AMERICAN VANGUARD REPORTS FIRST QUARTER 2014 RESULTS
Newport Beach, CA – May 1, 2014 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the first quarter ended March 31, 2014.
Financial Highlights Fiscal 2014 First Quarter – versus Fiscal 2013 First Quarter
• Net sales of $81.1 million, compared with $121.5 million.
• Net income of $2.2 million, compared with $16.9 million.
• Earnings per diluted share of $0.07, compared with $0.59.
Note: Further details are available in the financial schedules attached to this press release
As reported previously, prolonged wet weather in the Midwest United States during the spring of 2013 limited the application of many crop protection products that are used at the time of planting. As a result, higher than normal levels of these products, including AMVAC’s corn soil insecticides, remained in the distribution channel at the end of the 2013 growing season. The Company’s first quarter performance decline is attributable to reduced demand for corn inputs, as the channel of distribution first works down 2013 inventory carryover to satisfy 2014 demand. This process has been further slowed in the first quarter of 2014 by severe winter weather in our core markets and by lower corn commodity pricing, which is tending to delay grower planting decisions for the 2014 season.
Mr. Eric Wintemute, Chairman and CEO of American Vanguard stated: “Despite the abnormal purchasing pattern that we are seeing this season, U.S. corn growers continue to demonstrate support for our proven crop protection products by investing in our proprietary delivery systems. American Vanguard has the largest offering of these yield enhancing insecticides sold exclusively in our closed delivery equipment, which provides for safe and efficient dispensing of these products. Our corn franchise also continues to benefit from the multi-year co-marketing program with Monsanto, which rewards corn growers for using AMVAC’s Impact®
post-emergent herbicide with Monsanto’s widely used Roundup®
glyphosate herbicide brands.”
Mr. Wintemute continued: “We are placing a great deal of focus on reducing our own elevated inventory levels and setting the appropriate level of factory activity. Accordingly, we are compelled to reduce manufacturing output and to accept higher levels of under-absorbed overhead. This has reduced gross margins for the quarter and is likely to impact our performance for the balance of the year. At the same time we are working to control operating expenses throughout the organization.”
Mr. Wintemute concluded: “We believe that inventories in the channel of distribution will return to normal levels during the 2014 growing season and that our soil insecticide business will get back on track for the 2015 season. Our non-corn product lines and international expansion initiatives continue to meet planned expectations. We look forward to giving additional details during our first quarter earnings call.”
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, May 1, 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® 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.
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