Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Common Stock, $.10 Par Value—~~30,878,201~~30,869,520 shares as of August 2, ~~2021.~~2022.

	For the Three Months Ended June 30,						For the Six Months Ended June 30,						For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2021			2020			2021			2020			2022			2021			2022			2021
Net sales	$	134,610		$	104,555		$	250,765		$	200,517		$	148,084		$	134,610		$	297,519		$	250,765
Cost of sales		(82,471	)		(64,249	)		(153,495	)		(121,830	)		(88,305	)		(82,471	)		(176,547	)		(153,495	)
Gross profit		52,139			40,306			97,270			78,687			59,779			52,139			120,972			97,270
Operating expenses		(43,080	)		(33,579	)		(84,524	)		(70,124	)		(48,966	)		(43,080	)		(95,410	)		(84,524	)
Adjustment to bargain purchase gain on business acquisition		(88	)		—			(121	)		—			—			(88	)		—			(121	)
Operating income		8,971			6,727			12,625			8,563			10,813			8,971			25,562			12,625
Change in fair value of an equity investment		(295	)		24			771			24			(486	)		(295	)		(403	)		771
Other income		—			—			672			—			—			—			—			672
Interest expense, net		(1,013	)		(1,274	)		(1,959	)		(2,782	)		(772	)		(1,013	)		(1,170	)		(1,959	)
Income before provision for income taxes and loss on equity method investment		7,663			5,477			12,109			5,805			9,555			7,663			23,989			12,109
Income tax expense		(2,445	)		(1,565	)		(3,807	)		(1,360	)		(2,725	)		(2,445	)		(7,224	)		(3,807	)
Income before loss on equity method investment		5,218			3,912			8,302			4,445			6,830			5,218			16,765			8,302
Loss from equity method investment		(74	)		(25	)		(87	)		(38	)
Net income attributable to American Vanguard	$	5,144		$	3,887		$	8,215		$	4,407
Loss on equity method investment														—			(74	)		—			(87	)
Net income													$	6,830		$	5,144		$	16,765		$	8,215
Earnings per common share—basic	$	.17		$	.13		$	.28		$	.15		$	.23		$	.17		$	.57		$	.28
Earnings per common share—assuming dilution	$	.17		$	.13		$	.27		$	.15		$	.23		$	.17		$	.55		$	.27
Weighted average shares outstanding—basic		29,930			29,413			29,834			29,350			29,602			29,930			29,639			29,834
Weighted average shares outstanding—assuming dilution		30,499			29,854			30,511			29,904			30,225			30,499			30,289			30,511

		June 30, 2021			December 31, 2020				June 30, 2022			December 31, 2021
Current assets:
Cash and cash equivalents		$	19,559		$	15,923			$	22,057		$	16,285
Receivables:
Trade, net of allowance for doubtful accounts of $4,138 and $3,297, respectively			152,031			130,029
Trade, net of allowance for doubtful accounts of $4,411 and $3,938, respectively										165,711			149,326
Other			10,766			8,444				13,208			9,595
Total receivables, net			162,797			138,473				178,919			158,921
Inventories, net			175,151			163,784
Inventories										182,203			154,306
Prepaid expenses			13,896			10,499				16,368			12,488
Income taxes receivable			1,679			3,046				523			—
Total current assets			373,082			331,725				400,070			342,000
Property, plant and equipment, net			66,533			65,382				67,453			66,111
Operating lease right-of-use assets			21,601			12,198				24,449			25,386
Intangible assets, net of amortization			195,655			197,514
Intangible assets, net										191,560			197,841
Goodwill			48,154			52,108				46,997			46,260
Other assets			27,678			18,602				13,099			16,292
Deferred income tax assets, net			2,739			2,764				16			270
Total assets		$	735,442		$	680,293			$	743,644		$	694,160

LIABILITIES AND STOCKHOLDERS’ EQUITY	LIABILITIES AND STOCKHOLDERS’ EQUITY							LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current installments of other liabilities		$	1,629		$	2,647			$	1,367		$	802
Accounts payable			65,073			59,253				86,944			67,140
Deferred revenue			13,205			43,611
Customer prepayments										272			63,064
Accrued program costs			64,534			45,441				99,152			63,245
Accrued expenses and other payables			17,441			16,184				20,180			20,745
Operating lease liabilities, current			3,993			4,188
Income taxes payable										—			3,006
Current operating lease liabilities										5,029			5,059
Total current liabilities			165,875			171,324				212,944			223,061
Long-term debt, net of deferred loan fees			149,378			107,442
Operating lease liabilities, long-term			17,655			8,177
Other liabilities, excluding current installments			8,209			9,054
Deferred income tax liabilities			24,954			23,560
Long-term debt, net										100,779			52,240
Long-term operating lease liabilities										19,852			20,780
Other liabilities, net of current installments										5,584			5,335
Deferred income tax liabilities, net										19,651			20,006
Total liabilities			366,071			319,557				358,810			321,422
Commitments and contingent liabilities
Stockholders' equity:
Preferred stock, $.10 par value per share; authorized 400,000 shares; NaN issued			—			—				—			—
Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 34,261,651 shares at June 30, 2021 and 33,922,433 shares at December 31, 2020			3,428			3,394
Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 34,443,234 shares at June 30, 2022 and 34,248,218 shares at December 31, 2021										3,445			3,426
Additional paid-in capital			97,813			96,642				103,456			101,450
Accumulated other comprehensive loss			(8,911	)		(9,322	)			(12,768	)		(13,784	)
Retained earnings			295,201			288,182				319,672			304,385
			387,531			378,896
Less treasury stock at cost, 3,061,040 shares at June 30, 2021 and December 31, 2020			(18,160	)		(18,160	)
Less treasury stock at cost, 3,694,050 shares at June 30, 2022 and 3,361,040 shares at December 31, 2021										(28,971	)		(22,739	)
Total stockholders’ equity			369,371			360,736				384,834			372,738
Total liabilities and stockholders' equity		$	735,442		$	680,293			$	743,644		$	694,160

For The ~~Three-~~Three and ~~Six-Months~~Six Months Ended June 30, ~~2021~~2022

	Common Stock						Additional			Accumulated Other						Treasury Stock								Common Stock						Additional			Accumulated Other						Treasury Stock
	Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			Total			Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			Total
Balance, December 31, 2020		33,922,433		$	3,394		$	96,642		$	(9,322	)	$	288,182			3,061,040	$	(18,160	)	$	360,736
Balance, December 31, 2021																									34,248,218		$	3,426		$	101,450		$	(13,784	)	$	304,385			3,361,040	$	(22,739	)	$	372,738
Common stock issued under ESPP		25,120			2			338			—			—			—		—			340			26,751			2			434			—			—			—		—			436
Cash dividends on common stock ($0.02 per share)		—			—			—			—			(596	)		—		—			(596	)
Cash dividends on common stock ($0.025 per share)																									—			—			—			—			(736	)		—		—			(736	)
Foreign currency translation adjustment, net		—			—			—			(2,503	)		—			—		—			(2,503	)		—			—			—			7,080			—			—		—			7,080
Stock-based compensation		—			—			1,792			—			—			—		—			1,792			—			—			1,563			—			—			—		—			1,563
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(73,231	)		(7	)		(2,787	)		—			—			—		—			(2,794	)		(183,093	)		(18	)		(2,156	)		—			—			—		—			(2,174	)
Shares repurchased																																								332,404		(6,219	)		(6,219	)
Net income		—			—			—			—			3,071			—		—			3,071			—			—			—			—			9,935			—		—			9,935
Balance, March 31, 2021		33,874,322			3,389			95,985			(11,825	)		290,657			3,061,040		(18,160	)		360,046
Cash dividends on common stock ($0.02 per share)		—			—			—			—			(600	)		—		—			(600	)
Balance, March 31, 2022																									34,091,876			3,410			101,291			(6,704	)		313,584			3,693,444		(28,958	)		382,623
Cash dividends on common stock ($0.025 per share)																									—			—			—			—			(742	)		—		—			(742	)
Foreign currency translation adjustment, net		—			—			—			2,914			—			—		—			2,914			—			—			—			(6,064	)		—			—		—			(6,064	)
Stock-based compensation		—			—			1,806			—			—			—		—			1,806			—			—			1,273			—			—			—		—			1,273
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		387,329			39			22			—			—			—		—			61			351,358			35			892			—			—			—		—			927
Shares repurchased																																								606		(13	)		(13	)
Net income		—			—			—			—			5,144			—		—			5,144			—			—			—			—			6,830			—		—			6,830
Balance, June 30, 2021		34,261,651		$	3,428		$	97,813		$	(8,911	)	$	295,201			3,061,040	$	(18,160	)	$	369,371
Balance, June 30, 2022																									34,443,234		$	3,445		$	103,456		$	(12,768	)	$	319,672			3,694,050	$	(28,971	)	$	384,834

For The ~~Three-~~Three and ~~Six-Months~~Six Months Ended June 30, ~~2020~~2021

	Common Stock						Additional			Accumulated Other						Treasury Stock								Common Stock						Additional			Accumulated Other						Treasury Stock
	Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			AVD Total			Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			AVD Total
Balance, December 31, 2019		33,233,614		$	3,324		$	90,572		$	(5,698	)	$	274,118			3,061,040	$	(18,160	)	$	344,156
Balance, December 31, 2020																									33,922,433		$	3,394		$	96,642		$	(9,322	)	$	288,182			3,061,040	$	(18,160	)	$	360,736
Common stock issued under ESPP		22,776			2			350			—			—			—		—			352			25,120			2			338			—			—			—		—			340
Cash dividends on common stock ($0.02 per share)		—			—			—			—			(586	)		—		—			(586	)		—			—			—			—			(596	)		—		—			(596	)
Foreign currency translation adjustment, net		—			—			—			(9,063	)		—			—		—			(9,063	)		—			—			—			(2,503	)		—			—		—			(2,503	)
Stock-based compensation		—			—			1,357			—			—			—		—			1,357			—			—			1,792			—			—			—		—			1,792
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(67,969	)		(7	)		(2,522	)		—			—			—		—			(2,529	)		(73,231	)		(7	)		(2,787	)		—			—			—		—			(2,794	)
Net income		—			—			—			—			520			—		—			520			—			—			—			—			3,071			—		—			3,071
Balance, March 31, 2020		33,188,421			3,319			89,757			(14,761	)		274,052			3,061,040		(18,160	)		334,207
Balance, March 31, 2021																									33,874,322			3,389			95,985			(11,825	)		290,657			3,061,040		(18,160	)		360,046
Cash dividends on common stock ($0.02 per share)																									—			—			—			—			(600	)		—		—			(600	)
Foreign currency translation adjustment, net		—			—			—			324			—			—		—			324			—			—			—			2,914			—			—		—			2,914
Stock-based compensation		—			—			1,188			—			—			—		—			1,188			—			—			1,806			—			—			—		—			1,806
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		40,657			5			49			—			—			—		—			54			387,329			39			22			—			—			—		—			61
Net income		—			—			—			—			3,887			—		—			3,887			—			—			—			—			5,144			—		—			5,144
Balance, June 30, 2020		33,229,078		$	3,324		$	90,994		$	(14,437	)	$	277,939			3,061,040	$	(18,160	)	$	339,660
Balance, June 30, 2021																									34,261,651		$	3,428		$	97,813		$	(8,911	)	$	295,201			3,061,040	$	(18,160	)	$	369,371

	For the Six Months Ended June 30,						For the Six Months Ended June 30,
	2021			2020			2022			2021
Cash flows from operating activities:
Net income	$	8,215		$	4,407		$	16,765		$	8,215
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization of property, plant and equipment and intangible assets		10,697			9,665			11,004			10,697
Amortization of other long-term assets		2,044			1,965			1,739			2,044
Loss on disposal of property, plant and equipment								256			—
Accretion of discounted liabilities		(9	)		7			17			(11	)
Amortization of deferred loan fees		162			139			139			162
Provision for bad debts		945			392			470			945
Loan principal and interest forgiveness		(672	)		—			—			(672	)
Adjustment to contingent consideration		1,014			—
Fair value adjustment to contingent consideration								635			1,013
Stock-based compensation		3,598			2,545			2,836			3,598
Change in deferred income taxes		(353	)		(1,562	)		109			(353	)
Change in fair value of an equity investment		(771	)		—			403			(771	)
Loss on equity method investment								—			87
Adjustment to bargain purchase gain on business acquisition								—			121
Net foreign currency adjustments		(147	)		594			(20	)		(145	)
Loss from equity method investment		87			38
Adjustment to bargain purchase gain on business acquisition		121			—
Changes in assets and liabilities associated with operations:
(Increase) decrease in net receivables		(25,317	)		16,421
Increase in net receivables								(18,645	)		(25,317	)
Increase in inventories		(11,464	)		(21,706	)		(27,774	)		(11,464	)
Increase in prepaid expenses and other assets		(3,696	)		(2,297	)		(3,652	)		(3,696	)
Decrease in income tax receivable		1,374			899
(Decrease) increase in net operating lease liability		(120	)		7
Increase (decrease) in accounts payable		6,190			(12,351	)
Decrease in deferred revenue		(30,407	)		(2,431	)
(Increase) decrease in income tax receivable/payable, net								(3,526	)		1,374
(Decrease) in net operating lease liability								(21	)		(120	)
Increase in accounts payable								19,439			6,190
Decrease in customer prepayments								(62,789	)		(30,407	)
Increase in accrued program costs		19,098			12,577			35,987			19,098
Increase (decrease) in other payables and accrued expenses		507			(2,394	)
Net cash (used in) provided by operating activities		(18,904	)		6,915
(Decrease) increase in other payables and accrued expenses								(602	)		507
Net cash used in operating activities								(27,230	)		(18,905	)
Cash flows from investing activities:
Capital expenditures		(5,075	)		(6,386	)		(5,654	)		(5,075	)
Proceeds from disposal of property, plant and equipment								27			—
Acquisition of product line		(10,000	)		—			—			(10,000	)
Intangible assets		(241	)		(3,889	)		(1,044	)		(241	)
Investments		(184	)		(1,190	)		—			(184	)
Net cash used in investing activities		(15,500	)		(11,465	)		(6,671	)		(15,500	)
Cash flows from financing activities:
Net borrowings under line of credit agreement		41,774			10,502
Payments under line of credit agreement								(56,600	)		(24,226	)
Borrowings under line of credit agreement								105,000			66,000
Payment of contingent consideration		(250	)		(1,227	)		—			(250	)
Net payments from the issuance of common stock (sale of stock under ESPP, exercise of stock options, and shares purchased for tax withholding)		(2,393	)		(2,123	)
Net receipt from the issuance of common stock under ESPP								436			340
Net receipt from the exercise of stock options								765			167
Payment for tax withholding on stock-based compensation awards								(2,012	)		(2,900	)
Repurchase of common stock								(6,232	)		—
Payment of cash dividends		(1,189	)		(1,168	)		(1,330	)		(1,188	)
Net cash provided by financing activities		37,942			5,984			40,027			37,943
Net increase in cash and cash equivalents		3,538			1,434			6,126			3,538
Effect of exchange rate changes on cash and cash equivalents		98			585			(354	)		98
Cash and cash equivalents at beginning of period		15,923			6,581			16,285			15,923
Cash and cash equivalents at end of period	$	19,559		$	8,600		$	22,057		$	19,559
Supplemental cash flow information:
Cash paid during the period for:
Interest	$	1,873		$	2,902
Income taxes, net	$	2,757		$	1,901
Non-cash transactions:
ROU assets exchanged for lease liabilities	$	12,067		$	1,502

1. Summary of Significant Accounting Policies — The accompanying unaudited ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements of American Vanguard Corporation and Subsidiaries (“AVD” or “the Company”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of consolidating adjustments, eliminations and normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three- and ~~six-months~~six-month periods ended June 30, ~~2021~~2022 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2021.~~2022. The financial statements and related notes do not include all information and footnotes required by US GAAP for annual reports. This quarterly report should be read in conjunction with the ~~Condensed Consolidated Financial Statements~~consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, ~~2020.~~2021.

~~Since~~The Company is closely monitoring the ~~start~~impact of the novel coronavirus (COVID-19) pandemic ~~early in 2020, the Company has made sustained efforts to ensure the health and safety of the workforce while ensuring continuity of the business, which, under applicable federal guidelines (https://ww.cisa.gov~~) is part of the nation’s critical infrastructure (as part of the “Food and Agriculture,” “Chemical” and “Public Works and Infrastructure Support Services” sectors). In the workplace, the Company has designed and implemented protocols for social distancing, made provisions for the workforce to work remotely where possible, and established quarantine policies for those who present COVID-like symptoms or may have been in contact with those who have. Further, the Company keeps current with local, state, federal and international laws and restrictions that could affect the business and provide real-time information to the workforce. The Company has also prepared contingency plans to permit the continued operation of its factories, in the event that there are critical staffing issues due to attrition. Further, the Company continuously monitors supply chain, transport, logistics and border closures and has reached out to third parties to make clear that the Company is continuing to operate, and that it has its own policies relating to health and is committed to compliance with COVID-19 policieson all aspects of its business, ~~partners.~~

~~As has been~~including how the ~~case with many other employers, since~~pandemic will impact its customers, business partners, and employees. The Company is considered an essential business by most governments in the ~~start of 2021,~~jurisdictions and territories in which the Company ~~has encouraged its workforce to receive vaccinations against~~operates and, as a result, did not incur significant disruptions from the COVID-19 through various means, including incentive programs. However, new variants, particularly the Delta variant, have engendered a resurgence of the virus in many regions particularly among the unvaccinated. In the midst of changing conditions, the Company has nevertheless been able to manage its business with minimal impactpandemic during the three- and six-month periods ended June 30, ~~2021,~~2022 and ~~2020.~~2021. During the three- and six-month periods ended June 30, 2022, the Company experienced strong demand for its domestic crop and international products, and generally more normal business activities including face-to-face meetings with customers and suppliers etc. The Company established a pandemic working group at the start of the COVID-19 pandemic.

Looking forward, the Company is unable to predict the ~~ultimate~~ impact that the pandemic may have on its future financial condition, results of operations and cash flows due to numerous uncertainties. The extent to which the COVID-19 pandemic impacts the Company’s operations and those of its customers in the near term will depend on future developments, which are highly uncertain and, beyond extrapolating our experience since the start of the pandemic, cannot be predicted with confidence. The Company continues to monitor its business for adverse impacts of the pandemic, including some continuing volatility in ~~the~~ foreign exchange markets, ~~demand,~~ supply-chain disruptions in certain markets, and increased costs of employee safety, among others.

2. Leases — The Company has operating leases for warehouses, manufacturing facilities, offices, cars, railcars and certain equipment. The lease term includes the non-cancellable period of the lease plus any additional periods covered by either an option to extend (or not terminate) that the Company is reasonably certain to exercise. The Company has leases with a lease term ranging from 1 year to 20 years.

Finance leases are immaterial to the accompanying Condensed Consolidated Financial Statements. There were no lease transactions with related parties as of and for the three- and six-month periods presented in the table below.

The operating lease expense for the ~~three months~~three-month period ended June 30, 2022, and 2021, was $1,619 and ~~2020, was~~ $1,442, ~~and $1,396,~~ respectively, and ~~$2,896~~$3,223 and ~~$2,791~~$2,896 for the ~~six months~~six-month period ended June 30, ~~2021~~2022 and ~~2020,~~2021, respectively. Lease expenses related to variable lease payments and short-term leases were immaterial. Additional information related to operating leases are as follows:

Three months

ended

June 30, 2021

Three months

ended

June 30, 2020

Six months

ended

June 30, 2021

Six months

ended

June 30, 2020

Three months

ended

June 30, 2022

Three months

ended

June 30, 2021

Six months

ended

June 30, 2022

Six months

ended

June 30, 2021

Cash paid for amounts included in the

measurement of lease liabilities

1,546

1,382

3,011

2,778

1,559

1,546

3,233

3,011

ROU assets obtained in exchange for new

liabilities

11,691

677

12,067

1,502

898

11,691

1,825

12,067

The weighted-average remaining lease term and discount rate related to the operating leases as of June 30, ~~2021~~2022 were as follows:

Future minimum lease payments under non-cancellable operating leases as of June 30, ~~2021~~2022 were as follows:

2021 (excluding six months ended June 30, 2021)	$	2,345
2022		4,374
2022 (excluding six months ended June 30, 2022)			$	3,041
2023		3,421		5,378
2024		2,627		4,578
2025		2,332		4,067
2026				3,050
Thereafter		10,350		8,290
Total lease payments		25,449		28,404
Less: imputed interest		3,801		3,523
Total	$	21,648	$	24,881
Amounts recognized in the Condensed Consolidated Balance Sheets:
Operating lease liabilities, current	$	3,993	$	5,029
Operating lease liabilities, long-term	$	17,655	$	19,852

3. Revenue Recognition —The Company recognizes revenue from the sale of its products, which include crop and non-crop products. The Company sells its products to customers, which include distributors, retailers, and growers. In addition, the Company recognizes royalty income from licensing agreements. Based on similar economic and operational characteristics, the Company’s business is aggregated into 1 reportable segment. Selective enterprise information of sales disaggregated by category and geographic region is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020		2022		2021		2022		2021
Net sales:
U.S. crop	$	62,575	$	44,670	$	117,330	$	95,032	$	63,195	$	62,575	$	151,388	$	117,330
U.S. non-crop		21,488		13,872		38,941		24,865		21,316		21,488		34,712		38,941
Total U.S.		84,063		58,542		156,271		119,897		84,511		84,063		186,100		156,271
International		50,547		46,013		94,494		80,620		63,573		50,547		111,419		94,494
Total net sales:	$	134,610	$	104,555	$	250,765	$	200,517	$	148,084	$	134,610	$	297,519	$	250,765
Timing of revenue recognition:
Goods and services transferred at a point in time	$	134,493	$	103,846	$	250,464	$	199,622	$	148,047	$	134,493	$	297,376	$	250,464
Goods and services transferred over time		117		709		301		895		37		117		143		301
Total net sales:	$	134,610	$	104,555	$	250,765	$	200,517	$	148,084	$	134,610	$	297,519	$	250,765

~~Performance Obligations~~ — A performance obligation is a promise in a contract or sales order to transfer a distinct good or service to the customer. A transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Certain of the Company’s sales orders have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the sales orders. For sales orders with multiple performance obligations, the Company allocates the sales order’s transaction price to each performance obligation based on its relative stand-alone selling price. The stand-alone selling prices are determined based on the prices at which the Company separately sells these products. The Company’s performance obligations are satisfied either at a point in time or over time as work progresses.

Contract ~~Assets and Deferred Revenue~~ —~~The contract~~ assets ~~are included in other receivables on the Condensed Consolidated Balance Sheets and~~ relate to royalties earned on certain functional licenses granted for the use of the Company’s intellectual ~~property.~~ property and amounted to $3,000 and $3,900 at June 30, 2022 and December 31, 2021, respectively. The ~~timing~~short-term and long-term contract assets of ~~revenue recognition, billings~~$1,850 and ~~cash collections may result~~$1,150 are included in ~~deferred revenue.~~ other receivables and other assets, respectively, on the condensed consolidated balance sheets as of June 30, 2022. The short-term and long-term assets of $1,825 and $2,075 are included in other receivables and other assets, respectively, on the condensed consolidated balance sheets as of December 31, 2021.

The Company sometimes receives payments from its customers in advance of goods and services being provided in return for early cash incentive ~~programs, resulting~~programs. These payments are included in ~~deferred revenues.~~ Customer prepayments on the condensed consolidated balance sheets.

Revenue recognized for the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, that was included in ~~deferred revenue~~customer prepayments at the beginning of ~~2021 were $19,111~~2022, was $18,264 and ~~$30,406,~~$62,792, respectively.The Company expects to recognize all its remaining customer prepayments as revenue in fiscal 2022.

4. Property, Plant and Equipment — Property, plant and equipment at June 30, ~~2021~~2022 and December 31, ~~2020~~2021 consists of the following:

	June 30, 2021			December 31, 2020			June 30, 2022			December 31, 2021
Land	$	2,756		$	2,756		$	2,756		$	2,756
Buildings and improvements		20,057			19,786			19,814			19,844
Machinery and equipment		127,605			124,199			138,689			132,159
Office furniture, fixtures and equipment		10,002			7,403			10,444			10,094
Automotive equipment		1,979			1,747			1,625			1,832
Construction in progress		8,568			10,392			6,778			8,199
Total gross value		170,967			166,283			180,106			174,884
Less accumulated depreciation		(104,434	)		(100,901	)		(112,653	)		(108,773	)
Total net value	$	66,533		$	65,382		$	67,453		$	66,111

The Company recognized depreciation expense related to property ~~plant~~ and equipment of ~~$1,673~~$1,974 and ~~$1,839~~$1,673 for the ~~three months~~three-month period ended June 30, 2022 and 2021, ~~and 2020,~~ respectively. During the three months ended June 30, 2021, the Company eliminated $249 from such assets and accumulated depreciation of fully depreciated assets. During the three months ended June 30, 2020, the Company eliminated $283 from such assets and accumulated depreciation of fully depreciated assets.

The Company recognized depreciation expense related to property ~~plant~~ and equipment of ~~$3,844~~$4,077 and ~~$3,356~~$3,844 for the ~~six months~~six-month period ended June 30, 2022 and 2021, ~~and 2020,~~ respectively. ~~During the six months ended June 30, 2021, and 2020, the Company eliminated from such assets and accumulated depreciation $311 and $396, respectively, of fully depreciated assets.~~

Substantially all of the Company’s assets are pledged as collateral to its banks.

5. Inventories — Inventories are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out (“FIFO”) or average cost method. The components of inventories consist of the following:

	June 30, 2021		December 31, 2020		June 30, 2022		December 31, 2021
Finished products	$	156,170	$	149,415	$	154,742	$	138,159
Raw materials		18,981		14,369		27,461		16,147
	$	175,151	$	163,784	$	182,203	$	154,306

6. Segment Reporting — Based on similar economic and operational characteristics, the Company’s business is aggregated into 1 reportable segment. Selective enterprise information is as follows:

	For the three months ended June 30,									For the three months ended June 30,								��
	2021		2020		Change		% Change			2022		2021		Change			% Change
Net sales:
U.S. crop	$	62,575	$	44,670	$	17,905		40	%	$	63,195	$	62,575	$	620			1	%
U.S. non-crop		21,488		13,872		7,616		55	%		21,316		21,488		(172	)		-1	%
U.S. total		84,063		58,542		25,521		44	%		84,511		84,063		448			1	%
International		50,547		46,013		4,534		10	%		63,573		50,547		13,026			26	%
Net sales:	$	134,610	$	104,555	$	30,055		29	%	$	148,084	$	134,610	$	13,474			10	%
Gross profit:
U.S. crop	$	26,805	$	21,758	$	5,047		23	%	$	29,753	$	26,805	$	2,948			11	%
U.S. non-crop		9,782		7,029		2,753		39	%		10,049		9,782		267			3	%
U.S. total		36,587		28,787		7,800		27	%		39,802		36,587		3,215			9	%
International		15,552		11,519		4,033		35	%		19,977		15,552		4,425			28	%
Total gross profit:	$	52,139	$	40,306	$	11,833		29	%	$	59,779	$	52,139	$	7,640			15	%

For the six months
ended June 30,

2021

2020

Change

% Change

Net sales:

U.S. crop

$
117,330

$
95,032

$
22,298

23
%
U.S. non-crop

38,941

24,865

14,076

57
%
U.S. total

156,271

119,897

36,374

30
%
International

94,494

80,620

13,874

17
%
Net sales:

$
250,765

$
200,517

$
50,248

25
%
Gross profit:

U.S. crop

$
48,076

$
46,003

$
2,073

5
%
U.S. non-crop

19,165

11,748

7,417

63
%
U.S. total

67,241

57,751

9,490

16
%
International

30,029

20,936

9,093

43
%
Total gross profit:

$
97,270

$
78,687

$
18,583

24
%

	For the six months ended June 30,
	2022		2021		Change			% Change
Net sales:
U.S. crop	$	151,388	$	117,330	$	34,058			29	%
U.S. non-crop		34,712		38,941		(4,229	)		-11	%
U.S. total		186,100		156,271		29,829			19	%
International		111,419		94,494		16,925			18	%
Net sales:	$	297,519	$	250,765	$	46,754			19	%
Gross profit:
U.S. crop	$	70,098	$	48,076	$	22,022			46	%
U.S. non-crop		16,014		19,165		(3,151	)		-16	%
U.S. total		86,112		67,241		18,871			28	%
International		34,860		30,029		4,831			16	%
Total gross profit:	$	120,972	$	97,270	$	23,702			24	%

7. Accrued Program Costs — The Company offers various discounts to customers based on the volume purchased within a defined time period, other pricing adjustments, some grower volume incentives or other key performance indicator driven payments, which are usually made at the end of a growing season, to distributors, retailers or growers. The Company describes these payments as ~~“Programs.”~~“Programs”. Programs are a critical part of doing business in both the U.S. crop and non-crop chemicals marketplaces. These discount Programs represent variable consideration. Revenues from sales are recorded at the net sales price, which is the transaction price net of the impact of Programs and includes estimates of variable consideration. Variable consideration includes amounts expected to be paid to its customers estimated using the expected value method. Each quarter management reviews individual sale transactions with Programs to determine what, if any, estimated program liabilities have been incurred. Once this initial calculation is made for the specific quarter, sales and marketing management, along with support from financial analysts, reviews the accumulated Program balance and, for volume driven payments, make assessments of whether or not customers are tracking in a manner that indicates that they will meet the requirements set out in agreed upon terms and conditions attached to each Program. Following this assessment, management makes adjustments to the accumulated accrual to properly reflect the Company’s best estimate of the liability at the balance sheet date. Programs are then reviewed with executive management for final approval. Programs are paid out predominantly on an annual basis, usually in the final quarter of the financial year or the first quarter of the following year. No significant changes in estimates were made during the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020, respectively.~~2021.

8. Cash Dividends on Common Stock —The Company has declared and paid the following cash dividends in the periods covered by this Form 10-Q:

Declaration Date	Record Date	Distribution Date	Dividend Per Share		Total Paid		Record Date	Distribution Date	Dividend Per Share		Total Paid
June 6, 2022							June 24, 2022	July 8, 2022	$	0.025	$	742
March 14, 2022							March 25, 2022	April 15, 2022	$	0.025	$	736
December 13, 2021							December 27, 2021	January 10, 2022	$	0.020	$	594
June 8, 2021	June 24, 2021	July 8, 2021	$	0.020	$	600	June 24, 2021	July 8, 2021	$	0.020	$	600
March 10, 2021	March 15, 2021	April 15, 2021	$	0.020	$	596	March 15, 2021	April 15, 2021	$	0.020	$	596
December 7, 2020	December 23, 2020	January 6, 2021	$	0.020	$	593	December 23, 2022	January 6, 2021	$	0.020	$	592
March 9, 2020	March 26, 2020	April 16, 2020	$	0.020	$	586
December 9, 2019	December 26, 2019	January 9, 2020	$	0.020	$	582

9. Earnings Per Share — The components of basic and diluted earnings per share were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020		2022		2021		2022		2021
Numerator:
Net income attributable to AVD	$	5,144	$	3,887	$	8,215	$	4,407	$	6,830	$	5,144	$	16,765	$	8,215
Denominator: (in thousands)
Weighted average shares outstanding-basic		29,930		29,413		29,834		29,350		29,602		29,930		29,639		29,834
Dilutive effect of stock options and grants		569		441		677		554		623		569		650		677
		30,499		29,854		30,511		29,904		30,225		30,499		30,289		30,511

For the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020,~~2021, respectively, 0 stock options were excluded from the computation of diluted earnings per share.

10. Debt — The Company has a revolving line of credit that is shown as long-term debt in the ~~Condensed Consolidated Balance Sheets~~condensed consolidated balance sheets at June 30, ~~2021~~2022 and December 31, ~~2020.~~2021. The Company has 0 short-term debt as of June 30, ~~2021~~2022 and December 31, ~~2020.~~2021. The debt is summarized in the following table:

Long-term indebtedness ($000's)	June 30, 2021			December 31, 2020			June 30, 2022			December 31, 2021
Revolving line of credit	$	149,700		$	107,900		$	101,700		$	53,300
Deferred loan fees		(322	)		(458	)		(921	)		(1,060	)
Net long-term debt	$	149,378		$	107,442		$	100,779		$	52,240

The Company’s main bank is Bank of the West, a wholly-owned subsidiary of the French bank, BNP Paribas. Bank of the West has been the Company’s bank for more than 3040 years and is the syndication manager for the Company’s loans.

The Company and certain of its affiliates are parties to a revolving line of credit agreement entitled the “Third Amended and Restated Loan and Security Agreement” dated as of August 5, 2021 (the “Credit Agreement”), which is a senior secured lending facility among AMVAC, the Company’s principal operating subsidiary, as Borrower Agent, and (including the Company and AMVAC BV), as Borrowers, on the one hand, and a group of commercial lenders led by Bank of the West as administrative agent, documentation agent, syndication agent, collateral agent, sole lead arranger and book runner, on the other hand. The Credit Agreement, consists of a line of credit of up to $275,000, an accordion feature of up to $150,000, a letter of credit and swingline sub-facility (each having limits of $25,000) and a maturity date of August 5, 2026. The Credit Agreement amends and restates the previous credit facility, which had a maturity date of June 30, 2022. With respect to key financial covenants, the Credit Agreement contains two; namely, borrowers are required to maintain a Total Leverage (“TL”) Ratio of no more than 3.5-to-1, during the first three years, stepping down to 3.25-to-1 as of September 30, 2024, and a Fixed Charge Coverage Ratio of at least 1.25-to-1. In addition, to the extent that it completes acquisitions totaling $15 million or more in any 90-day period, AMVAC may step-up the TL Ratio by 0.5-to-1, not to exceed 4.00-to-1, for the next three full consecutive quarters. Acquisitions below $50 million ~~no longer~~do not require Agent consent. ~~In light of~~Distributions to the ~~maturity date of~~Company’s shareholders are limited to net income for the ~~Credit Agreement, the Company classifies its revolving line of credit as a non-current liability~~four fiscal quarter period ending on the ~~Condensed Consolidated Balance Sheets as of June 30, 2021.~~fiscal quarter immediately prior to the fiscal quarter in which the current distribution was declared.

The Company’s borrowing capacity varies with its financial performance, measured in terms of Consolidated EBITDA as defined in the Credit Agreement, for the trailing twelve-month period. Under the Credit Agreement, revolving loans bear interest at a variable rate based, at borrower’s election with proper notice, on either (i) LIBOR plus the “Applicable Margin” which is based upon the Total Leverage (“TL”) Ratio (“LIBOR Revolver Loan”) or (ii) the greater of (x) the Prime Rate, (y) the Federal Funds Rate plus 0.5%, and (z) the Daily One-Month LIBOR Rate plus 1.00%, plus, in the case of (x), (y) or (z) the Applicable Margin (“Adjusted Base Rate Revolver Loan”). Interest payments for LIBOR Revolver Loans are payable on the last day of each interest period (either one, two, three or six months, as selected by the borrower) and the maturity date, while interest payments for Adjusted Base Rate Revolver Loans are payable on the last business day of each calendar quarter and the maturity date. The interest rate onas of June 30, ~~2021~~2022 was ~~2.50%~~2.99%.

At June 30, ~~2021,~~2022, the Company was compliant with all covenants to its ~~then~~ current credit agreement. Also, at June 30, ~~2021,~~2022, the Company’s total Funded Debt amounted to ~~$149,700.~~$101,700. At that date the Company’s rolling four quarter Consolidated EBITDA (as defined in the Credit Agreement) amounted to ~~$59,030,~~$75,512, which results in a leverage ratio of ~~2.54,~~1.35, as compared to a maximum leverage ratio permitted under the Credit Agreement of 3.5. At June 30, ~~2021,~~2022, the Company has the capacity to increase its borrowings by up to ~~$56,906,~~$162,592, according to the terms thereof. This compares to an available borrowing capacity of ~~$49,420~~$56,906 as of June 30, ~~2020.~~2021. At December 31, ~~2020,~~2021, the Company had borrowing capacity of ~~$86,736.~~$178,705. The level of borrowing capacity is driven by three factors: (1) our financial performance, as measured in EBITDA for both the trailing twelve-month period and proforma basis arising from acquisitions, (2) net borrowings, and (3) the leverage covenant (the TL Ratio).

~~One~~As of ~~our recent acquisitions,~~ the date it was acquired by the Company in October 2020, Agrinos had an existing Paycheck Protection Program (PPP) loan in the amount of ~~$705 as of~~$705. This PPP loan was granted on April 27, 2020. On January 7, 2021, the ~~date it was acquired (October 2, 2020), of which~~Small Business Administration forgave $667 in principal and $5 in interest ~~was forgiven by the Small Business Administration on January 7, 2021. Agrinos repaid the remaining outstanding balance on the same day.~~of this PPP loan. As a result, the PPP loan was extinguished on January 7, 2021 and the total amount forgiven of $672 was recorded as other income in the Company’s ~~Condensed Consolidated Statement~~condensed consolidated statements of ~~Operations~~operations and represents a non-cash financing activity on the ~~Condensed Consolidated Statement~~condensed consolidated statement of ~~Cash Flows~~cash flows for the six months ended June 30, 2021.

11. Reclassifications — Certain items may have been reclassified in the prior period ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements to conform with the June 30, ~~2021,~~2022, presentation.

12. Comprehensive Income ~~(Loss)~~ — Total comprehensive income ~~(loss)~~ includes, in addition to net income, changes in equity that are excluded from the c~~Condensed Consolidated Statement~~ondensed consolidated statement of ~~Operations~~operations and are recorded directly into a separate section of stockholders’ equity on the ~~Condensed Consolidated Balance Sheets.~~condensed consolidated balance sheets. For the three- and six-month periods ended June 30, ~~2021,~~2022, and ~~2020,~~2021, total comprehensive income ~~(loss)~~ consisted of net income attributable to American Vanguard and foreign currency translation adjustments.

13. Stock-Based Compensation — The following tables illustrate the Company’s stock-based compensation, unamortized stock-based compensation, and remaining weighted average amortization period.

									Stock-Based Compensation for the Three months ended		Stock-Based Compensation for the Six months ended		Unamortized Stock-Based Compensation		Remaining Weighted Average Period (years)
June 30, 2022
Restricted Stock									$	1,079	$	2,072	$	9,277		2.2
Unrestricted Stock										122		239		476		0.9
Performance-Based Restricted Stock										72		525		3,781		2.1
Total									$	1,273	$	2,836	$	13,534
	Stock-Based Compensation for the Three months ended		Stock-Based Compensation for the Six months ended		Unamortized Stock-Based Compensation		Remaining Weighted Average Period (years)
June 30, 2021
Restricted Stock	$	1,167	$	2,223	$	9,734		2.2	$	1,167	$	2,223	$	9,734		2.2
Unrestricted Stock		107		217		367		0.9		107		217		367		0.9
Performance-Based Restricted Stock		532		1,158		4,186		2.1		532		1,158		4,186		2.1
Total	$	1,806	$	3,598	$	14,287			$	1,806	$	3,598	$	14,287

June 30, 2020
Restricted Stock	$	702	$	1,478	$	3,861		1.5
Unrestricted Stock		118		241		403		0.9
Performance-Based Restricted Stock		368		826		1,873		1.5
Total	$	1,188	$	2,545	$	6,137

The Company also granted stock options in past periods. All outstanding stock options are fully vested and exercisable and no expense was recorded during the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020.~~2021.

Restricted and Unrestricted Stock — A summary of non-vested shares as of, and for, the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020~~2021 is presented below:

	Six Months Ended June 30, 2021					Six Months Ended June 30, 2020					Three and Six Months Ended June 30, 2022					Three and Six Months Ended June 30, 2021
	Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value
Nonvested shares at December 31^st		820,624		$	16.64		719,845		$	17.67		817,290		$	17.04		820,624		$	16.64
Granted		—			—		4,185			18.63
Vested		(197,615	)		19.91		(213,781	)		16.18		(230,080	)		17.31		(197,615	)		19.91
Forfeited		(11,580	)		16.95		(14,715	)		18.08		(24,109	)		17.10		(11,580	)		16.95
Nonvested shares at March 31^st		611,429			15.57		495,534			18.31		563,101			16.93		611,429			15.57
Granted		289,757			20.10		43,168			13.45		242,067			23.79		289,757			20.10
Vested		(30,112	)		16.72		(37,958	)		13.88		(27,482	)		22.35		(30,112	)		16.72
Forfeited		(11,231	)		16.60		(8,221	)		18.64		(14,070	)		18.53		(11,231	)		16.60
Nonvested shares at June 30^th		859,843		$	17.04		492,523		$	18.22		763,616		$	18.88		859,843		$	17.04

Performance-Based Restricted Stock — A summary of non-vested performance-based shares as of, and for, the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020,~~2021, respectively is presented below:

	Six Months Ended June 30, 2021					Six Months Ended June 30, 2020					Three and Six Months Ended June 30, 2022					Three and Six Months Ended June 30, 2021
	Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value
Nonvested shares at December 31^st		391,771		$	16.26		345,432		$	16.92		379,061		$	16.43		391,771		$	16.26
Additional granted based on performance achievement		71,180			20.53		76,445			16.56
Additional granted (forfeited) based on performance achievement												(41,088	)		16.56		71,180			20.53
Vested		(175,087	)		19.78		(184,785	)		15.87		(78,704	)		17.18		(175,087	)		19.78
Forfeited		(505	)		19.26		(3,759	)		17.23		(7,074	)		16.77		(505	)		19.26
Nonvested shares at March 31^st		287,359			15.16		233,333			17.63		252,195			16.17		287,359			15.16
Granted		102,043			20.03		—			—		83,190			23.63		102,043			20.03
Forfeited		—			—		(2,268	)		18.00		(7,829	)		17.50		—			—
Nonvested shares at June 30^th		389,402		$	16.44		231,065		$	17.63		327,556		$	16.58		389,402		$	16.44

Stock Options — The Company has stock options outstanding under its incentive stock option plans and performance incentive stock option plan. All outstanding stock options are vested and exercisable. The following tables present details for each type of plan:

Activity for the three- and ~~six-months~~six-month periods ended June 30, ~~2021:~~2022:

All the incentive stock options outstanding as of June 30, ~~2021,~~2022, have an exercise price per share of $11.49 and a remaining life of 4230 months.

Activity for the three- and ~~six-months~~six-month periods ended June 30, ~~2020:~~2021:

Activity for the three- and ~~six-months~~six-month periods ended June 30, ~~2021:~~2022:

Activity for the three- and ~~six-months~~six-month periods ended June 30, ~~2020:~~2021:

All the performance incentive stock options outstanding as of June 30, ~~2021,~~2022, have an exercise price per share of $11.49 and a remaining life of 4230 months.

14. Legal Proceedings — During the reporting period, there have been no material developments in legal proceedings that were reported in the Company’s Form 10-K for the year ended December 31, ~~2020,~~2021, except as described below.

EPA FIFRA/RCRA Matter. On November 10, 2016, the Company was served with a grand jury subpoena from the United States Attorney’s Office for the Southern District of Alabama, seeking documents regarding the importation, transportation, and management of a specific ~~pesticide in substantially empty, closed containers.~~pesticide. The Company retained defense counsel to assist in responding to the subpoena and otherwise defending the Company’s interests. AMVAC is cooperating in the investigation.

Since April 2018, the Department of Justice (“DOJ”) has conducted several interviews of AMVAC employees and issued supplemental document requests in connection with the investigation. In November 2020, DOJ issued a second grand jury subpoena seeking records and related communications with regard to a submission made by the Company to the Environmental Protection Agency (“EPA”) in connection with a request to amend a pesticide’s registration. Soon thereafter, DOJ also identified the Company and one of its non-executive employees as targets of the government’s investigation. In January 2021, DOJ and EPA informed the Company that it is investigating violations of two environmental statutes, the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) and the Resource Conservation and Recovery Act (“RCRA”), as well as obstruction of an agency proceeding and false statement statutes. DOJ also identified ~~for the Company as well as for the individual target,~~ evidence that it contends supports alleged violations with respect to both the Company and the individual target. ~~The~~As part of discussions regarding possible resolution, in October 2021, the Company ~~is evaluating~~presented its evaluation of the legal and factual issues raised by the government (which do not include any allegations of harm to human health or the environment) to both DOJ and ~~is engaged~~USEPA. Further, three corporate witnesses were interviewed by the grand jury in ~~discussions with DOJ~~Mobile, Alabama in February 2022. Following that interview, the individual target entered into a plea agreement which was entered by the court having jurisdiction in this matter in May 2022. The Company expects that talks regarding ~~possible resolution.~~potential resolution will resume in the near future.

The governmental agencies involved in this investigation have a range of civil and criminal penalties they may seek to impose against corporations and individuals for violations of FIFRA, RCRA and other federal statutes including, but not limited to, injunctive relief, fines, penalties and modifications to business practices and compliance programs, including the appointment of a monitor. If violations are established, the amount of any fines or monetary penalties which could be assessed and the scope of possible non-monetary relief would depend on, among other factors, findings regarding the amount, timing, nature and scope of the violations, and the level of cooperation provided to the governmental authorities during the investigation. As a result, the Company cannot yet anticipate the timing or predict the ultimate resolution of this investigation, financial or otherwise, which could have a material adverse effect on our business prospects, operations, financial condition and cash flow. Accordingly, we have not recorded a loss contingency for this matter.

Harold Reed v. AMVAC et al. During January 2017, the Company was served with two Statements of Claim that had been filed on March 29, 2016 with the Court of Queen’s Bench of Alberta, Canada (as case numbers 160600211 and 160600237) in which plaintiffs, Harold Reed (an applicator) and 819596 Alberta Ltd. dba Jem Holdings (an application equipment rental company), allege physical injury and damage to equipment, respectively, arising from a fire that occurred during an application of the Company’s potato sprout inhibitor, SmartBlock, at a potato storage facility in Coaldale, Alberta on April 2, 2014. Four other related matters were subsequently consolidated into this case (alleging loss of potatoes, damage to equipment, damage to Quonset huts and loss of business income). The parties have exchanged written discovery, and depositions of persons most knowledgeable took place during the first quarter of 2019. Citing the length of the cases’ pendency and the expense, in December 2019, plaintiff Reed voluntarily dismissed two actions (160600211 and 160600237) for no consideration. Over the course of 2020, discovery was completed, and the parties held a mediation on March 11, 2021; however, no settlement was reached. The parties have set a second mediation to occur in August 2022. The Company continues to believe that it is not primarily at risk but that a loss is probable and reasonably estimable and, to that end, has recorded a loss contingency in an amount that is not material to its financial performance or operations cash flows.

Catalano v. AMVAC Chemical Corp. On June 6, 2022, AMVAC was served with a summons and complaint for a matter entitled Andrew Catalano and Ruth Catalano v. AMVAC in the Superior Court of the State of California, County of Orange (30-2022-01263987-CU-PL-CXC) in which plaintiff, who worked as a professional applicator of pesticides, including Orthene (for which AMVAC is registrant) seeks damages for an injury (specifically, cardiomyopathy) allegedly arising from his exposure to this product. AMVAC is unaware of any link between cardiovascular disease and Orthene (which has been commercially available for over 30 years) and believes that this case has no merit and intends to defend it vigorously. The Company retained counsel and filed an answer in early July 2022, including multiple affirmative defenses. At this stage, there is not sufficient information to form a judgment as to either the probability or amount of any loss; thus, the Company has not set aside a reserve in connection with this matter.

In November 2021, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2021-10, “Disclosures by Business Entities about Government Assistance.” This ASU codifies new requirements to disclose information about the nature of certain government assistance received, the accounting policy used to account for the transactions, the location in the financial statements where such transactions were recorded and significant terms and conditions associated with such transactions. The guidance is effective for annual periods beginning after December ~~2019,~~15, 2021. Effective January 1, 2022, the Company adopted ASU No. 2021-10 on a prospective basis. The adoption of this standard was not material to the Company’s condensed consolidated financial statements.

In October 2021, the FASB issued ASU ~~no. 2019-12, “Income Taxes~~2021-08, “Business Combinations (Topic ~~740)~~805): ~~Simplifying the~~ Accounting for ~~Income Taxes,~~Contract Assets and Liabilities from Contracts with Customers.” (“This ASU ~~No. 2019-12”).~~requires an acquiring entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606. The amendment removes certain exceptions to the general income tax accounting methodology including an exception for the recognition of a deferred tax liability when a foreign subsidiary becomes an equity method investment and an exception for interim periods showing operating losses in excess of anticipated operating losses for the year. The amendment also reduces the complexity surrounding franchise tax recognition; the step up in the tax basis of goodwill in conjunction with business combinations; and the accounting for the effect of changes in tax laws enacted during interim periods. The amendments in this update areASU is effective ~~for the Company~~ for fiscal years and interim periods beginning after December 15, ~~2020, including interim periods within those years~~2022, with early adoption permitted. The Company is evaluating the impact of adopting this ASU.

The Company ~~adopted ASU No. 2019-12 effective January 1, 2021.The adoption of this standard did~~reviewed all other recently issued accounting pronouncements and concluded that they were either not ~~result in any material adjustments~~applicable or not expected to ~~the Company’s Condensed Consolidated Financial Statements.~~have a significant impact to its condensed consolidated financial statements.

16. Fair Value of Financial Instruments — The accounting standard for fair value measurements provides a framework for measuring fair value and requires certain disclosures regarding fair value measurements. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. This accounting standard established a fair value hierarchy, which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required:

The carrying amount of the Company’s financial instruments, which principally include cash and cash equivalents, short-term investments, accounts receivable, long-term investments, accounts payable and accrued expenses, approximates fair value because of the relatively short maturity of such instruments. The carrying amount of the Company’s short-term and long-term borrowings, which are considered Level 2 liabilities, approximates fair value based upon current rates and terms available to the Company for similar debt.

The Company measures its contingent earn-out liabilities in connection with business acquisitions at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy. The Company may use various valuation techniques depending on the terms and conditions of the contingent consideration including a Monte-Carlo simulation. This simulation uses probability distribution for each significant input to produce hundreds or thousands of possible outcomes and the results are analyzed to determine probabilities of different outcomes occurring.

The following table illustrates the Company’s contingent consideration movements related to its business acquisitions:

							Three months ended June 30, 2022			Three months ended June 30, 2021
Balance, March 31							$	1,437		$	2,205
Purchase price adjustment								—			(955	)
Fair value adjustment								36			1,013
Accretion of discounted liabilities								11			(27	)
Foreign exchange effect								(117	)		(120	)
Balance, June 30							$	1,367		$	2,116

	Six months ended June 30, 2021			Six months ended June 30, 2020			Six months ended June 30, 2022			Six months ended June 30, 2021
Balance, December 31	$	2,468		$	1,243		$	786		$	2,468
Purchase price adjustment		(955	)		—			—			(955	)
Fair value adjustment		1,014			—			635			1,013
Payments on existing obligations		(250	)		(1,227	)		—			(250	)
Accretion of discounted liabilities		(11	)		—			17			(11	)
Foreign exchange effect		(150	)		(16	)		(71	)		(149	)
Balance, June 30	$	2,116		$	—		$	1,367		$	2,116

	Three months ended June 30, 2021			Six months ended June 30, 2020
Balance, March 31	$	2,205		$	—
Purchase price adjustment		(955	)		—
Fair value adjustment		1,014			—
Accretion of discounted liabilities		(27	)		—
Foreign exchange effect		(121	)		—
Balance, June 30	$	2,116		$	—

The ~~purchase price adjustment is~~current portion of the ~~result of a measurement-period adjustment and represents a non-cash investing activity~~contingent consideration in the ~~Condensed Consolidated Statements~~amount of ~~Operations. The fair value adjustment~~$1,367 and $1,501 is included in ~~operating expenses~~current installments of other liabilities and the ~~accretion~~long-term portion in the amount of ~~discounted liabilities~~$0 and $615 is included in ~~interest expense, net,~~other liabilities on the ~~Condensed Consolidated Statements~~condensed consolidated balance sheets as of ~~Operations. The foreign exchange effect is included in foreign currency translation adjustment on the Condensed Consolidated Statements of Comprehensive Income (Loss).~~June 30, 2022 and 2021, respectively.

17. Accumulated Other Comprehensive Loss (“AOCL”)—The following table lists the beginning balance, annual activity and ending balance of accumulated other comprehensive loss, which consists of foreign currency (FX) translation adjustments:

18. Equity ~~Method Investment~~Investments —On August 2, 2016, AMVAC BV entered into a joint venture with Huifeng (Hong Kong) Ltd, which is a wholly owned subsidiary of the Huifeng Group. The resulting entity, Hong Kong JV, focused on activities such as market access and technology transfer between the two members. AMVAC BV is a 50% owner of the entity. No material contributions were made subsequent to the initial investment. On June 27, 2017, both AMVAC BV and Huifeng (Hong Kong) Ltd. made individual capital contributions of $950 to the Hong Kong JV. The Company utilizes the equity method of accounting with respect to this investment. On July 7, 2017, the Hong Kong JV purchased the shares of Profeng Australia, Pty Ltd. (“Profeng”), for a total consideration of $1,900. The purchase consists of Profeng Australia, Pty Ltd Trustee and Profeng Australia Unit Trust. Both Trust and Trustee were previously owned by Huifeng (via its wholly owned subsidiary Huifeng (Hong Kong) Ltd).

For the three- and six-months ended June 30, 2021, the Company recognized losses of $74 and $87, respectively, as a result of the Company’s ownership position in the Hong Kong Joint Venture. For the three- and six-months ended June 30, 2020, the Company recognized losses of $25 and $38, respectively. The Company’s investment in this joint venture amounted to $301 and $475, respectively at June 30, 2021, and 2020, and is included in other assets on the Condensed Consolidated Balance Sheets.

~~19.~~ ~~Equity Investments~~— In February 2016, AMVAC Netherlands BV made an investment in Biological Products for Agriculture (“Bi-PA”) ~~in the amount of $3,283.~~. Bi-PA develops biological plant protection products that can be used for the control of pests and disease of agricultural crops. As of June 30, 2022 and 2021, the Company’s ownership position in Bi-PA was 15%. Since this investment does not have readily determinable fair value, the Company has elected to measure the investment at cost less impairment, if any, and also records an increase or decrease for changes resulting from observable price changes in orderly transactions for the identical or a similar investment of Bi-PA. The Company periodically reviews the investment for possible impairment. There was 0 impairment or observable price changes on the investment during the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022 and ~~2020.~~2021. The investment is recorded within other assets on the condensed consolidated balance sheets and amounted to $2,884 as of June 30, 2022 and December 31, 2021.

On April 1, 2020, AMVAC purchased 6.25 million shares, an ownership of approximately 8%, of common stock of Clean Seed Capital Group Ltd. (TSX Venture Exchange: “CSX”) for $1,190. The shares are publicly traded, have a readily determinable fair value, and are considered a Level 1 investment. The fair value of the stock amounted to ~~$2,678~~$1,113 and $1,516 as of June 30, ~~2021.~~2022 and December 31, 2021, respectively. The Company recorded a loss ~~in the amount~~ of $486 and $295 for the ~~three months~~three-month period ended June 30, 2022 and 2021, respectively. The Company recorded a loss of $403 and ~~recorded~~ a gain of $771 for the six months ended June 30, ~~2021.~~2022 and 2021, respectively The ~~Company~~investment is recorded ~~a gain in~~within other assets on the ~~amount of $24 for the three- and six-months ended June 30, 2020.~~

~~20.~~ ~~Income Taxes —~~condensed consolidated balance sheets.Income tax expense was $2,445 and $1,565 for the three months ended June 30, 2021, and 2020, respectively. The effective tax rate for the quarter was 31.9% and 28.6% for the three months ended June 30, 2021 and 2020, respectively. ~~Income tax expense was $3,807 and $1,360 for the six months ended June 30, 2021, and 2020, respectively.~~ ~~The effective tax rate for the six months ended June 30, 2021, and 2020 was 31.4% and 23.4%, respectively.~~ The rate has increased compared to prior years reflecting mix of income in different jurisdictions. The effective tax rate is based on the projected income for the full year and is subject to ongoing review and adjustment by management.

~~For the three- and six-months ended June 30, 2021 and 2020, the Company benefited from the tax impact of the vesting of certain stock grants.~~Additionally, for the same period in 2020, the Company benefited from a discrete income tax benefit as the Company assessed its income tax positions to account for the Coronavirus Aid Relief and Economic Security Act (“CARES Act”) which was signed into law on March 27, 2020. A provision of the act modified the amount of interest deduction allowed and therefore reduced the Company’s 2019 Global Intangible Low Tax Income (“GILTI”) inclusion.

The Florida Department of Revenue has completed its audit of the Company’s state income tax returns for the years ended December 31, 2012 through December 31, 2013 and December 31, 2015 through December 31, 2018. No adjustments have been proposed for these periods. The Company has also been notified by the Mississippi Department of Revenue of its intent to examine the Company’s state income tax returns for the years ended December 31, 2016 through December 31, 2018. The result of Mississippi’s audit is not determinable since the audit is at its preliminary stage.

~~21.~~19. Product and Business Acquisitions — The Company did 0tnot complete any acquisitions during the three- and ~~six-months~~six-month periods ended June 30, ~~2021,~~2022, and ~~2020.~~2021. However, the Company made a payment in the amount of $10,000 in June 2021 for the acquisition of a product line. The Company obtained control over the product line on July 1, 2021 and the acquisition ~~will be~~was accounted for as an asset acquisition in Q3 2021.

20. Income Taxes —Income tax expense was $2,725 and $2,445 for the three-month period ended June 30, 2022, and 2021, respectively. The ~~$10,000 is included in other assets on~~effective tax rate for the ~~Condensed Consolidated Balance Sheets.~~

~~During~~quarter was 28.5% and 31.9% for the ~~year~~three-month period ended ~~December 31, 2020, the Company completed 2 acquisitions in exchange~~June 30, 2022 and 2021, respectively. Income tax expense was $7,224 and $3,807 for a total cash consideration at closing of $19,342, which was net of cash acquired of $1,970, and contingent consideration of $1,052, and the settlement of a net asset adjustment of $623. In addition, the Company assumed liabilities of $11,616 and recognized a bargain purchase gain in the amount of $4,536. The total asset value of $37,169 was preliminarily allocated as follows: product rights $8,577, trade names $351, distribution agreements $3,584, customer relationships $386, goodwill $4,618, working capital and fixed assets $19,653. During the six months ended June 30, 2022, and 2021, respectively. The effective tax rate for the Company recorded an adjustment to reduce the bargain purchase gain by the amount of $121 with a corresponding adjustment to working capital. Further, the Company recorded the following adjustments included in the preliminary allocation during the six monthssix-month period ended June 30, ~~2021: decrease~~2022 and 2021, was 30.1% and 31.4%, respectively. For the three- and six-month periods ended June 30, 2022, the rate decreased compared to the same periods of 2021 reflecting the mix of income in contingent consideration $955, increase in product registrations and product rights $1,932, increase in distribution agreements $3,584, decrease in trade name and trademarks $843, decrease in customer relationships and customer lists $246, decrease in goodwill $4,054,different jurisdictions and an increase in tax benefit from the vesting of certain stock grants. For tax years beginning after December 31, 2021, the Tax Cuts and Jobs Act (“TCJA”) of 2017 amends Internal Revenue Code Section 174 Costs wherein research and development expenditures will no longer be deducted in the tax year that such costs are incurred but must now be capitalized and amortized over either a five- or fifteen-year period, depending on the location of the activities performed. The effective tax rate is based on the projected income ~~tax liabilities $1,328.~~for the full year and is subject to ongoing review and adjustment by management.

21. Stock Re-purchase Program— On March 8, 2022, pursuant to a Board of Directors resolution, the Company announced its intention to repurchase an aggregate number of up to 1,000,000 shares of its common stock, par value $0.10 per share, in the open market over the succeeding one year at a price not to exceed $20 per share, subject to limitations and restrictions under applicable securities laws.

The ~~purchase price allocation for both acquisitions is preliminary with respect to~~table below summarizes the ~~valuation~~number of contingent consideration, intangibles, property, plant and equipment, income taxes and certain other working capital items, as the Company is still in the process of gathering additional information and the determinationshares of the ~~respective fair values.~~

~~On October 2, 2020, the Company completed the acquisition of all outstanding~~Company’s common stock of the Agrinos Group Companies (Agrinos), except for Agrinos AS. Agrinos has operating entities in the U.S., Mexico, India, Brazil, China, Ukraine, and Spain. Agrinos is a fully integrated biological input supplier with proprietary technology, internal manufacturing, and global distribution capabilities. At closing, the Company paid cash consideration of $3,125, which was net of cash acquired of $1,813, and liabilities assumed of $4,963, including liabilities of $595 related to income tax matters. The acquisition was accounted for as a business combination and resulted in a preliminary bargain purchase gain of $4,536 (including a reduction of $121 recordedthat were repurchased during the ~~six months~~three- and six-month periods ended June 30, 2021). The total asset value of $12,624 has been preliminarily allocated as follows: working capital $7,370 (including trade receivables of $2,262), property, plant and equipment of $5,004, and intangible assets of $250. Agrinos was acquired out of bankruptcy. This provided the Company with an opportunity to acquire Agrinos at an advantageous purchase price which was below the preliminary fair value of Agrinos’ net assets acquired resulting in the above-mentioned bargain purchase gain.

On October 8, 2020, the Company completed the acquisition of all outstanding stock of AgNova Technologies Pty Ltd (“AgNova”). AgNova is an Australian entity that sources, develops, and distributes specialty crop protection and production solutions for agricultural and horticultural producers, and for selected non-crop users. At closing, the Company paid cash consideration of $16,217, which was net of cash acquired of $157, contingent consideration dependent on certain financial results of $1,052, the settlement of a net asset adjustment of $623, and liabilities assumed of $6,653, including liabilities of $3,857 related to income tax matters. The fair value of the contingent consideration of $1,052 was estimated using a Monte Carlo Simulation. The acquisition was accounted for as a business combination and the total asset value of $24,545 has been preliminarily allocated as follows: product registrations and product rights $8,327, distribution agreements $3,584, trade names and trademarks $351, customer relationships and customer lists $386, goodwill $4,618, which is non-deductible for tax purposes, working capital $7,206, including trade receivables of $1,508, and equipment $73. The preliminary allocation includes the following adjustments recorded2022. There were no such purchases during the ~~six months~~three- and six-month periods ended June 30, 2021, that were made based on a preliminary valuation report: decrease in contingent consideration $955, increase in product registrations and product rights $1,932, increase in distribution agreements $3,584, decrease in trade name and trademarks $843, decrease in customer relationships and customer lists $246, decrease in goodwill $4,054, and an increase in income tax liabilities $1,328.2021.

22. ~~Foreign Currency~~Supplemental Cash Flow Information— The Company recorded net foreign currency transaction gains in the amount of $738 and losses of $291 during the three months ended June 30, 2021, and 2020, respectively, included in operating expenses on the Condensed Consolidated Financial Statements. The Company incurred net foreign currency transaction losses in the amount of $465 and $1,128 during the six months ended June 30, 2021, and 2020, respectively, included in operating expenses on the Condensed Consolidated Financial Statements.

~~23.~~ ~~Subsequent Events~~— The Company made a payment in the amount of $10,000 in June 2021 for the acquisition of a product line and obtained control over the related assets on July 1, 2021. Please refer to Note 21 for further details.

~~The Company executed an amendment related to its Credit Agreement on August 5, 2021. Please refer to Note 10 for the terms of the Credit Agreement.~~

The Company, from time-to-time, may discuss forward-looking statements including assumptions concerning the Company’s operations, future results and prospects. These forward-looking statements are based on current expectations and are subject to a number of risks, uncertainties and other factors. In connection with the Private Securities Litigation Reform Act of 1995, the Company provides the following cautionary statements identifying important factors which, among other things, could cause the actual results and events to differ materially from those set forth in or implied by the forward-looking statements and related assumptions contained in the entire Annual Report. Such factors include, but are not limited to: product demand and market acceptance risks; the effect of economic conditions; weather conditions; changes in regulatory policy; the impact of competitive products and pricing; changes in foreign exchange rates; product development and commercialization difficulties; capacity and supply constraints or difficulties; availability of capital resources; general business regulations, including taxes and other risks as detailed from time-to-time in the Company’s reports and filings filed with the U.S. Securities and Exchange Commission (the “SEC”). It is not possible to foresee or identify all such factors. For more detailed information, refer to Item ~~1A., Risk factors and Item 7A.~~3., Quantitative and Qualitative Disclosures about Market Risk, and Part II, Item 1A., Risk Factors, in ~~the Company’s Annual~~this Quarterly Report on Form ~~10-K for the year ended December 31, 2020.~~10-Q.

Since the start of the coronavirus pandemic early in 2020, the company has made sustained efforts to maintain the health and safety of the workforce while ensuring continuity of the business, which, under applicable federal guidelines (~~https://ww.cisa.gov~~) is part of the nation’s critical infrastructure (as part of the “Food and Agriculture,” “Chemical” and “Public Works and Infrastructure Support Services” sectors). In the workplace, we have designed and implemented protocols for social distancing, made provisions for the workforce to work remotely where possible, and established quarantine policies for those who present COVID-like symptoms or may have been in contact with those who have. Further, we keep current with local, state, federal and international laws and restrictions that could affect the business and provide real-time information to the workforce. We have also prepared contingency plans to permit the continued operation of our factories, in the event that there are critical staffing issues. Further, we continuously monitor supply chain, transportation, logistics and border closures and have reached out to third parties to make clear that we are continuing to operate, that we have our own policies relating to health and that we are committed to compliance with COVID-19 policies of our business partners.

As has been the case with many other employers, since the start of 2021, we have encouraged our workforce to receive vaccinations against COVID-19 through various means, including incentive programs. However, new variants, particularly the Delta variant, have engendered a resurgence of the virus in many regions particularly among the unvaccinated. In the midst of changing conditions, we have nevertheless been able to manage our business with minimal impact during the reporting period.

Looking forward, the Company is unable to predict the ultimate impact that the pandemic may have on its future financial condition, results of operations and cash flows due to numerous uncertainties. The extent to which the COVID-19 pandemic impacts the Company’s operations and those of its customers in the near term will depend on future developments, which are highly uncertain and, beyond extrapolating our experience since the start of the pandemic, cannot be predicted with certainty. The Company continues to monitor its business for adverse impacts of the pandemic, including volatility in the foreign exchange markets, demand, supply-chain disruptions in certain markets, and increased costs of employee safety, among others.

The second quarter of 2020 began with a degree of hesitation in our markets, as buyers and sellers monitored the durability of the critical infrastructure, including supply chain, transportation and manufacturing. Over the course of that quarter, companies such as ours adapted to social restrictions, gained greater confidence and resumed business activity in a more normalized way. Shifting our focus to 2021, our industry has seen significant improvements in commodity pricing that has been coincident with considerable progress in vaccination campaigns and reductions in social restrictions. In a sense, to date, 2021 has been commonly seen as a year of recovery from the pandemic. Following a comparatively strong first quarter of 2021, the Company has continued that trend intoDuring the second quarter of ~~2021, during~~2022, the agriculture industry proceeded further into the second year of an upcycle, following a multi-year downcycle. While subject to intra-day fluctuations, commodity prices for row crops, which are largely driven by global conditions, were consistently strong. Consequently, the domestic farm economy showed continued resiliency. Geopolitical conditions, particularly the prolonged invasion of Ukraine, provided further price support for corn (and, consequently, soybeans), wheat and sunflower oil, as well as fertilizers. With improved supply chain conditions and a stronger U.S. dollar, domestic companies experienced enhanced buying power. Despite the advent of the BA5 variant, in the face of higher vaccination rates, the COVID-19 pandemic has shifted into an endemic in most regions. Amidst these factors and following on the heels of an extremely strong first quarter, the Company’s overall operating results for the second quarter of 2022 improved in most respects, as compared with those of the same period of 2021. Led by the strong sales growth of our international business, consolidated net sales increased by ~~29 % ($134,610~~10% (to end at $148,084 as compared to ~~$104,555 in second quarter of 2020)~~$134,610) and net income increased by ~~32% ($5,144 as compared to $3,887 in the comparable period of 2020)~~33% (to $6,830 from $5,144).

On a consolidated basis, domestic sales rose ~~44%~~1% and international sales increased ~~10%~~26%, resulting in an overall net sales improvement of ~~about 29%~~10%. ~~Cost~~In comparison, cost of sales increased by ~~28%, primarily due to the volume growth in sales, the variability in~~7% or $5,834. This lower comparative increase was a result of higher selling prices and a favorable mix of ~~sales and changes~~higher-margin products in overall factory performance including the new factories acquired as part of the acquisition of the Agrinos Group at the end of 2020. Cost of sales were 61% of sales in both 2021 and 2020. These factors, taken together, yielded a 28% increase in gross profit (to $52,139 from $40,306 in the comparable quarter of 2020). Net cost of our manufacturing activity was impacted by a slow down to accommodate required mechanical integrity inspection activity in Axis, the start-up of the PCNB unit in Los Angeles and the addition of biological fermentation facilities acquired with the Agrinos businesses. Average gross margin percent for the second quarter of ~~2021 remained level with that of the same period in 2020 at 39% of sales.~~

Operating expenses on an absolute basis increased by about 28%, as compared to the comparable quarter (to $43,080 from $33,579), and remained flat as a percent of net sales at 32% for the 3-month period ended June 30, 2021,2022, as compared to the same period of ~~2020. Operating profit~~the prior year. Cost of sales were 60% of sales in the second quarter of 2022, as compared to 61% for the same period ~~rose~~of 2021. These factors, taken together, yielded a 15% increase in gross profit (to $59,779 from $52,139 in the comparable quarter of 2021), while overall gross margin percent improved to 40% from 39% quarter-over-quarter.

Operating expenses increased to 33% ~~(to $8,971 from $6,727)~~of net sales (or $48,966), ~~driven by a slightly higher concurrent sales increase. During the quarter, interest expense decreased by 20%,~~as compared to 32% (or $43,080) in ~~comparison to~~ the same period of the prior year primarily due to legal and other expenses amounting to $1,785 relating to proxy defense activity in the reporting period. Absent those expenses, our operating expenses would have been at 32%, in line with the same period of the prior year.

Operating income for the period increased by 21% (to $10,813 from $8,971), driven by ~~cash generated over~~ the ~~last year~~overall sales increase, higher selling prices and ~~a slight improvement in~~improved factory utilization. Interest expense was 24% lower than the ~~effective interest rate. Income taxes increased by 48%, as a result of both higher pre-tax income and a slightly higher effective tax rate (32% as compared to 29% in the comparable~~same period of ~~2020).~~2021, driven by lower average levels of debt, which was aided by a second consecutive year of strong customer participation in early pay programs. These factors yielded net income for the period of $6,830, a 33% increase over compared to $5,144 ~~which was 32% higher than that~~in the second quarter of ~~the same quarter in 2020.~~2021. Details on our financial performance are set forth below.

	2021			2020			Change		% Change			2022			2021			Change			% Change
Net sales:
U.S. crop	$	62,575		$	44,670		$	17,905		40	%	$	63,195		$	62,575		$	620			1	%
U.S. non-crop		21,488			13,872			7,616		55	%		21,316			21,488			(172	)		-1	%
Total U.S.		84,063			58,542			25,521		44	%		84,511			84,063			448			1	%
International		50,547			46,013			4,534		10	%		63,573			50,547			13,026			26	%
Total net sales:	$	134,610		$	104,555		$	30,055		29	%	$	148,084		$	134,610		$	13,474			10	%
Cost of sales:
U.S. crop	$	35,770		$	22,912		$	12,858		56	%	$	33,442		$	35,770		$	(2,328	)		-7	%
U.S. non-crop		11,706			6,843			4,863		71	%		11,267			11,706			(439	)		-4	%
Total U.S.		47,476			29,755			17,721		60	%		44,709			47,476			(2,767	)		-6	%
International		34,995			34,494			501		1	%		43,596			34,995			8,601			25	%
Total cost of sales:	$	82,471		$	64,249		$	18,222		28	%	$	88,305		$	82,471		$	5,834			7	%
Gross profit:
U.S. crop	$	26,805		$	21,758		$	5,047		23	%	$	29,753		$	26,805		$	2,948			11	%
U.S. non-crop		9,782			7,029			2,753		39	%		10,049			9,782			267			3	%
Total U.S.		36,587			28,787			7,800		27	%		39,802			36,587			3,215			9	%
International		15,552			11,519			4,033		35	%		19,977			15,552			4,425			28	%
Total gross profit	$	52,139		$	40,306		$	11,833		29	%	$	59,779		$	52,139		$	7,640			15	%
Gross margin:
U.S. crop		43	%		49	%							47	%		43	%
U.S. non-crop		46	%		51	%							47	%		46	%
Total U.S.		44	%		49	%							47	%		44	%
International		31	%		25	%							31	%		31	%
Total gross margin		39	%		39	%							40	%		39	%

Our domestic crop business recorded net sales that were ~~over 40%~~1% higher than those of the second quarter ~~2020~~of 2021 ($~~62,575~~63,195, as compared to ~~$44,670)~~$62,575). ~~Rising crop commodity prices prompted growers~~Led by Dacthal, Impact, Assure II and ~~retailers~~Envoke, offset to ~~increase their purchases of crop protection inputs. In corn,~~a degree by lower sales of our ~~leading soil insecticide Aztec®~~Classic and ~~our Impact® post emergent~~Python brands. The herbicide brands ~~drove a 39% year-over-year increase~~showed strong growth across all markets, as weed management planning has become instrumental in controlling resistant weeds in cotton, sugarcane, soybeans, corn and high value crops. Our lead brands in cotton generated positive growth during the quarter due, in the case of Bidrin, to increased early season pest pressure, and, in the case of Folex, to an anticipated early harvest season as hot dry weather pushes cotton maturity ahead of seasonal norms. Partially offsetting these key products. Among other granular soil insecticides, Thimet®, used in peanuts and sugar cane, increased by 8% as compared to the prior year. Sales of our soybean products were flat, as compared to the same quarter in 2020. Fueled by renewed potato demand as pandemic restrictions on restaurants and schools eased,gains, sales of Thimet, Aztec and Counter were down in the quarter following unusually high demand in the first quarter. Further, lingering drought conditions in our Western and Southwestern markets adversely impacted our soil ~~fumigants grew significantly. With respect to cotton products,~~fumigant sales, as water allocations have limited annual crop production in those regions. Drier conditions also suppressed sales of ~~our Bidrin® foliar insecticide doubled~~Dibrom during the period with improved weather conditions and higher insect pressure. Similarly, we experienced increased demand for our Folex® harvest defoliant due largely to higher cotton prices and increased harvestable acreage in West Texas. In general, most of our products sold into the U.S. crop sector either equaled or exceeded their sales performance of the second quarter of 2020.period.

Cost of sales within the domestic crop business ~~increased significantly both~~decreased by 7% (from $35,770 in 2021 to $33,442 in 2022) primarily as a result of selling more, higher-margin products. As the ~~increased volumes just discussed, a different mix~~result of ~~sales~~better pricing and ~~increased net~~favorable factory ~~costs. This~~performance, domestic crop generated an 11% increase ~~of 23%~~ in gross profit ~~(to~~(from $26,805 ~~from $21,758~~ in the first quarter of ~~2020).~~2021 to $29,753 this year) on a 1% increase in sales.

~~Within our~~Our domestic non-crop business, posted nearly flat net sales ~~increased by 55% (to $21,488 from $13,872) quarter-over-quarter. Sales of our Dibrom® mosquito adulticide sales grew significantly~~ in the second quarter ~~influenced by timing shifts in customer procurement,~~of 2022, as ~~the distribution channel prepared to respond~~compared to the ~~2021 hurricane~~same period in the prior year (down 1% to $21,316 from $21,488 in 2021). In the quarter, relief from pandemic restrictions – primarily return to in-person school and ~~tropical storm season being forecast by National Oceanic~~work – has had a two-pronged effect on our non-crop business. On the one hand, the demand for nursery, ornamental and ~~Atmospheric Administration. Our pest strips business sales grew by more than 56%,~~consumer products for the home declined, as ~~consumer~~people spent less time in their homes. On the other hand, we saw an uptick in demand for goods that we supply to professional applicators and ~~commercial demand improved with the relaxation of pandemic restrictions.~~landscapers, as homeowners shifted from do-it-yourself to using professional services. In addition, ~~royalty and license fees for~~we enjoyed higher sales of our ~~Envance proprietary solutions reflected a steady stream of payments~~pharmaceutical products from ~~Proctor & Gamble for~~GemChem, while seeing an offsetting softness in the ~~formulations that are used in their Zevo® consumer pest spray brand. We recorded more than a 27% improvement in net sales from our OHP nursery and ornamental business~~turf supply market, as ~~demand for ornament and decorative plants stayed strong across the U.S.~~golfing activity declined.

Cost of sales within the domestic non-crop business ~~grew to $11,706,~~declined by 4% in the second quarter of 2022, as compared to ~~$6,843~~the same period in the prior ~~quarter. This increase was due largely~~year (from $11,706 in 2021 to ~~volume~~$11,267 in 2022), primarily resulting from improved factory performance and ~~mix of sales and increased net factory~~associated overhead cost ~~caused by a slower than expected start-up of our PCNB manufacturing cell at the Los Angeles facility and mechanical integrity inspection activity at the Axis site.~~recovery. Gross profit for domestic non-crop increased by ~~39% (to~~3% (from $9,782 ~~from $7,029~~ in ~~2020)~~2021 to $10,049 in 2022).

Net sales of our international businesses rose by ~~about 10%~~26% during the period ~~(to~~($63,573 in 2022 vs. $50,547 in ~~2021 from $46,013 in 2020). Newly acquired businesses contributed to this result. With more favorable weather conditions~~2021) and ~~the addition~~constituted 43% of our ~~recently acquired AgNova business, we experienced a 3-fold~~consolidated sales. These businesses benefited from sales ~~increase from our Australian business. The addition of the Agrinos biological products business also contributed incrementally to international sales~~increases in ~~China and India. Further, Mexico posted strongly improved sales with stable demand for granular~~soil fumigants, foliar insecticides, soil insecticides and ~~very strong~~fungicides across many regions. Our Central American business enjoyed increased demand ~~for our bromacil herbicides,~~in the pineapple, banana and ~~soil fumigants for use in a number of high-value vegetable crops. While we experienced a decline in European~~citrus markets, including stronger sales of our ~~Mocap~~Greenplants micronutrient solutions. In Mexico, despite drought conditions in the north, our Mexico business experienced good performance from at-plant fumigants and ~~Nemacur granular soil insecticides,~~herbicides on high-value crops. Our Brazilian business benefited from increased sales of Counter on corn, while our Australian operations posted stronger sales in light of increased rainfall, heavy demand for molluscicides as a result of regulatory action last year, in Brazil net sales increased sharply with the recovery of the agricultural sector following the height of the pandemic. Finally, our businesses in Central America reported increases in sales,well as ~~AgriCenter successfully overcame supply~~insecticide products for use on canola, winter wheat and ~~logistical difficulties arising from the pandemic.~~pulse.

~~The cost~~Cost of sales in our international business increased by 25% (from $34,995 in 2021 to $43,596 in 2022), on sales that increased by 26% and was ~~flat, quarter-over-quarter, while gross~~impacted by cost increases (including logistics and freight) of the third-party products that we distribute. Gross profit ~~rose~~for the international businesses increased by ~~35%~~28% (to $19,977 in 2022 from $15,552 ~~from $11,519) due~~ in part to a concerted effort to market higher margin products in Central America, greater supply availability of certain herbicide products in Mexico and the addition of biological products from newly acquired businesses.2021).

On a consolidated basis, gross profit for the second quarter of ~~2021~~2022 increased by ~~29% (to~~15% (from $52,139 ~~from $40,306~~ in ~~2020)~~2021 to $59,779 in 2022). ~~As mentioned above, despite some increased net factory cost,~~Overall gross ~~margins remained level~~margin percentage ended at 40% in the second quarter of 2022, as compared to 39% in the second quarter of ~~2021, as compared to the same period of~~ the prior year. The primary driver for this increase was higher selling prices coupled with improved factory performance, partially offset by inflation on raw materials and logistics and, for our international businesses, higher purchases costs related to increases in the US Dollar.

Operating expenses increased by ~~$9,501~~$5,886 to ~~$43,080~~$48,966 for the ~~three months~~three-month period ended June 30, ~~2021,~~2022, as compared to the same period in ~~2020.~~2021. The differences in operating expenses by department are as follows:

On April 1, 2020, the Company made a strategic investment in Clean Seed Inc., in the amount of $1,190. ~~During~~The Company recorded negative fair value adjustments in the amount of $486 and $296 for the three months ended June 30, 2022 and 2021, ~~and 2020, the Company recorded a (decrease) increase in fair value in the amount of $(295) and $24,~~ respectively. ~~These changes in fair value of our investment directly reflect changes in the stock’s quoted market price.~~

Interest costs net of capitalized interest were ~~$1,013~~$772 in the ~~three months~~three-month period ended June 30, ~~2021,~~2022, as compared to ~~$1,274~~$1,013 in the same period of ~~2020.~~2021. Interest costs are summarized in the following table:

	Three months ended June 30, 2021								Three months ended June 30, 2020								Three months ended June 30, 2022								Three months ended June 30, 2021
	Average Debt		Interest Expense			Interest Rate			Average Debt		Interest Expense			Interest Rate			Average Debt		Interest Expense			Interest Rate			Average Debt		Interest Expense			Interest Rate
Revolving line of credit (average)	$	163,140	$	984			2.4	%	$	185,989	$	1,248			2.7	%	$	124,184	$	745			2.4	%	$	163,140	$	984			2.4	%
Amortization of deferred loan fees		—		80			—			—		80			—			—		69			—			—		80			—
Amortization of other deferred liabilities		—		(25	)		—			—		3			—			—		11			—			—		(25	)		—
Other interest (income) expense		—		39			—			—		26			—
Other interest expense																		—		12			—			—		39			—
Subtotal		163,140		1,078			2.6	%		185,989		1,357			2.9	%		124,184		837			2.7	%		163,140		1,078			2.6	%
Capitalized interest		—		(65	)		—			—		(83	)		—			—		(65	)		—			—		(65	)		—
Total	$	163,140	$	1,013			2.5	%	$	185,989	$	1,274			2.7	%	$	124,184	$	772			2.5	%	$	163,140	$	1,013			2.5	%

The Company’s average overall debt for the ~~three months~~three-month period ended June 30, ~~2021~~2022 was ~~$163,140,~~$124,184, as compared to ~~$185,989~~$163,140 for the ~~three months~~three-month period ended June 30, ~~2020.~~2021. Our borrowings in the ~~three months~~three-month period ended June 30, ~~2021,~~2022, were lower mainly due to cash generated over the last 12 months used to pay down debt, partially offset by the acquisition activity over the same period and ~~the associated investment~~growth in ~~expanded~~ working ~~capital.~~capital in support of business growth. As can be seen from the table above, ~~our~~the effective bank interest rate on our revolving line of credit was 2.4% ~~for~~at each of the ~~three months~~three-month period ended June 30, ~~2021, as compared to 2.7% in 2020.~~2022 and 2021.

Income tax expense increased by ~~$880~~$280 to ~~$2,445~~$2,725 for the ~~three months~~three-month period ended June 30, ~~2021,~~2022, as compared to ~~$1,565~~$2,445 for the comparable period in ~~2020.~~2021. The effective tax ~~rate~~rates for the ~~three months~~three-month period ended June 30, 2022, and 2021, were 28.5% and ~~2020, was~~ 31.9% ~~and 28.6%~~, respectively. The effective tax rate for all interim periods is based on the projected income for the full year and is subject to ongoing review and adjustment by management. The ~~increase~~decrease in effective tax rate iswas primarily driven by the mix of our domestic and international ~~income.~~income and benefit from the tax impact of the vesting of certain stock grants.

Our net income for the ~~three months~~three-month period ended June 30, ~~2021,~~2022, was ~~$5,144~~$6,830 or ~~$0.17~~$0.23 per basic and diluted share, as compared to ~~$3,887~~$5,144 or ~~$0.13~~$0.17 per basic and diluted share in the same quarter of ~~2020.~~2021.

Within the global agricultural industry, the first six months of ~~2021~~2022 were ~~characterized by greater confidence (having just arisen from the worst~~a prolongation of the ~~pandemic)~~upcycle that began in 2021. Commodity prices remained high, driven in part by the Russian invasion of Ukraine, which has served to reduce exports from both Russia and Ukraine, of corn, wheat, sunflower oil and fertilizer inputs into the global market, and a stronger ~~commodity pricing for row crops. Domestic markets~~farm economy in the U.S. Following extraordinary activity in the first quarter, domestic distribution within our industry ~~gained strength~~slowed procurement modestly during the ~~first quarter and continued that trend into the second.~~second quarter. Our international businesses, for the most part, enjoyed ~~similar~~strong market ~~trends.~~conditions in nearly all regions during the first half of the year. All told, the Company’s overall operating results for the first six months of ~~2021~~2022 improved considerably over those of the same period of ~~2020.~~2021.

On a consolidated basis, with domestic sales up ~~30%~~19% and international sales up by ~~17%~~18%, overall net sales increased by ~~25%~~19% (to ~~$250,765~~$297,519 from ~~$200,517)~~$250,765). Cost of sales were up ~~26%~~15% on an absolute basis but ~~remained flat~~decreased as a percent of net sales atto 59% from 61%. Factory performance ~~declined~~improved during the first half of ~~2021,~~2022, as compared to that of ~~2020.~~2021. These factors, taken together, yielded an increase in gross profit, which was up ~~$18,583~~$23,702 or 24% (to ~~$97,270~~$120,972 from ~~$78,687)~~$97,270) and ~~remained level when compared~~improved to 41% of net sales, atup from 39%. during the first half of 2021. In the first half of ~~2021,~~2022, while operating expenses rose on an absolute basis by ~~21%~~13%, these costs declined as a percent of net sales to ~~34%~~32% from ~~35%~~34% for the same period of the prior year.

Interest expense declined by ~~30% as a result of cash generated over the last 12-months, use to pay down debt. Income~~40%, while income tax expense increased primarily as a result of stronger financial performance ~~plus an increase~~partially offset by a decrease in effective tax rate ~~and decreased benefit from discrete items~~ compared to the first half of the prior year (at ~~31% as compared to 23%~~30.1% in 2022 and 31.4% in the prior year). Overall, the ~~Company generated increased~~Company’s net income for the period increased by a factor of two, ending at $16,765, as compared to $8,215 ~~from $4,407~~ during the first half of the prior ~~year, up 86%.~~year. Details on our financial performance are set forth below.

	2021			2020			Change			% Change			2022			2021			Change			% Change
Net sales:									��
U.S. crop	$	117,330		$	95,032		$	22,298			23	%	$	151,388		$	117,330		$	34,058			29	%
U.S. non-crop		38,941			24,865			14,076			57	%		34,712			38,941			(4,229	)		-11	%
Total U.S.		156,271			119,897			36,374			30	%		186,100			156,271			29,829			19	%
International		94,494			80,620			13,874			17	%		111,419			94,494			16,925			18	%
Total net sales:	$	250,765		$	200,517		$	50,248			25	%	$	297,519		$	250,765		$	46,754			19	%
Cost of sales:
U.S. crop	$	69,254		$	49,029		$	20,225			41	%	$	81,290		$	69,254		$	12,036			17	%
U.S. non-crop		19,776			13,117			6,659			51	%		18,698			19,776			(1,078	)		-5	%
Total U.S.		89,030			62,146			26,884			43	%		99,988			89,030			10,958			12	%
International		64,465			59,684			4,781			8	%		76,559			64,465			12,094			19	%
Total cost of sales:	$	153,495		$	121,830		$	31,665			26	%	$	176,547		$	153,495		$	23,052			15	%
Gross profit:
U.S. crop	$	48,076		$	46,003		$	2,073			5	%	$	70,098		$	48,076		$	22,022			46	%
U.S. non-crop		19,165			11,748			7,417			63	%		16,014			19,165			(3,151	)		-16	%
Total U.S.		67,241			57,751			9,490			16	%		86,112			67,241			18,871			28	%
International		30,029			20,936			9,093			43	%		34,860			30,029			4,831			16	%
Total gross profit	$	97,270		$	78,687		$	18,583			24	%	$	120,972		$	97,270		$	23,702			24	%
Gross margin:
U.S. crop		41	%		48	%								46	%		41	%
U.S. non-crop		49	%		47	%								46	%		49	%
Total U.S.		43	%		48	%								46	%		43	%
International		32	%		26	%								31	%		32	%
Total gross margin		39	%		39	%								41	%		39	%

Our domestic crop business recorded net sales that were ~~24%~~29% above those of first half of ~~2020~~2021 (to ~~$117,330~~$151,388 from ~~$95,032). Higher crop~~$117,330) Assisted by consistently high commodity prices and ~~solid economic recovery alleviated prior concerns about near-term~~a strong domestic farm economy, the Company experienced strong demand across all product categories. Further, with our domestic production capacity, we were able to meet demand in spite of international supply constraints. Our herbicide portfolio for use on corn, soybeans, cotton and ~~allowed procurement patterns~~sugar cane, and our granular soil insecticides both grew by approximately 60%. Foliar insecticides grew by 20% in the ~~domestic market~~first half versus 2021. The only area of reduced demand was for soil fumigants, which experienced lower sales due to ~~be elevated as~~drought conditions in Western and Southwestern states where water allocation has been implemented. During the first half of 2022, customer ~~consumption increased at every~~procurement activity was exceptionally high in the first quarter and then stepped down to a more normalized level ~~preparing for~~in the ~~2021-2022 growing season. In Midwest corn, we posted much higher sales of our key soil insecticides and our post-emergent herbicide Impact,~~as customers invested to protect their crops from pests such as corn root worm or challenging weeds in order to maximize yield during this time of higher commodity prices. Sales of our cotton products increased significantly, due primarily to higher commodity prices and favorable weather which provided incremental demand for our Folex harvest defoliant in Texas. Soil fumigant sales also increased, fueled by renewed demand in potatoes and other vegetables resulting from the reopening of restaurants and schools. Among our many other products, we saw increased sales in virtually every category, including single digit gains for several of our soil insecticides and double-digit growth for some of our most profitable specialty herbicides and growth regulators. second quarter.

Cost of sales within the domestic crop business increased ~~41%~~17%, as compared to the first six months of ~~2020,~~2021, driven by ~~mix changes~~sales that increased by 29% including increased sales of higher margin products (many of which we manufacture in our domestic facilities) and ~~a generally weaker~~benefitting from improved factory ~~performance, including the newly acquired Agrinos biological manufacturing facilities.~~performance. Gross profit rose by ~~5% (to $48,076~~46% to $70,212 from ~~$46,003).~~$48,076.

Our domestic non-crop business recorded ~~a 57% year-over-year increase~~an 11% decrease in net sales for the first half of the year (to ~~$38,941~~$34,712 from ~~$24,865)~~$38,941). InThis decrease was largely due to a one-time license fee from P&G relating to Envance technology that had been received in the first half of 2021 and was recorded as revenue. Under the terms of that license, depending upon the achievement of commercialization milestones by the licensee, the Company will receive royalties in future reporting periods. Furthermore, in this category, sales of our Dibrom® mosquito adulticide ~~sales grew significantly, influenced by distribution channel inventory restocking and timing shifts in customer procurement. Demand~~remained flat as did demand for commercial pest control products (pest strips, bifenthrin) ~~improved considerably from 2020 pandemic levels. Revenues for~~. Sales of our ~~Envance technologies increased significantly when compared to the first half of last year, due primarily to additional license fees and royalties during the first quarter of 2021. Our~~ OHP nursery and ornamental business ~~continued~~were comparable to ~~post increased sales, as~~the same period of the prior year, with reduced demand for homeowner garden and landscape products ~~remained strong throughout the first half of the year. Our GemChem pharmaceutical supply business also grew, benefitting~~resulting from ~~the rebounding economy.~~continually reducing pandemic restrictions, offset by increased demand from professional landscape service providers.

Cost of sales within the domestic non-crop business decreased by 5%, (to $18,698 in 2022 from $19,776 in 2021). Gross profit for domestic non-crop decreased by 16% to $16,014 in 2022 from $19,165 in 2021, due largely to the non-recurrence of a one-time, upfront license fee as described above.

Net sales of our international businessesincreased by ~~51%, broadly in line with the growth in sales (to $19,776 from $13,117)~~18% during the first half of ~~2021 versus the comparable period~~2022 (to $111,419 in ~~2020. Gross profit for domestic non-crop increased by 63% (to $19,165~~2022 from ~~$11,748 in 2020), consistent with sales growth.~~

~~Net sales of our~~ ~~international businesses~~ ~~increased by 17% during the first half of 2021 (to~~ $94,494 in ~~2021 from $80,620~~2021). Central America experienced double-digit growth in ~~2020). Strong~~all but one of its six countries. Mexico generated strong results ~~in Mexico and Australia contributed significantly to this success. Mexico posted improved sales~~ with continuing demand for ~~granular insecticides, bromacil~~soil fumigants (on high-value crops), herbicides and ~~soil fumigants for use on high-value vegetable crops. In~~granular insecticides. Similarly, Australia enjoyed improved sales driven by improved rainfall and the extended footprint arising from the integration of ~~recently acquired~~the AgNova ~~with our existing business in that territory drove sales to five-times previous levels. Sales performance was down slightly in Central America resulting from COVID-19 limitations~~business. Brazil is now on in-person sales and marketing efforts, and some instances of unfavorable weather in the region earlier this year. While in Europe, sales of our Mocap® insecticide continued to decline during the phase-out of that product following the cancellation of its registration in the EU. In Canada, we experienced a sharp decline in Assure II sales due to intense first half price competition, and in Brazil, net sales increased sharply in the first half,an upward trend, due to a rebound in the agricultural sector ~~following the height~~and further market penetration of ~~the pandemic.~~our granular insecticides.

Cost of sales in our international business increased by 8%19% (to $76,559 in 2022 from $64,465 ~~from $59,684~~ in ~~2020)~~2021) primarily driven by volume growth and ~~mix~~impacted by increased prices from the strengthening US Dollar, and ~~foreign currency changes.~~general inflation on materials and associated logistics costs. Gross profit for the international businesses increased by ~~43% (to~~16% to $34,860 in 2022 from $30,029 ~~from $20,936) during the period.~~in 2021.

On a consolidated basis, gross profit for the six months of ~~2021~~2022 increased by 24% (to $120,972 in 2022 from $97,270 ~~from $78,687),~~in 2021). This is the same rate of growth that we had seen last year, when we compared the first half of 2021 with that of 2020. Our gross profit in the first six months of 2022 increased in part as a result of improved sales volumes ~~detailed above. Factory performance, however, declined during the first six months of 2021, as compared~~and pricing in part due to ~~the same period of 2020.~~improved factory performance. Gross margin performance, when expressed as a percentage of sales, ~~remained flat at~~rose to 41% from 39%. year-over-year.

Operating expenses increased by ~~$14,400~~$10,886 to ~~$84,524~~$95,410 for the ~~six-months~~six-month period ended June 30, ~~2021,~~2022, as compared to the same period in ~~2020.~~2021. The differences in operating expenses by department are as follows:

	2021		2020		Change		% Change			2022		2021		Change		% Change
Selling	$	22,765	$	20,505	$	2,260		11	%	$	23,683	$	22,765	$	918		4	%
General and administrative		31,091		23,020		8,071		35	%
General and administrative:
Other											34,691		31,091		3,600		12	%
Proxy contest activities											1,785		—		1,785		100	%
Research, product development and regulatory		13,545		12,257		1,288		11	%		14,728		13,545		1,183		9	%
Freight, delivery and warehousing		17,123		14,342		2,781		19	%		20,523		17,123		3,400		20	%
	$	84,524	$	70,124	$	14,400		21	%	$	95,410	$	84,524		10,886		13	%

During the ~~six months~~six-month period ended June 30, ~~2021, and 2020,~~2022, the Company recorded ~~an increase~~a decrease in the fair value of our equity investment in Clean Seed in the amount of $403 and recorded an increase in the amount of $771 ~~and $24, respectively.~~during the six months ended June 30, 2021. These changes in fair value of our investment directly reflect changes in the stock’s quoted market price.

During the ~~six months~~six-month period ended June 30, 2021, a Paycheck Protection Program loan assumed on the acquisition of Agrinos in the fourth quarter of 2020 was fully extinguished with the majority of the balance forgiven and recorded as other income in the Company’s ~~Condensed Consolidated Statements~~condensed consolidated statements of ~~Operations~~operations in the amount of $672.

Interest costs net of capitalized interest were ~~$1,959~~$1,170 in the first ~~six months~~six-month period of ~~2021,~~2022, as compared to ~~$2,782~~$1,959 in the same period of ~~2020.~~2021. Interest costs are summarized in the following table:

	Six months ended June 30, 2021								Six months ended June 30, 2020								Six months ended June 30, 2022								Six months ended June 30, 2021
��	Average Debt		Interest Expense			Interest Rate			Average Debt		Interest Expense			Interest Rate
																	Average Debt		Interest Expense			Interest Rate			Average Debt		Interest Expense			Interest Rate
Revolving line of credit (average)	$	144,324	$	1,843			2.6	%	$	175,475	$	2,744			3.1	%	$	105,076	$	1,146			2.2	%	$	144,324	$	1,843			2.6	%
Amortization of deferred loan fees		—		161			—			—		139			—			—		138			—			—		161			—
Amortization of other deferred liabilities		—		(9	)		—			—		6			—			—		17			—			—		(9	)		—
Other interest (income) expense		—		89			—			—		57			—			—		21			—			—		89			—
Subtotal		144,324		2,084			2.9	%		175,475		2,946			3.4	%		105,076		1,322			2.5	%		144,324		2,084			2.9	%
Capitalized interest		—		(125	)		—			—		(164	)		—			—		(152	)		—			—		(125	)		—
Total	$	144,324	$	1,959			2.7	%	$	175,475	$	2,782			3.2	%	$	105,076	$	1,170			2.2	%	$	144,324	$	1,959			2.7	%

The Company’s average overall debt for the ~~six months~~six-month period ended June 30, ~~2021,~~2022, was ~~$144,324,~~$105,076, as compared to ~~$175,475~~$144,324 for the six months ended June 30, ~~2020.~~2021. During the period, we continued to focus on our ~~usage~~use of revolving debt, while funding working capital for the ~~newly acquired products and businesses.~~growing business. As can be seen from the table above, our effective bank interest rate on our revolving line of credit was ~~2.6%~~2.2% for the six months ended June 30, ~~2021,~~2022, as compared to ~~3.1%~~2.6% in ~~2020.~~

Income tax expense increased by ~~$2,447~~$3,417 to end at ~~$3,807~~$7,224 for the ~~six months~~six-month period ended June 30, ~~2021,~~2022, as compared to income tax expense of ~~$1,360~~$3,807 for the comparable period in ~~2020.~~2021. The effective tax rate for the six months ended June 30, ~~2021,~~2022, was ~~31.4%~~30.1% as compared to ~~23.4%~~31.4% for same period last year. The ~~effective tax~~ rate ~~for the six months ended June 30, 2020, included~~has decreased compared to prior year reflecting a mix of income in different jurisdictions ~~two discrete income tax benefits. First, the Company assessed its income tax positions to account for the Coronavirus Aid Relief~~ and Economic Security Act (“CARES Act”) which was signed into law on March 27, 2020. A provision of the act modified the amount of interest deduction allowed and therefore reduced the Company’s 2019 Global Intangible Low Tax Income (“GILTI”) inclusion. Second, the Company benefitedan increased benefit from ~~the tax impact of~~ the vesting of certain stock grants.For tax years beginning after December 31, 2021, the Tax Cuts and Jobs Act (“TCJA”) of 2017 amends Internal Revenue Code Section 174 costs wherein research and development expenditures will no longer be deducted in the tax year that such costs are incurred but must now be capitalized and amortized over either a five- or fifteen-year period, depending on the location of the activities performed. The effective tax rate for all interim periods is based on the projected income for the full year and is subject to ongoing review and adjustment by management.

Our net income for the ~~six months~~six-month period ended June 30, ~~2021~~2022 was $16,765 or $0.57 per basic and $0.55 per diluted share, as compared to $8,215 or $0.28 per basic and $0.27 per diluted share ~~as compared to $4,407 or $0.15 per basic and diluted share~~ in the same period of ~~2020.~~2021.

The Company’s operating activities utilized net cash of ~~$18,904~~$27,230 during the six-month period ended June 30, 2022, as compared to $18,905 during the six months ended June 30, ~~2021, as compared to providing net cash of $6,915 during the six months ended June 30, 2020.~~2021. Included in the ~~$18,904~~$27,230 are net income of ~~$8,215,~~$16,765, plus non-cash depreciation, amortization of intangibles and other assets and discounted future liabilities, in the amount of ~~$12,732,~~$12,760, loss on disposal of property, plant and equipment of $256, amortization of deferred loan fees of ~~$162~~$139 and provision for bad debts in the amount of ~~$945.~~$470. Also included are stock-based compensation of ~~$3,598,~~$2,836, adjustment to contingent consideration in the amount of ~~$1,014, losses from equity method investment of $87, decrease~~$635, increase in deferred income taxes of ~~$353,~~$109, change in fair value of an equity investment of ~~$771, loan principal~~$403, and ~~interest forgiveness of $672,~~ net foreign currency adjustments of ~~$147 and adjustment to bargain purchase gain on business acquisition of $121.~~$20. These together provided net cash inflows of ~~$24,931,~~$34,353, as compared to ~~$18,190~~$24,930 for the same period of ~~2020.~~2021.

During the ~~six months~~six-month period of ~~2021,~~2022, the Company increased working capital by ~~$43,715,~~$68,187, as compared to an increase of ~~$11,282~~$43,715 during the same period of the prior year. Included in this change: inventories increased by ~~$11,464 (normal at this point in the season),~~$27,774, as compared to ~~$21,706~~$11,464 for the same period of ~~2020. Deferred revenue~~2021. While increases in inventory are normal for the Company’s annual cycle, this year, the Company has made decisions to bring in raw materials earlier than in prior seasons in order to secure our needs of key materials for the balance of the year and the start of the next growing season.

Customer prepayments decreased by ~~$30,407,~~$62,789, as compared to ~~$2,431~~$30,407 in the same period of ~~2020,~~2021, driven by customer decisions regarding demand, payment timing and our cash incentive programs. Our accounts payable balances increased by ~~$6,190,~~$19,439, as compared to ~~decreased by $12,351~~an increase of $6,190 in the same period of ~~2020.~~2021, driven by increased factory activity levels. Accounts receivables increased by ~~$25,317,~~$18,645, as compared to ~~decreased by $16,421~~an increase of $25,317 in the same period of ~~2020.~~2021. This is primarily driven by increased group sales and strong international growth. Prepaid expenses increased by ~~$3,696,~~$3,652, as compared to ~~$2,297~~$3,696 in the same period of ~~2020.~~2021. Income tax receivable ~~decreased~~increased by ~~$1,374,~~$3,526, as compared to ~~$899~~a decrease of $1,374 in the prior year. Accrued programs increased by ~~$19,098,~~$35,987, as compared to ~~$12,577~~$19,098 in the prior year, which is normal at this point in the growing season. Finally, other payables and accrued expenses ~~increased~~decreased by ~~$507,~~$602, as compared to ~~decreased by $2,394~~an increase of $507 in the prior year.

With regard to our program accrual, the increase (as noted above) primarily reflects our volume and mix of sales (certain products are marketed with higher levels of program accruals), and customers in the first six months of ~~2021,~~2022, as compared to the prior year. The Company accrues programs in line with the growing season upon which specific products are targeted. Typically crop products have a growing season that ends on September 30^thof each year. During the first six months of ~~2021,~~2022, the Company made accruals for programs in the amount of ~~$39,235~~$67,274 and payments in the amount of ~~$20,142.~~$31,367. During the first six months of the prior year, the Company made accruals in the amount of ~~$33,336~~$39,235 and made payments in the amount of ~~$20,771.~~$20,142. The increase in accruals for programs in the first six months of 2022, compared to the same period in 2021, is a direct result of an increase in sales of qualifying products.

Cash used for investing activities for the ~~six months~~six-month period ended June 30, 2022, and 2021 was $6,671 and ~~2020 was~~ $15,500, ~~and $11,465,~~ respectively. The $15,500 in 2021 includes a product acquisition in the amount of $10,000. No such acquisition took place in the current year. In 2022, the Company spent ~~$5,075~~$5,654 on purchases of fixed assets ~~acquisitions~~ primarily focused on continuing to invest in manufacturing ~~infrastructure,~~infrastructure. In addition, the Company made a ~~deposit~~payment of $1,000 to Clean Seed to amend a license agreement under which royalty-bearing license rights were converted to fully paid-up, royalty-free, perpetual license rights, and spent $44 on ~~a product line acquisition of $10,000, intangible assets of $241 and further investment of $184.~~patents for the Envance technology business.

During the ~~six months~~six-month period ended June 30, ~~2021, and 2020,~~2022, financing activities provided ~~$37,942 and $5,984, respectively. This is principally from~~$40,027, as compared to $37,943 during the ~~increased~~same period of the prior year. Net borrowings onunder the ~~Company’s senior credit facility. In~~Credit Agreement amounted to $48,400 during the ~~first half~~six-month period ended June 30, 2022, as compared to $41,774 in the same period of ~~2021,~~ the prior year. The Company paid dividends to stockholders amounting to ~~$1,189,~~$1,330 during the six months ended June 30, 2022, as compared to ~~$1,168~~$1,188 in the same period of ~~2020. In addition,~~2021. The Company paid $6,232 for the repurchase of 333,010 shares of its common stock during the six-month period ended June 30, 2022. There were no such purchases during the six-month period ended June 30, 2021. Lastly, in exchange for shares of common stock returned by employees, the Company ~~made payments~~paid $2,012 and $2,900 for tax withholding on ~~contingent consideration in~~stock-based compensation awards during the ~~amount of $250, as compared to $1,227 in the same period of 2020.~~ six months ended June 30, 2022 and 2021, respectively.

The Company has a revolving line of credit that is shown as long-term debt in the ~~Condensed Consolidated Balance Sheets~~condensed consolidated balance sheets at June 30, ~~2021~~2022 and December 31, ~~2020.~~2021. These are summarized in the following table:

Long-term indebtedness ($000's)	June 30, 2021			December 31, 2020			June 30, 2022			December 31, 2021
Revolving line of credit	$	149,700		$	107,900		$	101,700		$	53,300
Deferred loan fees		(322	)		(458	)		(921	)		(1,060	)
Net long-term debt	$	149,378		$	107,442		$	100,779		$	52,240

At June 30, ~~2021,~~2022, the Company was compliant with all covenants to its ~~then current~~ credit agreement. Also, at June 30, ~~2021,~~2022, the Company’s total Funded Debt amounted to ~~$149,700.~~$101,700. At that date the Company’s rolling four quarter Consolidated EBITDA (as defined in the Credit Agreement, see Note 10) amounted to ~~$59,030,~~$75,512, which results in a leverage ratio of ~~2.54,~~1.35, as compared to a maximum leverage ratio permitted under the Credit Agreement of 3.5. At June 30, ~~2021,~~2022, the Company has the capacity to increase its borrowings by up to ~~$56,906,~~$162,592, according to the terms thereof. This compares to an available borrowing capacity of ~~$49,420~~$56,906 as of June 30, ~~2020.~~2021. At December 31, ~~2020,~~2021, the Company had borrowing capacity of ~~$86,736.~~$178,705. The level of borrowing capacity is driven by three factors: (1) our financial performance, as measured in EBITDA for both the trailing twelve-month period and proforma basis arising from acquisitions, (2) net borrowings, and (3) the leverage covenant (the TL Ratio).

We believe that anticipated cash flow from operations, existing cash balances and available borrowings under our amended senior credit facility will be sufficient to provide us with liquidity necessary to fund our working capital and cash requirements for the next twelve months.

Please refer to Note 15 in the accompanying Notes to the ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements for recently issued accounting standards.

The Company continually re-assesses the critical accounting policies used in preparing its financial statements. In the Company’s Form 10-K filed with the SEC for the year ended December 31, ~~2020,~~2021, the Company provided a comprehensive statement of critical accounting policies. These policies have been reviewed in detail as part of the preparation work for this Form 10-Q. After our review of these matters, we have determined that, during the subject reporting period, there has been no material change to the critical accounting policies that are listed in the Company’s Form 10-K for the year ended December 31, ~~2020.~~2021.

Certain of the Company’s policies require the application of judgment by management in selecting the appropriate assumptions for calculating financial estimates. These judgments are based on historical experience, terms of existing contracts, commonly accepted industry practices and other assumptions that the Company believes are reasonable under the circumstances. These estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements in the period that revisions are determined to be necessary. Actual results may differ from these estimates under different outcomes or conditions. Our estimates did not change materially during the three- and six-months ended June 30, 2022.

The Company is exposed to market risk related to changes in interest rates, primarily from its borrowing activities. The Company’s indebtedness to its primary lender is evidenced by a line of credit with a variable rate of interest, which fluctuates with changes in the lender’s reference rate. For more information, please refer to the applicable disclosures in the Company’s Form 10-K filed with the SEC for the year ended December 31, ~~2020~~2021 and note 10 to the ~~Condensed Consolidated Financial Statements.~~condensed consolidated financial statements.

The Company faces market risk to the extent that changes in foreign currency exchange rates affect our non-U.S. dollar functional currency as to foreign subsidiaries’ revenues, expenses, assets and liabilities. The Company currently does not engage in hedging activities with respect to such exchange rate risks.

Assets and liabilities outside the U.S. are located in regions where the Company has subsidiaries or joint ventures: Central America, South America, North America, Europe, Asia, and Australia. The Company’s investments in foreign subsidiaries and joint ventures with a functional currency other than the U.S. dollar are generally considered long-term. Accordingly, the Company does not hedge these net investments.

As of June 30, ~~2021,~~2022, the Company has a comprehensive set of disclosure controls and procedures designed to ensure that all information required to be disclosed in our filings under the Securities Exchange Act (1934) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. As of June 30, ~~2021,~~2022, the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, has concluded, based on their evaluation, that the Company’s disclosure controls and procedures are effective to provide reasonable assurance of the achievement of the objectives described above.

There were no changes in the Company’s internal controls over financial reporting that occurred during the most recent quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

The Company was not required to report any matters or changes for any items of Part II except as disclosed below.

Please refer to Note 14 in the accompanying Notes to the ~~Condensed Consolidated Financial Statements~~condensed consolidated financial statements for legal updates.

The Company continually re-assesses the business risks, and as part of that process detailed a range of risk factors in the disclosures in American Vanguard’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020,~~2021, filed on March ~~31, 2021. In preparing this document, we have reviewed all the~~14, 2022. The following disclosure amends and supplements those risk factors ~~included in that document~~ and, ~~find that~~except to the extent restated below, there are no material changes to ~~those~~the risk factors ~~except for the following:~~as so stated.

~~The COVID-19 pandemic is creating risk, uncertainty and adverse conditions in many industries both here and abroad.~~ ~~The Company is closely monitoring the impact~~An NGO petition to revoke tolerances a family of chemistries (namely, organophosphate) could jeopardize several of the ~~COVID-19 pandemic~~Company’s products. On November 18, 2021, a group of non-governmental organizations led by Pesticide Action Network North America filed a petition with the USEPA to revoke the food tolerances for eight of the Company’s registered active ingredients, all of which are in the family of organophosphates. In July 2022, USEPA published in the Federal Register an invitation for public comment on ~~all aspects~~the petition, giving commenters 30 days’ within which to submit their comments. In light of ~~its business, including how~~ the ~~pandemic will impact its customers, business partners,~~large number of active ingredients implicated by the petition, the Company and ~~employees.~~multiple other stakeholders (including grower groups and trade organizations) are seeking an extension of time for submitting such comments. While the Company ~~did~~does not ~~incur significant disruptions from~~believe that there is a valid basis for revoking tolerances under applicable law (as the ~~COVID-19 pandemic during~~petition is largely based upon unsound studies solely involving chlorypyrifos), there is no guarantee that USEPA will grant an extension or, for that matter, will deny the ~~six months ended June 30, 2021,~~remedy being sought by the petition. It is possible that USEPA could find a basis upon which to revoke tolerances and therefore cancel one or all active ingredients which, in turn, could have a material adverse effect upon the Company’s financial performance. Further, this matter is unprecedented insofar as it, in effect, targets an entire class of chemistry (as opposed to one active ingredient); thus, it is possible that, if granted, this petition will establish an adverse precedent by which NGOs can seek to cancel other families of chemistries within the broader industry.

USEPA’s notice of intention to suspend the DCPA registration could have a broader impact on the Company’s portfolio and the industry in general. In May 2022, the USEPA issued a notice of intention to suspend DCPA, the active ingredient of an herbicidal product marketed by the Company ~~is unable to predict~~under the ~~impact~~name Dacthal on the basis that the ~~pandemic will have~~Company acted allegedly inappropriately in providing data studies that had been requested by the agency. In fact, the agency had requested 89 data studies and, over the course of several years, the Company had supplied 69 such studies and had been working constructively on ~~its financial condition, results of operations and cash flows due~~mutually acceptable timetables either to ~~numerous uncertainties. The extent~~complete, or to ~~which~~obtain waivers for, the COVID-19 pandemic impacts the Company’s operations and those of its customers will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and durationbalance of the ~~pandemic,~~studies. The Company petitioned an administrative law judge (“ALJ”) to appeal the ~~actions taken~~NOITS. In response to ~~contain~~USEPA’s motion, the ~~pandemic or mitigate its impact,~~ALJ granted an accelerated decision to uphold the NOITS. The Company, in turn, has appealed the ALJ’s decision to the Environmental Appeals Board, on the ground that the basis was erroneous, both with respect to statutory construction and factual inferences being improperly made in the ~~direct and indirect economic effects of~~agency’s favor. While the ~~pandemic and containment measures, among others. There~~Company believes that there is no merit to the agency’s position, there is no guarantee that the Company will ~~be able~~prevail in defending against the attempted suspension. Further, if this suspension is granted, it is possible that the agency will seek to ~~operate without~~invalidate registrations summarily, including both the Company’s and those of its peers. This, in turn, could have a material ~~disruption~~adverse effect upon the Company’s financial performance.

The Catalano product liability case could set an adverse precedent for the ~~duration~~active ingredient acephate, as well as for organophosphates more generally. As more fully described in Part 14, Item II herein, plaintiffs in Catalano seek damages for cardiovascular injury allegedly arising from making applications of ~~the pandemic or that its financial conditions and results of operations will not be materially adversely affected~~Orthene, a systemic insecticide marketed by the ~~pandemic~~Company, having acephate as its active ingredient. While the Company believes that the claim has not merit and that there have been no data studies linking acephate to cardiovascular disease, it is possible that a court could reach a judgment that is adverse to the Company and, in ~~future quarters.~~so doing, set an adverse precedent with respect not only to commercial acephate products, but also to consumer acephate products and organophosphate products more generally. Such adverse judgment and/or precedent could have a materially adverse effect upon the Company’s financial performance.

On March 8, 2022, pursuant to a Board of Directors resolution, the Company announced its intention to repurchase an aggregate number of up to 1,000,000 shares of its common stock, par value $0.10 per share, in the open market over the succeeding one year at a price not to exceed $20 per share, subject to limitations and restrictions under applicable securities laws.

The table below summarizes the number of shares of our common stock that were repurchased during the three- and six-month periods ended June 30, 2022. There were no such purchases during the three- and six-month periods ended June 30, 2021. The shares and respective amount are recorded as treasury shares on the Company’s condensed consolidated balance sheet.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware	95-2588080
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification Number)

4695 MacArthur Court, Newport Beach, California	92660
(Address of principal executive offices)	(Zip Code)

		Page Number
PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Operations	3

	Condensed Consolidated Statements of Comprehensive Income ~~(Loss)~~	4

	Condensed Consolidated Balance Sheets	5

	Condensed Consolidated ~~Statement~~Statements of Stockholders’ Equity	6

	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2120

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2928

Item 4.	Controls and Procedures	3028

PART II—OTHER INFORMATION		3129

Item 1.	Legal Proceedings	3129

Item 1A.	Risks Factors	3129
Item 2.	Purchases of Equity Securities by the Issuer	30
Item 6.	Exhibits	3231

SIGNATURES		3332

Weighted-average remaining lease term (in years)			~~7.58~~6.33
Weighted-average discount rate			~~4.08~~4.02	%

	Number of Shares			Weighted Average Price Per Share
Balance outstanding, December 31, 2020		123,087		$	11.48
Options exercised		(5,838	)		11.49
Balance outstanding, March 31, 2021		117,249			11.48
Options exercised		(8,826	)		11.35
Balance outstanding, June 30, 2021		108,423		$	11.49

	Number of Shares			Weighted Average Price Per Share
Balance outstanding, December 31, 2021 and March 31, 2022		108,036			11.49
Options exercised		(33,745	)		11.49
Balance outstanding, June 30, 2022		74,291		$	11.49

Large Accelerated Filer	☐	Accelerated Filer	☒
Non-Accelerated Filer	☐	Smaller reporting company	☐
Emerging growth company	☐

	Number of Shares			Weighted Average Price Per Share
Balance outstanding, December 31, 2019		332,823		$	9.14
Options exercised		(15,836	)		8.83
Balance outstanding, March 31, 2020		316,987			9.16
Options exercised		(9,291	)		8.27
Balance outstanding, June 30, 2020		307,696		$	9.18

Month ended	Total number of shares purchased		Average price paid per share		Total amount paid		Maximum number of shares that may yet be purchased under the plan
March 31, 2022		332,404	$	18.71	$	6,219		667,596
April 30, 2022		100	$	19.99	$	2		667,496
May 31, 2022		506	$	19.99	$	11		666,990
Total number of shares repurchased		333,010	$	18.71	$	6,232		666,990

Month ended	Total number of shares purchased		Average price paid per share		Total amount paid		Maximum number of shares that may yet be purchased under the plan
March 31, 2022		332,404	$	18.71	$	6,219		667,596
April 30, 2022		100	$	19.99	$	2		667,496
May 31, 2022		506	$	19.99	$	11		666,990
Total number of shares repurchased		333,010	$	18.71	$	6,232		666,990

Exhibit No.		Description

31.1		Certification of Chief Executive Officer Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002.

32.1		Certification Pursuant to Section 906 of The Sarbanes-Oxley Act of 2002.

101		The following materials from American Vanguard Corp’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Condensed Consolidated Statements of Operations; (ii) Condensed Consolidated Statements of Comprehensive ~~Income (Loss);~~Income; (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statement of Stockholders’ Equity; (v) Condensed Consolidated Statements of Cash Flows; and (vi) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.

104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, ~~2021,~~2022, has been formatted in Inline XBRL.

	american vanguard corporation

Dated: August ~~10, 2021~~8, 2022	By:	/s/ eric g. wintemute
		Eric G. Wintemute
		Chief Executive Officer and Chairman of the Board

Dated: August ~~10, 2021~~8, 2022	By:	/s/ david t. johnson
		David T. Johnson
		Chief Financial Officer & Principal Accounting Officer