Basis Of Presentation

6 Months Ended

Jun. 30, 2011

Basis Of Presentation

Basis Of Presentation

NOTE 1—BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and notes necessary for a comprehensive presentation of financial position, results of operations and cash flows.

It is our opinion, however, that all adjustments (consisting of normal, recurring adjustments, unless otherwise disclosed) have been made which are necessary for the financial statements to be fairly stated. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K filed on February 18, 2011.

The results for the interim period are not necessarily indicative of the results to be expected for the full year.

When we use the terms the "Corporation", "Company", "Registrant", "we", "us" and "our", we are referring to Innospec Inc. and its consolidated subsidiaries ("Innospec") unless otherwise indicated or the context otherwise requires.

During the second quarter, 2011, the Company revised the classification of certain amortization of intangible assets expenses in its results for 2011 and comparable information for 2010. Previously, these expenses were disclosed separately within operating expenses. This has no impact on 2011 or any prior periods' reported net sales, income before income taxes, net income, earnings per share, net cash provided by operating activities or any balance sheet category. The classification of expenses of $1.2 million for the three months ended March 31, 2011, and $4.7 million for the year ended December 31, 2010, with respect to amortization of intangible assets has been revised from operating expenses to an increase in costs of goods sold of $0.8 million and $3.1 million, respectively, and an increase in selling expenses of $0.4 million and $1.6 million, respectively. The impact on gross profit and selling, general and administrative expenses for the previously reported quarters is provided below:

	2011
(in millions)	First Quarter
Previously reported:
Gross profit	$	53.6
SG&A expenses		(23.6	)
Amortization of intangible assets		(1.2	)
Revised classification:
Gross profit		52.8
SG&A expenses	$	(24.0	)

	2010
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
Previously reported:
Gross profit	$	52.2		$	54.7		$	55.4		$	54.9		$	217.2
SG&A expenses		(26.9	)		(23.7	)		(28.2	)		(33.1	)		(111.9	)
Amortization of intangible assets		(1.2	)		(1.1	)		(1.2	)		(1.2	)		(4.7	)
Revised classification:
Gross profit		51.4			54.0			54.6			54.1			214.1
SG&A expenses	$	(27.3	)	$	(24.1	)	$	(28.6	)	$	(33.5	)	$	(113.5	)