American Vanguard reports Q2 & first half 2011 results

Date:08-05-2011

American Vanguard Corporation announced financial results for the second quarter and six month period ended June 30, 2011.

Fiscal 2011 Second Quarter Financial Highlights – versus Fiscal 2010 Second Quarter:

Net sales improved from $52.2m to $80.4m, an increase of 54%
Net income for the period improved from $1.6m to $6.0 million, an increase of 265%
Earnings per diluted share were $0.22 versus $0.06 in the prior year quarter

Fiscal 2011 First Half Financial Highlights – versus Fiscal 2010 First Half

Net sales improved from $98.9m to $147.8m, an increase of 49%
Net income improved from $3.5m to $11.0 million, an increase of 217%
Earnings per diluted share were $0.40 versus $0.13 in the prior year’s first half

Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We are pleased to report performance for the second quarter and the first half of 2011 that reflects the successful execution of our corporate strategy for product portfolio extension, geographic expansion and consistent financial discipline. Strong crop commodity prices have stimulated U.S. agricultural demand in corn, cotton, and a wide variety of other crops, fueling increased purchases of our well-positioned productivity and yield enhancing products. Additionally, we have expanded our international sales penetration driven by the Mocap® and Nemacur® product acquisitions that we completed in December 2010.”

Mr. Wintemute continued: “In keeping with our promise to strengthen and maintain a healthy balance sheet, we have continued to control our inventory levels and carefully maintain our receivable collections performance. In fact, our management of working capital and continuing cash generation provides us with the opportunity to use our positive cash balance for possible debt reduction, dividend payments, product acquisitions or other corporate purposes in the months ahead. Also, during the quarter we were pleased to announce a significant agreement with Monsanto for the co-marketing of our post-emergent corn herbicide Impact® in conjunction with their Roundup® glyphosate brands. The weed management benefits of this combination of two market leading brands will be promoted by both companies and should expand the sales of Impact over the next several years.”

Mr. Wintemute concluded: “We have maintained focus on our gross profit margins by consistently emphasizing profitability in our sales and marketing efforts resulting in an improvement from 37% to 40%. This year our overall manufacturing operations have experienced higher utilization rates resulting in improved coverage of facility fixed costs. We continue to seek the acquisition of appropriately-priced, branded products, similar to our 2010 purchases, as we expand our product offering in key crops. In our product development program, we expect our new potato sprout inhibitor SmartBlock® to become commercial during the first half of 2012. By adding high-value/high-margin products to our portfolio, focusing our sales and marketing priorities, achieving greater manufacturing efficiencies and diligently maintaining financial discipline, we expect to continue profitably expanding our global business.”