Part I [Business](index=5&type=section&id=Item%201.%20Business) Balchem Corporation develops and markets specialty ingredients across Human Nutrition and Health, Animal Nutrition and Health, and Specialty Products segments, supported by strategic acquisitions and operational investments - Balchem operates through three primary business segments: Human Nutrition and Health (HNH), Animal Nutrition and Health (ANH), and Specialty Products, serving markets from nutritional supplements to medical device sterilization[8](index=8&type=chunk) - In 2022, the company completed two key acquisitions to bolster its Human Nutrition and Health segment: Kappa Bioscience, a manufacturer of vitamin K2, and Bergstrom Nutrition, a leading producer of MSM (methylsulfonylmethane)[17](index=17&type=chunk) Research and Development Expenses (2021-2023) | Year | R&D Expense (in thousands) | | :--- | :--- | | 2023 | $15,049 | | 2022 | $12,191 | | 2021 | $13,524 | Capital Expenditures (2021-2023) and 2024 Projection | Year / Period | Capital Expenditures (in thousands) | | :--- | :--- | | 2023 | $37,274 | | 2022 | $49,086 | | 2021 | $36,142 | | 2024 (Projected) | $35,000 - $40,000 | - As of December 31, 2023, Balchem employed approximately **1,302 full-time employees** worldwide, with about **18%** covered by collective bargaining agreements[38](index=38&type=chunk) Employee Turnover Rate (2022-2023) | Employee Type | 2023 Turnover Rate | 2022 Turnover Rate | | :--- | :--- | :--- | | Salaried | 11% | 15% | | Hourly | 29% | 36% | [Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) The company faces operational, financial, and regulatory risks, including supply chain disruptions, economic volatility, and environmental compliance - **Operational Risks:** The company faces risks from its international sales and manufacturing, supply chain disruptions due to geopolitical conflicts, reliance on manufacturing facilities, and potential cybersecurity attacks on its IT systems[51](index=51&type=chunk)[52](index=52&type=chunk)[63](index=63&type=chunk) - **Business and Financial Risks:** Key risks include intense competition, adverse global economic conditions like inflation and recession, raw material price fluctuations, currency translation risk, and risks associated with debt, such as interest rate fluctuations and restrictive covenants[67](index=67&type=chunk)[68](index=68&type=chunk)[71](index=71&type=chunk) - **Legal, Regulatory, and Compliance Risks:** The company is exposed to risks from potential product liability claims, infringement of intellectual property, reputational damage related to ESG matters, and stringent environmental regulations, particularly the EPA's ongoing review of ethylene oxide, which could impact customers in the medical device sterilization industry[86](index=86&type=chunk)[88](index=88&type=chunk)[99](index=99&type=chunk) [Unresolved Staff Comments](index=18&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[100](index=100&type=chunk) [Cybersecurity](index=19&type=section&id=Item%201C.%20Cybersecurity) Balchem's cybersecurity program, overseen by the Audit Committee and aligned with the NIST framework, includes proactive testing and a crisis management plan - Cybersecurity oversight is managed by the Board's Audit Committee, with the global head of Information Security reporting to the CFO and providing at least annual updates to the committee and full Board[101](index=101&type=chunk) - The company's cybersecurity program is built on the U.S. National Institute of Standards and Technology (NIST) framework and is tested annually by an independent third party[102](index=102&type=chunk) - In the event of a cybersecurity incident, the company would implement its crisis management plan, which includes steps for internal reporting, information assessment, communication strategy, response monitoring, and recovery[106](index=106&type=chunk) [Properties](index=20&type=section&id=Item%202.%20Properties) Balchem operates 38 owned and leased facilities globally for manufacturing, warehousing, and administration, supporting its business segments Summary of Principal Properties by Segment | Segment | Location | Administrative | Manufacturing | Warehousing | | :--- | :--- | :--- | :--- | :--- | | Corporate | 5 U.S. cities | 5 | — | — | | HNH | 17 U.S. cities and 6 foreign countries | 1 | 16 | 6 | | ANH | 9 U.S. cities and 3 foreign countries | — | 10 | 2 | | Specialty Products | 6 U.S. cities and 6 foreign countries | 2 | 8 | 2 | | Other | 2 U.S. cities and 1 foreign country | — | 3 | — | [Legal Proceedings](index=20&type=section&id=Item%203.%20Legal%20Proceedings) Balchem is involved in various legal proceedings incidental to its business, none of which are expected to have a material adverse effect - The company is involved in a variety of lawsuits and legal proceedings incidental to its business but does not expect them to have a material adverse effect on its financial condition or results[110](index=110&type=chunk)[111](index=111&type=chunk) [Mine Safety Disclosures](index=20&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[112](index=112&type=chunk) [Information about Our Executive Officers](index=21&type=section&id=Information%20about%20Our%20Executive%20Officers) This section lists Balchem Corporation's executive officers as of February 16, 2024, including their names, ages, and positions Executive Officers as of February 16, 2024 | Name | Age | Position | | :--- | :--- | :--- | | Theodore L. Harris | 58 | Chairman, President and Chief Executive Officer | | C. Martin Bengtsson | 46 | Executive Vice President and Chief Financial Officer | | Hatsuki Miyata | 48 | Executive Vice President, General Counsel and Secretary | | Frederic Boned | 46 | Senior Vice President and General Manager, Human Nutrition and Health | | Jonathan H. Griffin | 48 | Senior Vice President and General Manager, Animal Nutrition and Health | | Martin L. Reid | 57 | Senior Vice President and Chief Supply Chain Officer | | Michael R. Sestrick, Ph.D. | 60 | Senior Vice President and Chief Technology Officer | | M. Brent Tignor | 46 | Senior Vice President and Chief Human Resources Officer | | Job L. van Gunsteren | 48 | Senior Vice President and General Manager, Specialty Products | | William A. Backus | 57 | Vice President and Chief Accounting Officer | Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Balchem's common stock trades on Nasdaq under "BCPC," with 64 record holders as of February 2, 2024, and the company repurchased shares primarily for tax settlements in 2023 - The company's common stock is listed on the Nasdaq Stock Market LLC under the symbol "BCPC". As of February 2, 2024, there were **64 record holders**[119](index=119&type=chunk) 2023 Share Repurchase Summary | Quarter | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | First Quarter | 28,109 | - | | Second Quarter | 567 | - | | Third Quarter | 775 | - | | Fourth Quarter | 3,107 | - | | **Total** | **32,558** | **-** | - No share repurchases were made under the company's publicly announced stock repurchase program during 2023, other than shares withheld for tax purposes from employees[125](index=125&type=chunk) [[Reserved]](index=24&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In fiscal year 2023, Balchem's net sales decreased 2.1% to **$922.4 million**, while earnings from operations increased 9.6% to **$159.2 million**, supported by strong operating cash flow [Results of Operations - Fiscal Year 2023 compared to Fiscal Year 2022](index=26&type=section&id=Results%20of%20Operations%20-%20Fiscal%20Year%202023%20compared%20to%20Fiscal%20Year%202022) In 2023, net sales decreased 2.1% to **$922.4 million**, driven by declines in ANH and Specialty Products, while gross margin improved 7.7% to **$302.1 million** Consolidated Financial Summary (2023 vs. 2022) | Metric (in thousands) | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Net sales | $922,439 | $942,358 | (2.1)% | | Gross margin | $302,056 | $280,451 | 7.7% | | Earnings from operations | $159,193 | $145,186 | 9.6% | | Net earnings | $108,543 | $105,367 | 3.0% | Net Sales by Segment (2023 vs. 2022) | Segment (in thousands) | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Human Nutrition and Health | $550,751 | $527,131 | 4.5% | | Animal Nutrition and Health | $238,326 | $262,297 | (9.1)% | | Specialty Products | $125,965 | $131,438 | (4.2)% | - The increase in operating expenses was primarily due to **$7.8 million** in restructuring charges and **$7.7 million** in incremental expenses from the Kappa and Bergstrom acquisitions, partially offset by a **$10.8 million** favorable adjustment to transaction costs[141](index=141&type=chunk) - Interest expense increased **120.2%** to **$22.6 million** due to additional borrowings for acquisitions and higher interest rates[145](index=145&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) As of December 31, 2023, Balchem reported **$64.4 million** in cash, with operating cash flow increasing 32.6% to **$183.8 million**, used for debt reduction and capital expenditures Cash Flow Summary (in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Cash flows provided by operating activities | $183,761 | $138,536 | | Cash flows used in investing activities | ($34,813) | ($416,014) | | Cash flows (used in) provided by financing activities | ($153,321) | $246,679 | - Cash and cash equivalents decreased to **$64.4 million** at year-end 2023. Significant cash payments during the year included **$131.0 million** in net payments on the revolving loan, **$37.9 million** in capital expenditures, and **$22.9 million** in dividend payments[150](index=150&type=chunk) - In 2023, the company made net payments of **$131.0 million** on its revolving loan, leaving **$240.4 million** available under its credit agreement as of December 31, 2023[155](index=155&type=chunk) [Critical Accounting Estimates](index=30&type=section&id=Critical%20Accounting%20Estimates) Management identifies critical accounting estimates in goodwill and intangible asset valuation, contingent consideration liabilities, and income tax calculations, all requiring significant judgment - The valuation of goodwill and intangible assets, and the assessment for impairment, involve significant estimation uncertainty regarding future cash flows, growth rates, and discount rates[164](index=164&type=chunk) - The valuation of contingent consideration liabilities related to acquisitions requires significant estimation, although as of December 31, 2023, the earn-out periods had concluded, reducing this uncertainty[165](index=165&type=chunk) - The calculation of income taxes, deferred tax assets/liabilities, and any necessary valuation allowances involves significant judgment regarding future taxable income and tax planning strategies[166](index=166&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from interest rate fluctuations on variable-rate debt and foreign currency volatility, with hedging instruments maturing in 2023 - The company is exposed to interest rate risk on its revolving loan, which bears a fluctuating rate. A **100 basis point** increase or decrease in interest rates would change annual interest expense by approximately **$3,096 thousand**[168](index=168&type=chunk) - Derivative instruments, including an interest rate swap and a cross-currency swap used for hedging, matured and settled on June 27, 2023[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) [Financial Statements and Supplementary Data](index=32&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents Balchem's audited consolidated financial statements for fiscal years 2021-2023, including balance sheets, statements of earnings, and cash flows Consolidated Statements of Earnings (in thousands) | | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net sales | $922,439 | $942,358 | $799,023 | | Gross margin | $302,056 | $280,451 | $243,174 | | Earnings from operations | $159,193 | $145,186 | $127,502 | | Net earnings | $108,543 | $105,367 | $96,104 | | Diluted EPS | $3.35 | $3.25 | $2.94 | Consolidated Balance Sheet Highlights (in thousands) | | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Total Current Assets | $314,242 | $335,803 | | Total Assets | $1,597,211 | $1,624,512 | | Total Current Liabilities | $148,491 | $140,042 | | Revolving loan | $309,569 | $440,569 | | Total Liabilities | $543,227 | $686,228 | | Total Stockholders' Equity | $1,053,984 | $938,284 | Consolidated Statements of Cash Flows (in thousands) | | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $183,761 | $138,536 | $160,514 | | Net cash used in investing activities | ($34,813) | ($416,014) | ($35,300) | | Net cash (used in) provided by financing activities | ($153,321) | $246,679 | ($102,178) | | (Decrease) increase in cash | ($2,113) | ($36,679) | $18,668 | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=72&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants regarding accounting principles, financial disclosure, or auditing procedures - None[368](index=368&type=chunk) [Controls and Procedures](index=72&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that Balchem's disclosure controls and internal control over financial reporting were effective as of December 31, 2023, including recently acquired businesses - The company's management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of December 31, 2023[370](index=370&type=chunk) - Based on the COSO 2013 framework, management determined that the company's internal control over financial reporting was effective as of December 31, 2023[373](index=373&type=chunk) - As of December 31, 2023, management's assessment of internal controls now includes the recently acquired Kappa and Bergstrom businesses[375](index=375&type=chunk) [Other Information](index=73&type=section&id=Item%209B.%20Other%20Information) No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement during the fourth quarter of 2023 - No directors or officers made changes to a Rule 10b5-1 trading arrangement in the fourth quarter of 2023[377](index=377&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=74&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20of%20the%20Registrant%2C%20and%20Corporate%20Governance.) Information on directors, executive officers, and corporate governance is incorporated by reference from the company's 2024 Proxy Statement - Information required by this item is incorporated by reference from the Registrant's 2024 Proxy Statement[379](index=379&type=chunk) [Executive Compensation](index=74&type=section&id=Item%2011.%20Executive%20Compensation.) Executive compensation details, Compensation Committee Report, and insider participation are incorporated by reference from the 2024 Proxy Statement - Information required by this item is incorporated by reference from the Registrant's 2024 Proxy Statement[380](index=380&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=74&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters.) Security ownership details for beneficial owners and management, along with equity compensation plans, are incorporated by reference from the 2024 Proxy Statement - Information required by this item is incorporated by reference from the Registrant's 2024 Proxy Statement[381](index=381&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=74&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence.) Information on related party transactions and director independence is incorporated by reference from the 2024 Proxy Statement - Information required by this item is incorporated by reference from the Registrant's 2024 Proxy Statement[381](index=381&type=chunk) [Principal Accountant Fees and Services](index=74&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services.) Information on fees paid to and services provided by the principal accountant is incorporated by reference from the 2024 Proxy Statement - Information required by this item is incorporated by reference from the Registrant's 2024 Proxy Statement[382](index=382&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=75&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules.) This section lists all documents filed as part of the Form 10-K, including financial statements, schedules, and various exhibits - This section contains the index of financial statements, financial statement schedules, and exhibits filed with the Form 10-K[385](index=385&type=chunk)

The market expects Blachem (BCPC) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended December 2023. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released o ...

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Financial Performance - Balchem's Q3 2023 sales decreased by 5.9% compared to Q3 2022[35] - Balchem's Q3 2023 adjusted EBITDA increased by 4.3% compared to Q3 2022[38] - Balchem's Q3 2023 adjusted net earnings increased by 4.0% compared to Q4 2022[40] - Balchem's full year 2022 sales increased by 17.9% compared to 2021[50] - Balchem's full year 2022 adjusted EBITDA increased by 13.8% compared to 2021[52] - Balchem's full year 2022 adjusted net earnings increased by 11.9% compared to 2021[54] Business Overview - In 2022, Human Nutrition & Health segment accounted for 56% of Balchem's revenue, Animal Nutrition & Health 28%, and Specialty Products 14%[6] - Balchem reached 14 billion people in 2022 with its solutions[73] Strategic Focus - Balchem aims to reduce GHG emissions and global water use by 25% by 2030[77]

Balchem Corporation (NASDAQ:BCPC) Q3 2023 Earnings Conference Call October 27, 2023 11:00 AM ET Company Participants Martin Bengtsson - CFO Ted Harris - Chairman, President and CEO Conference Call Participants Bob Labick - CJS Securities Anthony Polak - Aegis Capital Kyle May - Sidoti Operator Greetings, and welcome to the Balchem Third Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce you to your host, Martin Bengtsson, CFO. ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____ Commission file number: 1-13648 _____________________________________________________________________________________________________________ ...

Balchem Corporation (NASDAQ:BCPC) Q2 2023 Earnings Conference Call July 28, 2023 11:00 AM ET Company Participants Martin Bengtsson - CFO Ted Harris - Chairman, President and CEO Conference Call Participants Bob Labick - CJS Securities Ram Selvaraju - H.C. Wainwright Operator Greetings and welcome to Balchem's Second Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, th ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____ Commission file number: 1-13648 _______________________________________________________________________________________________________________ Ba ...

Balchem Corporation (NASDAQ:BCPC) Q1 2023 Earnings Conference Call April 28, 2023 11:00 AM ET Company Participants Martin Bengtsson - Chief Financial Officer Ted Harris - Chairman, Chief Executive Officer & President Conference Call Participants Mitra Ramgopal - Sidoti Bob Labick - CJS Securities Operator Greetings and welcome to Balchem's First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presenta ...

1 Investor Presentation Q1, 2023 Safe Harbor Statement • During the course of this presentation, management may make forward-looking statements regarding financial performance and future events. • We will attempt to identify these statements by use of words such as expect, believe, anticipate, intend, and other words that denote future events. You should understand that, even though our forwardlooking statements are based on assumptions we believe are reasonable when made, they are still subject to uncertai ...