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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549



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FORM 10-Q



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|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------



For the quarterly period ended September 30, 2005



OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from  to



Commission File Number 1-32190



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NEWMARKET CORPORATION

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|VIRGINIA                                                       |  | 20-0812170                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|330 SOUTH FOURTH STREET RICHMOND, VIRGINIA                     |  | 23218-2189                          
|(Address of principal executive offices)                       |  | (Zip Code)                          



Registrants
telephone number, including area code - (804) 788-5000



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90
days.    Yes  x     No ̈



Indicate by check mark whether the registrant is an
accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    Yes  x    No ̈



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ̈No  x



Number of shares of common stock, without par value, outstanding as of October 31, 2005: 17,066,059.



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NEWMARKET CORPORATION



I N D E X



|                                                                                                      |  |           
|----------------------------------------------------------------------------------------------------- |  | ----------
|                                                                                                      |  | PageNumber
|PART I.
FINANCIAL INFORMATION                                                                         |  |           
|                                                                                                      | 
|ITEM 1.
Financial Statements                                                                          |  |           
|                                                                                                      | 
|Condensed Consolidated Statements of Income  Three and Nine Months Ended September 30, 2005 and 2004 |  | 3         
|                                                                                                      | 
|Condensed Consolidated Balance Sheets  September 30, 2005 and December 31, 2004                      |  | 4         
|                                                                                                      | 
|Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2005 and 2004       |  | 5         
|                                                                                                      | 
|Notes to Condensed Consolidated Financial Statements                                                  |  | 6-25      
|                                                                                                      | 
|ITEM 2.
Managements Discussion and Analysis of Financial Condition and Results of Operations         |  | 26-37     
|                                                                                                      | 
|ITEM 3.
Quantitative and Qualitative Disclosures About Market Risk                                    |  | 37        
|                                                                                                      | 
|ITEM 4.
Controls and Procedures                                                                       |  | 37-38     
|                                                                                                      | 
|PART II.
OTHER INFORMATION                                                                            |  |           
|                                                                                                      | 
|ITEM 1.
Legal Proceedings                                                                             |  | 39        
|                                                                                                      | 
|ITEM 5.
Other Information                                                                             |  | 39        
|                                                                                                      | 
|ITEM 6.
Exhibits                                                                                      |  | 39        
|                                                                                                      | 
|SIGNATURES                                                                                            |  | 40        



2



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PART I. FINANCIAL INFORMATION

|ITEM 1. Financial | Statements
|----------------- | ----------



NEWMARKET CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)



|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|------------------------------------------------------- |  | ------------------------------ | ------- | ---- | ----------------------------- | ------- | ---- |  | ---- | ------- |  | - | -------
|                                                        |  | Three Months EndedSeptember 30 |         |      | Nine Months EndedSeptember 30
|                                                        |  | 2005                           |         | 2004 |                               |         | 2005 |  | 2004
|Net sales                                               |  | $                              | 270,932 |      | $                             | 224,668 |      |  | $    | 781,888 |  | $ | 662,948
|Cost of goods sold                                      |  |                                | 217,761 |      |                               | 182,039 |      |  |      | 633,443 |  |   | 523,926
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Gross profit                                            |  |                                | 53,171  |      |                               | 42,629  |      |  |      | 148,445 |  |   | 139,022
|                                                        |  |                                |         |     
|Operating profit from TEL marketing agreements services |  |                                | 6,352   |      |                               | 8,864   |      |  |      | 19,629  |  |   | 26,939 
|                                                        |  |                                |         |     
|Selling, general, and administrative expenses           |  |                                | 24,967  |      |                               | 23,729  |      |  |      | 71,229  |  |   | 72,157 
|Research, development, and testing expenses             |  |                                | 15,919  |      |                               | 18,104  |      |  |      | 47,996  |  |   | 48,951 
|Special items income                                    |  |                                | 2,878   |      |                               | 13,245  |      |  |      | 6,746   |  |   | 13,245 
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Operating profit                                        |  |                                | 21,515  |      |                               | 22,905  |      |  |      | 55,595  |  |   | 58,098 
|                                                        |  |                                |         |     
|Interest and financing expenses                         |  |                                | 4,138   |      |                               | 4,259   |      |  |      | 12,920  |  |   | 13,942 
|Other income (expense), net                             |  |                                | 372     |      |                               | (208    | )    |  |      | 743     |  |   | 241    
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Income before income taxes                              |  |                                | 17,749  |      |                               | 18,438  |      |  |      | 43,418  |  |   | 44,397 
|Income tax expense                                      |  |                                | 4,348   |      |                               | 5,464   |      |  |      | 12,188  |  |   | 14,251 
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Net income                                              |  | $                              | 13,401  |      | $                             | 12,974  |      |  | $    | 31,230  |  | $ | 30,146 
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Basic earnings per share                                |  | $                              | 0.79    |      | $                             | 0.76    |      |  | $    | 1.84    |  | $ | 1.78   
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Diluted earnings per share                              |  | $                              | 0.77    |      | $                             | 0.75    |      |  | $    | 1.80    |  | $ | 1.76   
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Shares used to compute basic earnings per share         |  |                                | 17,042  |      |                               | 16,969  |      |  |      | 17,013  |  |   | 16,895 
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        
|Shares used to compute diluted earnings per share       |  |                                | 17,317  |      |                               | 17,189  |      |  |      | 17,312  |  |   | 17,159 
|                                                        |  |                                |         |      |                               |         |      |  |      |         |  |   |        



See
accompanying notes to the condensed consolidated financial statements.



3



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NEWMARKET CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)



|                                                                                                         |  |                  |         |   |                 |   |         |  
|-------------------------------------------------------------------------------------------------------- |  | ---------------- | ------- | - | --------------- | - | ------- | -
|                                                                                                         |  | September 302005 |         |   | December 312004 |  
|ASSETS                                                                                                   |  | (unaudited)      |         |   |                 |  
|Current assets:                                                                                          |  |                  |         |   |                 |   |         |  
|Cash and cash equivalents                                                                                |  | $                | 40,305  |   |                 | $ | 28,778  |  
|Restricted cash                                                                                          |  |                  | 1,488   |   |                 |   | 1,706   |  
|Trade and other accounts receivable, less allowance for doubtful accounts ($1,138 - 2005; $1,067 - 2004) |  |                  | 171,692 |   |                 |   | 158,423 |  
|Receivable - TEL marketing agreements services                                                           |  |                  | 1,680   |   |                 |   | 3,298   |  
|Inventories:                                                                                             |  |                  |         |   |                 |   |         |  
|Finished goods                                                                                           |  |                  | 123,525 |   |                 |   | 131,627 |  
|Raw materials                                                                                            |  |                  | 18,428  |   |                 |   | 17,471  |  
|Stores, supplies and other                                                                               |  |                  | 8,378   |   |                 |   | 8,691   |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|                                                                                                         |  |                  | 150,331 |   |                 |   | 157,789 |  
|Deferred income taxes                                                                                    |  |                  | 7,184   |   |                 |   | 7,874   |  
|Prepaid expenses                                                                                         |  |                  | 4,644   |   |                 |   | 2,387   |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Total current assets                                                                                     |  |                  | 377,324 |   |                 |   | 360,255 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Property, plant and equipment, at cost                                                                   |  |                  | 775,998 |   |                 |   | 777,105 |  
|Less accumulated depreciation and amortization                                                           |  |                  | 616,019 |   |                 |   | 610,876 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Net property, plant and equipment                                                                        |  |                  | 159,979 |   |                 |   | 166,229 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Prepaid pension cost                                                                                     |  |                  | 18,808  |   |                 |   | 20,101  |  
|Deferred income taxes                                                                                    |  |                  | 18,130  |   |                 |   | 4,367   |  
|Other assets and deferred charges                                                                        |  |                  | 48,762  |   |                 |   | 68,961  |  
|Intangibles, net of amortization                                                                         |  |                  | 51,876  |   |                 |   | 56,282  |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Total assets                                                                                             |  | $                | 674,879 |   |                 | $ | 676,195 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                     |  |                  |         |   |                 |   |         |  
|Current liabilities:                                                                                     |  |                  |         |   |                 |   |         |  
|Accounts payable                                                                                         |  | $                | 71,257  |   |                 | $ | 75,719  |  
|Accrued expenses                                                                                         |  |                  | 57,126  |   |                 |   | 52,710  |  
|Book overdraft                                                                                           |  |                  | 4,661   |   |                 |   | 5,015   |  
|Long-term debt, current portion                                                                          |  |                  | 630     |   |                 |   | 601     |  
|Income taxes payable                                                                                     |  |                  | 14,177  |   |                 |   | 6,138   |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Total current liabilities                                                                                |  |                  | 147,851 |   |                 |   | 140,183 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Long-term debt                                                                                           |  |                  | 153,355 |   |                 |   | 183,837 |  
|Other noncurrent liabilities                                                                             |  |                  | 114,909 |   |                 |   | 120,293 |  
|                                                                                                         |  |                 
|Commitments and contingencies (Note 9)                                                                   |  |                  |         |   |                 |   |         |  
|                                                                                                         |  |                 
|Shareholders equity:                                                                                    |  |                  |         |   |                 |   |         |  
|Common stock and paid-in capital (without par value) Issued - 17,062,059 in 2005 and 16,980,759 in 2004  |  |                  | 85,077  |   |                 |   | 84,724  |  
|Accumulated other comprehensive loss                                                                     |  |                  | (26,571 | ) |                 |   | (21,870 | )
|Retained earnings                                                                                        |  |                  | 200,258 |   |                 |   | 169,028 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|                                                                                                         |  |                  | 258,764 |   |                 |   | 231,882 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  
|Total liabilities and shareholders equity                                                               |  | $                | 674,879 |   |                 | $ | 676,195 |  
|                                                                                                         |  |                  |         |   |                 |   |         |  



4



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NEWMARKET CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)



|                                                                             |  |                               |         |   |      |   |         |  
|---------------------------------------------------------------------------- |  | ----------------------------- | ------- | - | ---- | - | ------- | -
|                                                                             |  | Nine Months EndedSeptember 30 |        
|                                                                             |  | 2005                          |         |   | 2004 |  
|Cash and cash equivalents at beginning of year                               |  | $                             | 28,778  |   |      | $ | 33,367  |  
|                                                                             |  |                               |         |   |      |   |         |  
|Cash flows from operating activities:                                        |  |                               |         |   |      |   |         |  
|Net income                                                                   |  |                               | 31,230  |   |      |   | 30,146  |  
|Adjustments to reconcile net income to cash flows from operating activities: |  |                               |         |   |      |   |         |  
|Depreciation and other amortization                                          |  |                               | 25,755  |   |      |   | 32,185  |  
|Amortization of deferred financing costs                                     |  |                               | 1,417   |   |      |   | 2,111   |  
|Noncash pension expense                                                      |  |                               | 9,565   |   |      |   | 7,984   |  
|Deferred income tax benefit                                                  |  |                               | (10,701 | ) |      |   | (2,200  | )
|Gain on insurance settlement                                                 |  |                               | (3,868  | ) |      |   | (13,245 | )
|Gain on sale of corporate property                                           |  |                               | (2,878  | ) |      |   |        |  
|Working capital changes                                                      |  |                               | 686     |   |      |   | (19,851 | )
|Cash pension contributions                                                   |  |                               | (8,663  | ) |      |   | (9,695  | )
|Proceeds from insurance settlement                                           |  |                               | 7,400   |   |      |   | 7,650   |  
|Long-term receivable - TEL marketing agreements                              |  |                               | 1,119   |   |      |   | 558     |  
|Other, net                                                                   |  |                               | 2,804   |   |      |   | 1,551   |  
|                                                                             |  |                               |         |   |      |   |         |  
|Cash provided from operating activities                                      |  |                               | 53,866  |   |      |   | 37,194  |  
|                                                                             |  |                               |         |   |      |   |         |  
|Cash flows from investing activities:                                        |  |                               |         |   |      |   |         |  
|Capital expenditures                                                         |  |                               | (13,749 | ) |      |   | (10,108 | )
|Proceeds from sale of corporate property                                     |  |                               | 4,244   |   |      |   |        |  
|Purchase of certain property                                                 |  |                               |        |   |      |   | (3,323  | )
|Other, net                                                                   |  |                               |        |   |      |   | 29      |  
|                                                                             |  |                               |         |   |      |   |         |  
|Cash used in investing activities                                            |  |                               | (9,505  | ) |      |   | (13,402 | )
|                                                                             |  |                               |         |   |      |   |         |  
|Cash flows from financing activities:                                        |  |                               |         |   |      |   |         |  
|Repayment under revolving credit agreement                                   |  |                               | (30,000 | ) |      |   | (17,000 | )
|Repayment of debt - previous agreements                                      |  |                               |        |   |      |   | (53,807 | )
|Issuance of term loan                                                        |  |                               |        |   |      |   | 50,000  |  
|Change in book overdraft                                                     |  |                               | (354    | ) |      |   | 1,382   |  
|Financing costs                                                              |  |                               |        |   |      |   | (1,279  | )
|Proceeds from exercise of stock options                                      |  |                               | 353     |   |      |   | 811     |  
|Decrease in capital lease                                                    |  |                               | (453    | ) |      |   | (426    | )
|                                                                             |  |                               |         |   |      |   |         |  
|Cash used in financing activities                                            |  |                               | (30,454 | ) |      |   | (20,319 | )
|                                                                             |  |                               |         |   |      |   |         |  
|Effect of foreign exchange on cash and cash equivalents                      |  |                               | (2,380  | ) |      |   | (2,058  | )
|                                                                             |  |                               |         |   |      |   |         |  
|Increase in cash and cash equivalents                                        |  |                               | 11,527  |   |      |   | 1,415   |  
|                                                                             |  |                               |         |   |      |   |         |  
|Cash and cash equivalents at end of period                                   |  | $                             | 40,305  |   |      | $ | 34,782  |  
|                                                                             |  |                               |         |   |      |   |         |  



See
accompanying notes to the condensed consolidated financial statements.



5



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NEWMARKET CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)



|1. | Financial Statement Presentation
|-- | --------------------------------



In the opinion of management, the accompanying condensed consolidated financial statements of NewMarket Corporation and Subsidiaries contain all necessary
adjustments for the fair presentation of, in all material respects, our consolidated financial position as of September 30, 2005, as well as our consolidated results of operations for the three-months and nine-months ended September 30,
2005 and 2004 and our consolidated cash flows for the nine-months ended September 30, 2005 and 2004. The financial statements are subject to normal year-end adjustments and do not include comprehensive footnotes. All adjustments are of a
normal, recurring nature, unless otherwise disclosed. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the NewMarket Corporation Annual Report on Form 10-K for the
fiscal year ended December 31, 2004 (2004 Annual Report), as filed with the Securities and Exchange Commission (SEC). The results of operations for the three-month and nine-month periods ended September 30, 2005 are not necessarily
indicative of the results to be expected for the full year.



Unless the context otherwise requires, all references to we, us, our, the Company and NewMarket are to NewMarket Corporation and its consolidated subsidiaries.



At both September 30, 2005 and December 31, 2004, we had a book
overdraft for some of our disbursement cash accounts. A book overdraft represents transactions that have not cleared the bank accounts at the end of the reporting period. We transfer cash on an as-needed basis to fund these items as they clear the
bank in subsequent periods.



|2. | Asset Retirement Obligations
|-- | ----------------------------



Our asset retirement obligations are related primarily to tetraethyl lead (TEL) operations. These obligations had been previously fully accrued. Upon the
January 1, 2003 adoption of Statement of Financial Accounting Standards No. 143, Accounting for Asset Retirement Obligations (SFAS No. 143), these accruals were discounted to their net present value, which resulted in the
recognition of a gain. Current accretion of the asset retirement obligations is expensed in operations. The following table illustrates the activity associated with SFAS No. 143 for the nine-months ended September 30, 2005 and the year
ended December 31, 2004. The current portion of our asset retirement obligations is included in accrued expenses on our balance sheet. The long-term portion of the obligation is included in other noncurrent liabilities on our balance sheet.



|                                                 |  |                  |        |   |                 |   |        |  
|------------------------------------------------ |  | ---------------- | ------ | - | --------------- | - | ------ | -
|                                                 |  | September 302005 |        |   | December 312004 |  
|                                                 |  | (in thousands)   |       
|Asset retirement obligation, beginning of period |  | $                | 10,268 |   |                 | $ | 13,238 |  
|Accretion expense                                |  |                  | 592    |   |                 |   | 702    |  
|Liabilities incurred                             |  |                  | 675    |   |                 |   |       |  
|Liabilities settled                              |  |                  | (1,805 | ) |                 |   | (2,998 | )
|Changes in expected cash flows and timing        |  |                  | 1,463  |   |                 |   | (1,147 | )
|Foreign currency impact                          |  |                  | 237    |   |                 |   | 473    |  
|                                                 |  |                  |        |   |                 |   |        |  
|Asset retirement obligation, end of period       |  | $                | 11,430 |   |                 | $ | 10,268 |  
|                                                 |  |                  |        |   |                 |   |        |  



6



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|3. | Stock-Based Compensation
|-- | ------------------------



We account for our stock-based compensation plan using the intrinsic-value method. Under this method, we do not record compensation cost for stock options
unless the quoted market price of the stock at grant date or other measurement date exceeds the amount the employee must pay to exercise the stock option. Compensation cost for restricted stock grants, if issued, is recognized over the vesting
period. See Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for information on an accounting standard that we will adopt in 2006 related to the accounting for stock-based compensation. See
Note 16 of the Notes to Consolidated Financial Statements in our 2004 Annual Report for further information on our stock-based compensation plan.



The following table illustrates the effect on net income and earnings per share as if we had applied the fair-value method of accounting for the
stock-based compensation plan.



|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|----------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------- | ------ | ---- | ----------------------------- | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                                                                                              |  | Three Months EndedSeptember 30           |        |      | Nine Months EndedSeptember 30 |       
|                                                                                                                              |  | 2005                                     |        | 2004 |                               |        | 2005 |  |   | 2004   |  
|                                                                                                                              |  | (in thousands, except per share amounts) |       
|Net income, as reported                                                                                                       |  | $                                        | 13,401 |      | $                             | 12,974 |      |  | $ | 31,230 |   |  | $ | 30,146 |  
|Less: Total stock-based employee compensation expense determined under the fair-value based method, net of related tax effect |  |                                          |       |      |                               | (31    | )    |  |   | (23    | ) |  |   | (92    | )
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Net income, pro forma                                                                                                         |  | $                                        | 13,401 |      | $                             | 12,943 |      |  | $ | 31,207 |   |  | $ | 30,054 |  
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Earnings per share:                                                                                                           |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Basic, as reported                                                                                                            |  | $                                        | 0.79   |      | $                             | 0.76   |      |  | $ | 1.84   |   |  | $ | 1.78   |  
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Basic, pro forma                                                                                                              |  | $                                        | 0.79   |      | $                             | 0.76   |      |  | $ | 1.83   |   |  | $ | 1.78   |  
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Diluted, as reported                                                                                                          |  | $                                        | 0.77   |      | $                             | 0.75   |      |  | $ | 1.80   |   |  | $ | 1.76   |  
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  
|Diluted, pro forma                                                                                                            |  | $                                        | 0.77   |      | $                             | 0.75   |      |  | $ | 1.80   |   |  | $ | 1.75   |  
|                                                                                                                              |  |                                          |        |      |                               |        |      |  |   |        |   |  |   |        |  



|4. | Segment Information
|-- | -------------------



The tables below show our consolidated net sales by segment, operating profit by segment, including a reconciliation to income before income taxes, and
depreciation and amortization by segment.



7



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Net Sales by Segment

(in millions)



|                       |  |                                |       |                               |   |       |  |      |       |  |   |      
|---------------------- |  | ------------------------------ | ----- | ----------------------------- | - | ----- |  | ---- | ----- |  | - | -----
|                       |  | Three Months EndedSeptember 30 |       | Nine Months EndedSeptember 30
|                       |  | 2005                           |       | 2004                          |   | 2005  |  | 2004
|Petroleum additives    |  | $                              | 267.4 |                               | $ | 222.8 |  | $    | 773.6 |  | $ | 655.5
|Tetraethyl lead        |  |                                | 3.5   |                               |   | 1.9   |  |      | 8.3   |  |   | 7.4  
|                       |  |                                |       |                               |   |       |  |      |       |  |   |      
|Consolidated net sales |  | $                              | 270.9 |                               | $ | 224.7 |  | $    | 781.9 |  | $ | 662.9
|                       |  |                                |       |                               |   |       |  |      |       |  |   |      



Segment Operating
Profit

(in millions)



|                                              |  |                                |      |   |                               |   |      |      |  |   |       |   |  |   |       |  
|--------------------------------------------- |  | ------------------------------ | ---- | - | ----------------------------- | - | ---- | ---- |  | - | ----- | - |  | - | ----- | -
|                                              |  | Three Months EndedSeptember 30 |      |   | Nine Months EndedSeptember 30 |  
|                                              |  | 2005                           |      |   | 2004                          |   |      | 2005 |  |   | 2004  |  
|Petroleum additives (a)                       |  | $                              | 17.4 |   |                               | $ | 9.4  |      |  | $ | 44.2  |   |  | $ | 39.6  |  
|Tetraethyl lead (a)                           |  |                                | 5.6  |   |                               |   | 17.2 |      |  |   | 19.4  |   |  |   | 32.7  |  
|Contract manufacturing and other              |  |                                | 0.2  |   |                               |   | 0.8  |      |  |   | 1.8   |   |  |   | 0.8   |  
|                                              |  |                                |      |   |                               |   |      |      |  |   |       |   |  |   |       |  
|Segment operating profit                      |  |                                | 23.2 |   |                               |   | 27.4 |      |  |   | 65.4  |   |  |   | 73.1  |  
|Corporate, general and administrative expense |  |                                | (3.5 | ) |                               |   | (3.7 | )    |  |   | (9.5  | ) |  |   | (10.9 | )
|Special item (b)                              |  |                                | 2.9  |   |                               |   |     |      |  |   | 2.9   |   |  |   |      |  
|Interest expense                              |  |                                | (4.1 | ) |                               |   | (4.3 | )    |  |   | (12.9 | ) |  |   | (13.9 | )
|Other expense, net                            |  |                                | (0.8 | ) |                               |   | (1.0 | )    |  |   | (2.5  | ) |  |   | (3.9  | )
|                                              |  |                                |      |   |                               |   |      |      |  |   |       |   |  |   |       |  
|Income before income taxes                    |  | $                              | 17.7 |   |                               | $ | 18.4 |      |  | $ | 43.4  |   |  | $ | 44.4  |  
|                                              |  |                                |      |   |                               |   |      |      |  |   |       |   |  |   |       |  

---

Certain prior period amounts have been reclassified
to conform to the current presentation. The reclassifications consist of an allocation of certain costs between corporate, general and administrative expense and other expense, net. There was no impact on net income in any period.

|(a) | The tetraethyl lead segment operating profit for nine months in 2005 includes an insurance settlement gain of $3.9 million related to premises asbestos liabilities. This item is
discussed in Note 9. In 2004, the petroleum additives segment included a special item of $800 thousand income and the tetraethyl lead segment included a special item of $12.5 million income related to an environmental insurance settlement in the
third quarter.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | The special item for both 2005 periods represents a gain on the sale of corporate property.
|--- | -------------------------------------------------------------------------------------------



8



---

Depreciation and Amortization

(in millions)



|                                    |  |                                |     |                               |   |      |  |      |      |  |   |     
|----------------------------------- |  | ------------------------------ | --- | ----------------------------- | - | ---- |  | ---- | ---- |  | - | ----
|                                    |  | Three Months EndedSeptember 30 |     | Nine Months EndedSeptember 30
|                                    |  | 2005                           |     | 2004                          |   | 2005 |  | 2004
|Petroleum additives                 |  | $                              | 6.1 |                               | $ | 8.0  |  | $    | 19.6 |  | $ | 24.6
|Tetraethyl lead                     |  |                                | 1.7 |                               |   | 2.1  |  |      | 5.1  |  |   | 6.5 
|Other long-lived assets             |  |                                | 0.4 |                               |   | 0.4  |  |      | 1.1  |  |   | 1.1 
|                                    |  |                                |     |                               |   |      |  |      |      |  |   |     
|Total depreciation and amortization |  | $                              | 8.2 |                               | $ | 10.5 |  | $    | 25.8 |  | $ | 32.2
|                                    |  |                                |     |                               |   |      |  |      |      |  |   |     



During the second
quarter 2005, The Associated Octel Company Limited and its affiliates (Octel) advised us that one of the major TEL customers under our marketing agreements had discontinued the use of TEL earlier than we had previously expected. Because of this
development, we evaluated the prepayment for TEL marketing agreement services for impairment and concluded the unamortized value reflected in our condensed consolidated financial statements is not impaired. We adjusted the rate of amortization for
these prepayments from a 20% declining balance method to a 30% declining balance method. In addition, based on revised projections of product shipments and product life expectancy, we adjusted the amortization period to run through 2012. This change
will have an insignificant impact on earnings for the fiscal year ended December 31, 2005. Total amortization related to the TEL marketing agreements is currently projected to be:



|                  |  |                                                
|----------------- |  | -----------------------------------------------
|      2005       |  | $6.6 million                                   
|                  | 
|      2006       |  | $4.6 million                                   
|                  | 
|      2007       |  | $3.3 million                                   
|                  | 
|      2008       |  | $2.3 million                                   
|                  | 
|      2009       |  | $1.6 million                                   
|                  | 
|      Thereafter |  | $2.4 million in total for the final three years



The appropriate amount
of amortization for these agreements is included in tetraethyl lead in the table above.



|5. | Pension and Postretirement Plans
|-- | --------------------------------



During the first nine months of 2005, we made contributions of approximately $4.1 million for domestic pension plans and approximately $1.5 million for
domestic postretirement plans. We expect to make total contributions in 2005 of approximately $6 million for our domestic pension plans and approximately $2 million to $3 million for our domestic postretirement plans.



We made contributions of approximately $4.6 million for our foreign pension
plans during the first nine months of 2005 and expect to make total contributions to our foreign pension plans of approximately $7 million during 2005.



The tables below present information on periodic benefit cost for our domestic pension and postretirement plans. The third table presents the same
information for the foreign pension plans.



9



---

|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|---------------------------------- |  | ------------------------------ | ------ | - | ----------------------------- | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                   |  | Domestic                       |       
|                                   |  | Pension Benefits               |       
|                                   |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30 |  
|                                   |  | 2005                           |        |   | 2004                          |   |        | 2005 |  |   | 2004   |  
|                                   |  | (in thousands)                 |       
|Service cost                       |  | $                              | 1,368  |   |                               | $ | 1,337  |      |  | $ | 4,103  |   |  | $ | 3,631  |  
|Interest cost                      |  |                                | 1,353  |   |                               |   | 1,465  |      |  |   | 4,309  |   |  |   | 4,172  |  
|Expected return on plan assets     |  |                                | (1,496 | ) |                               |   | (1,498 | )    |  |   | (4,489 | ) |  |   | (4,225 | )
|Amortization of prior service cost |  |                                | 200    |   |                               |   | 210    |      |  |   | 600    |   |  |   | 569    |  
|Amortization of net loss           |  |                                | 506    |   |                               |   | 412    |      |  |   | 1,518  |   |  |   | 1,124  |  
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|                                   |  | $                              | 1,931  |   |                               | $ | 1,926  |      |  | $ | 6,041  |   |  | $ | 5,271  |  
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|                                   | 
|                                   |  | Domestic                       |       
|                                   |  | Postretirement Benefits        |       
|                                   |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30 |  
|                                   |  | 2005                           |        |   | 2004                          |   |        | 2005 |  |   | 2004   |  
|                                   |  | (in thousands)                 |       
|Service cost                       |  | $                              | 340    |   |                               | $ | 242    |      |  | $ | 1,021  |   |  | $ | 776    |  
|Interest cost                      |  |                                | 927    |   |                               |   | 938    |      |  |   | 2,781  |   |  |   | 2,974  |  
|Expected return on plan assets     |  |                                | (485   | ) |                               |   | (475   | )    |  |   | (1,456 | ) |  |   | (1,426 | )
|Amortization of prior service cost |  |                                | (8     | ) |                               |   | (7     | )    |  |   | (22    | ) |  |   | (22    | )
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|                                   |  | $                              | 774    |   |                               | $ | 698    |      |  | $ | 2,324  |   |  | $ | 2,302  |  
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|                                   | 
|                                   |  | Foreign                        |       
|                                   |  | Pension Benefits               |       
|                                   |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30 |  
|                                   |  | 2005                           |        |   | 2004                          |   |        | 2005 |  |   | 2004   |  
|                                   |  | (in thousands)                 |       
|Service cost                       |  | $                              | 508    |   |                               | $ | 393    |      |  | $ | 1,577  |   |  | $ | 1,186  |  
|Interest cost                      |  |                                | 1,027  |   |                               |   | 922    |      |  |   | 3,198  |   |  |   | 2,779  |  
|Expected return on plan assets     |  |                                | (839   | ) |                               |   | (743   | )    |  |   | (2,601 | ) |  |   | (2,237 | )
|Amortization of prior service cost |  |                                | 77     |   |                               |   | 78     |      |  |   | 239    |   |  |   | 233    |  
|Amortization of transition asset   |  |                                | (12    | ) |                               |   | (10    | )    |  |   | (35    | ) |  |   | (31    | )
|Amortization of net loss           |  |                                | 367    |   |                               |   | 260    |      |  |   | 1,146  |   |  |   | 783    |  
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|                                   |  | $                              | 1,128  |   |                               | $ | 900    |      |  | $ | 3,524  |   |  | $ | 2,713  |  
|                                   |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  



10



---

|6. | Earnings Per Share
|-- | ------------------



Basic and diluted earnings per share are calculated as shown in the table below. Options are not included in the computation of diluted earnings per share
when the option exercise price exceeds the average market price of the common stock. At both September 30, 2005 and September 30, 2004, there were outstanding options to purchase 50,000 shares of NewMarket common stock at $44.375 per
share. These options were not included in the computation of diluted earnings per share for any period due to their anti-dilutive impact.



|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|---------------------------------------------------- |  | ---------------------------------------- | ------ | ----------------------------- | - | ------ |  | ---- | ------ |  | - | ------
|                                                     |  | Three Months EndedSeptember 30           |        | Nine Months EndedSeptember 30
|                                                     |  | 2005                                     |        | 2004                          |   | 2005   |  | 2004
|                                                     |  | (in thousands, except per share amounts)
|Basic earnings per share                             |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Numerator:                                           |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Income available to shareholders, as reported        |  | $                                        | 13,401 |                               | $ | 12,974 |  | $    | 31,230 |  | $ | 30,146
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Denominator:                                         |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Average number of shares of common stock outstanding |  |                                          | 17,042 |                               |   | 16,969 |  |      | 17,013 |  |   | 16,895
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Basic earnings per share                             |  | $                                        | .79    |                               | $ | .76    |  | $    | 1.84   |  | $ | 1.78  
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Diluted earnings per share                           |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Numerator:                                           |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Income available to shareholders, as reported        |  | $                                        | 13,401 |                               | $ | 12,974 |  | $    | 31,230 |  | $ | 30,146
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Denominator:                                         |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Average number of shares of common stock outstanding |  |                                          | 17,042 |                               |   | 16,969 |  |      | 17,013 |  |   | 16,895
|Shares issuable upon exercise of stock options       |  |                                          | 275    |                               |   | 220    |  |      | 299    |  |   | 264   
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Total shares                                         |  |                                          | 17,317 |                               |   | 17,189 |  |      | 17,312 |  |   | 17,159
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       
|Diluted earnings per share                           |  | $                                        | .77    |                               | $ | .75    |  | $    | 1.80   |  | $ | 1.76  
|                                                     |  |                                          |        |                               |   |        |  |      |        |  |   |       



11



---

|7. | Intangibles, net of amortization
|-- | --------------------------------



The following table provides certain information related to our intangible assets.



|                                |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|------------------------------- |  | ------------------------ | ------- | ----------------------- | - | ------------------- |  | ----------------------- | ------- |  | - | ------
|                                |  | September 30 2005        |         | December 31 2004       
|                                |  | Identifiable Intangibles
|                                |  | GrossCarryingAmount      |         | AccumulatedAmortization |   | GrossCarryingAmount |  | AccumulatedAmortization
|                                |  | (in thousands)          
|Amortizing intangible assets    |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|Formulas                        |  | $                        | 85,910  |                         | $ | 38,774              |  | $                       | 85,910  |  | $ | 35,384
|Contracts                       |  |                          | 40,873  |                         |   | 40,873              |  |                         | 40,873  |  |   | 40,030
|                                |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|                                |  | $                        | 126,783 |                         | $ | 79,647              |  | $                       | 126,783 |  | $ | 75,414
|                                |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|Nonamortizing intangible assets |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|Minimum pension liabilities     |  | $                        | 4,740   |                         |   |                     |  | $                       | 4,913   |  |   |       
|                                |  |                          |         |                         |   |                     |  |                         |         |  |   |       
|Aggregate amortization expense  |  |                          |         |                         | $ | 4,233               |  |                         |         |  | $ | 6,540 
|                                |  |                          |         |                         |   |                     |  |                         |         |  |   |       



Estimated annual
amortization expense related to our intangible assets for the next five years is expected to be: (in thousands)



|            |  |       
|----------- |  | ------
|      2005 |  | $5,365
|      2006 |  | $4,524
|      2007 |  | $4,524
|      2008 |  | $4,524
|      2009 |  | $4,524



We amortize the cost
of intangible assets by the straight-line method, over their economic lives. We generally amortize contracts over 5 to 10 years. Our contracts are now fully amortized. We generally amortize formulas over 20 years.



|8. | Long-term Debt
|-- | --------------



Long-term debt consisted of the following:



|                                     |  |                  |         |   |                 |   |         |  
|------------------------------------ |  | ---------------- | ------- | - | --------------- | - | ------- | -
|                                     |  | September 302005 |         |   | December 312004 |  
|                                     |  | (in thousands)   |        
|Senior notes                         |  | $                | 150,000 |   |                 | $ | 150,000 |  
|Revolving loan agreement             |  |                  |        |   |                 |   | 30,000  |  
|Capital lease obligations            |  |                  | 3,985   |   |                 |   | 4,438   |  
|                                     |  |                  |         |   |                 |   |         |  
|                                     |  |                  | 153,985 |   |                 |   | 184,438 |  
|Current maturities of long-term debt |  |                  | (630    | ) |                 |   | (601    | )
|                                     |  |                  |         |   |                 |   |         |  
|                                     |  | $                | 153,355 |   |                 | $ | 183,837 |  
|                                     |  |                  |         |   |                 |   |         |  



12



---

Senior Notes - On April 30, 2003, Ethyl Corporation (Ethyl) sold senior notes
in the aggregate principal amount of $150 million that bear interest at a fixed rate of 8.875% and are due in 2010.



The senior notes are our senior unsecured obligations and are jointly and severally guaranteed on an unsecured basis by all of our existing and future
wholly-owned domestic restricted subsidiaries and certain of our existing wholly-owned foreign subsidiaries. We incurred financing costs of approximately $5 million related to the senior notes, which are being amortized over seven years.



In connection with the holding company formation, NewMarket assumed all
of Ethyls rights, liabilities and obligations under the senior notes, effective June 18, 2004.



The senior notes and the subsidiary guarantees rank:



| |  |  | effectively junior to all of our and the guarantors existing and future secured indebtedness, including any borrowings under the senior credit facility described below;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | equal in right of payment with any of our and the guarantors existing and future unsecured senior indebtedness; and
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | senior in right of payment to any of our and the guarantors existing and future subordinated indebtedness.
| | - |  | -----------------------------------------------------------------------------------------------------------



The indenture governing the senior notes contains covenants that, among
other things, limit our ability and the ability of our restricted subsidiaries to:



| |  |  | incur additional indebtedness;
| | - |  | ------------------------------



| |  |  | create liens;
| | - |  | -------------



| |  |  | pay dividends or repurchase capital stock;
| | - |  | ------------------------------------------



| |  |  | make certain investments;
| | - |  | -------------------------



| |  |  | sell assets or consolidate or merge with or into other companies; and
| | - |  | ---------------------------------------------------------------------



| |  |  | engage in transactions with affiliates.
| | - |  | ---------------------------------------



We were in compliance with these covenants as of both September 30, 2005 and December 31, 2004.



Senior Credit Facility - On April 30, 2003, we
entered into a long-term debt structure for Ethyl. The debt structure included the senior notes discussed above and a senior credit facility with a bank term loan and a revolving credit facility.



On June 18, 2004, prior to the completion of the holding company
formation, Ethyl entered into an Amended and Restated Credit Agreement, which consists of a $100 million revolving credit facility. This agreement amended and restated the credit agreement that Ethyl had entered into on April 30, 2003.
Effective with the completion of the holding company formation, NewMarket assumed all of Ethyls rights and obligations under the Amended and Restated Credit Agreement pursuant to the First Amendment thereto. We incurred additional financing
costs of approximately $1 million, which resulted in total deferred financing costs of approximately $6 million related to the amended and restated credit facility. These costs are being amortized over five years.



13



---

Borrowings under the $100 million revolving credit facility are used for working capital and other
general corporate purposes for NewMarket and our subsidiaries. The revolving credit facility includes a sub-facility for letters of credit. Borrowings bear interest, at our election, at either a base rate plus a margin (75 basis points as of
September 30, 2005) or LIBOR plus a margin (225 basis points as of September 30, 2005). The revolving credit facility matures on June 18, 2009. There were no borrowings outstanding at September 30, 2005 under the revolving credit
facility. At September 30, 2005, we had outstanding letters of credit of $2.6 million, resulting in the unused portion of the revolver amounting to $97.4 million.



The revolving credit facility is secured by liens on substantially all of our U.S. assets. In addition, the credit facility
is guaranteed by our U.S. subsidiaries and certain foreign subsidiaries to the extent that such guarantees would not result in adverse tax consequences.



The credit agreement contains covenants, representations, and events of default that management considers typical of a credit agreement of this nature.
The financial covenants include:



| |  |  | minimum consolidated net worth;
| | - |  | -------------------------------



| |  |  | a minimum fixed charge coverage ratio;
| | - |  | --------------------------------------



| |  |  | a maximum leverage ratio;
| | - |  | -------------------------



| |  |  | a maximum senior secured leverage ratio; and
| | - |  | --------------------------------------------



| |  |  | restrictions on the payment of dividends or repurchases of capital stock.
| | - |  | -------------------------------------------------------------------------



We were in compliance with these covenants as of both September 30, 2005 and December 31, 2004.



|9. | Contractual Commitments and Contingencies
|-- | -----------------------------------------



There have been no significant changes in our contractual commitments from those reported in our 2004 Annual Report. In the TEL case in Maryland, Ethyl
was served as a defendant in the case filed in the Circuit Court for Baltimore City, Maryland, in September 1999. Smith, et al. v. Lead Industries Association, Inc., et al., alleged personal injuries for seven children from lead exposure
arising from lead paint and dust from tailpipe emissions due to leaded gasoline. The court dismissed Ethyl and some other defendants from the case in February 2002 and granted summary judgment to other defendants in November 2002. The plaintiffs
have appealed both decisions, but did not appeal the dismissal of Ethyl as a defendant. On April 4, 2005, the Court of Appeals of Maryland dismissed the appeal on the basis that the trial courts decision was not a final decision that
could be appealed, and the case is once again pending in the trial court. If such claims are further pursued against Ethyl, we believe Ethyl has strong defenses and will vigorously defend any such claims.



Our accruals for environmental remediation were approximately $23 million at
September 30, 2005 and $22 million at December 31, 2004. In addition to the accruals for environmental remediation, we also have accruals for dismantling and decommissioning costs of approximately $8 million at September 30, 2005 and
$7 million at December 31, 2004.



14



---

During the second quarter 2005, we entered into an agreement with Travelers Indemnity Company (Travelers)
resolving certain long standing issues regarding our coverage for certain premises asbestos claims. In addition, our agreement with Travelers provides a procedure for allocating defense and indemnity costs with respect to certain future premises
asbestos claims.

The lawsuit against Travelers in the Southern District of Texas was dismissed.



We also settled our outstanding receivable from Albemarle Corporation
(Albemarle) for certain premises asbestos liability obligations. As a result of the insurance settlement described above, the outstanding amount owed to us by Albemarle was adjusted to $1.4 million, compared to $4 million at year end. Albemarle paid
us $1.4 million in the third quarter of this year.



These
settlements resulted in an aggregate second quarter gain of $3.9 million ($2.5 million after income taxes), which is included as a special item for nine months 2005. The net gain represents amounts paid to us to settle historical claims in excess of
the receivables we carried on our financial statements from both Travelers and Albemarle in the aggregate.



|10. | Comprehensive Income and Accumulated Other Comprehensive Loss
|--- | -------------------------------------------------------------



The components of comprehensive income consist of the following:



|                                                       |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|------------------------------------------------------ |  | ------------------------------ | ------ | - | ----------------------------- | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                       |  | Three Months EndedSeptember 30 |        |   | Nine Months EndedSeptember 30 |  
|                                                       |  | 2005                           |        |   | 2004                          |   |        | 2005 |  |   | 2004   |  
|                                                       |  | (in thousands)                 |        |   | (in thousands)                |  
|Net income                                             |  | $                              | 13,401 |   |                               | $ | 12,974 |      |  | $ | 31,230 |   |  | $ | 30,146 |  
|Other comprehensive (loss) income, net of tax          |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|Unrealized (loss) gain on marketable equity securities |  |                                | (20    | ) |                               |   | (25    | )    |  |   | (123   | ) |  |   | 35     |  
|Unrealized (loss) gain on derivative instruments       |  |                                | (239   | ) |                               |   |       |      |  |   | 1,215  |   |  |   |       |  
|Minimum pension liability                              |  |                                |       |   |                               |   | 50     |      |  |   |       |   |  |   | 50     |  
|Foreign currency translation adjustments               |  |                                | (820   | ) |                               |   | 686    |      |  |   | (5,793 | ) |  |   | (1,491 | )
|                                                       |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|Other comprehensive (loss) income                      |  |                                | (1,079 | ) |                               |   | 711    |      |  |   | (4,701 | ) |  |   | (1,406 | )
|                                                       |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  
|Comprehensive income                                   |  | $                              | 12,322 |   |                               | $ | 13,685 |      |  | $ | 26,529 |   |  | $ | 28,740 |  
|                                                       |  |                                |        |   |                               |   |        |      |  |   |        |   |  |   |        |  



The components of
accumulated other comprehensive loss consist of the following:



|                                                 |  |                  |         |   |                 |   |         |  
|------------------------------------------------ |  | ---------------- | ------- | - | --------------- | - | ------- | -
|                                                 |  | September 302005 |         |   | December 312004 |  
|                                                 |  | (in thousands)   |        
|Unrealized gain on marketable equity securities  |  | $                | 23      |   |                 | $ | 146     |  
|Minimum pension liability adjustment             |  |                  | (16,091 | ) |                 |   | (16,091 | )
|Unrealized gain (loss) on derivative instruments |  |                  | 270     |   |                 |   | (945    | )
|Foreign currency translation adjustments         |  |                  | (10,773 | ) |                 |   | (4,980  | )
|                                                 |  |                  |         |   |                 |   |         |  
|Accumulated other comprehensive loss             |  | $                | (26,571 | ) |                 | $ | (21,870 | )
|                                                 |  |                  |         |   |                 |   |         |  



15



---

|11. | Recently Issued Accounting Pronouncements
|--- | -----------------------------------------



In May 2005, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 154, Accounting
Changes and Error Corrections, (SFAS 154). SFAS 154 replaces Accounting Principles Board Opinion No. 20, Accounting Changes, and SFAS No. 3, Reporting Accounting Changes in Interim Financial Statements and is
effective for fiscal years beginning after December 15, 2005. SFAS 154 addresses the accounting and reporting of a change in accounting principle. We do not expect SFAS 154 to have a material impact on our financial statements, unless we adopt
a change in accounting principle.



In December 2004, the FASB
issued SFAS No. 123 (Revised 2004), Share-Based Payment (SFAS 123R). SFAS 123R is a revision of SFAS No. 123, Accounting for Stock-Based Compensation, and supersedes Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees. In general, SFAS 123R provides guidance in accounting for transactions in which a company obtains employee services in exchange for share-based payments. SFAS 123R requires that the cost from
share-based payment transactions be recognized in the financial statements and be determined using a fair-value-based measurement method. SFAS 123R was to be effective for interim periods beginning after June 15, 2005. In April 2005, the SEC
delayed the effective date to the first fiscal year beginning after June 15, 2005. SFAS 123R applies to all share-based payment transactions initiated or modified after the effective date. Since all of our exercisable stock options are fully
vested, we do not expect SFAS 123R to have a material impact on our financial results, unless we grant an additional share-based payment. We expect to adopt this standard prospectively on January 1, 2006.



In March 2005, the FASB issued FASB Interpretation No. 47,
Accounting for Conditional Asset Retirement Obligations (FIN 47). FIN 47 clarifies certain aspects of FASB No. 143, Accounting for Asset Retirement Obligations and is effective no later than December 31, 2005. We do
not expect FIN 47 to have a material effect on our financial results.



|12. | Consolidating Financial Information
|--- | -----------------------------------



The senior notes are fully and unconditionally guaranteed by certain of our subsidiaries (Guarantor Subsidiaries) on a joint and several unsecured senior
basis. The Guarantor Subsidiaries include all of our existing and future wholly-owned domestic restricted subsidiaries and certain of our existing wholly-owned foreign subsidiaries. The Guarantor Subsidiaries and the subsidiaries that do not
guarantee the senior notes (the Non-Guarantor Subsidiaries) are wholly owned by NewMarket Corporation (the Parent). The Guarantor Subsidiaries consist of the following:



|                                   |  |                                          
|---------------------------------- |  | -----------------------------------------
|Domestic Subsidiaries              |  |                                          
|Ethyl Corporation                  |  | Afton Chemical Corporation               
|Ethyl Asia Pacific LLC             |  | Afton Chemical Asia Pacific LLC          
|Ethyl Canada Holdings, Inc.        |  | Afton Chemical Canada Holdings, Inc.     
|Ethyl Export Corporation           |  | Afton Chemical Japan Holdings, Inc.      
|Ethyl Interamerica Corporation     |  | Afton Chemical Additives Corporation     
|Ethyl Ventures, Inc.               |  | NewMarket Services Corporation           
|Interamerica Terminals Corporation |  | The Edwin Cooper Corporation             
|Afton Chemical Intangibles LLC     |  | Old Town LLC                             
|                                   | 
|Foreign Subsidiaries               |  |                                          
|Ethyl Europe S.P.R.L.              |  | Afton Chemical S.P.R.L.                  
|Ethyl Administration GmbH          |  | Afton Chemical Industria de Aditivos Ltda
|Ethyl Services GmbH                |  |                                          



16



---

We conduct all of our business and derive all of our income from our subsidiaries. Therefore, our ability
to make payments on the senior notes or other obligations is dependent on the earnings and the distribution of funds from our subsidiaries. There are no restrictions on the ability of any of our domestic subsidiaries to transfer funds to the Parent.
We are currently able to transfer funds from our foreign subsidiaries, although certain conditions may arise occasionally that may restrict these transfers.



The following sets forth the consolidating statements of income for the three months and nine months ended September 30, 2005 and 2004, consolidating
balance sheets as of September 30, 2005 and December 31, 2004, and condensed consolidating statements of cash flows for the nine months ended September 30, 2005 and 2004 for the Parent, the Guarantor Subsidiaries and Non-Guarantor
Subsidiaries. Certain amounts in these financial statements have been reclassified for the transition to a holding company structure effective as of June 18, 2004. The financial information is based on our understanding of the SECs
interpretation and application of Rule 3-10 of the Regulation S-X promulgated by the SEC.



The financial information may not necessarily be indicative of the results of operations or financial position had the Guarantor Subsidiaries or Non-Guarantor Subsidiaries operated as independent entities. The Parent
accounts for investments in these subsidiaries using the equity method.



17



---

NewMarket Corporation and Subsidiaries

Consolidating Statements of Income

Three Months Ended September 30, 2005

(in thousands)



|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        
|----------------------------------------------------------------------- |  | ------ | ------ | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | ------- | - |  | - | -------
|                                                                        |  | Parent |        |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated
|Net sales                                                               |  | $      |       |   |                       | $ | 191,881 |                           |  | $ | 133,820                       |   |  | $            | (54,769 | ) |  | $ | 270,932
|Cost of goods sold                                                      |  |        | 342    |   |                       |   | 163,945 |                           |  |   | 108,891                       |   |  |              | (55,417 | ) |  |   | 217,761
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        
|Gross (loss) profit                                                     |  |        | (342   | ) |                       |   | 27,936  |                           |  |   | 24,929                        |   |  |              | 648     |   |  |   | 53,171 
|                                                                        |  |        |        |   |                      
|Operating profit from TEL marketing agreements services                 |  |        |       |   |                       |   | 692     |                           |  |   | 5,660                         |   |  |              |        |   |  |   | 6,352  
|Intercompany service fee income (expense) from TEL marketing agreements |  |        |       |   |                       |   | 5,473   |                           |  |   | (5,473                        | ) |  |              |        |   |  |   |       
|                                                                        |  |        |        |   |                      
|Selling, general, and administrative expenses                           |  |        | 1,013  |   |                       |   | 12,096  |                           |  |   | 11,858                        |   |  |              |        |   |  |   | 24,967 
|Research, development, and testing expenses                             |  |        |       |   |                       |   | 12,578  |                           |  |   | 3,341                         |   |  |              |        |   |  |   | 15,919 
|Special item income                                                     |  |        |       |   |                       |   | 2,878   |                           |  |   |                              |   |  |              |        |   |  |   | 2,878  
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        
|Operating (loss) profit                                                 |  |        | (1,355 | ) |                       |   | 12,305  |                           |  |   | 9,917                         |   |  |              | 648     |   |  |   | 21,515 
|                                                                        |  |        |        |   |                      
|Interest and financing expenses                                         |  |        | 4,117  |   |                       |   | 21      |                           |  |   |                              |   |  |              |        |   |  |   | 4,138  
|Other income, net                                                       |  |        | 294    |   |                       |   | 20      |                           |  |   | 58                            |   |  |              |        |   |  |   | 372    
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        
|(Loss) income before income taxes and equity income of subsidiaries     |  |        | (5,178 | ) |                       |   | 12,304  |                           |  |   | 9,975                         |   |  |              | 648     |   |  |   | 17,749 
|Income tax expense (benefit)                                            |  |        | 4,010  |   |                       |   | (3,462  | )                         |  |   | 3,553                         |   |  |              | 247     |   |  |   | 4,348  
|Equity income of subsidiaries                                           |  |        | 22,589 |   |                       |   |        |                           |  |   |                              |   |  |              | (22,589 | ) |  |   |       
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        
|Net income                                                              |  | $      | 13,401 |   |                       | $ | 15,766  |                           |  | $ | 6,422                         |   |  | $            | (22,188 | ) |  | $ | 13,401 
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |        



18



---

NewMarket Corporation and Subsidiaries

Consolidating Statements of Income

Three Months Ended September 30, 2004

(in thousands)



|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|----------------------------------------------------------------------- |  | ------ | ------ | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | ------- | - |  | - | ------- | -
|                                                                        |  | Parent |        |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated |        
|Net sales                                                               |  | $      |       |   |                       | $ | 162,876 |                           |  | $ | 119,104                       |   |  | $            | (57,312 | ) |  | $ | 224,668 |  
|Cost of goods sold                                                      |  |        | 73     |   |                       |   | 140,299 |                           |  |   | 99,385                        |   |  |              | (57,718 | ) |  |   | 182,039 |  
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Gross (loss) profit                                                     |  |        | (73    | ) |                       |   | 22,577  |                           |  |   | 19,719                        |   |  |              | 406     |   |  |   | 42,629  |  
|                                                                        |  |        |        |   |                      
|Operating profit from TEL marketing agreements services                 |  |        |       |   |                       |   | (438    | )                         |  |   | 9,302                         |   |  |              |        |   |  |   | 8,864   |  
|Intercompany service fee income (expense) from TEL marketing agreements |  |        |       |   |                       |   | 8,964   |                           |  |   | (8,964                        | ) |  |              |        |   |  |   |        |  
|                                                                        |  |        |        |   |                      
|Selling, general, and administrative expenses                           |  |        | 1,768  |   |                       |   | 11,325  |                           |  |   | 10,636                        |   |  |              |        |   |  |   | 23,729  |  
|Research, development, and testing expenses                             |  |        |       |   |                       |   | 14,363  |                           |  |   | 3,741                         |   |  |              |        |   |  |   | 18,104  |  
|Special item income                                                     |  |        |       |   |                       |   | 13,245  |                           |  |   |                              |   |  |              |        |   |  |   | 13,245  |  
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Operating (loss) profit                                                 |  |        | (1,841 | ) |                       |   | 18,660  |                           |  |   | 5,680                         |   |  |              | 406     |   |  |   | 22,905  |  
|                                                                        |  |        |        |   |                      
|Interest and financing expenses                                         |  |        | 4,600  |   |                       |   | (461    | )                         |  |   | 120                           |   |  |              |        |   |  |   | 4,259   |  
|Other income (expense), net                                             |  |        | 85     |   |                       |   | (318    | )                         |  |   | 25                            |   |  |              |        |   |  |   | (208    | )
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|(Loss) income before income taxes and equity income of subsidiaries     |  |        | (6,356 | ) |                       |   | 18,803  |                           |  |   | 5,585                         |   |  |              | 406     |   |  |   | 18,438  |  
|Income tax (benefit) expense                                            |  |        | (4,033 | ) |                       |   | 7,796   |                           |  |   | 1,546                         |   |  |              | 155     |   |  |   | 5,464   |  
|Equity income of subsidiaries                                           |  |        | 15,297 |   |                       |   |        |                           |  |   |                              |   |  |              | (15,297 | ) |  |   |        |  
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Net income                                                              |  | $      | 12,974 |   |                       | $ | 11,007  |                           |  | $ | 4,039                         |   |  | $            | (15,046 | ) |  | $ | 12,974  |  
|                                                                        |  |        |        |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  



19



---

NewMarket Corporation and Subsidiaries

Consolidating Statements of Income

Nine Months Ended September 30, 2005

(in thousands)



|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        
|----------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------------------------- |  | - | ----------------------------- | - |  | ------------ | -------- | - |  | - | -------
|                                                                        |  | Parent |         |   | GuarantorSubsidiaries |   | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated
|Net sales                                                               |  | $      |        |   |                       | $ | 561,720                   |  | $ | 390,713                       |   |  | $            | (170,545 | ) |  | $ | 781,888
|Cost of goods sold                                                      |  |        | 1,022   |   |                       |   | 483,530                   |  |   | 320,959                       |   |  |              | (172,068 | ) |  |   | 633,443
|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        
|Gross (loss) profit                                                     |  |        | (1,022  | ) |                       |   | 78,190                    |  |   | 69,754                        |   |  |              | 1,523    |   |  |   | 148,445
|                                                                        |  |        |         |   |                      
|Operating profit from TEL marketing agreements services                 |  |        |        |   |                       |   | 5,443                     |  |   | 14,186                        |   |  |              |         |   |  |   | 19,629 
|Intercompany service fee income (expense) from TEL marketing agreements |  |        |        |   |                       |   | 13,600                    |  |   | (13,600                       | ) |  |              |         |   |  |   |       
|                                                                        |  |        |         |   |                      
|Selling, general, and administrative expenses                           |  |        | 4,254   |   |                       |   | 32,664                    |  |   | 34,311                        |   |  |              |         |   |  |   | 71,229 
|Research, development, and testing expenses                             |  |        |        |   |                       |   | 37,168                    |  |   | 10,828                        |   |  |              |         |   |  |   | 47,996 
|Special item income                                                     |  |        |        |   |                       |   | 6,746                     |  |   |                              |   |  |              |         |   |  |   | 6,746  
|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        
|Operating (loss) profit                                                 |  |        | (5,276  | ) |                       |   | 34,147                    |  |   | 25,201                        |   |  |              | 1,523    |   |  |   | 55,595 
|                                                                        |  |        |         |   |                      
|Interest and financing expenses                                         |  |        | 12,807  |   |                       |   | 113                       |  |   |                              |   |  |              |         |   |  |   | 12,920 
|Other income, net                                                       |  |        | 432     |   |                       |   | 165                       |  |   | 146                           |   |  |              |         |   |  |   | 743    
|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        
|(Loss) income before income taxes and equity income of subsidiaries     |  |        | (17,651 | ) |                       |   | 34,199                    |  |   | 25,347                        |   |  |              | 1,523    |   |  |   | 43,418 
|Income tax (benefit) expense                                            |  |        | (1,302  | ) |                       |   | 3,754                     |  |   | 9,163                         |   |  |              | 573      |   |  |   | 12,188 
|Equity income of subsidiaries                                           |  |        | 47,579  |   |                       |   |                          |  |   |                              |   |  |              | (47,579  | ) |  |   |       
|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        
|Net income                                                              |  | $      | 31,230  |   |                       | $ | 30,445                    |  | $ | 16,184                        |   |  | $            | (46,629  | ) |  | $ | 31,230 
|                                                                        |  |        |         |   |                       |   |                           |  |   |                               |   |  |              |          |   |  |   |        



20



---

NewMarket Corporation and Subsidiaries

Consolidating Statements of Income

Nine Months Ended September 30, 2004

(in thousands)



|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        
|---------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | -------- | - |  | - | -------
|                                                                       |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated
|Net sales                                                              |  | $      |        |   |                       | $ | 487,366 |                           |  | $ | 351,857                       |   |  | $            | (176,275 | ) |  | $ | 662,948
|Cost of goods sold                                                     |  |        | 569     |   |                       |   | 398,070 |                           |  |   | 303,790                       |   |  |              | (178,503 | ) |  |   | 523,926
|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        
|Gross (loss) profit                                                    |  |        | (569    | ) |                       |   | 89,296  |                           |  |   | 48,067                        |   |  |              | 2,228    |   |  |   | 139,022
|                                                                       |  |        |         |   |                      
|Operating profit from TEL marketing agreements services                |  |        |        |   |                       |   | 3,900   |                           |  |   | 23,039                        |   |  |              |         |   |  |   | 26,939 
|Intercompany service fee income (expense)from TEL marketing agreements |  |        |        |   |                       |   | 22,440  |                           |  |   | (22,440                       | ) |  |              |         |   |  |   |       
|                                                                       |  |        |         |   |                      
|Selling, general, and administrative expenses                          |  |        | 4,141   |   |                       |   | 35,434  |                           |  |   | 32,582                        |   |  |              |         |   |  |   | 72,157 
|Research, development, and testing expenses                            |  |        |        |   |                       |   | 38,984  |                           |  |   | 9,967                         |   |  |              |         |   |  |   | 48,951 
|Special item income                                                    |  |        |        |   |                       |   | 13,245  |                           |  |   |                               |   |  |              |         |   |  |   | 13,245 
|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        
|Operating (loss) profit                                                |  |        | (4,710  | ) |                       |   | 54,463  |                           |  |   | 6,117                         |   |  |              | 2,228    |   |  |   | 58,098 
|                                                                       |  |        |         |   |                      
|Interest and financing expenses                                        |  |        | 13,857  |   |                       |   | (35     | )                         |  |   | 120                           |   |  |              |         |   |  |   | 13,942 
|Other income (expense), net                                            |  |        | 89      |   |                       |   | (976    | )                         |  |   | 1,128                         |   |  |              |         |   |  |   | 241    
|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        
|(Loss) income before income taxes and equity income of subsidiaries    |  |        | (18,478 | ) |                       |   | 53,522  |                           |  |   | 7,125                         |   |  |              | 2,228    |   |  |   | 44,397 
|Income tax (benefit) expense                                           |  |        | (6,353  | ) |                       |   | 18,557  |                           |  |   | 1,208                         |   |  |              | 839      |   |  |   | 14,251 
|Equity income of subsidiaries                                          |  |        | 42,271  |   |                       |   |        |                           |  |   |                              |   |  |              | (42,271  | ) |  |   |       
|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        
|Net income                                                             |  | $      | 30,146  |   |                       | $ | 34,965  |                           |  | $ | 5,917                         |   |  | $            | (40,882  | ) |  | $ | 30,146 
|                                                                       |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |        



21



---

NewMarket Corporation and Subsidiaries

Consolidating Balance Sheets

September 30, 2005

(in thousands)



|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|---------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | -------- | - |  | - | ------- | -
|                                               |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated |         
|ASSETS                                         |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Cash and cash equivalents                      |  | $      | 108     |   |                       | $ | 23,225  |                           |  | $ | 16,972                        |   |  | $            |         |   |  | $ | 40,305  |  
|Restricted cash                                |  |        | 980     |   |                       |   | 508     |                           |  |   |                              |   |  |              |         |   |  |   | 1,488   |  
|Trade and other accounts receivable, net       |  |        | 119     |   |                       |   | 90,647  |                           |  |   | 80,926                        |   |  |              |         |   |  |   | 171,692 |  
|Receivable - TEL marketing agreements services |  |        |        |   |                       |   | (8,794  | )                         |  |   | 10,474                        |   |  |              |         |   |  |   | 1,680   |  
|Amounts due from affiliated companies          |  |        |         |   |                       |   | 136,679 |                           |  |   | 29,567                        |   |  |              | (166,246 | ) |  |   |        |  
|Inventories                                    |  |        |        |   |                       |   | 88,150  |                           |  |   | 62,996                        |   |  |              | (815     | ) |  |   | 150,331 |  
|Deferred income taxes                          |  |        | 1,129   |   |                       |   | 4,999   |                           |  |   | 708                           |   |  |              | 348      |   |  |   | 7,184   |  
|Prepaid expenses                               |  |        | 323     |   |                       |   | 3,091   |                           |  |   | 1,230                         |   |  |              |         |   |  |   | 4,644   |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total current assets                           |  |        | 2,659   |   |                       |   | 338,505 |                           |  |   | 202,873                       |   |  |              | (166,713 | ) |  |   | 377,324 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Property, plant and equipment, at cost         |  |        |        |   |                       |   | 709,304 |                           |  |   | 66,694                        |   |  |              |         |   |  |   | 775,998 |  
|Less accumulated depreciation & amortization   |  |        |        |   |                       |   | 553,524 |                           |  |   | 62,495                        |   |  |              |         |   |  |   | 616,019 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Net property, plant and equipment              |  |        |        |   |                       |   | 155,780 |                           |  |   | 4,199                         |   |  |              |         |   |  |   | 159,979 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Investment in consolidated subsidiaries        |  |        | 493,832 |   |                       |   |        |                           |  |   |                              |   |  |              | (493,832 | ) |  |   |        |  
|Prepaid pension cost                           |  |        | 16,644  |   |                       |   |        |                           |  |   | 2,164                         |   |  |              |         |   |  |   | 18,808  |  
|Deferred income taxes                          |  |        | 15,067  |   |                       |   | 7,202   |                           |  |   | (4,139                        | ) |  |              |         |   |  |   | 18,130  |  
|Other assets and deferred charges              |  |        | 8,709   |   |                       |   | 32,811  |                           |  |   | 7,242                         |   |  |              |         |   |  |   | 48,762  |  
|Intangibles, net of amortization               |  |        | 970     |   |                       |   | 49,002  |                           |  |   | 1,904                         |   |  |              |         |   |  |   | 51,876  |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total assets                                   |  | $      | 537,881 |   |                       | $ | 583,300 |                           |  | $ | 214,243                       |   |  | $            | (660,545 | ) |  | $ | 674,879 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|LIABILITIES AND SHAREHOLDERS EQUITY           |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Accounts payable                               |  | $      | 47      |   |                       | $ | 48,493  |                           |  | $ | 22,717                        |   |  | $            |         |   |  | $ | 71,257  |  
|Accrued expenses                               |  |        | 9,054   |   |                       |   | 41,518  |                           |  |   | 6,554                         |   |  |              |         |   |  |   | 57,126  |  
|Book overdraft                                 |  |        | 17      |   |                       |   | 4,644   |                           |  |   |                              |   |  |              |         |   |  |   | 4,661   |  
|Amounts due to affiliated companies            |  |        | 62,660  |   |                       |   | 29,995  |                           |  |   | 73,591                        |   |  |              | (166,246 | ) |  |   |        |  
|Long-term debt, current portion                |  |        |        |   |                       |   | 630     |                           |  |   |                              |   |  |              |         |   |  |   | 630     |  
|Income taxes payable                           |  |        | (2,791  | ) |                       |   | 10,710  |                           |  |   | 6,258                         |   |  |              |         |   |  |   | 14,177  |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total current liabilities                      |  |        | 68,987  |   |                       |   | 135,990 |                           |  |   | 109,120                       |   |  |              | (166,246 | ) |  |   | 147,851 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Long-term debt                                 |  |        | 150,000 |   |                       |   | 3,355   |                           |  |   |                              |   |  |              |         |   |  |   | 153,355 |  
|Other noncurrent liabilities                   |  |        | 60,130  |   |                       |   | 36,840  |                           |  |   | 17,939                        |   |  |              |         |   |  |   | 114,909 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total liabilities                              |  |        | 279,117 |   |                       |   | 176,185 |                           |  |   | 127,059                       |   |  |              | (166,246 | ) |  |   | 416,115 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Shareholders equity:                          |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Common stock and paid-in capital               |  |        | 85,077  |   |                       |   | 272,588 |                           |  |   | 40,347                        |   |  |              | (312,935 | ) |  |   | 85,077  |  
|Accumulated other comprehensive loss           |  |        | (26,571 | ) |                       |   | (13,228 | )                         |  |   | (10,160                       | ) |  |              | 23,388   |   |  |   | (26,571 | )
|Retained earnings                              |  |        | 200,258 |   |                       |   | 147,755 |                           |  |   | 56,997                        |   |  |              | (204,752 | ) |  |   | 200,258 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total shareholders equity                     |  |        | 258,764 |   |                       |   | 407,115 |                           |  |   | 87,184                        |   |  |              | (494,299 | ) |  |   | 258,764 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total liabilities and shareholders equity     |  | $      | 537,881 |   |                       | $ | 583,300 |                           |  | $ | 214,243                       |   |  | $            | (660,545 | ) |  | $ | 674,879 |  
|                                               |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  



22



---

NewMarket Corporation and Subsidiaries

Consolidating Balance Sheets

December 31, 2004

(in thousands)



|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|--------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | -------- | - |  | - | ------- | -
|                                              |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated |         
|ASSETS                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Cash and cash equivalents                     |  | $      | 51      |   |                       | $ | 8,587   |                           |  | $ | 20,140                        |   |  | $            |         |   |  | $ | 28,778  |  
|Restricted cash                               |  |        | 1,132   |   |                       |   | 574     |                           |  |   |                              |   |  |              |         |   |  |   | 1,706   |  
|Trade and other accounts receivable, net      |  |        | 5,402   |   |                       |   | 82,507  |                           |  |   | 70,514                        |   |  |              |         |   |  |   | 158,423 |  
|Receivable -TEL marketing agreements services |  |        |        |   |                       |   | (3,869  | )                         |  |   | 7,167                         |   |  |              |         |   |  |   | 3,298   |  
|Amounts due from affiliated companies         |  |        |        |   |                       |   | 82,228  |                           |  |   | 33,819                        |   |  |              | (116,047 | ) |  |   |        |  
|Inventories                                   |  |        |        |   |                       |   | 97,823  |                           |  |   | 62,305                        |   |  |              | (2,339   | ) |  |   | 157,789 |  
|Deferred income taxes                         |  |        | 1,129   |   |                       |   | 5,117   |                           |  |   | 704                           |   |  |              | 924      |   |  |   | 7,874   |  
|Prepaid expenses                              |  |        | 252     |   |                       |   | 1,263   |                           |  |   | 872                           |   |  |              |         |   |  |   | 2,387   |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total current assets                          |  |        | 7,966   |   |                       |   | 274,230 |                           |  |   | 195,521                       |   |  |              | (117,462 | ) |  |   | 360,255 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Property, plant and equipment, at cost        |  |        |        |   |                       |   | 712,074 |                           |  |   | 65,031                        |   |  |              |         |   |  |   | 777,105 |  
|Less accumulated depreciation & amortization  |  |        |        |   |                       |   | 549,562 |                           |  |   | 61,314                        |   |  |              |         |   |  |   | 610,876 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Net property, plant and equipment             |  |        |        |   |                       |   | 162,512 |                           |  |   | 3,717                         |   |  |              |         |   |  |   | 166,229 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Investment in consolidated subsidiaries       |  |        | 458,555 |   |                       |   |        |                           |  |   |                              |   |  |              | (458,555 | ) |  |   |        |  
|Prepaid pension cost                          |  |        | 18,113  |   |                       |   |        |                           |  |   | 1,988                         |   |  |              |         |   |  |   | 20,101  |  
|Deferred income taxes                         |  |        | 13,468  |   |                       |   | (4,079  | )                         |  |   | (5,022                        | ) |  |              |         |   |  |   | 4,367   |  
|Other assets and deferred charges             |  |        | 20,587  |   |                       |   | 40,456  |                           |  |   | 7,918                         |   |  |              |         |   |  |   | 68,961  |  
|Intangibles, net of amortization              |  |        | 970     |   |                       |   | 53,235  |                           |  |   | 2,077                         |   |  |              |         |   |  |   | 56,282  |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total assets                                  |  | $      | 519,659 |   |                       | $ | 526,354 |                           |  | $ | 206,199                       |   |  | $            | (576,017 | ) |  | $ | 676,195 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|LIABILITIES AND SHAREHOLDERS EQUITY          |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Accounts payable                              |  | $      | 30      |   |                       | $ | 44,944  |                           |  | $ | 30,745                        |   |  | $            |         |   |  | $ | 75,719  |  
|Accrued expenses                              |  |        | 5,648   |   |                       |   | 41,069  |                           |  |   | 5,993                         |   |  |              |         |   |  |   | 52,710  |  
|Book overdraft                                |  |        | 17      |   |                       |   | 4,998   |                           |  |   |                              |   |  |              |         |   |  |   | 5,015   |  
|Amounts due to affiliated companies           |  |        | 40,831  |   |                       |   |        |                           |  |   | 75,216                        |   |  |              | (116,047 | ) |  |   |        |  
|Long-term debt, current portion               |  |        |        |   |                       |   | 601     |                           |  |   |                              |   |  |              |         |   |  |   | 601     |  
|Income taxes payable                          |  |        | 1,708   |   |                       |   | 4,750   |                           |  |   | (320                          | ) |  |              |         |   |  |   | 6,138   |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total current liabilities                     |  |        | 48,234  |   |                       |   | 96,362  |                           |  |   | 111,634                       |   |  |              | (116,047 | ) |  |   | 140,183 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Long-term debt                                |  |        | 180,000 |   |                       |   | 3,837   |                           |  |   |                              |   |  |              |         |   |  |   | 183,837 |  
|Other noncurrent liabilities                  |  |        | 59,543  |   |                       |   | 40,074  |                           |  |   | 20,676                        |   |  |              |         |   |  |   | 120,293 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total liabilities                             |  |        | 287,777 |   |                       |   | 140,273 |                           |  |   | 132,310                       |   |  |              | (116,047 | ) |  |   | 444,313 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Shareholders equity:                         |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Common stock and paid-in capital              |  |        | 84,724  |   |                       |   | 271,483 |                           |  |   | 40,347                        |   |  |              | (311,830 | ) |  |   | 84,724  |  
|Accumulated other comprehensive loss          |  |        | (21,870 | ) |                       |   | (11,686 | )                         |  |   | (7,125                        | ) |  |              | 18,811   |   |  |   | (21,870 | )
|Retained earnings                             |  |        | 169,028 |   |                       |   | 126,284 |                           |  |   | 40,667                        |   |  |              | (166,951 | ) |  |   | 169,028 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total shareholders equity                    |  |        | 231,882 |   |                       |   | 386,081 |                           |  |   | 73,889                        |   |  |              | (459,970 | ) |  |   | 231,882 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  
|Total liabilities and shareholders equity    |  | $      | 519,659 |   |                       | $ | 526,354 |                           |  | $ | 206,199                       |   |  | $            | (576,017 | ) |  | $ | 676,195 |  
|                                              |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |          |   |  |   |         |  



23



---

NewMarket Corporation and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Nine Months Ended
September 30, 2005



|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ------------------------- |  | - | ----------------------------- | - |  | ------------ | ------- | - |  | - | ------- | -
|                                                        |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated |        
|Cash (used in) provided from operating activities       |  | $      | (4,721  | ) |                       | $ | 57,928  |                           |  | $ | 659                           |   |  | $            |        |   |  | $ | 53,866  |  
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Cash flows from investing activities                    |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Capital expenditures                                    |  |        |        |   |                       |   | (12,640 | )                         |  |   | (1,109                        | ) |  |              |        |   |  |   | (13,749 | )
|Increase in intercompany loans                          |  |        | (5,700  | ) |                       |   |        |                           |  |   |                              |   |  |              | 5,700   |   |  |   |        |  
|Proceeds from sale of corporate property                |  |        |        |   |                       |   | 4,244   |                           |  |   |                              |   |  |              |        |   |  |   | 4,244   |  
|Cash dividends from subsidiaries                        |  |        | 40,125  |   |                       |   |        |                           |  |   |                              |   |  |              | (40,125 | ) |  |   |        |  
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Cash provided from (used in) investing activities       |  |        | 34,425  |   |                       |   | (8,396  | )                         |  |   | (1,109                        | ) |  |              | (34,425 | ) |  |   | (9,505  | )
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Cash flows from financing activities                    |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Borrowings under revolving credit agreements            |  |        | (30,000 | ) |                       |   |        |                           |  |   |                              |   |  |              |        |   |  |   | (30,000 | )
|Change in book overdraft                                |  |        |        |   |                       |   | (354    | )                         |  |   |                              |   |  |              |        |   |  |   | (354    | )
|Financing from affiliated companies                     |  |        |        |   |                       |   | 5,700   |                           |  |   |                              |   |  |              | (5,700  | ) |  |   |        |  
|Cash dividends paid                                     |  |        |        |   |                       |   | (40,125 | )                         |  |   |                              |   |  |              | 40,125  |   |  |   |        |  
|Proceeds from exercise of stock options                 |  |        | 353     |   |                       |   |        |                           |  |   |                              |   |  |              |        |   |  |   | 353     |  
|Decrease in capital lease                               |  |        |        |   |                       |   | (453    | )                         |  |   |                              |   |  |              |        |   |  |   | (453    | )
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Cash used in financing activities                       |  |        | (29,647 | ) |                       |   | (35,232 | )                         |  |   |                              |   |  |              | 34,425  |   |  |   | (30,454 | )
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Effect of foreign exchange on cash and cash equivalents |  |        |        |   |                       |   | 338     |                           |  |   | (2,718                        | ) |  |              |        |   |  |   | (2,380  | )
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Increase (decrease) in cash and cash equivalents        |  |        | 57      |   |                       |   | 14,638  |                           |  |   | (3,168                        | ) |  |              |        |   |  |   | 11,527  |  
|Cash and cash equivalents at beginning of year          |  |        | 51      |   |                       |   | 8,587   |                           |  |   | 20,140                        |   |  |              |        |   |  |   | 28,778  |  
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  
|Cash and cash equivalents at end of period              |  | $      | 108     |   |                       | $ | 23,225  |                           |  | $ | 16,972                        |   |  | $            |        |   |  | $ | 40,305  |  
|                                                        |  |        |         |   |                       |   |         |                           |  |   |                               |   |  |              |         |   |  |   |         |  



24



---

NewMarket Corporation and Subsidiaries

Condensed Consolidating Statements of Cash Flows

Nine Months Ended
September 30, 2004



|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------ | ------------------------- |  | - | ----------------------------- | - |  | ------------ | ------ | - |  | - | ------- | -
|                                                        |  | Parent |         |   | GuarantorSubsidiaries |   |        | Non-GuarantorSubsidiaries |  |   | TotalConsolidatingAdjustments |   |  | Consolidated |       
|Cash provided from (used in) operating activities       |  | $      | 12,727  |   |                       | $ | 24,936 |                           |  | $ | (469                          | ) |  | $            |       |   |  | $ | 37,194  |  
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Cash flows from investing activities                    |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Capital expenditures                                    |  |        |        |   |                       |   | (9,521 | )                         |  |   | (587                          | ) |  |              |       |   |  |   | (10,108 | )
|Purchase of nonoperating asset                          |  |        | (3,323  | ) |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | (3,323  | )
|Cash dividends from subsidiaries                        |  |        | 2,000   |   |                       |   |       |                           |  |   |                              |   |  |              | (2,000 | ) |  |   |        |  
|Other, net                                              |  |        |        |   |                       |   | 29     |                           |  |   |                              |   |  |              |       |   |  |   | 29      |  
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Cash used in investing activities                       |  |        | (1,323  | ) |                       |   | (9,492 | )                         |  |   | (587                          | ) |  |              | (2,000 | ) |  |   | (13,402 | )
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Cash flows from financing activities                    |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Repayments of debt - previous agreements                |  |        | (53,807 | ) |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | (53,807 | )
|Repayment of revolving credit agreement                 |  |        | (17,000 | ) |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | (17,000 | )
|Issuance of revolving credit agreement                  |  |        | 50,000  |   |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | 50,000  |  
|Change in book overdraft                                |  |        |        |   |                       |   | 1,382  |                           |  |   |                              |   |  |              |       |   |  |   | 1,382   |  
|Cash dividends paid                                     |  |        |        |   |                       |   | (2,000 | )                         |  |   |                              |   |  |              | 2,000  |   |  |   |        |  
|Debt issuance costs                                     |  |        | (1,279  | ) |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | (1,279  | )
|Proceeds from exercise of stock options                 |  |        | 811     |   |                       |   |       |                           |  |   |                              |   |  |              |       |   |  |   | 811     |  
|Decrease in capital lease                               |  |        |        |   |                       |   | (426   | )                         |  |   |                              |   |  |              |       |   |  |   | (426    | )
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Cash used in financing activities                       |  |        | (21,275 | ) |                       |   | (1,044 | )                         |  |   |                              |   |  |              | 2,000  |   |  |   | (20,319 | )
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Effect of foreign exchange on cash and cash equivalents |  |        |        |   |                       |   | (3,819 | )                         |  |   | 1,761                         |   |  |              |       |   |  |   | (2,058  | )
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|(Decrease) increase in cash and cash equivalents        |  |        | (9,871  | ) |                       |   | 10,581 |                           |  |   | 705                           |   |  |              |       |   |  |   | 1,415   |  
|Cash and cash equivalents at beginning of year          |  |        | 9,887   |   |                       |   | 7,802  |                           |  |   | 15,678                        |   |  |              |       |   |  |   | 33,367  |  
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  
|Cash and cash equivalents at end of period              |  | $      | 16      |   |                       | $ | 18,383 |                           |  | $ | 16,383                        |   |  | $            |       |   |  | $ | 34,782  |  
|                                                        |  |        |         |   |                       |   |        |                           |  |   |                               |   |  |              |        |   |  |   |         |  



25



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ITEM 2. Managements Discussion and Analysis of

Financial Condition and Results of Operations



Forward-Looking Statements



The following discussion contains statements about future events and expectations, or forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations and projections about future results. When we use words in this document, such as anticipates,
intends, plans, believes, estimates, expects, and similar expressions, we do so to identify forward-looking statements. Examples of forward-looking statements include, but are not limited
to, statements we make regarding future prospects of growth in the petroleum additives market, the level of future declines in the market for tetraethyl lead (TEL), other trends in the petroleum additives market, our ability to maintain or increase
our market share, and our future capital expenditure levels.



We believe our forward-looking statements are based on reasonable expectations and assumptions, within the bounds of what we know about our business and operations. However, we offer no assurance that actual results will not differ
materially from our expectations due to uncertainties and factors that are difficult to predict and beyond our control.



These factors include, but are not limited to, timing of sales orders, gain or loss of significant customers, competition from other manufacturers,
resolution of environmental liabilities, changes in the demand for our products, significant changes in new product introduction, increases in product cost, the impact of fluctuations in foreign exchange rates on reported results of operations,
changes in various markets, geopolitical risks in certain of the countries in which we conduct business, and the impact of consolidation of the petroleum additives industry. In addition, we also discuss certain risk factors in Item 7A,
Quantitative and Qualitative Disclosures About Market Risk in the 2004 Annual Report and incorporate the same herein by reference.



You should keep in mind that any forward-looking statement made by us in this discussion speaks only as of the date on which we make it. New risks and
uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. We have no duty to, and do not intend to, update or revise the forward-looking statements in this discussion after the date hereof,
except as may be required by law. In light of these risks and uncertainties, you should keep in mind that the events described in any forward-looking statement, made in this discussion or elsewhere, might not occur.



Results of Operations



Net Sales



Our consolidated net sales for the third quarter 2005 amounted to $270.9
million, representing an increase of 21% from the 2004 level of $224.7 million. The nine months 2005 consolidated net sales were $781.9 million as compared to $662.9 million for the same 2004 period, which represents an increase of 18% over nine
months 2004. The table below shows our consolidated net sales by segment.



26



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Net Sales by Segment

(in millions)



|                       |  |                                |       |                               |   |       |  |      |       |  |   |      
|---------------------- |  | ------------------------------ | ----- | ----------------------------- | - | ----- |  | ---- | ----- |  | - | -----
|                       |  | Three Months EndedSeptember 30 |       | Nine Months EndedSeptember 30
|                       |  | 2005                           |       | 2004                          |   | 2005  |  | 2004
|Petroleum additives    |  | $                              | 267.4 |                               | $ | 222.8 |  | $    | 773.6 |  | $ | 655.5
|Tetraethyl lead        |  |                                | 3.5   |                               |   | 1.9   |  |      | 8.3   |  |   | 7.4  
|                       |  |                                |       |                               |   |       |  |      |       |  |   |      
|Consolidated net sales |  | $                              | 270.9 |                               | $ | 224.7 |  | $    | 781.9 |  | $ | 662.9
|                       |  |                                |       |                               |   |       |  |      |       |  |   |      



Petroleum Additives
Segment



Petroleum additives net sales in the third
quarter 2005 of $267.4 million were up $44.6 million, or approximately 20%, from $222.8 million in the third quarter 2004. Shipments for the third quarter 2005 increased approximately 7% as compared to third quarter 2004. The increase in shipments
was the result of significantly higher shipments in the engine oil additives product line and higher shipments in the fuels product line. Shipments in the specialty additives product line for the third quarter 2005 were generally unchanged compared
to third quarter 2004. Higher selling prices and a favorable foreign currency impact also resulted in a 12% increase in net sales between the two third quarter periods.



The nine months 2005 petroleum additives net sales of $773.6 million were $118.1 million, or 18%, higher than the 2004 nine
months petroleum additives net sales of $655.5 million. Total petroleum additives shipments increased approximately 7% when comparing nine months 2005 to nine months 2004. Again, the higher shipments resulted from an increase in the engine oil
additives product line. Shipments in the other product lines were down less than 2%. Similar to the third quarter results, higher selling prices and a favorable foreign currency impact also resulted in a 10% increase in net sales when comparing nine
months 2005 and nine months 2004.



The components of the
petroleum additives increase in net sales of $44.6 million between the two third quarter periods and $118.1 million between the two nine-month periods are shown below (in millions):



|                                                            |  |              |       |            |   |      
|----------------------------------------------------------- |  | ------------ | ----- | ---------- | - | -----
|                                                            |  | ThirdQuarter |       | NineMonths
|Period ended September 30, 2004                             |  | $            | 222.8 |            | $ | 655.5
|Change in shipments and product mix                         |  |              | 17.6  |            |   | 51.2 
|Changes in selling prices including foreign currency impact |  |              | 27.0  |            |   | 66.9 
|                                                            |  |              |       |            |   |      
|Period ended September 30, 2005                             |  | $            | 267.4 |            | $ | 773.6
|                                                            |  |              |       |            |   |      



Tetraethyl Lead
Segment



Most of the TEL marketing activity is through
marketing agreements with The Associated Octel Company Limited and its affiliates (Octel), under which we do not record the sales transactions. Therefore, the TEL net sales shown in the table above are those made by our wholly-owned subsidiary,
Ethyl Corporation (Ethyl) in areas not covered by the marketing agreements. The sales made in areas not covered by the Octel marketing agreements are very minor compared to the TEL



27



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sales made through the marketing agreements. These TEL sales for the third quarter and nine months 2005 were higher than the same periods in 2004. These
changes were caused substantially by variation in the quarter-to-quarter timing of sales orders.



Segment Operating Profit



NewMarket evaluates the performance of the petroleum additives business of Afton Chemical Corporation (Afton) and Ethyls TEL business based on
segment operating profit. Corporate departments and other expenses are billed to Afton and Ethyl based on the services provided under the holding company structure. Depreciation on segment property, plant, and equipment and amortization of segment
intangible assets and the prepayment for services are included in the operating profit of each segment.



The table below reports operating profit by segment for the third quarter and nine months 2005 and 2004. The Contract manufacturing and other
classification in the table below primarily represents certain manufacturing operations that Ethyl provides to Afton.



Segment Operating Profit

(in millions)



|                                 |  |                                |      |                               |   |      |  |      |      |  |   |     
|-------------------------------- |  | ------------------------------ | ---- | ----------------------------- | - | ---- |  | ---- | ---- |  | - | ----
|                                 |  | Three Months EndedSeptember 30 |      | Nine Months EndedSeptember 30
|                                 |  | 2005                           |      | 2004                          |   | 2005 |  | 2004
|Petroleum additives              |  | $                              | 17.4 |                               | $ | 9.4  |  | $    | 44.2 |  | $ | 39.6
|                                 |  |                                |      |                               |   |      |  |      |      |  |   |     
|Tetraethyl lead                  |  | $                              | 5.6  |                               | $ | 17.2 |  | $    | 19.4 |  | $ | 32.7
|                                 |  |                                |      |                               |   |      |  |      |      |  |   |     
|Contract manufacturing and other |  | $                              | 0.2  |                               | $ | 0.8  |  | $    | 1.8  |  | $ | 0.8 
|                                 |  |                                |      |                               |   |      |  |      |      |  |   |     



Petroleum Additives
Segment



Third Quarter 2005 vs. Third Quarter
2004 - Petroleum additives third quarter 2005 operating profit was $17.4 million as compared to $9.4 million for third quarter 2004. The increase was across all product lines with most of the increase in the engine oil additives and fuels
product lines. Third quarter 2005 includes expenses of $800 thousand related to damage from Hurricane Rita. Third quarter 2004 results included a gain of $800 thousand from an environmental insurance settlement.



Net sales were approximately 20% higher and shipments were approximately 7%
higher for the third quarter 2005 than the same 2004 period, resulting in the higher operating profit for the third quarter 2005. Selling, general, and administrative (SG&A) expenses were $1.7 million higher when comparing the two third quarter
periods. The increase in SG&A was mostly in the engine oil additives and fuel product lines. Offsetting the increase in SG&A expense is a $2.4 million decline quarter over quarter in research, development, and testing (R&D) expenses.
This decrease was substantially in the engine oil additives product line. Operating profit for the third quarter 2005 included a favorable foreign currency impact versus third quarter 2004. We are making some progress in recovering rising raw
material costs through price increases for our products and continue to seek price increases as raw material costs continue to rise.



28



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As a percentage of net sales, SG&A expenses combined with R&D expenses, decreased from 16.2% for
the third quarter 2004 to 13.3% for the same period this year. This decrease reflects higher sales, as well as a 2% decrease in combined SG&A and R&D expenses.



Nine Months 2005 vs. Nine Months 2004 - Petroleum additives nine months 2005 operating profit was $44.2
million, which was an increase of 12% from the nine months 2004 level of $39.6 million. Nine months 2005 include expenses of $800 thousand related to damage from Hurricane Rita, while nine months 2004 results include a gain of $800 thousand from an
environmental insurance settlement.



Continuing the trend from
the first six months of 2005, net sales were approximately 18% higher and shipments were approximately 7% higher. On a combined basis, SG&A expenses and R&D expenses were even for nine months 2005 as compared to nine months 2004. We have had
some success increasing selling prices during the nine months 2005, but raw material costs have continued to rise. We will attempt to recover the ongoing increase in the raw material costs during the remainder of the year. The nine months 2005
results also include a significant favorable foreign currency impact.



Petroleum additives segment R&D expenses decreased $1.5 million when comparing nine months 2005 to nine months 2004. The decreases in the engine oil additives and fuel product lines were partially offset by an increase in the specialty
additives product line. R&D included a small unfavorable foreign currency impact.



Nine months 2005 SG&A expenses for the petroleum additives segment increased approximately $1.5 million when compared to nine months 2004 levels. The increase was across all product lines and included an
unfavorable foreign currency impact. As a percentage of net sales, SG&A expenses combined with R&D expenses decreased from 15.9% for nine months 2004 to 13.5% for nine months 2005. This decrease reflects higher sales and a small decrease in
combined SG&A and R&D expenses.



TEL Segment



Results of our TEL segment include the operating profit
contribution from our marketing agreements with Octel, as well as certain TEL operations not included in the marketing agreements.



The operating profit from our marketing agreements for the third quarter 2005 was $6.4 million, which was $2.5 million lower than the third quarter last
year. Similarly, the nine months 2005 marketing agreements operating results of $19.6 million were $7.3 million lower than nine months 2004. Both 2005 periods reflect improved pricing over 2004, however, this was more than offset by a 22% decrease
in volume for the third quarter 2005 and 28% lower volume for nine months 2005 compared to the same periods in 2004. Amortization of the prepayment for services was about $400 thousand lower for the third quarter 2005 and $1.2 million lower for nine
months 2005 as compared to the same periods in 2004, reflecting the declining balance method of amortization and an increase in the estimated life.



The decrease in operating profit from the marketing agreements is primarily due to lower shipments. During the second quarter 2005, Octel advised us that
one of the major TEL customers under our marketing agreements indicated that it had discontinued the use of TEL earlier than we had previously expected. The TEL market will continue to decline as other customers discontinue use of the product.



29



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Other TEL operations not included in the marketing agreements were $9.1 million unfavorable when
comparing third quarter 2005 to third quarter 2004 and $6.0 million unfavorable when comparing nine months 2005 to the same 2004 period. Nine months 2005 results include a special item of $3.9 million ($2.5 million after income taxes) for insurance
settlement gains related to our premises asbestos liabilities. Both the third quarter and nine months 2004 periods include a special item gain of $12.5 million ($7.9 million after income taxes) from an environmental insurance settlement. The other
TEL operations results for both the third quarter and nine months 2005 periods also reflect lower expenses for premises asbestos charges, reflecting the favorable impact of a change in expected future insurance reimbursements. The favorable impact
for nine months 2005 from premises asbestos charges was partially offset by an increase in environmental clean-up costs.



The following discussion references the Condensed Consolidated Financial Statements beginning on page 3 of this Quarterly Report on Form 10-Q.



Special Item Income



Third quarter 2005 special item income resulted from a gain of $2.9 million
($1.8 million after income taxes) on the sale of corporate property. Nine months 2005 special item income includes this item, as well as the gain discussed below.



During the second quarter 2005, we entered into an agreement with Travelers Indemnity Company (Travelers) resolving certain
long standing issues regarding our coverage for certain premises asbestos claims. In addition, our agreement with Travelers provides a procedure for allocating defense and indemnity costs with respect to future premises asbestos claims. The lawsuit
against Travelers in the Southern District of Texas was dismissed.



We also settled our outstanding receivable from Albemarle Corporation (Albemarle) for premises asbestos liability obligations. As a result of the insurance settlement described above, the outstanding amount owed to us by Albemarle was
adjusted to $1.4 million, compared to $4 million at year end. Albemarle paid us $1.4 million in the third quarter of this year.



These settlements resulted in an aggregate second quarter gain of $3.9 million ($2.5 million after income taxes), which is included as a special item for
nine months 2005. The net gain represents amounts paid to us to settle historical claims in excess of the receivables we carried on our financial statements from both Travelers and Albemarle in the aggregate.



Special item income of $13.2 million ($8.4 million after income taxes) for
both third quarter and nine months 2004 represented the gain on an environmental insurance settlement. The terms of the settlement provided for a total payment of $15.6 million, of which $4.2 million remains to be paid to us in the first quarter
2006.



Interest and Financing Expenses



Third quarter 2005 interest and financing expenses were
$4.1 million, while third quarter 2004 was $4.2 million. Lower average debt resulted in a decrease of $400 thousand, while higher average interest rates resulted in increased expenses of $300 thousand. Fees and amortization of financing costs were
substantially unchanged between the two periods.



Nine months
2005 interest and financing expenses were $12.9 million as compared to $13.9 million for nine months 2004. Lower average debt resulted in a decrease in interest and financing expenses of $700 thousand, while higher average interest rates resulted in
an increase of $300 thousand. Fees and amortization of financing costs were $600 thousand lower for the 2005 period.



30



---

Other Income (Expense), Net



Other income (expense), net was $400 thousand income for the third quarter 2005 compared to $200 thousand expense for the
third quarter 2004. Nine months 2005 amount to $700 thousand income while nine months 2004 was $200 thousand income. All periods were comprised of a number of non-material items.



Income Taxes



Income taxes were $4.3 million for the third quarter 2005 and $5.5 million for the third quarter 2004. The effective tax rate was 24.5% for the third
quarter 2005 and 29.6% for the third quarter 2004. The decrease in income before income taxes from 2004 to 2005 resulted in a decrease of $300 thousand in income taxes in the third quarter 2005, while the decrease in the effective tax rate between
2005 and 2004 resulted in an additional decrease in tax expense of $900 thousand.



Nine months 2005 income taxes were $12.2 million with an effective tax rate of 28.1%. The income taxes for nine months 2004 were $14.3 million with an effective tax rate of 32.1%. The decrease in the effective tax
rate resulted in a decrease of $1.8 million in income taxes. The remaining $300 thousand decrease was the result of the lower income before income taxes for nine months 2005.



The effective tax rate for both 2005 periods reflects the favorable impact of about $1.1 million from the settlement of
certain tax years with the Internal Revenue Service.



Our
deferred taxes are in a net asset position. Based on our current projections, we believe that we will recover the full benefit of our deferred tax assets.



Net Income



Our net income for third quarter 2005 was $13.4 million ($.79 per basic share) while third quarter 2004 net income was $13.0 million ($.76 per basic
share). Third quarter 2005 included the $1.8 million ($.11 per share) gain on the sale of corporate property, as well as a $1.3 million benefit ($.07 per basic share) from the settlement of certain tax years with the Internal Revenue Service. The
tax settlement included $200 thousand of interest income. Third quarter 2004 included the $8.4 million ($.50 per basic share) benefit from the environmental insurance settlement. Corporate unallocated general and administrative expenses were
slightly lower for third quarter 2005 as compared to the same 2004 period.



Nine months 2005 net income was $31.2 million ($1.84 per basic share). In addition to the two third quarter items mentioned above totaling $3.1 million ($.18 per basic share), nine months 2005 also included the
benefit of an insurance settlement of $2.5 million ($.15 per basic share). Nine months 2004 included the third quarter benefit of $8.4 million ($.50 per basic share) mentioned above. Corporate unallocated general and administrative expenses were
$1.4 million lower for nine months 2005 as compared to the same 2004 period. The 2004 period had higher legal and holding company formation expenses.



Cash Flows, Financial Condition, and Liquidity



Cash and cash equivalents at September 30, 2005 were $40.3 million, which was an increase of $11.5 million since December 31, 2004 and included
a $2.4 million negative impact from foreign currency translation. Cash flows from operating activities for the nine months 2005 were $53.9 million. We used these cash flows and $4.2 million of proceeds from the sale of corporate property to fund
capital expenditures of $13.7 million and pay down $30.0 million of debt. Included in the 2005 cash flows from operating activities were collections of $3.7 million related to the 2004 environmental insurance settlement and $7.4 million from a 2005
insurance settlement related to our



31



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premises asbestos liabilities. Cash flows from operating activities for the 2005 period also included higher working capital requirements, which are
discussed more fully below under Working Capital. We expect that cash from operations, together with borrowing available under our senior credit facility, will continue to be sufficient to cover our operating expenses and planned capital
expenditures.



The terms of the 2004 environmental insurance
settlement provide for a total payment of $15.6 million. In addition to the $7.7 million received during 2004, we received $3.7 million in the first quarter 2005 and will receive the remaining $4.2 million in the first quarter 2006.



Cash



We had restricted cash of $1.5 million at September 30, 2005 and $1.7 million at December 31, 2004. Of these funds
at September 30, 2005, $1 million was cash received from Metropolitan Life Insurance Company (Metropolitan) in 2005 and 2003. These funds amounted to $1.1 million at December 31, 2004. The funds from Metropolitan are used to reduce the
employee portion of retiree health benefits costs. The remaining $500 thousand of restricted cash represents funds related to the issuance of a European bank guarantee.



Debt



Senior Notes - On April 30, 2003, Ethyl sold senior notes in the aggregate principal amount of $150 million that bear interest at a
fixed rate of 8.875% and are due in 2010.



The senior notes
are our senior unsecured obligations and are jointly and severally guaranteed on an unsecured basis by all of our existing and future wholly-owned domestic restricted subsidiaries and certain of our existing wholly-owned foreign subsidiaries. We
incurred financing costs of approximately $5 million related to the senior notes, which are being amortized over seven years.



In connection with the holding company formation, NewMarket assumed all of Ethyls rights, liabilities and obligations under the senior notes,
effective June 18, 2004.



The senior notes and the
subsidiary guarantees rank:



| |  |  | effectively junior to all of our and the guarantors existing and future secured indebtedness, including any borrowings under the senior credit facility described below;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | equal in right of payment with any of our and the guarantors existing and future unsecured senior indebtedness; and
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | senior in right of payment to any of our and the guarantors existing and future subordinated indebtedness.
| | - |  | -----------------------------------------------------------------------------------------------------------



The indenture governing the senior notes contains covenants that, among
other things, limit our ability and the ability of our restricted subsidiaries to:



| |  |  | incur additional indebtedness;
| | - |  | ------------------------------



| |  |  | create liens;
| | - |  | -------------



| |  |  | pay dividends or repurchase capital stock;
| | - |  | ------------------------------------------



| |  |  | make certain investments;
| | - |  | -------------------------



32



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| |  |  | sell assets or consolidate or merge with or into other companies; and
| | - |  | ---------------------------------------------------------------------



| |  |  | engage in transactions with affiliates.
| | - |  | ---------------------------------------



We were in compliance with these covenants as of both September 30, 2005 and December 31, 2004.



Senior Credit Facility - On April 30, 2003, we
entered into a long-term debt structure for Ethyl. The debt structure included the senior notes discussed above and a senior credit facility with a bank term loan and a revolving credit facility.



On June 18, 2004, prior to the completion of the holding company
formation, Ethyl entered into an Amended and Restated Credit Agreement, which consists of a $100 million revolving credit facility. This agreement amended and restated the credit agreement that Ethyl had entered into on April 30, 2003.
Effective with the completion of the holding company formation, NewMarket assumed all of Ethyls rights and obligations under the Amended and Restated Credit Agreement pursuant to the First Amendment thereto. We incurred additional financing
costs of approximately $1 million, which resulted in total deferred financing costs of approximately $6 million related to the amended and restated credit facility. These costs are being amortized over five years.



Borrowings under the $100 million revolving credit facility are used for
working capital and other general corporate purposes for NewMarket and our subsidiaries. The revolving credit facility includes a sub-facility for letters of credit. Borrowings bear interest, at our election, at either a base rate plus a margin (75
basis points as of September 30, 2005) or LIBOR plus a margin (225 basis points as of September 30, 2005). The revolving credit facility matures on June 18, 2009. There were no borrowings outstanding at September 30, 2005 under
the revolving credit facility. At September 30, 2005, we had outstanding letters of credit of $2.6 million, resulting in the unused portion of the revolver amounting to $97.4 million.



The revolving credit facility is secured by liens on substantially all of
our U.S. assets. In addition, the credit facility is guaranteed by our U.S. subsidiaries and certain foreign subsidiaries to the extent that such guarantees would not result in adverse tax consequences.



The credit agreement contains covenants, representations, and events of
default that management considers typical of a credit agreement of this nature. The financial covenants include:



| |  |  | minimum consolidated net worth;
| | - |  | -------------------------------



| |  |  | a minimum fixed charge coverage ratio;
| | - |  | --------------------------------------



| |  |  | a maximum leverage ratio;
| | - |  | -------------------------



| |  |  | a maximum senior secured leverage ratio; and
| | - |  | --------------------------------------------



| |  |  | restrictions on the payment of dividends or repurchases of capital stock.
| | - |  | -------------------------------------------------------------------------



We were in compliance with these covenants as of both September 30, 2005 and December 31, 2004.



** *



33



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We had combined current and noncurrent long-term debt of $154.0 million at September 30, 2005,
representing a decrease of $30.5 million in our total debt since December 31, 2004. The decrease resulted from a payoff of outstanding borrowings amounting to $30.0 million on the revolving credit facility and payments of $500 thousand on
capital leases.



As a percentage of total capitalization
(total long-term debt and shareholders equity), our total debt decreased from 44.3% at the end of 2004 to 37.3% at September 30, 2005. The lower percentage was a result of the decreased debt level and the increase in shareholders
equity, which was due to net income. Normally, we repay long-term debt with cash from operations and with proceeds from occasional sales of business units, plant sites, or other assets.



Capital Expenditures



We funded capital expenditures of $13.7 million through September 30, 2005, and we estimate our total capital spending during 2005 will be
approximately $20 million. We expect to continue to finance capital spending through cash provided from operations.



Working Capital



We had working capital at September 30, 2005, of $229.5 million, resulting in a current ratio of 2.55 to 1. At December 31, 2004, the working
capital was $220.1 million and the current ratio was 2.57 to 1.



The increase in working capital primarily reflects a higher cash level and higher accounts receivables. These were offset by a decrease in inventory and an increase in income taxes payable. The accounts receivable increase is due to the
higher sales levels, reflecting both increased volumes shipped and higher prices. The decrease in inventory is the result of planned reductions in our olefin copolymer viscosity index improvers. The increase in income taxes payable is due to current
year taxable income at our foreign locations.



Critical
Accounting Policies



It is our goal to clearly present
our financial information in a manner that enhances the understanding of our sources of earnings and our financial condition. We do this by including the information required by the SEC, as well as additional information that gives further insight
into our financial operations.



This report, as well as the
2004 Annual Report, includes a discussion of our accounting principles, as well as methods and estimates used in the preparation of our financial statements. We believe these discussions and statements fairly represent the financial position and
operating results of our company. The purpose of this portion of our discussion is to further emphasize some of the more critical areas where a significant change in facts and circumstances in our operating and financial environment might cause a
change in reported financial results.



As discussed in the
2004 Annual Report, we have made certain prepayments related to our TEL marketing agreements. The unamortized total at September 30, 2005 for these prepayments is $15.9 million. We are amortizing these costs on an accelerated basis using a
declining balance method over the life of the contracts. We believe this is the appropriate methodology and time period for this amortization based on the facts and circumstances of our TEL operations and the estimated product life of TEL. The
customer base of TEL is significantly concentrated in a few countries and when conditions change that cause a shorter product life or other restrictions outside of our control, the amortization period and/or rate is adjusted accordingly. Any
adjustment to the amortization period would impact earnings, but would have no effect on cash flows. We continue to keep our accounting for this issue current with the business conditions.



34



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During the second quarter 2005, Octel advised us that one of the major TEL customers under our marketing
agreements has indicated that it had discontinued the use of TEL earlier than we had previously expected. Because of this development, we evaluated the prepayment for marketing agreement services for impairment and concluded the unamortized value
was not impaired. We adjusted the rate of amortization from a 20% declining balance method to a 30% declining balance method. In addition, based on revised projections of product shipments and product life expectancy, we adjusted the amortization
period to run through 2012. This change will have an insignificant impact on 2005 earnings. Total amortization related to the TEL marketing agreements is currently projected to be:



| |  |  | $6.6 million in 2005,
| | - |  | ---------------------



| |  |  | $4.6 million in 2006,
| | - |  | ---------------------



| |  |  | $3.3 million in 2007,
| | - |  | ---------------------



| |  |  | $2.3 million in 2008,
| | - |  | ---------------------



| |  |  | $1.6 million in 2009, and
| | - |  | -------------------------



| |  |  | $2.4 million in total for the final three years.
| | - |  | ------------------------------------------------



We also have certain identifiable intangibles amounting to $47.1 million at September 30, 2005. These intangibles relate to our petroleum additives
business and are being amortized over periods with up to eleven years of remaining life. We continue to assess the market related to these intangibles, as well as their specific values, and conclude the amortization periods and values are
appropriate. We also evaluate these intangibles for any potential impairment. These evaluations continue to support the value at which these identifiable intangibles are carried on our financial statements. However, if conditions were to deteriorate
substantially in this market, it could possibly cause a reduction in the periods of this amortization charge or could possibly result in a noncash write-off of a portion of the intangibles carrying value. A reduction in the amortization period
would have no cash effect. While we do not anticipate such a change in the market conditions, this disclosure is provided to enhance the understanding of the factors involved.



We have made disclosure of our environmental issues in Part I, Item I of the 2004 Annual Report, as well as in the Notes to
Consolidated Financial Statements of the 2004 Annual Report. We believe our environmental accruals are appropriate for the exposures and regulatory guidelines under which we currently operate. While we currently do not anticipate significant changes
to the many factors that could impact our environmental requirements, we continue to keep our accruals consistent with these requirements as they change.



Also, as noted in the discussion of Legal Proceedings in Item 3 of the 2004 Annual Report, while it is not possible to predict or determine the
outcome of any legal proceeding, it is our opinion that we will not experience materially adverse effects on our results of operations or financial condition as a result of any pending or threatened proceeding.



We use significant assumptions to record the impact of the pension and
postretirement plans in the financial statements. These assumptions include the discount rate, expected long-term rate of return, rate of compensation increase, and health care cost trend rate. A change in any one of these assumptions could result
in significantly different results for the plans. We develop these assumptions after considering advice from a major global actuarial consulting firm. Information is provided on the pension and postretirement plans in Note 19 of the 2004 Annual
Report. In addition, further disclosure on the impact of changes in these assumptions is provided in the Financial Position and Liquidity section of Item 7 of the 2004 Annual Report.



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Recently Issued Accounting Pronouncements



In May 2005, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 154, Accounting Changes and Error Corrections, (SFAS 154). SFAS 154 replaces Accounting Principles Board Opinion No. 20, Accounting Changes, and SFAS
No. 3, Reporting Accounting Changes in Interim Financial Statements and is effective for fiscal years beginning after December 15, 2005. SFAS 154 addresses the accounting and reporting of a change in accounting principle. We do
not expect SFAS 154 to have a material impact on our financial statements, unless we adopt a change in accounting principle.



In December 2004, the FASB issued SFAS No. 123 (Revised 2004), Share-Based Payment (SFAS 123R). SFAS 123R is a revision of SFAS
No. 123, Accounting for Stock-Based Compensation, and supersedes Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees. In general, SFAS 123R provides guidance in accounting for
transactions in which a company obtains employee services in exchange for share-based payments. SFAS 123R requires that the cost from share-based payment transactions be recognized in the financial statements and be determined using a
fair-value-based measurement method. SFAS 123R was to be effective for interim periods beginning after June 15, 2005. In April 2005, the SEC delayed the effective date to the first fiscal year beginning after June 15, 2005. SFAS 123R
applies to all share-based payment transactions initiated or modified after the effective date. Since all of our exercisable stock options are fully vested, we do not expect SFAS 123R to have a material impact on our financial results, unless we
grant an additional share-based payment. We expect to adopt this standard prospectively on January 1, 2006.



In March 2005, the FASB issued FASB Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations (FIN 47). FIN 47
clarifies certain aspects of FASB No. 143, Accounting for Asset Retirement Obligations and is effective no later than December 31, 2005. We do not expect FIN 47 to have a material effect on our financial results.



Outlook

Petroleum Additives



We believe this segment performed well in the marketplace during the first nine months of 2005 as evidenced by its significant revenue and volume gains
when compared to the same 2004 period. Unfortunately, many of the business gains have been obscured by our inability to fully recover the rising cost of raw materials.



We continue to expect that the operating profit for petroleum additives will be higher in 2005 than in 2004. The many
business factors detailed in our 2004 Annual Report and the compression of our margins mentioned above will be major factors in the ultimate profitability of this segment for the year.



TEL

This segment had a relatively good performance during the first nine months of 2005. Nonetheless, we believe profits in the fourth quarter of the year will be significantly lower than the fourth quarter of 2004. The anticipated decline in
profitability is volume driven, and we expect that TEL will earn less in 2005 than in 2004. As we have continually stated, this segment will continue to decline in profitability as its use is phased-out around the world.



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Cash Flows



We expect to end the year with no amounts outstanding on our revolving loan agreement. The fourth quarter cash requirements
are expected to be managed through our cash-on-hand and may result in reductions of cash at December 31, 2005.



ITEM 3. Quantitative and Qualitative Disclosures About Market Risk



Except for interest rate risk and foreign currency risk discussed below, there have been no significant changes in our market risk from the information
provided in the 2004 Annual Report.



At September 30,
2005, we had paid-off the outstanding balance under our revolving credit agreement. As a result, we had no interest rate risk under the revolving credit agreement at the end of the third quarter 2005. If we were to borrow under this agreement in the
future, we would experience interest rate risk based on the interest rates available to us at that time.



During 2004, we entered into $26 million of Euro-denominated forward contracts to minimize currency exposure from expected cash flows from foreign
operations. The contracts all have maturity dates in 2005. At September 30, 2005, there were $6.5 million remaining of these Euro-denominated contracts. With other variables held constant, a hypothetical 10% adverse change in the
September 30, 2005 forward Euro rates would have resulted in a decrease of about $600 thousand in the value of the contracts.



ITEM 4. Controls and Procedures



Evaluation of Disclosure Controls and Procedures



We maintain a system of internal control over financial reporting to provide reasonable, but not absolute, assurance of the reliability of the financial
records and the protection of assets. Our controls and procedures include written policies and procedures, careful selection and training of qualified personnel, and an internal audit program. We use a third-party firm, separate from our independent
registered public accounting firm, to assist with internal audit services.



We work closely with the business groups, operations personnel, and information technology to ensure transactions are recorded properly. Environmental and legal staff are consulted to determine the appropriateness of
our environmental and legal liabilities for each reporting period. We regularly review the regulations and rule changes that affect our financial disclosures.



Our disclosure control procedures include signed representation letters from our regional officers, as well as senior management.



We have formed a Financial Disclosure Committee, which is made up of the
president and senior vice president of Afton, the president of Ethyl, and the general counsel and controller of NewMarket. The committee, as well as regional management, makes representations with regard to the financial statements that, to the best
of their knowledge, the report does not contain any misstatement of a material fact or omit a material fact that is necessary to make the statements not misleading with respect to the periods covered by the report.



The committee and the regional management also represent, to the best of
their knowledge, that the financial statements and other financial information included in the report fairly present, in all material respects, the financial condition, results of operations and cash flows of the company as of and for the periods
presented in the report.



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Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (the Exchange Act), we carried out
an evaluation, with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined under Rule 13a-15(e)) under the
Exchange Act as of the end of the period covered by this report. Based upon that evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures are effective.



There has been no change in our internal control over financial reporting,
as such term is defined in Rule 13a-15(f) under the Exchange Act, during the quarter ended September 30, 2005, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



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PART II  Other Information



ITEM 1. Legal Proceedings



We are involved in legal proceedings that are incidental to our business and include administrative or judicial actions seeking remediation under environmental laws, such as Superfund.



These proceedings include certain product liability cases. The only product
liability cases of potential consequence in which we are involved are TEL-related. In one case, Ethyl was served as a defendant in a case filed in the Circuit Court for Baltimore City, Maryland, in September 1999. Smith, et al. v. Lead Industries
Association, Inc., et al., alleged personal injuries for seven children from lead exposure arising from lead paint and dust from tailpipe emissions due to leaded gasoline. The court dismissed Ethyl and some other defendants from the case in
February 2002 and granted summary judgment to other defendants in November 2002. The plaintiffs have appealed both decisions, but did not appeal the dismissal of Ethyl as a defendant. On April 4, 2005, the Court of Appeals of Maryland dismissed
the appeal on the basis that the trial courts decision was not a final decision that could be appealed, and the case is once again pending in the trial court. If such claims are further pursued against Ethyl, we believe Ethyl has strong
defenses and will vigorously defend any such claims.



ITEM 5. Other Information



None



ITEM 6. Exhibits



|              |  |                                                                                                                                                                               
|------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit 31(a) |  | Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by Thomas E. Gottwald
|              | 
|Exhibit 31(b) |  | Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by David A. Fiorenza 
|              | 
|Exhibit 32(a) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Thomas E. Gottwald                                  
|              | 
|Exhibit 32(b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by David A. Fiorenza                                   



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SIGNATURES



Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



|                       |  |                       |  |                               
|---------------------- |  | --------------------- |  | ------------------------------
|                       | 
|                       |  | NEWMARKET CORPORATION
|                       |  | (Registrant)         
|                       |  |                      
|Date: November 2, 2005 |  | By:                   |  | /s/ D. A. Fiorenza            
|                       |  |                       |  | David A. Fiorenza             
|                       |  |                       |  | Vice President and            
|                       |  |                       |  | Treasurer                     
|                       |  |                       |  | (Principal Financial Officer) 
|                       |  |                      
|Date: November 2, 2005 |  | By:                   |  | /s/ Wayne C. Drinkwater       
|                       |  |                       |  | Wayne C. Drinkwater           
|                       |  |                       |  | Controller                    
|                       |  |                       |  | (Principal Accounting Officer)



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EXHIBIT INDEX



|           |     |  |                                                                                                                                                                               
|---------- | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit 31 | (a) |  | Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Thomas E. Gottwald
|           |    
|Exhibit 31 | (b) |  | Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of David A. Fiorenza 
|           |    
|Exhibit 32 | (a) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Thomas E. Gottwald                                  
|           |    
|Exhibit 32 | (b) |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by David A. Fiorenza                                   



41