American Vanguard Reports Third Quarter & Nine-Month 2013 Results Continued Strong Demand Fuels Excellent Business Performance Business Wire NEWPORT BEACH, Calif. -- October 31, 2013 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 14,690 12,629 52,716 39,965 for income tax Income tax expense 5,559 4,553 18,500 14,411 Income before loss on 9,131 8,076 34,216 25,554 equity investment Loss from equity method 386 — 386 — investment Net income 8,745 8,076 33,830 25,554 Net loss attributable to 125 — 341 — non-controlling interest Net income attributable 8,870 8,076 34,171 25,554 to American Vanguard Change in fair value of 133 41 485 87 interest rate swaps Foreign currency (126 ) 306 (195 ) 428 translation adjustment Comprehensive income $ 8,877 $ 8,423 $ 34,461 $ 26,069 Earnings per common $ 0.31 $ 0.29 $ 1.21 $ 0.92 share—basic Earnings per common $ 0.31 $ 0.28 $ 1.18 $ 0.89 share—assuming dilution Weighted average shares 28,322 27,970 28,295 27,818 outstanding—basic Weighted average shares outstanding—assuming 28,889 28,878 28,890 28,673 dilution 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 109,318 76,073 $543 and $623, respectively 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 3,100 3,077 September 30, 2013 and 30,766,730 shares at December 31, 2012 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 (4,804 ) (4,804 ) September 30, 2013 and at December 31, 2012 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 December31, 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 September30, 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 11,183 9,915 intangible assets 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 (520 ) 644 receivable/payable, net 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 929 3,260 of stock under ESPP and exercise of stock options) 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 Contact: Company: American Vanguard Corporation William A. Kuser, 949-260-1200 Director of Investor Relations email@example.com or Investor Representative: The Equity Group Inc. Lena Cati, 212-836-9611 Lcati@equityny.com www.theequitygroup.com
American Vanguard Reports Third Quarter & Nine-Month 2013 Results
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