American Vanguard (AVD) - 2025 Q2 - Quarterly Results

Executive Summary & Business Update Second Quarter 2025 Financial and Operational Highlights Q2 2025 saw significantly improved financial results, with adjusted EBITDA up over 80% and reduced debt and inventory levels Q2 2025 Financial Highlights (YoY) | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :-------------------- | :------ | :------ | :----- | :------- | | Net sales | $129M | $128M | +$1M | +1% | | Adjusted EBITDA | $11M | $6M | +$5M | +83% | | GAAP EPS | $(0.03) | $(0.42) | +$0.39 | N/A | | Gross Profit Margin | 31% | 29% | +2% | N/A | - Debt outstanding at June 30, 2025 was $189 million, a decrease of $22 million compared to last year[4][5] - Inventory at June 30, 2025 was $191 million, a decrease of $53 million compared to last year[4][5] Management Commentary and Outlook Management attributed improved performance to transformation efforts and operational efficiencies while reiterating full-year 2025 guidance - CEO noted that operational improvements led to a substantial improvement in adjusted EBITDA, increasing by more than 80% year-over-year[3] - Gross profit margin increased to 31% from 29% due to improvements in manufacturing and procurement processes[3] - CFO stated that operating costs were down $5 million in Q2 and $8 million year-to-date, excluding transformation expenses[5] 2025 Full-Year Guidance | Metric | Guidance Range | | :------------- | :------------- | | Revenue | $535M – $545M | | Adjusted EBITDA | $40M – $44M | Company Overview and Forward-Looking Statements The company operates as a diversified specialty and agricultural products provider with extensive global product registrations - American Vanguard develops and markets products for crop protection and management, turf and ornamentals management, and public and animal health[7] - The company has significantly expanded its operations over the past 20 years, holding more than 1,000 product registrations worldwide[7] - Forward-looking statements in the release are based on current expectations and estimates, subject to risks and uncertainties detailed in SEC reports[8] Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheets Total assets and liabilities increased as of June 30, 2025, compared to year-end 2024, while stockholders' equity slightly decreased Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total Assets | $651,978 | $636,721 | | Total Current Assets | $399,326 | $378,893 | | Inventories | $191,497 | $179,292 | | Total Liabilities | $421,156 | $403,611 | | Long-term debt | $189,500 | $147,332 | | Total Stockholders' Equity | $230,822 | $233,110 | - Management highlighted a year-over-year decrease in inventory ($191 million, down $53 million) and debt ($189 million, down $22 million) despite increases from year-end 2024[4][5][11] Condensed Consolidated Statements of Operations Q2 2025 saw a significant improvement in operating income and a reduced net loss compared to the prior year Q2 2025 vs. Q2 2024 Operating Results (in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Net sales | $129,313 | $128,209 | +$1,104 | | Gross profit | $40,547 | $37,763 | +$2,784 | | Operating income (loss) | $4,366 | $(9,232) | +$13,598 | | Net loss | $(849) | $(11,721) | +$10,872 | | Net loss per common share—basic | $(0.03) | $(0.42) | +$0.39 | Six Months 2025 vs. Six Months 2024 Operating Results (in thousands) | Metric | 6M 2025 | 6M 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Net sales | $245,113 | $263,352 | $(18,239) | | Gross profit | $70,738 | $80,181 | $(9,443) | | Operating income (loss) | $56 | $(3,141) | +$3,197 | | Net loss | $(9,311) | $(10,169) | +$858 | | Net loss per common share—basic | $(0.33) | $(0.36) | +$0.03 | Analysis of Sales by Segment Q2 2025 net sales grew 1% year-over-year with an improved gross margin, while six-month sales saw a decline Q2 2025 Sales Performance by Segment (in thousands) | Segment | 2025 Sales | 2024 Sales | Change | % Change | | :---------- | :--------- | :--------- | :----- | :------- | | U.S. crop | $52,674 | $52,289 | +$385 | +1% | | U.S. non-crop | $19,585 | $19,011 | +$574 | +3% | | International | $57,054 | $56,909 | +$145 | 0% | | Total net sales | $129,313 | $128,209 | +$1,104 | +1% | | Total gross margin | 31% | 29% | +2% | N/A | Six Months 2025 Sales Performance by Segment (in thousands) | Segment | 2025 Sales | 2024 Sales | Change | % Change | | :---------- | :--------- | :--------- | :----- | :------- | | U.S. crop | $110,201 | $119,542 | $(9,341) | -8% | | U.S. non-crop | $34,834 | $36,787 | $(1,953) | -5% | | International | $100,078 | $107,023 | $(6,945) | -6% | | Total net sales | $245,113 | $263,352 | $(18,239) | -7% | | Total gross margin | 29% | 30% | -1% | N/A | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities for the first six months of 2025 decreased compared to the prior year period Six Months 2025 vs. Six Months 2024 Cash Flow Highlights (in thousands) | Metric | 6M 2025 | 6M 2024 | Change | | :-------------------------------- | :------ | :------ | :----- | | Net cash used in operating activities | $(39,836) | $(49,357) | +$9,521 | | Net cash used in investing activities | $(1,057) | $(6,398) | +$5,341 | | Net cash provided by financing activities | $41,479 | $63,190 | $(21,711) | | Net increase in cash and cash equivalents | $586 | $7,435 | $(6,849) | | Cash and cash equivalents at end of period | $14,482 | $17,949 | $(3,467) | - Operating cash flow improvement was driven by a smaller increase in inventories and a decrease in customer prepayments[17] Reconciliation of Net Income (Loss) to Adjusted EBITDA Adjusted EBITDA for Q2 2025 improved by 79% year-over-year, though the six-month figure declined from the prior year Adjusted EBITDA (in thousands) | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :---------------- | :------ | :------ | :----- | :------- | | Adjusted EBITDA | $11,039 | $6,164 | +$4,875 | +79.1% | | | | | | | | Metric | 6M 2025 | 6M 2024 | Change | % Change | | :---------------- | :------ | :------ | :----- | :------- | | Adjusted EBITDA | $14,012 | $21,679 | $(7,667) | -35.4% | - Transformation costs decreased significantly, from $7.35 million in Q2 2024 to $1.62 million in Q2 2025, and from $8.50 million in 6M 2024 to $3.81 million in 6M 2025[13][19] - Adjusted EBITDA is a non-GAAP financial measure and should not be considered an alternative to net income or cash flow from operating activities[19] Supplemental Information Earnings Conference Call Details The company hosted an earnings call on July 31, 2025, with replay and presentation materials available online - The earnings conference call was held on July 31, 2025, at 5 pm ET[6] - A replay of the conference call and an investor presentation are accessible through the company's Investor Relations website[6] Company Contact Information Contact details for investor relations representatives were provided for inquiries - Company Contact: Anthony Young, Director of Investor Relations, American Vanguard Corporation (anthonyy@amvac.com, (949) 221-6119)[9] - Investor Representative: Robert Winters, AlphaIR Group (Robert.winters@alpha-ir.com, (929) 266-6315)[9]