American Vanguard Corporation (NYSE:AVD) today announced financial
results for the third quarter and nine-month period ended September 30,
2013.
Fiscal 2013 Nine Month Financial Highlights – versus Fiscal 2012 Nine
Month Results
-
Net sales improved from $261.9 million to $305.5 million, an increase
of 17%
-
Net income improved from $25.6 million to $34.2 million, an increase
of 34%
-
Earnings per diluted share improved from $0.89 to $1.18, an increase
of 33%
Fiscal 2013 Third Quarter Financial Highlights – versus Fiscal 2012
Third Quarter Results
-
Net sales improved from $89.8 million to $97.2 million, an increase of
8%
-
Net income improved from $8.1 million to $8.9 million, an increase of
10%
-
Earnings per diluted share improved from $0.28 to $0.31, an increase
of 11%
Note: Further details are available in the financial schedules attached
to this press release
Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We are
pleased to report record third quarter and year-to-date revenue and
earnings growth. Our quarterly results benefited from strong sales of
Bidrin®, Thimet® and our Force® corn soil insecticide in Smartbox. In
the face of challenging market dynamics, we have reported our best ever
Company performance. Looking forward, as the industry ramps up for the
2014 planting season and prepares to cope with the reported
intensification of weed and insect pressure, we are ready to supply
growers with the best selection of proven crop protection tools
available.”
Mr. Wintemute continued: “We continue to achieve strong gross margin
levels, posting 46% in the first nine months of 2013 and 44% in the
third quarter. Our 2013 sales have been enhanced by the extended
agreement with Monsanto to co-market our Impact® herbicide with their
market leading Roundup glyphosate brands. Demand for our wide range of
granular soil insecticides continues to grow, as expanding insect
resistance encourages the use of our products in conjunction with
genetically modified trait seed. Further, we continue to manage our
balance sheet for long-term growth and have strengthened our
organization to capitalize on promising opportunities in product
development, international expansion and non-agricultural pest control
markets.”
Mr. Wintemute concluded: “Over the next several quarters, we expect to
see strong demand for our diversified product lines across the many
crops and geographies that we serve. Furthermore, for the 2014 planting
season, we are planning to introduce a liquid, fertilizer-ready corn
soil insecticide, which will complement our industry-leading portfolio
of granular SmartBox products. AMVAC’s proven, yield-enhancing products
are an essential part of integrated pest management, and solidify
American Vanguard’s important role in the future of modern agriculture
worldwide.”
Conference Call
Eric Wintemute, Chairman & CEO and David Johnson, VP & CFO, will conduct
a conference call focusing on the financial results at 4:30 pm ET / 1:30
pm PT on Thursday, October 31, 2013. 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 as well as the S&P Small Cap 600 Index.
To learn more about American Vanguard, please reference the Company’s
web site at www.amvac-chemical.com.
The Company, from time to time, may discuss forward-looking information.
Except for the historical information contained in the conference call
referenced 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
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
|
|
(In thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
For the three months
|
|
For the nine months
|
|
|
|
ended September 30
|
|
ended September 30
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Net sales
|
|
$
|
97,201
|
|
|
$
|
89,836
|
|
|
$
|
305,499
|
|
|
$
|
261,928
|
|
|
Cost of sales
|
|
|
54,042
|
|
|
|
50,211
|
|
|
|
166,493
|
|
|
|
146,579
|
|
|
Gross profit
|
|
|
43,159
|
|
|
|
39,625
|
|
|
|
139,006
|
|
|
|
115,349
|
|
|
Operating expenses
|
|
|
28,025
|
|
|
|
26,460
|
|
|
|
84,823
|
|
|
|
73,540
|
|
|
Operating income
|
|
|
15,134
|
|
|
|
13,165
|
|
|
|
54,183
|
|
|
|
41,809
|
|
|
Interest expense
|
|
|
464
|
|
|
|
701
|
|
|
|
1,712
|
|
|
|
2,157
|
|
|
Interest capitalized
|
|
|
(20
|
)
|
|
|
(165
|
)
|
|
|
(245
|
)
|
|
|
(313
|
)
|
|
Income before provision for income tax
|
|
|
14,690
|
|
|
|
12,629
|
|
|
|
52,716
|
|
|
|
39,965
|
|
|
Income tax expense
|
|
|
5,559
|
|
|
|
4,553
|
|
|
|
18,500
|
|
|
|
14,411
|
|
|
Income before loss on equity investment
|
|
|
9,131
|
|
|
|
8,076
|
|
|
|
34,216
|
|
|
|
25,554
|
|
|
Loss from equity method investment
|
|
|
386
|
|
|
|
—
|
|
|
|
386
|
|
|
|
—
|
|
|
Net income
|
|
|
8,745
|
|
|
|
8,076
|
|
|
|
33,830
|
|
|
|
25,554
|
|
|
Net loss attributable to non-controlling interest
|
|
|
125
|
|
|
|
—
|
|
|
|
341
|
|
|
|
—
|
|
|
Net income attributable to American Vanguard
|
|
|
8,870
|
|
|
|
8,076
|
|
|
|
34,171
|
|
|
|
25,554
|
|
|
Change in fair value of interest rate swaps
|
|
|
133
|
|
|
|
41
|
|
|
|
485
|
|
|
|
87
|
|
|
Foreign currency translation adjustment
|
|
|
(126
|
)
|
|
|
306
|
|
|
|
(195
|
)
|
|
|
428
|
|
|
Comprehensive income
|
|
$
|
8,877
|
|
|
$
|
8,423
|
|
|
$
|
34,461
|
|
|
$
|
26,069
|
|
|
Earnings per common share—basic
|
|
$
|
0.31
|
|
|
$
|
0.29
|
|
|
$
|
1.21
|
|
|
$
|
0.92
|
|
|
Earnings per common share—assuming dilution
|
|
$
|
0.31
|
|
|
$
|
0.28
|
|
|
$
|
1.18
|
|
|
$
|
0.89
|
|
|
Weighted average shares outstanding—basic
|
|
|
28,322
|
|
|
|
27,970
|
|
|
|
28,295
|
|
|
|
27,818
|
|
|
Weighted average shares outstanding—assuming dilution
|
|
|
28,889
|
|
|
|
28,878
|
|
|
|
28,890
|
|
|
|
28,673
|
|
|
|
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(In thousands, except per share data)
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Sept. 30,
|
|
Dec. 31,
|
|
|
|
2013
|
|
2012
|
|
|
|
(Unaudited)
|
|
(Note)
|
|
Current assets:
|
|
|
|
|
|
Cash
|
|
$
|
12,325
|
|
|
$
|
38,476
|
|
|
Receivables:
|
|
|
|
|
|
Trade, net of allowance for doubtful accounts of $543 and $623,
respectively
|
|
|
109,318
|
|
|
|
76,073
|
|
|
Other
|
|
|
2,489
|
|
|
|
1,230
|
|
|
|
|
|
111,807
|
|
|
|
77,303
|
|
|
Inventories
|
|
|
127,172
|
|
|
|
87,951
|
|
|
Prepaid expenses and other short-term assets
|
|
|
12,381
|
|
|
|
13,710
|
|
|
Deferred income tax assets
|
|
|
4,877
|
|
|
|
4,877
|
|
|
Total current assets
|
|
|
268,562
|
|
|
|
222,317
|
|
|
Property, plant and equipment, net
|
|
|
51,642
|
|
|
|
45,701
|
|
|
Intangible assets, net of applicable amortization
|
|
|
108,641
|
|
|
|
113,521
|
|
|
Other assets
|
|
|
34,569
|
|
|
|
18,351
|
|
|
|
|
$
|
463,414
|
|
|
$
|
399,890
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Current installments of long-term debt
|
|
$
|
71
|
|
|
$
|
16,247
|
|
|
Current installments of other liabilities
|
|
|
1,635
|
|
|
|
1,839
|
|
|
Accounts payable
|
|
|
32,764
|
|
|
|
32,838
|
|
|
Deferred revenue
|
|
|
393
|
|
|
|
20,427
|
|
|
Accrued program costs
|
|
|
95,722
|
|
|
|
32,335
|
|
|
Accrued expenses and other payables
|
|
|
11,271
|
|
|
|
8,671
|
|
|
Income taxes payable
|
|
|
736
|
|
|
|
1,313
|
|
|
Total current liabilities
|
|
|
142,592
|
|
|
|
113,670
|
|
|
Long-term debt, excluding current installments
|
|
|
38,894
|
|
|
|
36,196
|
|
|
Other liabilities, excluding current installments
|
|
|
3,932
|
|
|
|
5,425
|
|
|
Deferred income taxes
|
|
|
19,163
|
|
|
|
19,163
|
|
|
Total liabilities
|
|
|
204,581
|
|
|
|
174,454
|
|
|
|
|
|
|
|
|
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 30,997,686 shares at September 30, 2013 and
30,766,730 shares at December 31, 2012
|
|
|
3,100
|
|
|
|
3,077
|
|
|
Additional paid-in capital
|
|
|
58,181
|
|
|
|
54,323
|
|
|
Accumulated other comprehensive loss
|
|
|
(1,472
|
)
|
|
|
(1,762
|
)
|
|
Retained earnings
|
|
|
203,610
|
|
|
|
174,243
|
|
|
|
|
|
263,419
|
|
|
|
229,881
|
|
|
Less treasury stock, at cost, 2,310,634 shares at September 30,
2013 and at December 31, 2012
|
|
|
(4,804
|
)
|
|
|
(4,804
|
)
|
|
American Vanguard stockholders’ equity
|
|
|
258,615
|
|
|
|
225,077
|
|
|
Non-controlling interest
|
|
|
218
|
|
|
|
359
|
|
|
Total stockholders’ equity
|
|
|
258,833
|
|
|
|
225,436
|
|
|
|
|
$
|
463,414
|
|
|
$
|
399,890
|
|
|
|
|
Note: The balance sheet at December 31, 2012 has been derived from
the audited financial statements at that date.
|
|
|
|
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In thousands)
|
|
For The Nine Months Ended September 30, 2013 and 2012
|
|
(Unaudited)
|
|
|
|
Increase (decrease) in cash
|
|
2013
|
|
2012
|
|
Cash flows from operating activities:
|
|
|
|
|
|
Net income
|
|
$
|
33,830
|
|
|
$
|
25,554
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
Depreciation and amortization of fixed and intangible assets
|
|
|
11,183
|
|
|
|
9,915
|
|
|
Amortization of other long term assets
|
|
|
2,976
|
|
|
|
2,061
|
|
|
Amortization of discounted liabilities
|
|
|
130
|
|
|
|
592
|
|
|
Stock-based compensation
|
|
|
2,895
|
|
|
|
1,856
|
|
|
Tax benefit from exercise of stock options
|
|
|
(57
|
)
|
|
|
(493
|
)
|
|
Loss from equity method investment
|
|
|
386
|
|
|
|
—
|
|
|
Changes in assets and liabilities associated with operations:
|
|
|
|
|
|
Increase in net receivables
|
|
|
(34,304
|
)
|
|
|
(36,515
|
)
|
|
Increase in inventories
|
|
|
(39,221
|
)
|
|
|
(21,747
|
)
|
|
Increase in prepaid expenses and other assets
|
|
|
(14,564
|
)
|
|
|
(8,862
|
)
|
|
(Increase) decrease in income tax receivable/payable, net
|
|
|
(520
|
)
|
|
|
644
|
|
|
Increase in accounts payable
|
|
|
412
|
|
|
|
8,743
|
|
|
Decrease in deferred revenue
|
|
|
(20,034
|
)
|
|
|
(6,270
|
)
|
|
Increase in other liabilities
|
|
|
64,088
|
|
|
|
37,623
|
|
|
Net cash provided by operating activities
|
|
|
7,200
|
|
|
|
13,101
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Capital expenditures
|
|
|
(12,290
|
)
|
|
|
(14,908
|
)
|
|
Investment
|
|
|
(3,687
|
)
|
|
|
—
|
|
|
Net cash used in investing activities
|
|
|
(15,977
|
)
|
|
|
(14,908
|
)
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Net borrowings under line of credit agreement
|
|
|
38,750
|
|
|
|
—
|
|
|
Payments on long-term debt
|
|
|
(46,000
|
)
|
|
|
(6,000
|
)
|
|
Payments on other long-term liabilities
|
|
|
(1,415
|
)
|
|
|
—
|
|
|
Tax benefit from exercise of stock options
|
|
|
57
|
|
|
|
493
|
|
|
Decrease in other notes payable
|
|
|
(6,154
|
)
|
|
|
(6,460
|
)
|
|
Payment of cash dividends
|
|
|
(3,390
|
)
|
|
|
(1,380
|
)
|
|
Proceeds from the issuance of common stock (sale of stock under ESPP
and exercise of stock options)
|
|
|
929
|
|
|
|
3,260
|
|
|
Net cash used in financing activities
|
|
|
(17,223
|
)
|
|
|
(10,087
|
)
|
|
|
|
|
|
|
|
Net decrease in cash
|
|
|
(26,000
|
)
|
|
|
(11,894
|
)
|
|
Cash and cash equivalents at beginning of year
|
|
|
38,476
|
|
|
|
35,085
|
|
|
Effect of exchange rate changes on cash
|
|
|
(151
|
)
|
|
|
433
|
|
|
Cash and cash equivalents as of September 30
|
|
$
|
12,325
|
|
|
$
|
23,624
|
|
Copyright Business Wire 2013