FOR IMMEDIATE RELEASE
AMERICAN VANGUARD REPORTS SECOND QUARTER & MID-YEAR 2013 RESULTS
Strong First Half Performance - Despite Weather Dampened Spring Quarter
Newport Beach, CA – August 5, 2013 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the second quarter and six month period ended June 30, 2013.
Fiscal 2013 First Half Financial Highlights – versus Fiscal 2012 First Half
• Net sales improved from $172.1 million to $208.3 million, an increase of 21%
• Net income improved from $17.5 million to $25.3 million, an increase of 45%
• Earnings per diluted share improved from $0.61 to $0.88, an increase of 44%
Fiscal 2013 Second Quarter Financial Highlights – versus Fiscal 2012 Second Quarter:
• Net sales improved from $84.8 million to $86.8 million, an increase of 2%
• Net income declined slightly from $8.7 million to $8.4 million, a decrease of 4%
• Earnings per diluted share declined from $0.30 to $0.29, a decrease of 3%
Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We are pleased to report strong first half performance despite unfavorable U.S. weather conditions throughout the Midwest and South. During the 2013 corn planting season, we continued to see strong demand for our corn soil insecticides and post emergent herbicide. While adverse weather conditions kept us from achieving stronger sales during the second quarter, nevertheless we recorded slightly higher revenues overall as compared to second quarter of 2012, which had set the previous Company record for second quarter sales. As we previously reported, during the second quarter, persistent rainfall delayed and compressed normal planting practices, causing some growers to make fewer crop protection applications at the time of planting or to switch from corn and cotton to plant soybeans, which require a shorter growing period. Strong sales of our corn products were offset by a drop in sales of both our cotton and peanut products, resulting primarily from a decline in planted acres of those crops. Further, we did see more conservative purchasing patterns towards the end of the second quarter, as distribution reacted to increasing inventory levels.”
Mr. Wintemute continued: “Despite this late spring slowdown in grower demand, we continued to demonstrate strong gross margin performance, achieving 46% in the first half of 2013 compared to 44% in 2012. Our second quarter performance was better with gross margin of 48% as compared to 45% last year. During the second quarter, we extended our agreement with Monsanto to co-market our Impact® herbicide with their market leading Roundup brands. We continued to carefully manage our balance sheet including putting in place an expanded credit facility with our lender group, providing the Company with the capacity to pursue its domestic and international strategy. In keeping with our dedication to strategic growth, we have strengthened our organization to exploit promising opportunities in product development, international expansion and non-agricultural pest control markets.”
Mr. Wintemute concluded: “In the second half of 2013, we continue to see solid demand for our diversified product lines across the many crops and geographies that they serve. Factors affecting both the third and fourth quarters performance include the successful promotion and sales of our market leading post-harvest Metam soil fumigants, the normal late-summer pest pressure to support our Bidrin® foliar cotton insecticide, favorable autumn weather conditions to support of our Folex® cotton harvest defoliant, and wet weather in regions where our Dibrom® mosquito adulticide is used. At the end of the fourth quarter we will look for early 2014 season demand for both our granular corn soil insecticides and our Impact herbicide, which are both typically placed into the distribution chain at the end of the calendar year in readiness for the new season. Even with some working capital controls influencing distribution channel purchasing patterns, we believe, as do our customers, that our yield enhancing products are an essential part of integrated pest management, and that American Vanguard’s important role in modern agriculture will continue to serve as the foundation of our enduring business model.”
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 Monday, August 5, 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
William A. Kuser, Director of Investor Relations
The Equity Group Inc.