FOR IMMEDIATE RELEASE
AMERICAN VANGUARD REPORTS FOURTH QUARTER & FULL YEAR 2013 RESULTS
Full-Year Revenue up 4% – Despite Delayed Purchasing Trend Caused by Unfavorable Weather
Newport Beach, CA – February 27, 2014 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the fourth quarter and full year ended December 31, 2013.
Fiscal 2013 Fourth Quarter Financial Highlights – versus Fiscal 2012 Fourth Quarter:
• Net sales were $75.5 million compared to $104.3 million.
• Net income was $0.3 million compared to $11.3 million.
• Earnings per diluted share were $0.01 versus $0.39.
Fiscal 2013 Financial Highlights – versus Fiscal 2012 Results:
• Net sales were $381.0 million compared to $366.2 million.
• Net income was $34.4 million compared to $36.9 million.
• Earnings per diluted share were $1.19 versus $1.28.
Note: Further details are available in the financial schedules attached to this press release
Eric Wintemute, Chairman and CEO of American Vanguard, stated: “Our performance in 2013 has been significantly influenced by unfavorable, early-season Midwest weather conditions and the resulting cautious purchasing behavior of our customers. Compared to the prior full-year period, sales grew by ¬¬¬¬4% and gross profit margins improved to 45%. Our balance sheet remains strong; stockholders equity rose for the year by 14%; we were able to provide shareholders with quarterly dividend payments totaling $0.22/share during the year; and finally, we implemented a stock buyback program during the final quarter of the year spending $1.9 million to purchase 70,000 shares.”
Mr. Wintemute continued: “2013 started out very strong for us, as corn growers built inventory in anticipation of a healthy, normal planting season. However, as we reported previously, widespread and prolonged rainfall last spring caused nearly two million flooded acres to remain fallow and deferred spring planting so extensively that some growers were forced to switch from intended corn planting to short maturity soybean varieties. As a result, planted acres of both corn and cotton decreased, and unapplied corn crop inputs from many companies accumulated as excess channel inventory. Last December, the distribution channel sharply curtailed procurement for the 2014 season in order to work through residual 2013 product. At that time, unlike some suppliers in our sector, we opted not to discount prices and extend credit terms in order to garner limited sales from the channel.”
Mr. Wintemute explained further: “We reported last December that we were expecting sales to pick-up during the 2014 first quarter. While we have seen some pick-up, sales activity of our corn soil insecticides are lagging behind what we would expect for this time of year. We are receiving mixed signals as to the prospects for our corn soil insecticides over the course of the quarter. Based upon input from our sales force, our channel partners and our peers, and taking into account current inventory and weather conditions, we believe that our net sales for the first quarter could be down as much as 20% compared to our record sales performance of Q1 2013. We expect to recover a portion of these lost sales in the second quarter, but that depends upon many factors, including how quickly fields can recover from winter conditions, length of planting season, and economic considerations such as corn and soybean commodity prices.”
Mr. Wintemute concluded, “On the more positive side, we continue to see strong demand for our Impact® corn herbicide and expect year-over-year improvements in our cotton, peanut, potato and other crop businesses during 2014. Further, corn market conditions can change quickly, and we stand ready to meet market demand as the planting season unfolds.”
Eric Wintemute, Chairman & CEO and David T. Johnson, VP & CFO, will conduct a conference call focusing on the financial results at 4:30 pm ET / 1:30 pm PT on Thursday, February 27, 2014. 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 and the Standard & Poor’s Small Cap 600 Index. To learn more about American Vanguard, please reference the Company’s 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 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.