American Vanguard Corporation (NYSE:AVD) today announced financial results for the fourth quarter and full year ended December 31, 2015.
Fiscal 2015 Fourth Quarter Financial Highlights – versus Fiscal 2014 Fourth Quarter:
- Net sales were $84.0 million in Q4 2015 compared to $77.6 million in Q4 2014.
- Net income was $3.0 million in Q4 2015 compared to $1.8 million in Q4 2014.
- Earnings per diluted share were $0.10 in Q4 2015 versus $0.06 in Q4 2014.
Fiscal 2015 Financial Highlights – versus Fiscal 2014:
- Net sales were $289.4 million in FY 2015 compared to $298.6 million in FY 2014.
- Net income was $6.6 million in FY 2015 compared to $4.8 million in FY 2014.
- Earnings per diluted share were $0.23 in FY 2015 versus $0.17 in FY 2014.
Eric Wintemute, Chairman and CEO of American Vanguard, stated: “Our performance in 2015 reflects continued financial discipline in the face of difficult industry conditions. Low crop commodity prices have led to reduced farmer/grower profitability and cautious purchasing of all crop inputs, including crop protection products. Despite these market conditions, during 2015, American Vanguard recorded net sales only slightly below those of the prior year, maintained a steady level of business in many markets and generated improved profitability overall.”
Mr. Wintemute continued: “Our efforts to control working capital, manage manufacturing costs and reduce operating expenses have led to greater operating efficiency. As a result, we have experienced significant inventory reductions, improved cash generation and have reduced our debt, even while completing two acquisitions that should serve to strengthen our international business.”
Mr. Wintemute concluded: “While the Ag market prospects for 2016 remain challenging, American Vanguard is well-positioned, in a consolidating industry, to pursue its three main objectives: improving market access through additional product acquisitions and collaborative alliances; advancing technological innovation; and driving operational excellence. We believe that these will be the keys to our success and look forward to keeping our investors well informed as we progress in 2016.”
Conference Call
Eric Wintemute, Chairman & CEO, Bob Trogele, EVP & COO and David T. Johnson, VP & CFO, will conduct a conference call focusing on the financial results at 4:30 pm ET / 1:30 pm PT on Tuesday, March 1, 2016. Interested parties may participate in the call by dialing (201) 493-6744. Please call in 10 minutes before the call is scheduled to begin, and ask for the American Vanguard call. The conference call will also be webcast live via the News and Media section of the Company’s web site at www.american-vanguard.com. To listen to the live webcast, go to the web site at least 15 minutes early to register, download and install any necessary audio software. If you are unable to listen live, the conference call will be archived on the Company’s web site.
About American Vanguard
American Vanguard Corporation is a diversified specialty and agricultural products company that develops and markets products for crop protection and management, turf and ornamentals management and public and animal health. American Vanguard is included on the Russell 2000® and Russell 3000® Indexes and the Standard & Poor’s Small Cap 600 Index. To learn more about American Vanguard, please reference the Company’s web site at www.american-vanguard.com.
The Company, from time to time, may discuss forward-looking information. Except for the historical information contained in this release, all forward-looking statements are estimates by the Company’s management and are subject to various risks and uncertainties that may cause results to differ from management’s current expectations. Such factors include weather conditions, changes in regulatory policy and other risks as detailed from time-to-time in the Company’s SEC reports and filings. All forward-looking statements, if any, in this release represent the Company’s judgment as of the date of this release.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years ended December 31, 2015, 2014 and 2013 (In thousands, except per share data) | ||||||||||||||
| 2015 | 2014 | 2013 | ||||||||||||
| Net sales | $ | 289,382 | $ | 298,634 | $ | 381,021 | ||||||||
| Cost of sales | 177,480 | 184,138 | 209,674 | |||||||||||
| Gross profit | 111,902 | 114,496 | 171,347 | |||||||||||
| Operating expenses | 100,378 | 107,786 | 115,612 | |||||||||||
| Operating income | 11,524 | 6,710 | 55,735 | |||||||||||
| Interest expense, net | 2,772 | 3,153 | 2,175 | |||||||||||
| Interest capitalized | (210 | ) | (87 | ) | (274 | ) | ||||||||
| Income before provision for income taxes and loss on equity investment | 8,962 | 3,644 | 53,834 | |||||||||||
| Income taxes expense (benefit) | 2,009 | (451 | ) | 18,916 | ||||||||||
| Income before loss on equity investment | 6,953 | 4,095 | 34,918 | |||||||||||
| Less net loss from equity method investment | (636 | ) | (29 | ) | (986 | ) | ||||||||
| Net income | 6,317 | 4,066 | 33,932 | |||||||||||
| Add back net loss attributable to non-controlling interest | 274 | 775 | 517 | |||||||||||
| Net income attributable to American Vanguard | $ | 6,591 | $ | 4,841 | $ | 34,449 | ||||||||
| Change in fair value of interest rate swaps | — | 340 | 388 | |||||||||||
| Foreign currency translation adjustment | (1,571 | ) | (1,262 | ) | 326 | |||||||||
| Comprehensive income | $ | 5,020 | $ | 3,919 | $ | 35,163 | ||||||||
| Earnings per common share—basic | $ | .23 | $ | .17 | $ | 1.22 | ||||||||
| Earnings per common share—assuming dilution | $ | .23 | $ | .17 | $ | 1.19 | ||||||||
| Weighted average shares outstanding—basic | 28,673 | 28,436 | 28,301 | |||||||||||
| Weighted average shares outstanding—assuming dilution | 29,237 | 28,912 | 28,899 | |||||||||||
CONSOLIDATED BALANCE SHEETS December 31, 2015 and 2014 (In thousands, except share data) | ||||||||||
| 2015 | 2014 | |||||||||
| Assets | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 5,524 | $ | 4,885 | ||||||
| Receivables: | ||||||||||
| Trade, net of allowance for doubtful accounts of $423 and $166, respectively | 72,835 | 86,027 | ||||||||
| Other | 2,554 | 2,396 | ||||||||
| 75,389 | 88,423 | |||||||||
| Inventories | 136,477 | 165,631 | ||||||||
| Prepaid expenses | 11,172 | 13,415 | ||||||||
| Income taxes receivable | 168 | 5,964 | ||||||||
| Deferred income tax assets | 8,101 | 8,731 | ||||||||
| Total current assets | 236,831 | 287,049 | ||||||||
| Property, plant and equipment, net | 47,972 | 50,026 | ||||||||
| Intangible assets, net of applicable amortization | 129,160 | 100,211 | ||||||||
| Other assets | 29,576 | 35,035 | ||||||||
| $ | 443,539 | $ | 472,321 | |||||||
| Liabilities and Stockholders’ Equity | ||||||||||
| Current liabilities: | ||||||||||
| Current installments of other notes payable | $ | 55 | $ | 71 | ||||||
| Current installments of other liabilities | 514 | 1,357 | ||||||||
| Accounts payable | 15,343 | 20,411 | ||||||||
| Deferred revenue | 8,888 | 898 | ||||||||
| Accrued program costs | 44,371 | 52,546 | ||||||||
| Accrued expenses and other payables | 7,111 | 5,962 | ||||||||
| Total current liabilities | 76,282 | 81,245 | ||||||||
| Long-term debt and other notes payable, excluding current installments | 68,321 | 98,605 | ||||||||
| Other liabilities, excluding current installments | 3,054 | 3,309 | ||||||||
| Deferred income tax liabilities | 27,556 | 28,159 | ||||||||
| Total liabilities | 175,213 | 211,318 | ||||||||
| Commitments and contingent liabilities | ||||||||||
| Stockholders’ equity: | ||||||||||
| Preferred stock, $.10 par value per share; authorized 400,000 shares; none issued | — | — | ||||||||
| Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 31,638,225 shares in 2015 and 31,550,477 shares in 2014 | 3,164 | 3,156 | ||||||||
| Additional paid-in capital | 68,534 | 66,232 | ||||||||
| Accumulated other comprehensive loss | (3,541 | ) | (1,970 | ) | ||||||
| Retained earnings | 208,507 | 202,488 | ||||||||
| 276,664 | 269,906 | |||||||||
| Less treasury stock at cost, 2,450,634 shares in 2015 and in 2014 | (8,269 | ) | (8,269 | ) | ||||||
| American Vanguard Corporation stockholders’ equity | 268,395 | 261,637 | ||||||||
| Non-controlling interest | (69 | ) | (634 | ) | ||||||
| Total stockholders’ equity | 268,326 | 261,003 | ||||||||
| $ | 443,539 | $ | 472,321 | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31, 2015, 2014 and 2013 (In thousands) | ||||||||||||||
| 2015 | 2014 | 2013 | ||||||||||||
| Increase cash | ||||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net income | $ | 6,317 | $ | 4,066 | $ | 33,932 | ||||||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||
| Depreciation and amortization of fixed and intangible assets | 16,474 | 16,332 | 14,845 | |||||||||||
| Amortization of other long term assets | 5,275 | 5,811 | 4,598 | |||||||||||
| Amortization of discounted liabilities | 140 | 324 | 174 | |||||||||||
| Stock-based compensation | 3,881 | 4,153 | 3,819 | |||||||||||
| Tax effect from the share based compensation | (23 | ) | (300 | ) | (440 | ) | ||||||||
| Increase in deferred income taxes | 27 | 2,619 | 2,523 | |||||||||||
| Operating loss from equity method investment | 629 | 983 | 986 | |||||||||||
| Loss (gain) from dilution of equity method investment | 7 | (954 | ) | — | ||||||||||
| Changes in assets and liabilities associated with operations: | ||||||||||||||
| Decrease (increase) in net receivables | 13,034 | (13,471 | ) | 2,351 | ||||||||||
| Decrease (increase) in inventories | 29,154 | (25,801 | ) | (51,879 | ) | |||||||||
| Decrease (increase) in income tax receivable/payable, net | 4,872 | 4,424 | (10,961 | ) | ||||||||||
| Decrease (increase) in prepaid expenses and other assets | 2,082 | (4,743 | ) | (19,733 | ) | |||||||||
| (Decrease) increase in accounts payable | (5,068 | ) | (19,951 | ) | 8,252 | |||||||||
| Increase (decrease) in deferred revenue | 7,990 | (2,890 | ) | (16,639 | ) | |||||||||
| (Decrease) increase in other payables, accrued program costs and expenses | (6,223 | ) | (4,697 | ) | 21,958 | |||||||||
| Net cash provided by (used in) operating activities | 78,568 | (34,095 | ) | (6,214 | ) | |||||||||
| Cash flows from investing activities: | ||||||||||||||
| Capital expenditures | (6,899 | ) | (7,180 | ) | (15,260 | ) | ||||||||
| Investment | (125 | ) | (500 | ) | (3,687 | ) | ||||||||
| Acquisitions of intangible assets | (36,667 | ) | — | — | ||||||||||
| Net cash used in investing activities | (43,691 | ) | (7,680 | ) | (18,947 | ) | ||||||||
| Cash flows from financing activities: | ||||||||||||||
| Net (payments) borrowings under line of credit agreement | (30,520 | ) | 47,850 | 51,550 | ||||||||||
| Payments on long-term debt | — | — | (46,000 | ) | ||||||||||
| Payment on other long-term liabilities | (1,543 | ) | (1,756 | ) | (1,831 | ) | ||||||||
| Tax effect from the share based compensation | 23 | 300 | 440 | |||||||||||
| Decrease in other notes payable | — | — | (6,154 | ) | ||||||||||
| Repurchases of common stock | — | (1,531 | ) | (1,934 | ) | |||||||||
| Proceeds from the issuance of common stock (sale of stock under ESPP and exercise of stock options) | 317 | 1,666 | 1,610 | |||||||||||
| Non-controlling interest contribution | — | 299 | — | |||||||||||
| Payment of cash dividends | (1,141 | ) | (5,672 | ) | (4,804 | ) | ||||||||
| Net cash (used in) provided by financing activities | (32,864 | ) | 41,156 | (7,123 | ) | |||||||||
| Net increase (decrease) in cash and cash equivalents | 2,013 | (619 | ) | (32,284 | ) | |||||||||
| Effect of exchange rate changes on cash | (1,374 | ) | (1,176 | ) | 488 | |||||||||
| Cash and cash equivalents at beginning of year | 4,885 | 6,680 | 38,476 | |||||||||||
| Cash and cash equivalents at end of year | $ | 5,524 | $ | 4,885 | $ | 6,680 | ||||||||
| Supplemental cash flow information: | ||||||||||||||
| Cash paid (received) during the year for: | ||||||||||||||
| Interest | $ | 2,750 | $ | 2,298 | $ | 1,777 | ||||||||
| Income taxes | $ | (3,697 | ) | $ | (8,206 | ) | $ | 25,271 | ||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20160301006948/en/
Contacts:
American Vanguard Corporation
William A. Kuser,
949-260-1200
Director of Investor Relations
williamk@amvac-chemical.com
or
Investor
Representative
The Equity Group Inc.
Lena Cati, 212-836-9611
Lcati@equityny.com
www.theequitygroup.com
