 million at September 30, 2024 as the projected benefit obligation exceeded the fair value of plan assets.
Decreases in the fair value of plan assets and discount rates increase net pension and other postretirement plan expense and can also result in requirements to make contributions to the plans. Pension and other postretirement plans were underfunded by $151.7 million at September 30, 2025 as the projected benefit obligation exceeded the fair value of plan assets.

Other VVV 10-K year-over-year comparisons