American Vanguard Expects Elevated Inventory Levels in the Ag Chemical
Distribution Channel to Affect First Quarter 2014 Performance
NEWPORT BEACH, Calif. -- April 10, 2014
American Vanguard Corporation (NYSE:AVD) today announced that elevated channel
inventories, arising primarily from weather conditions in the Midwestern
United States, will affect its first quarter 2014 financial performance. Net
sales for the first quarter of 2014 will be approximately 33% below those of
the comparable period in 2013, and we anticipate reporting net earnings that
range from break-even to a few cents per share for the quarter.
As was reported by the Company last December and reiterated again on February
27, 2014, persistent wet weather during the 2013 planting season resulted in
reduced application of many crop protection inputs that are used at the time
of planting – such as AMVAC’s granular soil insecticides. This surplus
inventory in the distribution channel is gradually being drawn down as
purchases are made for the present 2014 spring planting season. While the
fundamental demand for our soil insecticide products remains solid, new orders
have been slowed by this inventory overhang and planting delays caused by this
year’s severe winter weather. We expect some purchases that would have
ordinarily been made in the first quarter will be made during April & May, and
as such will be reflected in our second quarter results.
Eric Wintemute, Chairman and CEO of American Vanguard, stated, “Our corn
products have been key drivers for our growth over the past three years.
Consequently, a shift in corn input purchasing patterns tends to have a
disproportionate effect upon our overall financial performance. Many of our Ag
Chem industry peers are experiencing reduced sales of their corn products due
to this sluggish procurement pattern. However, based upon discussions with our
customers, we consider this to be a temporary market condition and expect
continued growth for our corn products once conditions normalize. We remain in
close contact with our channel partners and stand ready to address the needs
of the market throughout the new planting season.”
American Vanguard will conduct a conference call with analysts and investors
to discuss current business conditions at 12:00 noon ET / 9:00 am PT, April
11, 2014. Interested parties may participate in the call by dialing
201-493-6744 - please dial 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® & Russell 3000® Indexes and
the Standard & Poors Small Cap 600 Index. To learn more about American
Vanguard, please reference the Company’s web site at
In its public commentary, the Company 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 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 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
William A. Kuser, 949-260-1200
Director of Investor Relations
The Equity Group Inc.
Lena Cati, 212-836-9611
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