EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

FOR IMMEDIATE RELEASE

AMERICAN VANGUARD REPORTS FIRST QUARTER 2010 RESULTS

Performance reflects quarterly revenue and earnings improvement as well as continued balance sheet discipline

Newport Beach, CA – May 6, 2010 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the first quarter ended March 31, 2010.

Fiscal 2010 First Quarter Financial Highlights – versus Fiscal 2009 First Quarter

 

 

Net sales of $46.7 million, an increase of 5%.

 

 

Net income of $1.8 million, more than double the $0.7 million generated in Q1 2009.

 

 

Earnings per diluted share were $0.07, compared with $0.03 in the prior year period.

Eric Wintemute, President and CEO of American Vanguard, stated: “Our first quarter year-over-year sales growth reflects improved conditions in the U.S. agricultural sector and the intense focus of our sales and marketing team. The farm credit difficulties and distributor inventory retrenchment of 2009 have moderated and improved weather conditions have resulted in more normal planting patterns. Additionally, the 2010 resurgence in cotton and peanut acreage represents a very positive development for us given the strong product offering that we have for those crops.”

“Our Company maintained the focused financial discipline on inventory and receivables that we have exercised effectively since the second half of 2009. Our inventory levels ended at $74.3 million, $38.2 million lower as compared to $112.5 million last year. Our receivables were $10.5 million lower, at $53.3 million, as compared to $63.8 million last year, even with increased sales. Overall, these key drivers have resulted in a decrease in debt, which is down $44.9 million at $70.8 million, from $115.7 million this time last year. It is our intention to continue this focus on balance sheet strength throughout 2010.”

Mr. Wintemute concluded, “As we mentioned in our final 2009 performance report, we continue to seek products that can strengthen our portfolio both through acquisition / licensing and via our in-house product development program. We are making good progress on a number of these projects and our future growth potential will be enhanced by these efforts. We expect that the combination of more favorable market conditions, increased demand in several key crops, higher utilization rates in our manufacturing facilities, improved organizational capabilities and judicious financial control will allow American Vanguard to achieve better performance in 2010.”


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 6, 2010. 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 # 70970269). 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 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
 
     2010     2009  

Net sales

   $ 46,712      $ 44,637   

Cost of sales

     27,788        26,081   
                

Gross profit

     18,924        18,556   

Operating expenses

     15,168        16,563   
                

Operating income

     3,756        1,993   

Interest expense

     761        886   

Interest capitalized

     (10     (21
                

Income before income tax

     3,005        1,128   

Income tax expense

     1,178        429   
                

Net income

   $ 1,827      $ 699   
                

Earnings per common share—basic

   $ .07      $ .03   
                

Earnings per common share—assuming dilution

   $ .07      $ .03   
                

Weighted average shares outstanding—basic

     27,346        27,004   
                

Weighted average shares outstanding—assuming dilution

     27,623        27,663   
                


AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands – except share amounts)

 

      Mar. 31,
2010
    Dec. 31,
2009
 
     (Unaudited)     (Note)  

Assets

    

Current assets:

    

Cash

   $ 1,520      $ 383   

Receivables:

    

Trade, net of allowance for doubtful accounts of $650 and $635, respectively

     53,298        40,681   

Other

     219        382   
                
     53,517        41,063   
                

Inventories

     74,339        72,512   

Prepaid expenses

     2,356        2,143   

Income taxes receivable

     3,514        3,575   
                

Total current assets

     135,246        119,676   

Property, plant and equipment, net

     39,462        39,196   

Intangible assets

     85,837        86,973   

Other assets

     9,363        8,866   
                
   $ 269,908      $ 254,711   
                

Liabilities and Stockholders’ Equity

    

Current liabilities:

    

Current installments of long-term debt

   $ 8,528      $ 8,528   

Accounts payable

     17,725        11,401   

Accrued program costs

     15,665        27,188   

Accrued expenses and other payables

     3,863        3,762   

Income taxes payable

     996        —     
                

Total current liabilities

     46,777        50,879   

Long-term debt, excluding current installments

     62,284        45,432   

Other Long-term Liabilities

     192        192   

Deferred income taxes

     5,121        5,121   
                

Total liabilities

     114,374        101,624   
                

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 29,594,526 shares at March 31, 2010 and 29,575,562 shares at December 31, 2009

     2,959        2,958   

Additional paid-in capital

     42,007        41,529   

Accumulated other comprehensive loss

     (1,331     (1,743

Retained earnings

     115,052        113,496   
                
     158,687        156,240   

Less treasury stock, at cost, 2,260,996 shares at March 31, 2010 and at December 31, 2009

     (3,153     (3,153
                

Total stockholders’ equity

     155,534        153,087   
                
   $ 269,908      $ 254,711   
                

Note: The balance sheet at December 31, 2009 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, 2010 and 2009

(Unaudited)

 

Increase (decrease) in cash

   2010     2009  

Cash flows from operating activities:

    

Net income

   $ 1,827      $ 699   

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

    

Depreciation and amortization of fixed and intangible assets

     2,738        2,712   

Amortization of other long term assets

     788        663   

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

     202        238   

Changes in assets and liabilities associated with operations:

    

Increase in net receivables

     (12,454     (12,159

Increase in inventories

     (1,827     (21,901

Increase in prepaid expenses and other assets

     (1,622     (1,844

Increase in accounts payable

     6,556        5,559   

Decrease in income tax receivable

     61        —     

Decrease in other current liabilities

     (10,696     (6,424
                

Net cash used in operating activities

     (14,427     (32,457
                

Cash flows from investing activities:

    

Capital expenditures

     (1,868     (945
                

Net cash used in investing activities

     (1,868     (945
                

Cash flows from financing activities:

    

Net borrowings under line of credit agreement

     18,900        34,500   

Principal payments on long-term debt

     (2,027     (1,176

Decrease in other notes payable

     (21     —     

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

     277        291   
                

Net cash provided by financing activities

     17,129        33,615   
                

Net increase in cash

     834        213   

Cash and cash equivalents at beginning of year

     383        1,229   

Effect of exchange rate changes on cash

     303        5   
                

Cash and cash equivalents as of March 31

   $ 1,520      $ 1,447