EX-99.1 2 dex991.htm PRESS RELEASE OF AMERICAN VANGUARD CORPORATION DATED MAY 7, 2009 Press release of American Vanguard Corporation dated May 7, 2009

Exhibit 99.1

LOGO

FOR IMMEDIATE RELEASE

AMERICAN VANGUARD REPORTS FIRST QUARTER 2009 RESULTS

Performance reflects quarterly revenue improvement and additional costs incurred in the

evaluation of strategic opportunities

Newport Beach, CA – May 7, 2009 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the first quarter ended March 31, 2009.

Fiscal 2009 First Quarter Financial Highlights – versus Fiscal 2008 First Quarter

 

   

Net sales of $44.6 million, an increase of 9%.

 

   

Net income of $0.7 million, compared to $1.7 generated in 1Q08.

 

   

Earnings per diluted share were $0.03, compared with $0.06 in the prior year period.

Note: Reported earnings for the current period include additional costs incurred in the evaluation of strategic opportunities – having an unfavorable after-tax earnings impact of more than $0.03 per diluted share.

Eric Wintemute, President and CEO of American Vanguard, stated: “Our first quarter year-over-year sales growth reflects continuous expansion of our business. Despite the economic and credit uncertainties in U.S. and international markets, our sales and marketing initiatives have proven successful in increasing our revenue base. We anticipate continued growth in a number of areas and plan to adjust our inventory levels and manufacturing operations accordingly.”

“Another factor in this quarter’s results involves the costs of evaluating strategic opportunities. Product acquisition or licensing, international expansion, and various manufacturing & marketing collaborations are important ingredients to our continued success. While we can not elaborate on these projects specifically, individually and/or collectively they could transform the scope and significance of American Vanguard in the crop protection industry. We have engaged in evaluating a number of these opportunities during the first quarter of 2009, and our financial statements reflect the cost of such activities.”

Mr. Wintemute concluded, “We will continue to seek products that can strengthen our portfolio. We will continue to explore and pursue international and non-crop expansion opportunities. We will exercise diligent cost control, remain conservative in our investment outlays, capitalize on our versatile domestic manufacturing capability and leverage both our intellectual property and our established market positions. We reiterate again, that the significant benefits we provide for enhancing agricultural productivity and improving crop quality will continue to be in demand and fuel our growth potential in 2009 and beyond.”


Conference Call

Eric Wintemute, President & CEO, Trevor Thorley, EVP & COO and David Johnson, CFO, will conduct a conference call focusing on the financial results at 12:00 pm ET / 9:00 am PT on Thursday, May 7, 2009. Interested parties may participate in the call by dialing 706-679-3155 – please call in 10 minutes before the call is scheduled to begin, and ask for the American Vanguard call (conference ID # 96508760). 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 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 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.

 

CONTACT:

  
American Vanguard Corporation   

The Equity Group Inc.

William A. Kuser, Director of Investor Relations

   www.theequitygroup.com

(949) 260-1200

   Lena Cati (212) 836-9611

williamk@amvac-chemical.com

   Lcati@equityny.com


AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands except per share amounts)

(Unaudited)

 

     For the three months
ended March 31
 
     2009     2008  

Net sales

   $ 44,637     $ 40,934  

Cost of sales

     26,081       23,198  
                

Gross profit

     18,556       17,736  

Operating expenses

     16,563       13,946  
                

Operating income

     1,993       3,790  

Interest expense

     886       1,015  

Interest capitalized

     (21 )     (50 )
                

Income before income tax

     1,128       2,825  

Income tax expense

     429       1,092  
                

Net income

   $ 699     $ 1,733  
                

Earnings per common share—basic

   $ .03     $ .07  
                

Earnings per common share—assuming dilution

   $ .03     $ .06  
                

Weighted average shares outstanding—basic

     27,004       26,464  
                

Weighted average shares outstanding—assuming dilution

     27,663       27,466  
                


AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands – except share amounts)

 

Assets    Mar. 31,
2009
    Dec. 31,
2008
 
     (Unaudited)     (Note)  

Current assets:

    

Cash

   $ 1,447     $ 1,229  

Receivables:

    

Trade, net of allowance for doubtful accounts of $530 and $472, respectively

     63,834       51,405  

Other

     293       563  
                
     64,127       51,968  
                

Inventories

     112,527       90,626  

Prepaid expenses

     1,717       1,688  
                

Total current assets

     179,818       145,511  

Property, plant and equipment, net

     40,554       41,241  

Intangible assets

     89,999       91,079  

Other assets

     10,258       9,106  
                
   $ 320,629     $ 286,937  
                
Liabilities and Stockholders’ Equity     

Current liabilities:

    

Current installments of long-term debt

   $ 7,506     $ 6,656  

Accounts payable

     21,061       16,196  

Accrued program costs

     14,715       16,204  

Accrued expenses and other payables

     5,972       6,767  

Income taxes payable

     533       3,332  
                

Total current liabilities

     49,787       49,155  

Long-term debt, excluding current installments

     108,222       75,748  

Deferred income taxes

     6,091       6,091  
                

Total liabilities

     164,100       130,994  
                

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 29,333,396 shares at March 31, 2009 and 29,209,863 shares at December 31, 2008

     2,932       2,920  

Additional paid-in capital

     39,390       38,873  

Accumulated other comprehensive income (loss)

     (2,894 )     (3,593 )

Retained earnings

     120,254       120,896  
                
     159,682       159,096  

Less treasury stock, at cost, 2,260,996 shares at March 31, 2009 and at December 31, 2008

     (3,153 )     (3,153 )
                

Total stockholders’ equity

     156,529       155,943  
                
   $ 320,629     $ 286,937  
                

Note: The balance sheet at December 31, 2008 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 Three Months Ended March 31, 2009 and 2008

(Unaudited)

 

Increase (decrease) in cash

   2009     2008  

Cash flows from operating activities:

    

Net income

   $ 699     $ 1,733  

Adjustments to reconcile net income to net cash used in operating activities:

    

Depreciation and amortization of fixed and intangible assets

     2,712       2,252  

Amortization of other long term assets

     663       510  

Stock-based compensation expense related to stock options and employee stock purchases

     238       235  

Changes in assets and liabilities associated with operations:

    

Increase in net receivables

     (12,159 )     (8,402 )

Increase in inventories

     (21,901 )     (26,829 )

Increase in prepaid expenses and other assets

     (1,844 )     (2,739 )

Increase in accounts payable

     5,559       6,859  

Decrease in other current liabilities

     (6,424 )     (4,977 )
                

Net cash used in operating activities

     (32,457 )     (31,358 )
                

Cash flows from investing activities:

    

Capital expenditures

     (945 )     (2,375 )

Acquisitions of intangible assets

     —         (8,209 )
                

Net cash used in investing activities

     (945 )     (10,584 )
                

Cash flows from financing activities:

    

Net borrowings under line of credit agreement

     34,500       41,500  

Principal payments on long-term debt

     (1,176 )     (1,027 )

Proceeds from the issuance of common stock (exercise of stock options and sale of stock under ESPP)

     291       513  
                

Net cash provided by financing activities

     33,615       40,986  
                

Net increase (decrease) in cash

     213       (956 )

Cash and cash equivalents at beginning of year

     1,229       3,201  

Effect of exchange rate changes on cash

     5       44  
                

Cash and cash equivalents as of March 31

   $ 1,447     $ 2,289