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8-K - FORM 8-K - AMERICAN VANGUARD CORP | d347487d8k.htm |
Exhibit 99.1
FOR IMMEDIATE RELEASE
AMERICAN VANGUARD REPORTS FIRST QUARTER 2012 RESULTS
Performance reflects growing demand for AMVACs granular soil insecticide franchise
Newport Beach, CA May 3, 2012 American Vanguard Corporation (NYSE:AVD), today announced financial results for the first quarter ended March 31, 2012.
Fiscal 2012 First Quarter Financial Highlights versus Fiscal 2011 First Quarter
| Net sales of $87.3 million, compared with $66.0 million, an increase of 32%. |
| Net income of $8.7 million, compared with $5.0 million, an increase of 74%. |
| Earnings per diluted share were $0.31, compared with $0.18, an increase of 72%. |
Eric Wintemute, Chairman and CEO of American Vanguard, stated: Our first quarter 2012 business performance reflects positive conditions in the U.S. agricultural sector and was driven largely by the growing demand for our portfolio of granular soil insecticides. Gross profit margins rose to 43% as we achieved improved overall factory utilization rates. Operating expenses as a percentage of sales were held to 26%, despite higher regulatory expenses and freight costs that kept pace with our expanding export business. Stronger sales, improved gross margins and operating expense management enabled us to improve our bottom line significantly.
Mr. Wintemute continued, We are seeing renewed demand for the use of granular soil insecticides in the U.S. corn market, as growers combat strong pest pressure from both primary and secondary insects. The use of our corn soil insecticides in conjunction with genetically modified seeds as part of an integrated pest management program provides the most comprehensive defense against the full range of soil insects and can enhance harvest yields. American Vanguard has the largest offering of corn soil insecticides along with the most advanced, closed delivery equipment for safely and efficiently dispensing these products.
Mr. Wintemute concluded, Our performance during the quarter serves to validate our long-standing belief that conventional chemistry is an essential part of integrated pest management. We are, of course, pleased with these results and look forward to giving additional color during our earnings call on the period.
Conference Call
Eric Wintemute, Chairman & CEO and David Johnson, CFO, will conduct a conference call focusing on the financial results at 12:00 pm ET / 9:00 am PT on Thursday, May 3, 2012. 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 Companys 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 Companys 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 the control of public and animal health pests. American Vanguard is included in the Russell 2000® & Russell 3000® Indexes and the Standard & Poors Small Cap 600 Index. To learn more about American Vanguard, please reference the Companys 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 the conference call referenced in this release, all forward-looking statements are estimates by the Companys management and are subject to various risks and uncertainties that may cause results to differ from managements current expectations. Such factors include weather conditions, changes in regulatory policy and other risks as detailed from time-to-time in the Companys SEC reports and filings. All forward-looking statements, if any, in this release represent the Companys judgment as of the date of this release.
CONTACT: | ||
American Vanguard Corporation | The Equity Group Inc. | |
William A. Kuser, Director of Investor Relations | www.theequitygroup.com | |
(949) 260-1200 | Lena Cati (212) 836-9611 | |
williamk@amvac-chemical.com | Lcati@equityny.com |
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except per share data)
(Unaudited)
For the three months ended March 31 |
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2012 | 2011 | |||||||
Net sales |
$ | 87,255 | $ | 66,033 | ||||
Cost of sales |
49,877 | 39,123 | ||||||
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Gross profit |
37,378 | 26,910 | ||||||
Operating expenses |
22,976 | 17,723 | ||||||
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Operating income |
14,402 | 9,187 | ||||||
Interest expense |
735 | 806 | ||||||
Interest capitalized |
(36 | ) | (58 | ) | ||||
Extinguishment of debt |
| 546 | ||||||
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Income before income tax |
13,703 | 7,893 | ||||||
Income tax expense |
4,969 | 2,881 | ||||||
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Net income |
8,734 | 5,012 | ||||||
Change in fair value of interest rate swaps |
22 | (246 | ) | |||||
Foreign currency translation adjustment |
542 | 237 | ||||||
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Comprehensive income |
$ | 9,298 | $ | 5,003 | ||||
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Earnings per common sharebasic |
$ | .32 | $ | .18 | ||||
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Earnings per common shareassuming dilution |
$ | .31 | $ | .18 | ||||
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Weighted average shares outstandingbasic |
27,624 | 27,596 | ||||||
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Weighted average shares outstandingassuming dilution |
28,299 | 27,851 | ||||||
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As reported at the earnings call and set forth in the financial statements in the Companys form 10-K for the period ended December 31, 2011, the company has reclassified immaterial program costs from operating expenses to net sales for all reporting periods. The figures in the prior year statement, presented here, reflect this reclassification.
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
ASSETS (note 7)
Mar. 31, 2012 |
Dec. 31, 2011 |
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(Unaudited) | (Note) | |||||||
Current assets: |
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Cash |
$ | 14,732 | $ | 35,085 | ||||
Receivables: |
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Trade, net of allowance for doubtful accounts of $397 and $340, respectively |
98,625 | 68,611 | ||||||
Other |
1,473 | 1,187 | ||||||
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100,098 | 69,798 | |||||||
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Inventories |
74,667 | 71,068 | ||||||
Prepaid expenses |
3,399 | 2,311 | ||||||
Income taxes receivable |
| 203 | ||||||
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Total current assets |
192,896 | 178,465 | ||||||
Property, plant and equipment, net |
43,039 | 39,273 | ||||||
Intangible assets |
114,703 | 116,189 | ||||||
Other assets |
5,012 | 5,214 | ||||||
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$ | 355,650 | $ | 339,141 | |||||
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LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
Current liabilities: |
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Current installments of long-term debt |
$ | 14,896 | $ | 14,460 | ||||
Current installments of other liabilities |
1,134 | 1,038 | ||||||
Accounts payable |
24,381 | 23,214 | ||||||
Deferred revenue |
| 7,571 | ||||||
Accrued program costs |
45,383 | 25,910 | ||||||
Accrued expenses and other payables |
6,032 | 6,832 | ||||||
Income taxes payable |
3,479 | | ||||||
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Total current liabilities |
95,305 | 79,025 | ||||||
Long-term debt, excluding current installments |
43,527 | 51,917 | ||||||
Other liabilities, excluding current installments |
5,774 | 5,955 | ||||||
Deferred income taxes |
15,172 | 15,172 | ||||||
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Total liabilities |
159,778 | 152,069 | ||||||
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Commitments and contingent liabilities |
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Stockholders equity: |
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Preferred stock, $.10 par value per share; authorized 400,000 shares; none issued |
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Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 30,083,066 shares at March 31, 2012 and 29,845,047 shares at December 31, 2011 |
3,009 | 2,985 | ||||||
Additional paid-in capital |
46,824 | 45,966 | ||||||
Accumulated other comprehensive loss |
(1,686 | ) | (2,250 | ) | ||||
Retained earnings |
150,878 | 143,524 | ||||||
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199,025 | 190,225 | |||||||
Less treasury stock, at cost, 2,260,996 shares at March 31, 2012 and at December 31, 2011 |
(3,153 | ) | (3,153 | ) | ||||
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Total stockholders equity |
195,872 | 187,072 | ||||||
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$ | 355,650 | $ | 339,141 | |||||
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Note: The balance sheet at December 31, 2011 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 Three Months Ended March 31, 2012 and 2011
(Unaudited)
Increase (decrease) in cash |
2012 | 2011 | ||||||
Cash flows from operating activities: |
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Net income |
$ | 8,734 | $ | 5,012 | ||||
Adjustments to reconcile net income to net cash used in operating activities: |
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Depreciation and amortization of fixed and intangible assets |
3,469 | 3,251 | ||||||
Amortization of other long term assets |
682 | 1,253 | ||||||
Amortization of discounted liabilities |
198 | 388 | ||||||
Stock-based compensation |
422 | 523 | ||||||
Tax benefit from exercise of stock options |
(43 | ) | | |||||
Changes in assets and liabilities associated with operations: |
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Increase in net receivables |
(30,300 | ) | (29,900 | ) | ||||
Increase in inventories |
(3,599 | ) | (3,243 | ) | ||||
Increase in prepaid expenses and other assets |
(1,568 | ) | (1,988 | ) | ||||
Decrease in income tax receivable/payable, net |
3,725 | 8,133 | ||||||
Increase in accounts payable |
1,188 | 7,703 | ||||||
Decrease in deferred revenue |
(7,571 | ) | (5,533 | ) | ||||
Increase in other liabilities |
17,065 | 3,896 | ||||||
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Net cash used in operating activities |
(7,598 | ) | (10,505 | ) | ||||
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Cash flows from investing activities: |
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Capital expenditures |
(5,718 | ) | (910 | ) | ||||
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Net cash used in investing activities |
(5,718 | ) | (910 | ) | ||||
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Cash flows from financing activities: |
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Net (repayments) borrowings under line of credit agreement |
| (7,300 | ) | |||||
Principal payments on long-term debt |
(2,000 | ) | (2,004 | ) | ||||
Tax benefit from exercise of stock options |
43 | | ||||||
Borrowings on long-term debt |
| 20,063 | ||||||
Decrease in other notes payable |
(6,035 | ) | | |||||
Proceeds from the issuance of common stock (sale of stock under ESPP and exercise of stock option) |
417 | 550 | ||||||
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Net cash (used in) provided by financing activities |
(7,575 | ) | 11,309 | |||||
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Net (decrease) in cash |
(20,891 | ) | (106 | ) | ||||
Cash and cash equivalents at beginning of period |
35,085 | 1,158 | ||||||
Effect of exchange rate changes on cash |
538 | 222 | ||||||
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Cash and cash equivalents as of March 31 |
$ | 14,732 | $ | 1,274 | ||||
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