Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries American Vanguard Reports Q1 2024 Results By: American Vanguard Corporation via Business Wire May 09, 2024 at 16:05 PM EDT Adjusted EBITDA up 35%, Operating Income up 87% American Vanguard Corporation (NYSE: AVD) today announced financial results for the first quarter ended March 31, 2024. First Quarter 2024 Financial Highlights – versus First Quarter 2023: Net sales of $135 million vs. $125 million Adjusted EBITDA1 of $15.5 million vs. $11.5 million Operating Income of $6.1 million vs. $3.3 million Net income of $1.6 million vs. $1.9 million Earnings per diluted share of $0.06 vs. $0.07 Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We attained improved operating leverage with a significant increase in adjusted EBITDA and operating income, during the first quarter as compared to last year. This is due in part to our cost control initiatives, on account of which our operating expenses reduced as a percent of net sales, even after including our transformation costs. We expect to gain greater efficiencies through our transformation program which we have begun in earnest and which we expect will generate an additional $15 million of adjusted EBITDA on an annualized basis by 2026.” He continued, “Further, it is pleasing to note that we experienced growth in all three businesses, US Crop, US Non-crop and International. Within US Crop, we recorded strong sales of granular soil insecticides (in light of a stable farm economy), herbicides (in part due to seasonal demand and favorable weather conditions) and cotton and peanut products (driven by increased planted acres for those crops). The destocking initiatives from last year have begun to subside to a degree; however, the distribution channel is still exercising conservatism in their procurement approach.” Mr. Wintemute continued, “Within US Non-crop, we experienced significantly higher sales, led by our mosquito adulticides (in anticipation of tropical storm activity), pest strips (with a resurgence in consumer and technical sales) and our OHP products for nursery and ornamental uses. Our International business recorded moderately higher sales, led by Mexico and APAC, despite continued overstocking of generic products in other regions. All in, we are encouraged by the resiliency of our markets during the quarter.” Mr. Wintemute concluded, “Market conditions remain stable with a strong farm economy and a more relaxed procurement approach within the distribution channel compared to last year. That said, in light of concerns raised by USEPA, we have voluntarily suspended sales of our herbicide Dacthal pending potential approval of a label that we believe should answer the agency’s concerns. In light of these factors, we are adjusting our annual targets to achieve an increase in net sales of between 6% and 9% year over year and are setting our adjusted EBITDA target to $60 - $70 million. We look forward to giving you a more detailed presentation during our upcoming earnings call.” 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 and strategic themes at 4:15 pm ET on Thursday, May 9, 2024. Interested parties may participate in the call by dialing 201-493-6744. Please call in 10 minutes before the scheduled start time 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. Over the past 20 years, through product and business acquisitions, the Company has expanded its operations into 21 countries and now has over 1,000 product registrations in 56 nations worldwide. Its strategy rests on three growth initiatives – i) Core Business (through innovation of conventional products), ii) Green Solutions (with over 120 biorational products – including fertilizers, microbials, nutritionals and non-conventional products) and iii) Precision Agriculture innovation (including SIMPAS prescriptive application and Ultimus measure/record/verify technologies). American Vanguard is included on the Russell 2000® and Russell 3000® Indexes. 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. AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (Unaudited) ASSETS March 31, 2024 December 31, 2023 Current assets: Cash $ 13,709 $ 11,416 Receivables: Trade, net of allowance for credit losses of $7,798 and $7,107, respectively 187,197 182,613 Other 7,395 8,356 Total receivables, net 194,592 190,969 Inventories 228,309 219,551 Prepaid expenses 7,446 6,261 Income taxes receivable 2,889 3,824 Total current assets 446,945 432,021 Property, plant and equipment, net 75,909 74,560 Operating lease right-of-use assets, net 23,084 22,417 Intangible assets, net of amortization 168,723 172,508 Goodwill 50,469 51,199 Deferred income tax assets 3,307 2,849 Other assets 13,188 11,994 Total assets $ 781,625 $ 767,548 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 64,642 $ 68,833 Customer prepayments 28,520 65,560 Accrued program costs 74,343 68,076 Accrued expenses and other payables 15,927 16,354 Operating lease liabilities, current 6,358 6,081 Income taxes payable 5,633 5,591 Total current liabilities 195,423 230,495 Long-term debt, net 187,017 138,900 Operating lease liabilities, long term 17,407 17,113 Deferred income tax liabilities 7,157 7,892 Other liabilities 3,038 3,138 Total liabilities 410,042 397,538 Commitments and contingent liabilities Stockholders' equity: Preferred stock, $0.10 par value per share; authorized 400,000 shares; none issued — — Common stock, $0.10 par value per share; authorized 40,000,000 shares; issued 34,754,634 shares at March 31, 2024 and 34,676,787 shares at December 31, 2023 3,475 3,467 Additional paid-in capital 113,223 110,810 Accumulated other comprehensive loss (7,527 ) (5,963 ) Retained earnings 333,613 332,897 Less treasury stock at cost, 5,915,182 shares at March 31, 2024 and December 31, 2023 (71,201 ) (71,201 ) Total stockholders’ equity 371,583 370,010 Total liabilities and stockholders’ equity $ 781,625 $ 767,548 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) For the three months ended March 31 2024 2023 Net sales $ 135,143 $ 124,885 Cost of sales (92,725 ) (86,348 ) Gross profit 42,418 38,537 Operating expenses Selling, general and administrative (30,621 ) (26,402 ) Research, product development and regulatory (5,706 ) (8,870 ) Operating income 6,091 3,265 Change in fair value of an equity investment 638 (22 ) Interest expense, net (3,693 ) (1,686 ) Income before provision for income taxes 3,036 1,557 Income tax (expense) benefit (1,484 ) 361 Net income $ 1,552 $ 1,918 Earnings per common share—basic $ 0.06 $ 0.07 Earnings per common share—assuming dilution $ 0.06 $ 0.07 Weighted average shares outstanding—basic 27,844 28,367 Weighted average shares outstanding—assuming dilution 28,128 29,073 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES ANALYSIS OF SALES (Unaudited) For the three months ended March 31, 2024 2023 Change % Change Net sales: U.S. crop $ 67,257 $ 61,876 $ 5,381 9 % U.S. non-crop 17,768 13,899 3,869 28 % Total U.S. 85,025 75,775 9,250 12 % International 50,118 49,110 1,008 2 % Total net sales $ 135,143 $ 124,885 $ 10,258 8 % Total cost of sales $ (92,725 ) $ (86,348 ) $ (6,377 ) 7 % Total gross profit $ 42,418 $ 38,537 $ 3,881 10 % Total gross margin 31 % 31 % AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) For the three months ended March 31 2024 2023 Cash flows from operating activities: Net income $ 1,552 $ 1,918 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization of property, plant and equipment and intangible assets 5,441 5,539 Amortization of other long-term assets 189 714 Provision for bad debts 700 581 Stock-based compensation 2,005 1,474 Change in deferred income taxes (1,025 ) 122 Change in liabilities for uncertain tax positions or unrecognized tax benefits 35 371 Change in equity investment fair value (638 ) 22 Other (5 ) 72 Foreign currency transaction gains (373 ) (446 ) Changes in assets and liabilities associated with operations: Increase in net receivables (5,579 ) (8,779 ) Increase in inventories (9,353 ) (33,731 ) Increase (decrease) in prepaid expenses and other assets (1,466 ) 600 Change in income tax receivable/payable, net 1,014 (2,965 ) (Decrease) increase in accounts payable (3,951 ) 5,655 Decrease in customer prepayments (37,037 ) (22,759 ) Increase in accrued program costs 6,399 10,660 Decrease in other payables and accrued expenses (332 ) (500 ) Net cash used in operating activities (42,424 ) (41,452 ) Cash flows from investing activities: Capital expenditures (3,565 ) (2,590 ) Proceeds from disposal of property, plant and equipment 23 — Acquisition of a product line — (703 ) Intangible assets (25 ) (15 ) Net cash used in investing activities (3,567 ) (3,308 ) Cash flows from financing activities: Payments under line of credit agreement (35,346 ) (27,300 ) Borrowings under line of credit agreement 83,463 72,000 Net receipt from the issuance of common stock under ESPP 430 480 Net (payment) receipt from the exercise of stock options — 18 Net payment from common stock purchased for tax withholding (14 ) (13 ) Repurchase of common stock — (557 ) Payment of cash dividends (834 ) (851 ) Net cash provided by financing activities 47,699 43,777 Net increase (decrease) in cash 1,708 (983 ) Effect of exchange rate changes on cash and cash equivalents 585 223 Cash at beginning of period 11,416 20,328 Cash at end of period $ 13,709 $ 19,568 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO EBITDA (In thousands) (Unaudited) Reconciliation of Net Income to EBITDA March 31, 2024 March 31, 2023 Net income, as reported $ 1,552 $ 1,918 Provision for income taxes 1,484 (361 ) Interest expense, net 3,693 1,686 Proxy costs — 541 Depreciation and amortization 5,630 6,253 Stock compensation 2,005 1,474 Transformation costs 1,152 — Adjusted EBITDA2 $ 15,516 $ 11,511 ______________________________ 1 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. 2 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. View source version on businesswire.com: https://www.businesswire.com/news/home/20240509081007/en/Contacts Company Contact: American Vanguard Corporation Anthony Young, Director of Investor Relations (949) 260-1200 anthonyy@amvac-chemical.com Investor Representative: The Equity Group Inc. www.theequitygroup.com Lena Cati Lcati@equityny.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
American Vanguard Reports Q1 2024 Results By: American Vanguard Corporation via Business Wire May 09, 2024 at 16:05 PM EDT Adjusted EBITDA up 35%, Operating Income up 87% American Vanguard Corporation (NYSE: AVD) today announced financial results for the first quarter ended March 31, 2024. First Quarter 2024 Financial Highlights – versus First Quarter 2023: Net sales of $135 million vs. $125 million Adjusted EBITDA1 of $15.5 million vs. $11.5 million Operating Income of $6.1 million vs. $3.3 million Net income of $1.6 million vs. $1.9 million Earnings per diluted share of $0.06 vs. $0.07 Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We attained improved operating leverage with a significant increase in adjusted EBITDA and operating income, during the first quarter as compared to last year. This is due in part to our cost control initiatives, on account of which our operating expenses reduced as a percent of net sales, even after including our transformation costs. We expect to gain greater efficiencies through our transformation program which we have begun in earnest and which we expect will generate an additional $15 million of adjusted EBITDA on an annualized basis by 2026.” He continued, “Further, it is pleasing to note that we experienced growth in all three businesses, US Crop, US Non-crop and International. Within US Crop, we recorded strong sales of granular soil insecticides (in light of a stable farm economy), herbicides (in part due to seasonal demand and favorable weather conditions) and cotton and peanut products (driven by increased planted acres for those crops). The destocking initiatives from last year have begun to subside to a degree; however, the distribution channel is still exercising conservatism in their procurement approach.” Mr. Wintemute continued, “Within US Non-crop, we experienced significantly higher sales, led by our mosquito adulticides (in anticipation of tropical storm activity), pest strips (with a resurgence in consumer and technical sales) and our OHP products for nursery and ornamental uses. Our International business recorded moderately higher sales, led by Mexico and APAC, despite continued overstocking of generic products in other regions. All in, we are encouraged by the resiliency of our markets during the quarter.” Mr. Wintemute concluded, “Market conditions remain stable with a strong farm economy and a more relaxed procurement approach within the distribution channel compared to last year. That said, in light of concerns raised by USEPA, we have voluntarily suspended sales of our herbicide Dacthal pending potential approval of a label that we believe should answer the agency’s concerns. In light of these factors, we are adjusting our annual targets to achieve an increase in net sales of between 6% and 9% year over year and are setting our adjusted EBITDA target to $60 - $70 million. We look forward to giving you a more detailed presentation during our upcoming earnings call.” 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 and strategic themes at 4:15 pm ET on Thursday, May 9, 2024. Interested parties may participate in the call by dialing 201-493-6744. Please call in 10 minutes before the scheduled start time 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. Over the past 20 years, through product and business acquisitions, the Company has expanded its operations into 21 countries and now has over 1,000 product registrations in 56 nations worldwide. Its strategy rests on three growth initiatives – i) Core Business (through innovation of conventional products), ii) Green Solutions (with over 120 biorational products – including fertilizers, microbials, nutritionals and non-conventional products) and iii) Precision Agriculture innovation (including SIMPAS prescriptive application and Ultimus measure/record/verify technologies). American Vanguard is included on the Russell 2000® and Russell 3000® Indexes. 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. AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (Unaudited) ASSETS March 31, 2024 December 31, 2023 Current assets: Cash $ 13,709 $ 11,416 Receivables: Trade, net of allowance for credit losses of $7,798 and $7,107, respectively 187,197 182,613 Other 7,395 8,356 Total receivables, net 194,592 190,969 Inventories 228,309 219,551 Prepaid expenses 7,446 6,261 Income taxes receivable 2,889 3,824 Total current assets 446,945 432,021 Property, plant and equipment, net 75,909 74,560 Operating lease right-of-use assets, net 23,084 22,417 Intangible assets, net of amortization 168,723 172,508 Goodwill 50,469 51,199 Deferred income tax assets 3,307 2,849 Other assets 13,188 11,994 Total assets $ 781,625 $ 767,548 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 64,642 $ 68,833 Customer prepayments 28,520 65,560 Accrued program costs 74,343 68,076 Accrued expenses and other payables 15,927 16,354 Operating lease liabilities, current 6,358 6,081 Income taxes payable 5,633 5,591 Total current liabilities 195,423 230,495 Long-term debt, net 187,017 138,900 Operating lease liabilities, long term 17,407 17,113 Deferred income tax liabilities 7,157 7,892 Other liabilities 3,038 3,138 Total liabilities 410,042 397,538 Commitments and contingent liabilities Stockholders' equity: Preferred stock, $0.10 par value per share; authorized 400,000 shares; none issued — — Common stock, $0.10 par value per share; authorized 40,000,000 shares; issued 34,754,634 shares at March 31, 2024 and 34,676,787 shares at December 31, 2023 3,475 3,467 Additional paid-in capital 113,223 110,810 Accumulated other comprehensive loss (7,527 ) (5,963 ) Retained earnings 333,613 332,897 Less treasury stock at cost, 5,915,182 shares at March 31, 2024 and December 31, 2023 (71,201 ) (71,201 ) Total stockholders’ equity 371,583 370,010 Total liabilities and stockholders’ equity $ 781,625 $ 767,548 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) For the three months ended March 31 2024 2023 Net sales $ 135,143 $ 124,885 Cost of sales (92,725 ) (86,348 ) Gross profit 42,418 38,537 Operating expenses Selling, general and administrative (30,621 ) (26,402 ) Research, product development and regulatory (5,706 ) (8,870 ) Operating income 6,091 3,265 Change in fair value of an equity investment 638 (22 ) Interest expense, net (3,693 ) (1,686 ) Income before provision for income taxes 3,036 1,557 Income tax (expense) benefit (1,484 ) 361 Net income $ 1,552 $ 1,918 Earnings per common share—basic $ 0.06 $ 0.07 Earnings per common share—assuming dilution $ 0.06 $ 0.07 Weighted average shares outstanding—basic 27,844 28,367 Weighted average shares outstanding—assuming dilution 28,128 29,073 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES ANALYSIS OF SALES (Unaudited) For the three months ended March 31, 2024 2023 Change % Change Net sales: U.S. crop $ 67,257 $ 61,876 $ 5,381 9 % U.S. non-crop 17,768 13,899 3,869 28 % Total U.S. 85,025 75,775 9,250 12 % International 50,118 49,110 1,008 2 % Total net sales $ 135,143 $ 124,885 $ 10,258 8 % Total cost of sales $ (92,725 ) $ (86,348 ) $ (6,377 ) 7 % Total gross profit $ 42,418 $ 38,537 $ 3,881 10 % Total gross margin 31 % 31 % AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) For the three months ended March 31 2024 2023 Cash flows from operating activities: Net income $ 1,552 $ 1,918 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization of property, plant and equipment and intangible assets 5,441 5,539 Amortization of other long-term assets 189 714 Provision for bad debts 700 581 Stock-based compensation 2,005 1,474 Change in deferred income taxes (1,025 ) 122 Change in liabilities for uncertain tax positions or unrecognized tax benefits 35 371 Change in equity investment fair value (638 ) 22 Other (5 ) 72 Foreign currency transaction gains (373 ) (446 ) Changes in assets and liabilities associated with operations: Increase in net receivables (5,579 ) (8,779 ) Increase in inventories (9,353 ) (33,731 ) Increase (decrease) in prepaid expenses and other assets (1,466 ) 600 Change in income tax receivable/payable, net 1,014 (2,965 ) (Decrease) increase in accounts payable (3,951 ) 5,655 Decrease in customer prepayments (37,037 ) (22,759 ) Increase in accrued program costs 6,399 10,660 Decrease in other payables and accrued expenses (332 ) (500 ) Net cash used in operating activities (42,424 ) (41,452 ) Cash flows from investing activities: Capital expenditures (3,565 ) (2,590 ) Proceeds from disposal of property, plant and equipment 23 — Acquisition of a product line — (703 ) Intangible assets (25 ) (15 ) Net cash used in investing activities (3,567 ) (3,308 ) Cash flows from financing activities: Payments under line of credit agreement (35,346 ) (27,300 ) Borrowings under line of credit agreement 83,463 72,000 Net receipt from the issuance of common stock under ESPP 430 480 Net (payment) receipt from the exercise of stock options — 18 Net payment from common stock purchased for tax withholding (14 ) (13 ) Repurchase of common stock — (557 ) Payment of cash dividends (834 ) (851 ) Net cash provided by financing activities 47,699 43,777 Net increase (decrease) in cash 1,708 (983 ) Effect of exchange rate changes on cash and cash equivalents 585 223 Cash at beginning of period 11,416 20,328 Cash at end of period $ 13,709 $ 19,568 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO EBITDA (In thousands) (Unaudited) Reconciliation of Net Income to EBITDA March 31, 2024 March 31, 2023 Net income, as reported $ 1,552 $ 1,918 Provision for income taxes 1,484 (361 ) Interest expense, net 3,693 1,686 Proxy costs — 541 Depreciation and amortization 5,630 6,253 Stock compensation 2,005 1,474 Transformation costs 1,152 — Adjusted EBITDA2 $ 15,516 $ 11,511 ______________________________ 1 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. 2 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. View source version on businesswire.com: https://www.businesswire.com/news/home/20240509081007/en/Contacts Company Contact: American Vanguard Corporation Anthony Young, Director of Investor Relations (949) 260-1200 anthonyy@amvac-chemical.com Investor Representative: The Equity Group Inc. www.theequitygroup.com Lena Cati Lcati@equityny.com
American Vanguard Corporation (NYSE: AVD) today announced financial results for the first quarter ended March 31, 2024. First Quarter 2024 Financial Highlights – versus First Quarter 2023: Net sales of $135 million vs. $125 million Adjusted EBITDA1 of $15.5 million vs. $11.5 million Operating Income of $6.1 million vs. $3.3 million Net income of $1.6 million vs. $1.9 million Earnings per diluted share of $0.06 vs. $0.07 Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We attained improved operating leverage with a significant increase in adjusted EBITDA and operating income, during the first quarter as compared to last year. This is due in part to our cost control initiatives, on account of which our operating expenses reduced as a percent of net sales, even after including our transformation costs. We expect to gain greater efficiencies through our transformation program which we have begun in earnest and which we expect will generate an additional $15 million of adjusted EBITDA on an annualized basis by 2026.” He continued, “Further, it is pleasing to note that we experienced growth in all three businesses, US Crop, US Non-crop and International. Within US Crop, we recorded strong sales of granular soil insecticides (in light of a stable farm economy), herbicides (in part due to seasonal demand and favorable weather conditions) and cotton and peanut products (driven by increased planted acres for those crops). The destocking initiatives from last year have begun to subside to a degree; however, the distribution channel is still exercising conservatism in their procurement approach.” Mr. Wintemute continued, “Within US Non-crop, we experienced significantly higher sales, led by our mosquito adulticides (in anticipation of tropical storm activity), pest strips (with a resurgence in consumer and technical sales) and our OHP products for nursery and ornamental uses. Our International business recorded moderately higher sales, led by Mexico and APAC, despite continued overstocking of generic products in other regions. All in, we are encouraged by the resiliency of our markets during the quarter.” Mr. Wintemute concluded, “Market conditions remain stable with a strong farm economy and a more relaxed procurement approach within the distribution channel compared to last year. That said, in light of concerns raised by USEPA, we have voluntarily suspended sales of our herbicide Dacthal pending potential approval of a label that we believe should answer the agency’s concerns. In light of these factors, we are adjusting our annual targets to achieve an increase in net sales of between 6% and 9% year over year and are setting our adjusted EBITDA target to $60 - $70 million. We look forward to giving you a more detailed presentation during our upcoming earnings call.” 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 and strategic themes at 4:15 pm ET on Thursday, May 9, 2024. Interested parties may participate in the call by dialing 201-493-6744. Please call in 10 minutes before the scheduled start time 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. Over the past 20 years, through product and business acquisitions, the Company has expanded its operations into 21 countries and now has over 1,000 product registrations in 56 nations worldwide. Its strategy rests on three growth initiatives – i) Core Business (through innovation of conventional products), ii) Green Solutions (with over 120 biorational products – including fertilizers, microbials, nutritionals and non-conventional products) and iii) Precision Agriculture innovation (including SIMPAS prescriptive application and Ultimus measure/record/verify technologies). American Vanguard is included on the Russell 2000® and Russell 3000® Indexes. 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. AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (Unaudited) ASSETS March 31, 2024 December 31, 2023 Current assets: Cash $ 13,709 $ 11,416 Receivables: Trade, net of allowance for credit losses of $7,798 and $7,107, respectively 187,197 182,613 Other 7,395 8,356 Total receivables, net 194,592 190,969 Inventories 228,309 219,551 Prepaid expenses 7,446 6,261 Income taxes receivable 2,889 3,824 Total current assets 446,945 432,021 Property, plant and equipment, net 75,909 74,560 Operating lease right-of-use assets, net 23,084 22,417 Intangible assets, net of amortization 168,723 172,508 Goodwill 50,469 51,199 Deferred income tax assets 3,307 2,849 Other assets 13,188 11,994 Total assets $ 781,625 $ 767,548 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 64,642 $ 68,833 Customer prepayments 28,520 65,560 Accrued program costs 74,343 68,076 Accrued expenses and other payables 15,927 16,354 Operating lease liabilities, current 6,358 6,081 Income taxes payable 5,633 5,591 Total current liabilities 195,423 230,495 Long-term debt, net 187,017 138,900 Operating lease liabilities, long term 17,407 17,113 Deferred income tax liabilities 7,157 7,892 Other liabilities 3,038 3,138 Total liabilities 410,042 397,538 Commitments and contingent liabilities Stockholders' equity: Preferred stock, $0.10 par value per share; authorized 400,000 shares; none issued — — Common stock, $0.10 par value per share; authorized 40,000,000 shares; issued 34,754,634 shares at March 31, 2024 and 34,676,787 shares at December 31, 2023 3,475 3,467 Additional paid-in capital 113,223 110,810 Accumulated other comprehensive loss (7,527 ) (5,963 ) Retained earnings 333,613 332,897 Less treasury stock at cost, 5,915,182 shares at March 31, 2024 and December 31, 2023 (71,201 ) (71,201 ) Total stockholders’ equity 371,583 370,010 Total liabilities and stockholders’ equity $ 781,625 $ 767,548 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) For the three months ended March 31 2024 2023 Net sales $ 135,143 $ 124,885 Cost of sales (92,725 ) (86,348 ) Gross profit 42,418 38,537 Operating expenses Selling, general and administrative (30,621 ) (26,402 ) Research, product development and regulatory (5,706 ) (8,870 ) Operating income 6,091 3,265 Change in fair value of an equity investment 638 (22 ) Interest expense, net (3,693 ) (1,686 ) Income before provision for income taxes 3,036 1,557 Income tax (expense) benefit (1,484 ) 361 Net income $ 1,552 $ 1,918 Earnings per common share—basic $ 0.06 $ 0.07 Earnings per common share—assuming dilution $ 0.06 $ 0.07 Weighted average shares outstanding—basic 27,844 28,367 Weighted average shares outstanding—assuming dilution 28,128 29,073 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES ANALYSIS OF SALES (Unaudited) For the three months ended March 31, 2024 2023 Change % Change Net sales: U.S. crop $ 67,257 $ 61,876 $ 5,381 9 % U.S. non-crop 17,768 13,899 3,869 28 % Total U.S. 85,025 75,775 9,250 12 % International 50,118 49,110 1,008 2 % Total net sales $ 135,143 $ 124,885 $ 10,258 8 % Total cost of sales $ (92,725 ) $ (86,348 ) $ (6,377 ) 7 % Total gross profit $ 42,418 $ 38,537 $ 3,881 10 % Total gross margin 31 % 31 % AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) For the three months ended March 31 2024 2023 Cash flows from operating activities: Net income $ 1,552 $ 1,918 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization of property, plant and equipment and intangible assets 5,441 5,539 Amortization of other long-term assets 189 714 Provision for bad debts 700 581 Stock-based compensation 2,005 1,474 Change in deferred income taxes (1,025 ) 122 Change in liabilities for uncertain tax positions or unrecognized tax benefits 35 371 Change in equity investment fair value (638 ) 22 Other (5 ) 72 Foreign currency transaction gains (373 ) (446 ) Changes in assets and liabilities associated with operations: Increase in net receivables (5,579 ) (8,779 ) Increase in inventories (9,353 ) (33,731 ) Increase (decrease) in prepaid expenses and other assets (1,466 ) 600 Change in income tax receivable/payable, net 1,014 (2,965 ) (Decrease) increase in accounts payable (3,951 ) 5,655 Decrease in customer prepayments (37,037 ) (22,759 ) Increase in accrued program costs 6,399 10,660 Decrease in other payables and accrued expenses (332 ) (500 ) Net cash used in operating activities (42,424 ) (41,452 ) Cash flows from investing activities: Capital expenditures (3,565 ) (2,590 ) Proceeds from disposal of property, plant and equipment 23 — Acquisition of a product line — (703 ) Intangible assets (25 ) (15 ) Net cash used in investing activities (3,567 ) (3,308 ) Cash flows from financing activities: Payments under line of credit agreement (35,346 ) (27,300 ) Borrowings under line of credit agreement 83,463 72,000 Net receipt from the issuance of common stock under ESPP 430 480 Net (payment) receipt from the exercise of stock options — 18 Net payment from common stock purchased for tax withholding (14 ) (13 ) Repurchase of common stock — (557 ) Payment of cash dividends (834 ) (851 ) Net cash provided by financing activities 47,699 43,777 Net increase (decrease) in cash 1,708 (983 ) Effect of exchange rate changes on cash and cash equivalents 585 223 Cash at beginning of period 11,416 20,328 Cash at end of period $ 13,709 $ 19,568 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO EBITDA (In thousands) (Unaudited) Reconciliation of Net Income to EBITDA March 31, 2024 March 31, 2023 Net income, as reported $ 1,552 $ 1,918 Provision for income taxes 1,484 (361 ) Interest expense, net 3,693 1,686 Proxy costs — 541 Depreciation and amortization 5,630 6,253 Stock compensation 2,005 1,474 Transformation costs 1,152 — Adjusted EBITDA2 $ 15,516 $ 11,511 ______________________________ 1 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. 2 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income, operating income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company’s competitors) may define adjusted EBITDA differently. View source version on businesswire.com: https://www.businesswire.com/news/home/20240509081007/en/
Company Contact: American Vanguard Corporation Anthony Young, Director of Investor Relations (949) 260-1200 anthonyy@amvac-chemical.com Investor Representative: The Equity Group Inc. www.theequitygroup.com Lena Cati Lcati@equityny.com