American Vanguard Reports Third Quarter 2024 Results
Reiterating full-year 2024 Adj. EBITDA guidance
Non-Crop Revenues Grew 17%; Green Solutions Revenues Grew 18% Y/o/Y
Business transformation continues to accelerate, raising expected annual benefit to
Company reduced debt by
Third Quarter 2024 Financial and Operational Highlights – versus Third Quarter 2023:
-
Net sales of
$118.3 million ($130.7 million when excluding Dacthal product recall impact) v.$149.5 million ; -
Adjusted EBITDA1 of
$1.8 million v.$11.4 million ; -
Maintaining full-year 2024 Adjusted EBITDA guidance of
$40 million to$50 million -
EPS of
$(0.92) v. ($0.01 ) -
Decreased debt by
$32.5 million from$211.3 million in the previous quarter
First nine months 2024 Financial and Operational Highlights – versus first nine months 2023:
-
Net sales of
$381.7 million ($394.1 million when excluding Dacthal product recall impact) v.$407.2 million ; -
Adjusted EBITDA of
$23.3 million v.$33.5 million ; -
EPS of
$(1.28) v.$0.02
Other Highlights:
-
Raising expected full-year transformation related benefits to
$20 million from$15 million - The Board is actively engaged in recruiting a CEO to build upon the transformation momentum
About
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
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES |
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(In thousands, except share data) |
||||||||
(Unaudited) |
||||||||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash |
|
$ |
11,880 |
|
|
$ |
11,416 |
|
Receivables: |
|
|
|
|
|
|
||
Trade, net of allowance for credit losses of |
|
|
146,145 |
|
|
|
182,613 |
|
Other |
|
|
5,852 |
|
|
|
8,356 |
|
Total receivables, net |
|
|
151,997 |
|
|
|
190,969 |
|
Inventories |
|
|
246,037 |
|
|
|
219,551 |
|
Prepaid expenses |
|
|
7,501 |
|
|
|
6,261 |
|
Income taxes receivable |
|
|
7,690 |
|
|
|
3,824 |
|
Total current assets |
|
|
425,105 |
|
|
|
432,021 |
|
Property, plant and equipment, net |
|
|
73,494 |
|
|
|
74,560 |
|
Operating lease right-of-use assets, net |
|
|
21,448 |
|
|
|
22,417 |
|
Intangible assets, net of amortization |
|
|
164,480 |
|
|
|
172,508 |
|
|
|
|
48,012 |
|
|
|
51,199 |
|
Deferred income tax assets |
|
|
12,218 |
|
|
|
2,849 |
|
Other assets |
|
|
14,701 |
|
|
|
11,994 |
|
Total assets |
|
$ |
759,458 |
|
|
$ |
767,548 |
|
|
|
|
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
73,557 |
|
|
$ |
68,833 |
|
Customer prepayments |
|
|
27,183 |
|
|
|
65,560 |
|
Accrued program costs |
|
|
85,665 |
|
|
|
68,076 |
|
Accrued expenses and other payables |
|
|
29,066 |
|
|
|
16,354 |
|
Operating lease liabilities, current |
|
|
6,604 |
|
|
|
6,081 |
|
Income taxes payable |
|
|
3,229 |
|
|
|
5,591 |
|
Total current liabilities |
|
|
225,304 |
|
|
|
230,495 |
|
Long-term debt |
|
|
178,749 |
|
|
|
138,900 |
|
Operating lease liabilities, long term |
|
|
15,574 |
|
|
|
17,113 |
|
Deferred income tax liabilities |
|
|
9,167 |
|
|
|
7,892 |
|
Other liabilities |
|
|
2,756 |
|
|
|
3,138 |
|
Total liabilities |
|
|
431,550 |
|
|
|
397,538 |
|
Commitments and contingent liabilities (Note 12) |
|
|
|
|
|
|
||
Stockholders' equity: |
|
|
|
|
|
|
||
Preferred stock, |
|
|
— |
|
|
|
— |
|
Common stock, |
|
|
3,452 |
|
|
|
3,467 |
|
Additional paid-in capital |
|
|
114,196 |
|
|
|
110,810 |
|
Accumulated other comprehensive loss |
|
|
(13,849 |
) |
|
|
(5,963 |
) |
Retained earnings |
|
|
295,310 |
|
|
|
332,897 |
|
Less treasury stock at cost, 5,915,182 shares at |
|
|
(71,201 |
) |
|
|
(71,201 |
) |
Total stockholders’ equity |
|
|
327,908 |
|
|
|
370,010 |
|
Total liabilities and stockholders’ equity |
|
$ |
759,458 |
|
|
$ |
767,548 |
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||
(In thousands, except per share data) |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
For the Three Months
|
|
|
For the Nine Months
|
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net sales |
|
$ |
118,307 |
|
|
$ |
149,516 |
|
|
$ |
381,659 |
|
|
$ |
407,191 |
|
Cost of sales |
|
|
(101,014 |
) |
|
|
(106,432 |
) |
|
|
(284,185 |
) |
|
|
(282,662 |
) |
Gross profit |
|
|
17,293 |
|
|
|
43,084 |
|
|
|
97,474 |
|
|
|
124,529 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling, general and administrative |
|
|
(26,365 |
) |
|
|
(29,813 |
) |
|
|
(86,885 |
) |
|
|
(85,954 |
) |
Research, product development and regulatory |
|
|
(11,177 |
) |
|
|
(9,080 |
) |
|
|
(25,482 |
) |
|
|
(27,363 |
) |
Transformation |
|
|
(8,139 |
) |
|
|
— |
|
|
|
(16,636 |
) |
|
|
— |
|
Operating (loss) income |
|
|
(28,388 |
) |
|
|
4,191 |
|
|
|
(31,529 |
) |
|
|
11,212 |
|
Change in fair value of equity investment |
|
|
— |
|
|
|
(247 |
) |
|
|
513 |
|
|
|
(324 |
) |
Interest expense, net |
|
|
(4,378 |
) |
|
|
(3,384 |
) |
|
|
(11,988 |
) |
|
|
(8,282 |
) |
(Loss) income before income tax benefit (expense) |
|
|
(32,766 |
) |
|
|
560 |
|
|
|
(43,004 |
) |
|
|
2,606 |
|
Income tax benefit (expense) |
|
|
7,024 |
|
|
|
(885 |
) |
|
|
7,093 |
|
|
|
(2,066 |
) |
Net (loss) income |
|
$ |
(25,742 |
) |
|
$ |
(325 |
) |
|
$ |
(35,911 |
) |
|
$ |
540 |
|
Net (loss) income per common share—basic |
|
$ |
(0.92 |
) |
|
$ |
(0.01 |
) |
|
$ |
(1.28 |
) |
|
$ |
0.02 |
|
Net (loss) income per common share—assuming dilution |
|
$ |
(0.92 |
) |
|
$ |
(0.01 |
) |
|
$ |
(1.28 |
) |
|
$ |
0.02 |
|
Weighted average shares outstanding—basic |
|
|
28,009 |
|
|
|
27,919 |
|
|
|
28,015 |
|
|
|
28,236 |
|
Weighted average shares outstanding—assuming dilution |
|
|
28,009 |
|
|
|
27,919 |
|
|
|
28,015 |
|
|
|
28,656 |
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES |
||||||||||||||||
ANALYSIS OF SALES |
||||||||||||||||
(In thousands), (Unaudited) |
||||||||||||||||
|
|
For the three months
ended |
|
|
|
|
|
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
|
Change |
|
|
% Change |
|
||||
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
35,533 |
|
|
$ |
67,749 |
|
|
$ |
(32,216 |
) |
|
|
-48 |
% |
|
|
|
22,454 |
|
|
|
19,250 |
|
|
|
3,204 |
|
|
|
17 |
% |
|
|
|
57,987 |
|
|
|
86,999 |
|
|
|
(29,012 |
) |
|
|
-33 |
% |
International |
|
|
60,320 |
|
|
|
62,517 |
|
|
|
(2,197 |
) |
|
|
-4 |
% |
Total net sales |
|
$ |
118,307 |
|
|
$ |
149,516 |
|
|
$ |
(31,209 |
) |
|
|
-21 |
% |
Total cost of sales |
|
$ |
(101,014 |
) |
|
$ |
(106,432 |
) |
|
$ |
5,418 |
|
|
|
-5 |
% |
Total gross profit |
|
$ |
17,293 |
|
|
$ |
43,084 |
|
|
$ |
(25,791 |
) |
|
|
-60 |
% |
Gross margin |
|
|
15 |
% |
|
|
29 |
% |
|
|
|
|
|
|
|
|
|
|
Impact of Dacthal Recall |
|
|
|
|
|
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
|
Change |
|
|
|
|
|
|||
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(11,783 |
) |
|
$ |
— |
|
|
$ |
(11,783 |
) |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
Total |
|
|
(11,783 |
) |
|
|
— |
|
|
|
(11,783 |
) |
|
|
|
|
International |
|
|
(620 |
) |
|
|
— |
|
|
|
(620 |
) |
|
|
|
|
Total net sales |
|
$ |
(12,403 |
) |
|
$ |
— |
|
|
$ |
(12,403 |
) |
|
|
|
|
Total cost of sales |
|
|
(3,788 |
) |
|
|
— |
|
|
|
(3,788 |
) |
|
|
|
|
Total gross profit |
|
$ |
(16,191 |
) |
|
$ |
— |
|
|
$ |
(16,191 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months
ended |
|
|
|
|
|
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
|
Change |
|
|
% Change |
|
||||
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
155,075 |
|
|
$ |
185,823 |
|
|
$ |
(30,748 |
) |
|
|
-17 |
% |
|
|
|
59,241 |
|
|
|
50,041 |
|
|
|
9,200 |
|
|
|
18 |
% |
|
|
|
214,316 |
|
|
|
235,864 |
|
|
|
(21,548 |
) |
|
|
-9 |
% |
International |
|
|
167,343 |
|
|
|
171,327 |
|
|
|
(3,984 |
) |
|
|
-2 |
% |
Total net sales |
|
$ |
381,659 |
|
|
$ |
407,191 |
|
|
$ |
(25,532 |
) |
|
|
-6 |
% |
Total cost of sales |
|
$ |
(284,185 |
) |
|
$ |
(282,662 |
) |
|
$ |
(1,523 |
) |
|
|
1 |
% |
Total gross profit |
|
$ |
97,474 |
|
|
$ |
124,529 |
|
|
$ |
(27,055 |
) |
|
|
-22 |
% |
|
|
|
26 |
% |
|
|
31 |
% |
|
|
|
|
|
|
|
|
|
|
Impact of Dacthal Recall |
|
|
|
|
|
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
|
Change |
|
|
|
|
|
|||
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(11,783 |
) |
|
$ |
— |
|
|
$ |
(11,783 |
) |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
Total |
|
|
(11,783 |
) |
|
|
— |
|
|
|
(11,783 |
) |
|
|
|
|
International |
|
|
(620 |
) |
|
|
— |
|
|
|
(620 |
) |
|
|
|
|
Total net sales |
|
$ |
(12,403 |
) |
|
$ |
— |
|
|
$ |
(12,403 |
) |
|
|
|
|
Total cost of sales |
|
|
(3,788 |
) |
|
|
— |
|
|
|
(3,788 |
) |
|
|
|
|
Total gross profit |
|
$ |
(16,191 |
) |
|
$ |
— |
|
|
$ |
(16,191 |
) |
|
|
|
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES |
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(In thousands) |
||||||||
(Unaudited) |
||||||||
|
|
For the Nine Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash flows from operating activities: |
|
|
|
|
|
|
||
Net (loss) income |
|
$ |
(35,911 |
) |
|
$ |
540 |
|
Adjustments to reconcile net (loss) income to net cash used in operating activities: |
|
|
|
|
|
|
||
Depreciation of property, plant and equipment |
|
|
6,655 |
|
|
|
6,396 |
|
Amortization of intangibles assets |
|
|
9,947 |
|
|
|
10,009 |
|
Amortization of other long-term assets |
|
|
199 |
|
|
|
1,445 |
|
Amortization of deferred loan fees |
|
|
342 |
|
|
|
174 |
|
Provision for bad debts |
|
|
1,278 |
|
|
|
952 |
|
Stock-based compensation |
|
|
3,887 |
|
|
|
4,257 |
|
Change in deferred income taxes |
|
|
(9,110 |
) |
|
|
(977 |
) |
Changes in liabilities for uncertain tax positions or unrecognized tax benefits |
|
|
106 |
|
|
|
467 |
|
Change in equity investment fair value |
|
|
(513 |
) |
|
|
324 |
|
Other |
|
|
110 |
|
|
|
7 |
|
Foreign currency transaction losses |
|
|
121 |
|
|
|
199 |
|
Changes in assets and liabilities associated with operations: |
|
|
|
|
|
|
||
Decrease (increase) in net receivables |
|
|
33,475 |
|
|
|
(29,055 |
) |
Increase in inventories |
|
|
(29,429 |
) |
|
|
(58,163 |
) |
Increase in prepaid expenses and other assets |
|
|
(4,107 |
) |
|
|
(633 |
) |
Change in income tax receivable/payable, net |
|
|
(6,216 |
) |
|
|
(4,046 |
) |
Increase (decrease) in net operating lease liability |
|
|
(48 |
) |
|
|
227 |
|
Increase in accounts payable |
|
|
6,141 |
|
|
|
1,240 |
|
Decrease in customer prepayments |
|
|
(38,375 |
) |
|
|
(104,590 |
) |
Increase in accrued program costs |
|
|
17,721 |
|
|
|
29,779 |
|
Increase (decrease) in other payables and accrued expenses |
|
|
13,878 |
|
|
|
(4,406 |
) |
Net cash used in operating activities |
|
|
(29,849 |
) |
|
|
(145,854 |
) |
Cash flows from investing activities: |
|
|
|
|
|
|
||
Capital expenditures |
|
|
(6,106 |
) |
|
|
(8,589 |
) |
Proceeds from disposal of property, plant and equipment |
|
|
66 |
|
|
|
200 |
|
Intangible assets |
|
|
(341 |
) |
|
|
(759 |
) |
Net cash used in investing activities |
|
|
(6,381 |
) |
|
|
(9,148 |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
||
Payments under line of credit agreement |
|
|
(168,188 |
) |
|
|
(62,800 |
) |
Borrowings under line of credit agreement |
|
|
208,037 |
|
|
|
228,500 |
|
Receipt from the issuance of common stock under ESPP |
|
|
901 |
|
|
|
980 |
|
Net receipt from the exercise of stock options |
|
|
— |
|
|
|
46 |
|
Net payment for tax withholding on stock-based compensation awards |
|
|
(1,416 |
) |
|
|
(1,957 |
) |
Repurchase of common stock |
|
|
— |
|
|
|
(15,539 |
) |
Payment of cash dividends |
|
|
(2,510 |
) |
|
|
(2,550 |
) |
Net cash provided by financing activities |
|
|
36,824 |
|
|
|
146,680 |
|
Net increase (decrease) in cash and cash equivalents |
|
|
594 |
|
|
|
(8,322 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
(130 |
) |
|
|
(477 |
) |
Cash and cash equivalents at beginning of period |
|
|
11,416 |
|
|
|
20,328 |
|
Cash and cash equivalents at end of period |
|
$ |
11,880 |
|
|
$ |
11,529 |
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES |
||||||||||||||||
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net (loss) income |
|
$ |
(25,742 |
) |
|
$ |
(325 |
) |
|
$ |
(35,911 |
) |
|
$ |
540 |
|
Income tax (benefit) expense |
|
|
(7,024 |
) |
|
|
885 |
|
|
|
(7,093 |
) |
|
|
2,066 |
|
Interest expense, net |
|
|
4,378 |
|
|
|
3,384 |
|
|
|
11,988 |
|
|
|
8,282 |
|
Depreciation and amortization |
|
|
5,703 |
|
|
|
5,704 |
|
|
|
16,801 |
|
|
|
17,850 |
|
Stock-based compensation |
|
|
1,135 |
|
|
|
1,716 |
|
|
|
3,887 |
|
|
|
4,257 |
|
Transformation costs & legal reserves |
|
|
7,159 |
|
|
|
— |
|
|
|
17,402 |
|
|
|
— |
|
Dacthal returns |
|
|
16,191 |
|
|
|
— |
|
|
|
16,191 |
|
|
|
— |
|
Proxy contest activities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
541 |
|
Adjusted EBITDA2 |
|
$ |
1,800 |
|
|
$ |
11,364 |
|
|
$ |
23,265 |
|
|
$ |
33,536 |
|
______________________________
1 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with
2 Adjusted earnings before interest, taxes, depreciation, and amortization. Adjusted EBITDA is not a financial measure calculated and presented in accordance with
View source version on businesswire.com: https://www.businesswire.com/news/home/20241111947698/en/
anthonyy@amvac.com
(949) 221-6119
Investor Representative
Robert.winters@alpha-ir.com
(929) 266-6315
Source: