Key Takeaways PAHC's Q2 outlook calls for $357M in revenues, up 15.4% year over year, with EPS seen at 69 cents.Phibro's Animal Health segment is expected to gain from MFA strength, nutrition growth and vaccines demand.PAHC may see mixed trends, with weaker Mineral Nutrition offset by stronger Performance Products sales.Phibro Animal Health Corp. (PAHC) is expected to release second-quarter fiscal 2026 results soon.In the last reported quarter, the company posted adjusted earnings per share (EPS) of 73 cent ...

Financial Performance and Key Metrics - Consolidated net sales for Q1 2026 were $363.9 million, a 40% increase year-over-year, driven by a 55% growth in the animal health segment [8][9] - Adjusted EBITDA for Q1 increased by 102% to $31.2 million, with adjusted net income rising by 112% and adjusted diluted EPS increasing by 108% [8][9] - The animal health segment's net sales reached $283.5 million, reflecting a 55% increase, while mineral nutrition grew by 7% and performance products declined by 7% [9][10] Business Line Performance - Medicated feed additives saw an 81% growth, with the new MFA business contributing $80.5 million in sales [5][9] - Nutritional specialties net sales increased by 13%, primarily due to higher demand for microbial and companion animal products [9] - Vaccine sales grew by 25%, driven by poultry products in Latin America and increased international demand [9] Market Data and Key Metrics - Strong demand for animal-based proteins is noted, supported by global population growth and changing consumer preferences towards high-quality proteins [30] - Livestock sector profitability remains positive across various regions, with lower feed costs encouraging investment in animal health products [30][31] Company Strategy and Industry Competition - The company is focused on innovation and execution, with the recent launch of Restoris, a dental gel for dogs, marking a significant step in the companion animal strategy [6][23] - The Phibro-forward initiatives aim to enhance operational discipline and drive sustainable long-term value creation [6][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for products globally and anticipates continued improvement in business performance [13][14] - The company raised its full-year earnings guidance, reflecting strong performance and disciplined financial management [12][13] Other Important Information - The company generated $34 million in positive free cash flow for the 12 months ending September 30, 2025, with a gross leverage ratio of 3.3 times [11] - A quarterly dividend of $0.12 per share was paid, totaling $4.9 million [12] Q&A Session Summary Question: Sustainability of growth in the MFA business - Management noted strong demand across the MFA portfolio, particularly in poultry, swine, and beef cattle segments, with limited impact on pricing in Q1 [15][16][17] Question: Margin profile for the remainder of the year - Management indicated that Q1 margins were favorable due to product mix, but expected a slight drop in margins as investments in new product launches occur [18][19] Question: Guidance update and revenue range - Management explained that while EBITDA and EPS guidance were raised, revenue guidance remained unchanged due to conservatism and being only one quarter into the fiscal year [21][22] Question: Role in the companion animal market - Management confirmed a focus on unique opportunities in the companion animal space, rather than competing directly with larger players [34][36]

Core Insights - Phibro Animal Health (PAHC) reported a revenue of $363.9 million for the quarter ended September 2025, marking a year-over-year increase of 39.8% and an EPS of $0.73 compared to $0.35 a year ago, exceeding Zacks Consensus Estimate of $354.68 million by 2.6% [1] Revenue Performance - Net Sales by Region: - United States: $202.35 million, exceeding the average estimate of $172.57 million, a year-over-year increase of 41% [3] - Asia Pacific: $29.38 million, surpassing the average estimate of $18.44 million, a year-over-year increase of 101.1% [3] - Europe, Middle East and Africa: $44.94 million, above the average estimate of $37.31 million, a year-over-year increase of 44.4% [3] - Latin America and Canada: $87.23 million, below the average estimate of $130.56 million, a year-over-year increase of 22.6% [3] - Net Sales by Segment: - Animal Health: $283.5 million, exceeding the average estimate of $277.16 million, a year-over-year increase of 55.3% [3] - Mineral Nutrition: $63 million, above the average estimate of $58.29 million, a year-over-year increase of 6.7% [3] - Animal Health - Vaccines: $40.1 million, surpassing the average estimate of $37.23 million, a year-over-year increase of 25.2% [3] - Animal Health - MFAs and other: $195.2 million, slightly above the average estimate of $194.62 million, a year-over-year increase of 81% [3] - Animal Health - Nutritional specialties: $48.2 million, exceeding the average estimate of $45.31 million, a year-over-year increase of 13% [3] - Performance Products: $17.4 million, below the average estimate of $19.23 million, a year-over-year decrease of 7.7% [3] Profitability Metrics - Adjusted EBITDA for Animal Health: $74.9 million, exceeding the average estimate of $66.19 million [3] - Adjusted EBITDA for Corporate: $-19.1 million, worse than the average estimate of $-17.6 million [3]

Financial Data and Key Metrics Changes - Consolidated net sales for Q4 2025 were $378.7 million, reflecting a 39% increase year-over-year [12] - For the full year, consolidated net sales were $1.296 billion, a 27% increase compared to the previous year [13] - Adjusted EBITDA for Q4 increased by $16.5 million or 49% year-over-year [13] - Full year adjusted EBITDA rose by $72.4 million or 65% [14] Business Line Data and Key Metrics Changes - The Animal Health segment saw net sales of $292.5 million in Q4, a 53% increase year-over-year [15] - For the full year, Animal Health segment sales reached $962.8 million, a 36% increase [16] - Nutritional specialties net sales increased by 11% in Q4 and 9% for the full year [15][20] - Vaccine net sales grew by 21% in Q4 and 13% for the full year [16][20] Market Data and Key Metrics Changes - The MFA and other portfolio grew by 77% in Q4, with the new MFA business contributing $94.5 million in sales [7][15] - Mineral Nutrition segment net sales for Q4 were $64.2 million, a 3% increase [19] - Performance Products segment net sales increased by 13% in Q4 [19] Company Strategy and Development Direction - The company is focused on scaling operations, enhancing its global footprint, and improving its innovation pipeline [10] - The "Fiber Forward" strategy aims to unlock additional revenue growth and cost savings through various initiatives [24] - The company anticipates continued growth in the Animal Health segment, particularly in vaccines and nutritional specialties [28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for products globally and expects continued improvement in business performance [25] - The guidance for fiscal year 2026 includes projected net sales of $1.425 billion to $1.475 billion, reflecting a growth range of 10% to 14% [24] - Management noted that the integration of the Zoetis MFA business is progressing well, with expectations to operate independently by Q4 of the calendar year [41] Other Important Information - The company generated $42 million of positive free cash flow for the twelve months ended June 30, 2025 [21] - The gross leverage ratio was 3.1 times at the end of Q4, with total debt of $725 million [22] - A quarterly dividend of $0.12 per share was paid, totaling $4.9 million [23] Q&A Session Summary Question: What does guidance now assume in terms of the underlying organic growth? - Management indicated that the guidance reflects a mix of contributions from the Zoetis portfolio and expectations for legacy business growth [27] Question: Can you quantify expectations for the Fiber Forward initiative? - Management expects significant contributions from the Fiber Forward initiative, with anticipated EBITDA growth of $40 million to $50 million [32] Question: Where are we in terms of the Zoetis integration process? - The integration is progressing well, with major system implementations complete and expectations to operate independently by Q4 [41] Question: What is the expected growth of the legacy MFA business? - The legacy MFA business is expected to grow in the flat to low single-digit range, with no significant pull forward in sales due to tariffs [58]

Financial Data and Key Metrics Changes - Consolidated net sales for Q4 2025 were $378.7 million, reflecting a 39% increase year-over-year [12] - For the full year, consolidated net sales were $1.296 billion, a 27% increase compared to the previous year [13] - Adjusted EBITDA for Q4 increased by 49% to $50.2 million, while for the full year, it rose by 65% to $184.4 million [13][14] - GAAP net income and diluted EPS saw significant increases, driven by the integration of the new MFA business and improved gross margins [12][14] Business Line Data and Key Metrics Changes - The Animal Health segment reported Q4 net sales of $292.5 million, a 53% increase year-over-year [15] - For the full year, Animal Health net sales reached $962.8 million, a 36% increase [17] - Nutritional specialties and vaccines saw substantial growth, with nutritional specialties increasing by 11% in Q4 and 9% for the full year, while vaccines grew by 21% in Q4 and 13% for the full year [15][17] - The Mineral Nutrition segment had Q4 net sales of $64.2 million, a 3% increase, and for the full year, $253.2 million, a 4% increase [18][19] Market Data and Key Metrics Changes - The company experienced strong demand across various geographies, particularly in Latin America for poultry products and in the U.S. for swine products [16][17] - The integration of the Zoetis medicated feed additive portfolio is progressing well, with expectations to operate independently by Q4 2025 [41][42] Company Strategy and Development Direction - The company is focused on its "Fiber Forward" strategy, which aims to enhance operations, global footprint, and innovation pipeline [10][11] - Investments are being made in scaling operations and strengthening customer relationships through initiatives like global procurement [34][35] - The guidance for fiscal year 2026 reflects confidence in continued growth, with projected net sales between $1.425 billion and $1.475 billion [10][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for products globally and anticipates continued improvement in business performance [24] - The guidance for fiscal year 2026 includes expectations for organic growth driven by the full twelve months of Zoetis contributions and continued strong performance in vaccines and nutritional specialties [27][28] Other Important Information - The company generated $42 million in positive free cash flow for the twelve months ended June 30, 2025 [20] - Corporate expenses increased due to higher employee-related costs and strategic investments [19] Q&A Session Summary Question: What does guidance now assume in terms of the underlying organic growth? - Management indicated that the guidance assumes a mix of growth from the Zoetis portfolio and continued strong performance in vaccines and nutritional specialties, with legacy MFA growth expected to be flat to low single digits [27][28] Question: Can you quantify expectations for the Fiber Forward initiative? - Management expects contributions from the Fiber Forward initiative to continue driving growth, with significant earnings growth anticipated in fiscal year 2026 [31][32] Question: Where are we in terms of the Zoetis integration process? - The integration is progressing well, with major system implementations complete and expectations to operate independently by Q4 2025 [41][42] Question: What is the expected growth of the legacy MFA business? - The legacy MFA business is expected to grow flat to low single digits, with no significant pull forward in sales due to tariffs [56][58]

Financial Performance - Consolidated - Q4 Net Sales increased by 39% to $378.7 million compared to $273.2 million in FY24[13] - Q4 Adjusted EBITDA increased by 49% to $50.0 million compared to $33.4 million in FY24[13] - Full Year Net Sales increased by 27% to $1,296.2 million compared to $1,017.7 million in FY24[16] - Full Year Adjusted EBITDA increased by 65% to $183.7 million compared to $111.2 million in FY24[16] Financial Performance - Animal Health - Q4 Animal Health Net Sales increased by 53% to $292.5 million[11,19] - Q4 Legacy Animal Health Net Sales increased by 3% to $197.9 million[11,19] - Full Year Animal Health Net Sales increased by 36% to $962.8 million[11,22] - Full Year Legacy Animal Health Net Sales increased by 7% to $754.6 million[11,22] Financial Guidance - Fiscal Year 2026 - The company projects Net Sales between $1.425 billion and $1.475 billion[12] - The company projects Adjusted EBITDA between $225 million and $235 million[12]

Financial Performance - Q3 FY2025 - Consolidated net sales increased to $347.8 million, compared to $263.2 million in Q3 FY24[12] - Consolidated adjusted EBITDA increased to $45 million, an 85% increase compared to $29.7 million in Q3 FY24[12] - Animal Health sales increased by 42% to $258.4 million[10, 16] - Animal Health adjusted EBITDA increased by 73% to $63.1 million[10, 16] - Mineral Nutrition net sales increased by 4% to $66.8 million[10, 20] - Performance Products net sales increased by 28% to $22.7 million[10, 21] FY2025 Guidance - Net sales are projected to be between $1.260 billion and $1.290 billion[11] - Adjusted EBITDA is projected to be between $177 million and $183 million[11] - Adjusted EPS is projected to be between $1.96 and $2.09[11] Capitalization - Free cash flow was $49 million for the trailing twelve months[25] - The company has a gross leverage ratio of 3.0x, with $734 million in total debt[25] - The company has a net leverage ratio of 2.7x, with $664 million in net debt[25]

Core Insights - Phibro Animal Health (PAHC) reported a revenue of $347.8 million for the quarter ended March 2025, marking a year-over-year increase of 32.1% and an EPS of $0.63 compared to $0.31 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $350.54 million by 0.78%, while the EPS exceeded the consensus estimate of $0.52 by 21.15% [1] Financial Performance - The company’s net sales by region showed varied performance: - United States: $209.94 million, a 31.8% increase year-over-year, but below the estimated $221.68 million [4] - Asia Pacific: $28.22 million, a significant 65.2% increase year-over-year, exceeding the estimate of $23.44 million [4] - Europe, Middle East and Africa: $38.91 million, a 17.3% increase year-over-year, below the estimate of $48.03 million [4] - Latin America and Canada: $70.75 million, a 31.9% increase year-over-year, surpassing the estimate of $55.39 million [4] Segment Performance - Animal Health segment reported net sales of $258.40 million, a 42.5% increase year-over-year, but below the estimate of $265.65 million [4] - Mineral Nutrition segment reported net sales of $66.80 million, a 4% increase year-over-year, slightly below the estimate of $66.88 million [4] - Animal Health Vaccines reported net sales of $33.40 million, a 1.5% increase year-over-year, below the estimate of $38.78 million [4] - Animal Health MFAs and other reported net sales of $181.60 million, a substantial 67.8% increase year-over-year, exceeding the estimate of $155.57 million [4] - Performance Products reported net sales of $22.70 million, a 28.5% increase year-over-year, surpassing the estimate of $18.01 million [4] EBITDA Performance - Adjusted EBITDA for the Animal Health segment was $63.10 million, above the average estimate of $60.59 million [4] - Adjusted EBITDA for the Corporate segment was -$17.30 million, better than the estimated -$19.57 million [4] Stock Performance - Phibro's shares have returned +6.5% over the past month, compared to the Zacks S&P 500 composite's +10.6% change, with a current Zacks Rank of 3 (Hold) indicating potential performance in line with the broader market [3]