Good day, and welcome to the Innospec Third Quarter 2012 Results Conference Call. This conference is being recorded. At this time, I would like to turn the conference over to David Williams. Please go ahead.

Thank you, and good day, everyone. My name is David Williams and I am Vice President, General Counsel and Chief Compliance Office at Innospec. Thanks for joining our third quarter 2012 financial results conference call. Today's call is being recorded. As you know late yesterday, we reported our financial results for the quarter ended September 30, 2012. The press release is posted on the company's website www.innospecinc.com. An audio webcast of the call and a slide presentation on the results are also now available and will be archived on the website. Before we start I would like to remind everyone that certain comments made during this call might be characterized as forward-looking statements under the Private Securities Litigation Reform Act of 1995. Generally speaking, any comments regarding management’s beliefs, expectations, targets, or other predictions of the future are forward-looking statements. These statements include a number of risks and uncertainties that could actual results to differ materially from the anticipated results implied by those forward-looking statements. These risks and uncertainties are detailed in Innospec’s most recent 10-K report as well as other filings we have with the SEC. We refer you to the SEC’s website or our site for these and other documents. In our discussions today we have also included some non-GAAP financial measures. A reconciliation to the most directly comparable GAAP financial measures is contained in our earnings release and in the presentation that follows, a copy of which is available on the Innospec website. With us today from Innospec are Patrick Williams, President and Chief Executive Officer; and Ian Cleminson, Executive Vice President & Chief Financial Officer. And with that I will turn it over to you Patrick.

Thank you, David, and welcome everyone to Innospec’s Third Quarter 2012 Conference Call. We have made important strides in our 2 growth segments during the third quarter, deepening our relationships with customers and generally positioning us very well for the near and immediate terms. This is particularly relevant in the contrast to reported performance metrics for the third quarter. These were materially impacted by timing of order, patterns in octane additives, as well as continued economic softness in world markets and the weaker euro compared to a year ago. We expect our fourth quarter will show a decided upturn to both top and bottom lines and market activity across our business segments so far in this period is encouraging. Year-to-date sales in our Fuel Specialty segment are tracking very close to our internal forecast. Sales were off slightly in the third quarter, very much expected in light of softer demand for both fuel in both the U.S. and in Europe, as well as some very stiff competition and the weaker euro. At the same time fuel specialties margins remained strong at 29%, supported by our U.S. and Asia Pacific operations. Meanwhile we have expanded our business relationships with existing customers in terms of new business, contract extensions, and longer-term technology agreements driven by the needs for future fuels, all of which are rewarding in quarters to come. Our Avtel business was close to expectations in the third quarter. The negative year-over-year comparison was due to a very strong comparative quarter in 2011. We achieved good volumes in this business in Q3, and we expect to see a stronger upside for Avtel volume in early 2013. Our Oilfield Specialties business continues to develop well and steadily. We continue to believe that we need to add the impetus of an acquisition in…

Thanks, Patrick. Turning to Slide 6 in the presentation. The company's total revenues for the third quarter were $183.4 million, a 9% decrease from $202.1 million a year ago. The overall gross margin fell by 1 percentage point from last year to 27.6% due primarily to the lower proportion of Octane Additives sales offset by improved margins in both Fuel Specialties and Performance Chemicals. Our GAAP earnings were $0.65 per share. On an adjusted basis our earnings per diluted share were also $0.65, a result of limited special items in the third quarter. EBITDA for the quarter was $20.2 million and benefitted from minimal special items and stable exchange rates over the quarter. Net income for the quarter was $15.5 million and after adjustments with special items in both this year and last, was down $7 million or $0.28 a share in 2011’s third quarter. Moving on to Slide 7. Revenues in Fuel Specialties for the third quarter were $127 million, down 7% from the year ago period. Our richer sales mix and improved pricing of 5% were offset by 6% lower volumes and an unfavorable currency impact of 6%. By region, revenues were down by 2% in the Americas and 12% in EMEA due to the weaker euro, which increased by 10% in Asia Pacific due to improved volumes. The Avtel business performed to plan in the quarter. Margins in this segment increased by 1 percentage point from last year to 29%. Gross profit was $36.8 million and operating income was $19.6 million, a 2% decrease from a year ago. Turning to Slide 8. Revenues in Performance Chemicals for the third quarter increased 7% from last year to $46.8 million. Volumes increased 15% from a year ago driven mainly by Personal Care. It was offset by 2% lower price…

Thanks, Ian. In summary, while third quarter trading was lower than we expected due to the phasing of orders and the continued sluggishness in the world economies, we are generally pleased with the progress we have made on several fronts in our key business areas. Innospec is in an excellent financial position with a very strong balance sheet and is positioned well for growth in both Fuel Specialties and Performance Chemicals. We have been working hard to achieve sustainable growth for years to come and we believe we have made a good number of important critical business decisions in that respect. We have consistently said that our growth is a function of both organic and acquisitive efforts. And we have successfully broadened our relationships with customers and delivered key new business wins in our core businesses. Additionally, our acquisition focus continues to be in the areas of smaller, compatible businesses as well as larger more opportunistic or transformational opportunities. Our recently announced bid for the TPC Group, an excellent fit for Innospec, is a good example of the latter. Our current due diligence activities are reinforcing our views of the value of this business and its synergies with Innospec and we continue to devote time and effort to completing this process. However, I am afraid that the current status of this proposed acquisition means that we are unable to comment beyond the public information contained in our SEC filings. And I regret that we will be unable to entertain any questions on this matter in the Q&A which follows this presentation. We are very mindful of our duty to create and enhance shareholder value. Since our management team has been in place, we believe we have done a good job for both the company and investors, as stewards of this trust. Our aim is to continue to consider and optimize the use of cash resources in the company's best interest, including strategic acquisitions, investments in the business and share repurchase programs as market conditions suggest. We very much appreciate your support and interest of our investors as well as the continued strong relationships we enjoy with our customers. And of course the good work of Innospec employees around the world. We look forward with confidence to the opportunities ahead. Now I will turn the call over to the operator and Ian and I will take any of your questions.

[Operator Instructions] Our first question comes from Jon Tanwanteng of CJS Securities.

Could you give a little more color on the new orders you have been getting in Q4 on Fuel Specialties? Are they likely to get you better than the seasonal performance you usually get from the switch to winter [ph] blends? And also, are you likely to get back above the 30% margin market in that segment or just overall?

Yes, Jon, good question. Yes I think that we should probably get right back up to that 30 percentile. We always float around 29.5% to 30.5% probably the last 4 to 5 quarters. You know the views I think with some of the orders that we will be moving from Q3 into Q4 is that we are going to have a very strong Q4 across all business lines, not just Fuel Specialties. So in answering your questions I want to go over the top and say it’s going to be well above Q4 comparison in 2011. But I will say I think that you are going to see a very confident Q4 and as a company we feel very confident going to 2013 as well.

And then could you talk a little bit about the technology JVs that you mentioned in the press release? What areas are they in and when will they start to impact the top and bottom line?

Sure. Yes, a lot of these are done in the fuels area and it’s really looking at the future of the fuels market. We go out and do a lot of presentations for not only our customers but as well as it really helps to enhance our strategies as a global business team, to look at what the future fuels look like. And in doing so we have partnered up with some of the majors whether it’s in Asia Pacific or whether it’s in the Americas region as well as Europe on a technology platform. So we share technology, we share fuels, we share future fuels and ideas and it really behooves us to do this because it gives us a real good outlook on what the future looks like and plus it enhances ourselves in that company to really move forward on a positive manner.

Okay. So no difference between gasoline or diesel, it’s just across the board?

I think it’s across the board. We have looked at some projects we have on heavy fuel oil. Some we have on gasoline and obviously a little over 50% on diesel.

And then any impact you might be seeing from Hurricane Sandy? Do you have any facilities on the East Coast? Or has the infrastructure damage kind of impacted demand in that area?

Yes, we have 2 plants in the Carolinas and we have an R&D chemicals site in Delaware. All plants are up and running. No issues. And the lab in Delaware is up and running, no issues. Obviously we are concerned about everybody on the East Coast and our thoughts and prayers are to them.

Okay. And then my final one is this, do you have any options in case the TPCG bid does not succeed?

Yes. I mean we always said, Jon, that we are looking at small acquisitions in Personal Care and in Oilfield, and as well as balancing that out with the stock buybacks or dividend. And we have not stopped that strategy moving forward. And if the TPC deal does not go through, we still have deals in the Q4 Oilfield that we are working on anyway.

Our next question comes from Gregg Hillman of First Wilshire Securities.

Yes, 2 things. The weakness in the third quarter, what were the macro sales, the units -- and how did -- you were down whatever, 8%. What was the -- in your opinion, in America, what were the actual in-consumption numbers for diesel fuel in those 2 markets versus what you did in those markets?

Yes, diesel fuel as down a little bit in Europe, fairly flat in the U.S. Gasoline was down significantly in all regions. So you are either flat or just a tad down, Gregg.

Okay. And that was consistent with what you did, basically? You didn’t...

Very, very, consistent. That’s correct.

Okay. And the other thing I wanted to ask you about, I guess carb regulations, and I guess ETA will, with the trucks a lot of things are just kind of being phased in. How are the regulations you think are going to affect you and I believe the fleets have a choice in terms of how they can fly [ph] with the new particular matter, with the various regs. And will that affect -- what are the fleets electing to do and how is that going to affect you going into the next few years?

Good question, Greg. You know typically in the Fuel Specialties business, unlike Active Chemicals or what we call Performance Chemicals now, and the Performance side is driven by consumer advocacy groups. And the Fuel side it’s literally driven by legislation or regulation -- regulatory approvals. And any time regulation or legislation comes into play is typically a positive for fuel additives. And I think that when you see across the globe, whether it’s China, India where it might be, where they are going to ULSD standard, it’s going to be a positive play for Innospec. I think any tightness in regs for the U.S. market will as well be a very positive step for Innospec in fuel additives overall.

And what does LSD stand for, that acronym you just used?

Well it’s low sulfur diesel.

Okay. So basically some regs are coming in so actually you should see kind of an uptick in sales due to these regs are coming on at the end of this year and next year?

Yes. I will tell you this, I think over the last 60 days we are feeling very confident going into 2013. Just a lot of things that our company has done as well as new business closures that we had in the business. And I think as you just said there is a lot of legislation coming about. A lot of new engine technology out in the market place and I think we are positioned very well to take market share.

[Operator Instructions] Our next question comes from Chris Shaw of Monness, Crespi.

I guess I will continue just asking about Fuel Specialties. The volumes that they were at, I might have missed this, were they down 6%, is that what you said?

Yes, down 6%, Chris.

You know it sounds a little worse than the diesel consumption numbers you were giving for the regions and all. And I guess is that part -- was the Avtel volumes down that much year-over-year?

Yes, it’s a mixture of things, Chris. Our Avtel volumes were down slightly year-over-year and as Patrick was alluding to earlier, diesel consumption is down in Europe and North America as well. And that’s played its part but predominantly it’s Avtel related. Now what I would say is that sequentially it is actually better in the third quarter than it was in the second quarter. As we go into the fourth quarter into ’13 we expect it to improve and really start to uptick for us.

Do you guys have any color around the new contract wins or the contract extensions? I mean what is that they, they are meaningful to adding points to sales next year or is there any information you can give?

Yes, we typically don’t give that information Chris. A, to respect the customer base that we work within. But I can tell you any new wins and any new business in this marketplace from an organic growth is significant to us. I think it bodes well going into 2013 and we are very confident with our numbers. The new business that’s going to kick in, in latter part of Q4 and early 2013. That’s really about all we could say. You know we are very transparent. We love to tell you guys as much as we can but out of respect to our customer base we just can't go that much further.

Okay. And then you -- you said you are still active looking into M&A in the Oilfield and Chemicals sector. Does -- if you were to complete, and hypothetically the TPCG deal, would that preclude you going oilfield chemical deals as well?

No. Because as you recall, Chris, those are smaller deals that will either: a, entrench technology; or b, entrench application knowledge in Oilfield. And again they are smaller deals so will not stop us from that strategy.

[Operator Instructions] Our next question comes from Ivan Marcuse of KeyBanc Capital Markets.

Couple of quick ones. On your material cost front per unit, what was your -- what was it down or is your raw material cost actually up?

You should repeat the question Ivan, we lost a bit of that?

Yes. For your raw material cost on a per unit basis. Was your material cost up or down and to what degree?

Broadly flat, Ivan, this quarter.

On a year-over-year...

You will see it broadly flat in Q4 as well, Ivan.

On a year-over-year basis or sequentially?

Sequentially.

Got you. On a year-over-year basis was it flat also?

Yes, I would say it’s fairly flat.

Got you.

It jumps around a little bit but it always balanced now below that $100 barrier and you see it pretty flat right now.

Got you. And then in the fourth quarter, is the fourth quarter typically a seasonally stronger quarter than the third quarter for diesel and fuel with, I guess, Europe you tend to have little vacation time in August. So is there typically a seasonally uptick in the fourth quarter or is there something...

Yes. You saw it. I mean you are correct, you typically have a seasonal uptick in Q4.

Is there going to be more of an uptick? Are you guys looking for more of an uptick than typical because you talked about the fourth quarter, you are expecting it to be a lot stronger than the third quarter and exclusive of what was going on in your -- in the Avtel business which you have. So would you expect the fourth quarter to be seasonally stronger more so than in the past or it’s just more of a typical seasonal uptick?

I think there is a couple of things there, Ivan. I think first of all, we are going to see some volume that we didn’t get in Q3 roll into Q4. Some of the new business that we have won as well, it’s going to start coming through in the backend of the Q4. And you are right, we do see more seasonal business in the fuels area call for improvement. Our heating products as well. So we are well set for a good Q4 in that business.

Yes. And I think just to add to that, Ivan. We will have a -- the likelihood is an order in Octane Additives, as we said in the presentation, we will be moving from Q3 to Q4 as well. That’s a significant order as well.

Got you. So octane, so you would expect that, I don’t know, to be as much as it’s down this quarter on a year-over-year basis to be up that much on a year-over-year basis in the fourth quarter?

Yes. I'd say you are going to be looking at a sort of a revenue number that’s going to be similar to Q3 last year plus a little bit less.

As there are no further questions in the queue, I would like to turn the call back to Patrick Williams for any additional or closing remarks.

Thank you all for joining us today and thanks to all our shareholders and Innospec employees for your interest and support. If you have any further questions about Innospec or matters discussed on this call, please give us a call. Meantime, we look forward to meeting up again with you in early next year. Have a great day.

That will conclude today's conference call. Thank you for your participation ladies and gentlemen, you may now disconnect.