Phibro(US:PAHC)2025-05-07 20:16Financial Performance - Net sales for the three months ended March 31, 2025, were $347.8 million, a 32% increase from $263.2 million in the same period of 2024[120] - Gross profit for the three months ended March 31, 2025, was $104.6 million, reflecting a 31% increase compared to $79.6 million in the prior year[120] - Operating income for the three months ended March 31, 2025, was $33.5 million, a 68% increase from $19.9 million in the same period of 2024[120] - Net income for the three months ended March 31, 2025, was $20.9 million, compared to $8.4 million in the same period of 2024, marking a significant increase[120] - Adjusted EBITDA for the three months ended March 31, 2025, was $54.9 million, an increase of $25.2 million or 85% compared to the same period in 2024[123] - Net sales for the nine months ended March 31, 2025, were $917.5 million, an increase of $173.0 million or 23% compared to the same period in 2024[141] - Net income for the nine months ended March 31, 2025, was $31.0 million, compared to $1.7 million for the same period in 2024[154] - Adjusted net income for the nine months ended March 31, 2025, was $61.7 million, a 95% increase from $31.7 million in 2024[156] - Adjusted diluted earnings per share (EPS) for the nine months ended March 31, 2025, was $1.52, up 95% from $0.78 in 2024[158] Expenses and Costs - Selling, general and administrative expenses (SG&A) for the three months ended March 31, 2025, were $71.1 million, an increase of $11.4 million or 19% compared to the same period in 2024[134] - Selling, general and administrative expenses (SG&A) totaled $213.2 million, an increase of $22.1 million, or 12%[148] - Interest expense for the three months ended March 31, 2025, was $9.4 million, an increase of 88% from $4.6 million in the same period of 2024[120] - Interest expense, net increased to $26.0 million, up $12.2 million, or 88%, due to higher debt levels from financing acquisitions[150] Taxation - The effective tax rate for the three months ended March 31, 2025, was 29.7%, down from 35.0% in the same period of 2024[120] - The effective income tax rate for the nine months ended March 31, 2025, was 29.7%, down from 63.1% in 2024, primarily due to higher pretax earnings[152] Acquisitions and Investments - The company completed the acquisition of Zoetis's medicated feed additive portfolio for approximately $302.9 million, which generated $407.6 million in revenue in 2023[108] - Animal Health segment net sales increased by $77.0 million or 42%, driven by $73.4 million from the Zoetis MFA portfolio acquired on October 31, 2024[127] - Investing activities used $281.7 million in net cash, primarily due to the acquisition purchase price of $291.9 million and capital expenditures of $25.2 million[161] Cash Flow and Liquidity - For the nine months ended March 31, 2025, operating activities provided $58.9 million in net cash, with net income adjusted for non-cash items totaling $66.2 million[160] - Financing activities generated $214.9 million in net cash, reflecting $300.0 million from debt refinancing and $350.0 million from term loan borrowings for the acquisition[162] - As of March 31, 2025, cash and cash equivalents and short-term investments totaled $70.4 million, with working capital at $455.4 million and a current assets to current liabilities ratio of 2.82:1[164] - The company expects adequate liquidity for at least the next twelve months, considering macroeconomic conditions and potential risks[163] Risks and Forward-Looking Statements - Forward-looking statements indicate potential risks including competition, regulatory actions, and economic conditions that may impact future performance[179] - The company faces risks related to product approval, R&D, acquisition, and licensing efforts that may not generate new products[183] - The company is dependent on its Israeli and Brazilian operations, which may impact overall performance[183] - The company has a substantial level of indebtedness and related debt-service obligations that could affect financial stability[183] - The company utilizes foreign currency contracts and interest rate swaps to hedge exposure to market risks, but does not eliminate the effects of changing market conditions[184] - As of the report date, there were no material changes in the company's financial market risks from those disclosed in the Annual Report[185] Dividends - The company declared a cash dividend of $0.12 per share on Class A and Class B common stock, payable on June 25, 2025[165]