Exhibit 99.2
FOR IMMEDIATE RELEASE
AMERICAN VANGUARD REPORTS FOURTH QUARTER & FULL YEAR 2011 RESULTS
American Vanguard Doubles Profits on 34% Increase in Sales
Record-setting Performance — Continuing Strong Demand Anticipated
Newport Beach, CA – March 6, 2012 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the fourth quarter and full year ended December 31, 2011.
Fiscal 2011 Fourth Quarter– versus Fiscal 2010 Fourth Quarter:
• | Net sales were $84.7 million compared to $62.4 million, an increase of 36%. |
• | Net income was $6.4 million compared to $3.9 million, an increase of 64%. |
• | Earnings per diluted share were $0.23 versus $0.14. |
Fiscal Full Year 2011– versus Fiscal Full Year 2010:
• | Net sales were $304.4 million compared to $226.9 million, an increase of 34%. |
• | Net income was $22.1 million compared to $11.0 million, an increase of 101%. |
• | Earnings per diluted share were $0.79 versus $0.40. |
Eric Wintemute, Chairman and CEO of American Vanguard, stated: “Our record-setting performance in 2011 resulted from strong domestic and international demand for our existing product portfolio, the successful integration of several product lines acquired in late 2010 and the continued outstanding business execution by our entire organization. Compared to the prior full-year period, sales grew by 34%, gross profit margin improved to 40%, operating expenses as a percentage of sales declined to 28%; allowing us to double our net income. We posted this record financial performance despite lost sales and profit opportunities caused by the year-long sales interruption of our PCNB product line, a supply shortage for one of our recently acquired products and a persistent drought that negatively affected our U.S. cotton insecticide business.”
Mr. Wintemute continued: “In 2012, we see many encouraging prospects. Ever-increasing global demand for food, feed, fiber and bio-fuels strengthens agricultural commodity prices and is expected to encourage growers to expand acreage and purchase the crop protection inputs that American Vanguard sells. Our Impact herbicide for glyphosate tolerant weeds, our industry leading granular soil insecticides and proprietary closed delivery systems will continue to provide a superior yield enhancing solution for our customers.”
Mr. Wintemute concluded: “American Vanguard is well positioned to capitalize on these trends. We anticipate steady growth in most of our domestic crop markets; we expect to expand our footprint in international markets and continue our penetration of the non-crop pest control segment. Our strong balance sheet will allow us to invest in these growth initiatives and increasing cash generation should allow us to provide enhanced near-term returns to shareholders and also consider available growth opportunities that will strengthen the long-term enterprise value of American Vanguard.”
Conference Call
Eric Wintemute, Chairman & CEO and David T. Johnson, VP & CFO, will conduct a conference call focusing on the financial results at 12:00 pm ET / 9:00 am PT on Tuesday, March 6, 2012. Interested parties may participate in the call by dialing (201) 493-6744 please call in 10 minutes before the call is scheduled to begin, and ask for the American Vanguard call. The conference call will also be webcast live via theNews and Media section of the Company’s web site atwww.american-vanguard.com. To listen to the live webcast, go to the web site at least 15 minutes early to register, download and install any necessary audio software. If you are unable to listen live, the conference call will be archived on the Company’s web site.
About American Vanguard
American Vanguard Corporation is a diversified specialty and agricultural products company that develops and markets products for crop protection and management, turf and ornamentals management and public and animal health. American Vanguard is included on the Russell 2000® and Russell 3000® Indexes and the Standard & Poor’s Small Cap 600 Index. To learn more about American Vanguard, please reference the Company’s web site atwww.american-vanguard.com.
The Company, from time to time, may discuss forward-looking information. Except for the historical information contained in this release, all forward-looking statements are estimates by the Company’s management and are subject to various risks and uncertainties that may cause results to differ from management’s current expectations. Such factors include weather conditions, changes in regulatory policy and other risks as detailed from time-to-time in the Company’s SEC reports and filings. All forward-looking statements, if any, in this release represent the Company’s judgment as of the date of this release.
Company Contact: | Investor Representative | |||
American Vanguard Corporation | The Equity Group Inc. | |||
William A. Kuser, Director of Investor Relations | www.theequitygroup.com | |||
(949) 260-1200 | Lena Cati | |||
williamk@amvac-chemical.com | Lcati@equityny.com | |||
(212) 836-9611 |
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months and twelve months ended December 31, 2011 and 2010
(Dollars in thousands, except per share data)
For the three months ended December 31 | For the twelve months ended December 31 | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net sales | $ | 84,680 | $ | 62,413 | $ | 304,429 | $ | 226,859 | ||||||||
Cost of sales | 50,768 | 36,931 | 181,361 | 140,538 | ||||||||||||
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Gross profit | 33,912 | 25,482 | 123,068 | 86,321 | ||||||||||||
Operating expenses | 22,724 | 20,044 | 83,842 | 67,130 | ||||||||||||
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Operating income | 11,188 | 5,438 | 39,226 | 19,191 | ||||||||||||
Interest expense | 882 | 691 | 3,569 | 3,171 | ||||||||||||
Interest income | — | — | (3 | ) | — | |||||||||||
Interest capitalized | (17 | ) | (56 | ) | (109 | ) | (154 | ) | ||||||||
Extinguishment of debt | — | — | 546 | — | ||||||||||||
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Income before income tax | 10,323 | 4,803 | 35,223 | 16,174 | ||||||||||||
Income tax expense | 3,892 | 900 | 13,155 | 5,190 | ||||||||||||
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Net income | $ | 6,431 | $ | 3,903 | $ | 22,068 | $ | 10,984 | ||||||||
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Earnings per common share—basic | $ | .23 | $ | .14 | $ | .80 | $ | .40 | ||||||||
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Earnings per common share—assuming dilution | $ | .23 | $ | .14 | $ | .79 | $ | .40 | ||||||||
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Weighted average shares outstanding—basic | 27,583 | 27,452 | 27,559 | 27,385 | ||||||||||||
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Weighted average shares outstanding—assuming dilution | 28,026 | 27,682 | 27,875 | 27,652 | ||||||||||||
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CONSOLIDATED BALANCE SHEETS
December 31, 2011 and 2010
(Dollars in thousands, except per share data)
2011 | 2010 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash | $ | 35,085 | $ | 1,158 | ||||
Receivables: | ||||||||
Trade, net of allowance for doubtful accounts of $340 and $447, respectively | 68,611 | 33,833 | ||||||
Other | 1,187 | 263 | ||||||
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69,798 | 34,096 | |||||||
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Inventories | 71,068 | 74,054 | ||||||
Prepaid expenses | 2,311 | 2,591 | ||||||
Income taxes receivable | 203 | 6,715 | ||||||
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Total current assets | 178,465 | 118,614 | ||||||
Property, plant and equipment, net | 39,273 | 40,541 | ||||||
Intangible assets, net | 116,189 | 115,249 | ||||||
Other assets | 5,214 | 5,775 | ||||||
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$ | 339,141 | $ | 280,179 | |||||
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Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Current installments of long-term debt | $ | 14,460 | $ | 8,429 | ||||
Current installments of other liabilities | 1,038 | — | ||||||
Accounts payable | 23,214 | 13,961 | ||||||
Deferred revenue | 7,571 | 5,568 | ||||||
Accrued program costs | 25,910 | 16,976 | ||||||
Accrued expenses and other payables | 6,832 | 4,634 | ||||||
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Total current liabilities | 79,025 | 49,568 | ||||||
Long-term debt, excluding current installments | 51,917 | 53,710 | ||||||
Other liabilities, excluding current installments | 5,955 | 3 | ||||||
Deferred income taxes | 15,172 | 10,461 | ||||||
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Total liabilities | 152,069 | 113,742 | ||||||
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Commitments and contingent liabilities: | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $.10 par value per share; authorized 400,000 shares; none issued | — | — | ||||||
Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 29,845,047 shares in 2011 and 29,735,928 shares in 2010 | 2,985 | 2,974 | ||||||
Additional paid-in capital | 45,966 | 43,403 | ||||||
Accumulated other comprehensive loss | (2,250 | ) | (448 | ) | ||||
Retained earnings | 143,524 | 123,661 | ||||||
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190,225 | 169,590 | |||||||
Less treasury stock at cost, 2,260,996 shares in both 2011 and 2010 | (3,153 | ) | (3,153 | ) | ||||
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Total stockholders’ equity | 187,072 | 166,437 | ||||||
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$ | 339,141 | $ | 280,179 | |||||
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See summary of significant accounting policies and notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended December 31, 2011, 2010 and 2009
(Dollars in thousands, except per share data)
2011 | 2010 | 2009 | ||||||||||
Increase (decrease) in cash | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 22,068 | $ | 10,984 | $ | (5,789 | ) | |||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization of fixed and intangible assets | 13,546 | 11,123 | 10,804 | |||||||||
Amortization of other long term assets | 1,983 | 3,258 | 2,683 | |||||||||
Amortization of discounted liabilities | 1,371 | — | — | |||||||||
Stock-based compensation | 1,994 | 1,122 | 1,223 | |||||||||
Increase(decrease) in deferred income taxes | 4,711 | 5,342 | (778 | ) | ||||||||
Changes in assets and liabilities associated with operations: | ||||||||||||
(Increase) decrease in net receivables | (35,021 | ) | 6,967 | 10,905 | ||||||||
Decrease (increase) in inventories | 2,986 | (1,542 | ) | 18,114 | ||||||||
Decrease (increase) in income tax receivable | 6,512 | (2,583 | ) | (4,132 | ) | |||||||
(Increase) in prepaid expenses and other assets | (1,823 | ) | (2,235 | ) | (2,898 | ) | ||||||
Increase (decrease) in accounts payable | 8,383 | 3,095 | (2,828 | ) | ||||||||
Increase in deferred revenue | 2,003 | 5,568 | — | |||||||||
Increase (decrease) in other payables and accrued expenses | 10,553 | (7,909 | ) | 4,647 | ||||||||
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Net cash provided by operating activities | 39,266 | 33,190 | 31,951 | |||||||||
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Cash flows from investing activities: | ||||||||||||
Capital expenditures | (6,261 | ) | (8,004 | ) | (4,322 | ) | ||||||
Acquisitions of intangible assets | (316 | ) | (32,677 | ) | — | |||||||
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Net cash used in investing activities | (6,577 | ) | (40,681 | ) | (4,322 | ) | ||||||
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Cash flows from financing activities: | ||||||||||||
Net (repayments) borrowings under line of credit agreement | (7,300 | ) | 4,700 | (21,900 | ) | |||||||
Payments on long-term debt | (8,429 | ) | (8,107 | ) | (4,106 | ) | ||||||
Payment on other long-term liabilities | (401 | ) | — | — | ||||||||
Increase (decrease) in other notes payable | 20,063 | 11,586 | (2,438 | ) | ||||||||
Proceeds from the issuance of common stock | 580 | 768 | 1,470 | |||||||||
Payment of cash dividends | (2,205 | ) | (819 | ) | (1,611 | ) | ||||||
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Net cash provided (used in) by financing activities | 2,308 | 8,128 | (28,585 | ) | ||||||||
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Net increase (decrease) in cash | 34,997 | 637 | (956 | ) | ||||||||
Effect of exchange rate changes on cash | (1,070 | ) | 138 | 110 | ||||||||
Cash at beginning of year | 1,158 | 383 | 1,229 | |||||||||
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Cash at end of year | $ | 35,085 | $ | 1,158 | $ | 383 | ||||||
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Supplemental cash flow information: | ||||||||||||
Cash paid during the year for: | ||||||||||||
Interest | $ | 2,055 | $ | 3,661 | $ | 3,279 | ||||||
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Income taxes | $ | 6,359 | $ | 2,205 | $ | 3,361 | ||||||
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