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2010 Press Releases

FOR IMMEDIATE RELEASE

AMERICAN VANGUARD REPORTS SECOND QUARTER & MID-YEAR 2010 RESULTS

Quarterly & First Half Performance Reflects Improved Market Demand and Continued Balance Sheet Focus

Newport Beach, CA – August 5, 2010 – American Vanguard Corporation (NYSE:AVD), today announced financial results for the second quarter and six month period ended June 30, 2010.   

Fiscal 2010 Second Quarter Financial Highlights – versus Fiscal 2009 Second Quarter:

  • Net sales increased 10% to $52.2 million    
  • Net income for the period was $1.6 million  
  • Earnings per diluted share were $0.06 versus breakeven in the prior year quarter

Fiscal 2010 First Half Financial Highlights – versus Fiscal 2009 First Half

  • Net sales increased 7% to $98.9 million
  • Net income increased to $3.5 million
  • Earnings per diluted share were $0.13 versus $0.03 in the prior year’s first half

Note: Complete details are available in the financial schedules attached to this press release

Eric Wintemute, President and CEO of American Vanguard, stated: “We are pleased to report performance for the second quarter and the first half of 2010 that reflects improved market conditions and our own focus on continued financial discipline.  Better farm credit availability, more favorable weather during Midwest planting, increased cotton and peanut acres and the replenishment of depleted distributor inventories have fueled improved demand for our products.  To satisfy this demand, we have increased output at our domestic production facilities, and the resulting higher utilization rates have allowed us to more fully absorb the fixed overhead costs of these sites during the second quarter. While increased manufacturing activity has had a positive effect on gross margins, this effect has been offset somewhat by heavy pricing pressure on our three generic product lines.”

Mr. Wintemute continued: “In keeping with our promise to strengthen and maintain a healthy balance sheet, we have controlled our inventories very judiciously - with only a slight $2 million expansion during the spring season when inventory increases are traditionally much more significant.  Our management of working capital and continuing cash generation have allowed us to steadily pay down our debt.  Additionally, during the quarter, we added Wells Fargo bank to our lending syndicate (led by Bank of the West) which continues to support and encourage the growth of our business.”

Mr. Wintemute concluded: “We will continue to pursue the acquisition of appropriately-priced, branded products, similar to our recent purchase of the cotton defoliant Def® from Bayer CropScience, as we assemble a broader product offering in key crops.  In the first half of next year, we expect to commercialize a superior potato sprout inhibitor, called SmartBlock®, which will emerge from our new product development program.  We believe that adding high-value/high-margin products to our portfolio, focusing our sales and marketing organization on customer needs, and maintaining financial discipline, will continue to be important elements of our success.”

Conference Call
Eric Wintemute, President & CEO and David T. Johnson, VP & CFO, will conduct a conference call focusing on the financial results at 12:00 pm EDT / 9:00 am PDT on Thursday, August 5, 2010.  Interested parties may participate in the call by dialing 706-679-3155 – please call in 10 minutes before the call is scheduled to begin, and ask for the American Vanguard call (conference ID # 91686704).  The conference call will also be webcast live via the News and Media section of the Company’s web site at www.american-vanguard.com.  To listen to the live webcast, go to the web site at least 15 minutes early to register, download and install any necessary audio software.  If you are unable to listen live, the conference call will be archived on the Company’s web site.

About American Vanguard
American Vanguard Corporation is a diversified specialty and agricultural products company that develops and markets products for crop protection and management, turf and ornamentals management and public and animal health.  American Vanguard is included on the Russell 2000® and Russell 3000® Indexes.  To learn more about American Vanguard, please reference the Company’s web site at www.american-vanguard.com.

The Company, from time to time, may discuss forward-looking information.  Except for the historical information contained in the conference call referenced in this release, all forward-looking statements are estimates by the Company’s management and are subject to various risks and uncertainties that may cause results to differ from management’s current expectations.  Such factors include weather conditions, changes in regulatory policy and other risks as detailed from time-to-time in the Company’s SEC reports and filings.  All forward-looking statements, if any, in this release represent the Company’s judgment as of the date of this release.

CONTACT:
American Vanguard Corporation
William A. Kuser, Director of Investor Relations
(949) 260-1200 
williamk@amvac-chemical.com <mailto:williamk@amvac-chemical.com>

OR- AVD’S INVESTOR RELATIONS FIRM
The Equity Group Inc.
Lena Cati
(212) 836-9611
www.theequitygroup.com <http://www.theequitygroup.com />
Lcati@equityny.com
Linda Latman (212) 836-9609
Llatman@equityny.com

 

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Number in thousands except per share data)
(Unaudited)

 

 

 

 

 

 

For the three months
ended June30

 

For the six months
ended June30

 

 

2010

 

2009

 

2010

 

2009

 

Net sales.

$ 52,172

$ 47,485

$ 98,884

$ 92,122

Cost of sales

32,939

31,066

60,727

57,147

 

 

 

 

 

Gross profit

19,233

16,419

38,157

34,975

Operating expenses

15,636

15,537

30,804

32,100

 

 

 

 

 

Operating income.

3,597

882

7,353

2,875

Interest expense

953

911

1,714

1,797

Interest capitalized.

(39 )

(5 )

(49 )

(26 )

 

 

 

 

 

Income (loss) before income taxes.

2,683

(24)

5,688

1,104

Income tax expense (benefit)

1,040

(20)

2,218

409

 

 

 

 

 

Net income (loss)

$ 1,643

$ (4)

$ 3,470

$ 695

 

 

 

 

 

Earnings per common share—basic.

$ .06

$ -

$ .13

$ .03

 

 

 

 

 

Earnings per common share—assuming dilution.

$ .06

$ -

$ .13

$ .03

 

 

 

 

 

Weighted average shares outstanding—basic.

27,343

27,081

27,344

27,043

 

 

 

 

 

Weighted average shares outstanding—assuming dilution

27,650

27,081

27,633

27,701

 

 

 

 

 


AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Number in thousands except per share data)
(Unaudited)
 
 
 
 
 
 
 
For the three months
ended June 30
 
For the six months
ended June 30
 
 
2010
 
2009
 
2010
 
2009
 
Net sales..........................................
$ 52,172            
$ 47,485            
$ 98,884            
$ 92,122            
Cost of sales.....................................
    32,939            
    31,066            
    60,727            
    57,147            
 
 
 
 
 
Gross profit..............................
    19,233            
    16,419            
    38,157            
    34,975            
Operating expenses............................
    15,636            
    15,537            
    30,804            
    32,100            
 
 
 
 
 
Operating income......................
      3,597            
        882            
      7,353            
      2,875            
Interest expense.................................
        953            
        911            
      1,714            
      1,797            
Interest capitalized.............................
         (39            )
           (5            )
         (49            )
         (26            )
 
 
 
 
 
Income (loss) before income taxes.
      2,683            
        (24)            
      5,688            
      1,104            
Income tax expense (benefit)................
      1,040            
        (20)            
      2,218            
        409            
 
 
 
 
 
Net income (loss)......................
$    1,643            
$        (4)            
$    3,470            
$       695            
 
 
 
 
 
Earnings per common share—basic.......
$       .06            
$           -            
$       .13
$       .03
 
 
 
 
 
Earnings per common share—assuming dilution.......................................
$       .06            
$           -            
$       .13            
$       .03            
 
 
 
 
 
Weighted average shares outstanding—basic...........................................
    27,343            
    27,081            
    27,344            
    27,043            
 
 
 
 
 
Weighted average shares outstanding—assuming dilution.........................
    27,650            
    27,081            
    27,633            
    27,701            
 
 
 
 
 
 
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS 
(Number in thousands, excerpt per share data)
 
 
 
 
 
June 30,
2010
 
Dec. 31,
2009
 
 
(Unaudited)
(Note)
Current assets:
 
 
Cash and cash equivalents................................................................
$               929                        
$         383                  
Receivables:
 
 
Trade, net of allowance for doubtful accounts of $640 and $635, respectively.........................................................................
            43,397                        
      40,681                  
Other.......................................................................................................
                  206                        
            382
 
 
 
 
            43,603                        
      41,063
 
 
 
Inventories........................................................................................................
            74,539                        
      72,512                  
Prepaid expenses.............................................................................................
              2,105                        
        2,143                  
Income tax receivable......................................................................................
          3,105
        3,575
 
 
 
Total current assets.................................................................
         124,281                        
   119,676                  
Property, plant and equipment, net............................................................
            40,594                        
      39,196                  
Intangible assets..............................................................................................
            84,744                        
      86,973                  
Other assets.......................................................................................................
              8,593                        
        8,866
 
 
 
 
$    258,212
$    254,711
`
 
 
 LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
 
 
Current installments of long-term debt..........................................
$          8,528                      
$      8,528
Accounts payable................................................................................
          15,578                      
      11,401
Accrued program costs.......................................................................
          24,509
      27,188
Accrued expenses and other payables...........................................
            5,076                      
        3,762
 
 
 
Total current liabilities..........................................................
          53,691                      
      50,879
Long-term debt, excluding current installments.....................................
          41,558                      
      45,432
Other long-term liabilities............................................................................
               192
            192
Deferred income taxes.....................................................................................
            5,121                      
        5,121
 
 
 
Total liabilities........................................................................
       100,562
   101,624
 
 
 
Commitments and contingent liabilities
 
 
Stockholders’ Equity:
 
 
Preferred stock, $.10 par value per share; authorized 400,000 shares; none issued.......................................................................
                 —                        
             —  
Common stock, $.10 par value per share; authorized 40,000,000 shares; issued 29,634,653 shares at June 30, 2010 and 29,575,562 shares at December 31, 2009............
            2,963                      
        2,958
Additional paid-in capital................................................................
          42,305                      
      41,529
Accumulated other comprehensive income (loss)......................
         (1,160)                      
     (1,743)
Retained earnings................................................................................
       116,695                      
   113,496
 
 
 
 
       160,803                      
   156,240
Less treasury stock, at cost, 2,260,996 shares at June 30, 2010 and December 31, 2009.....................................................
           (3,153                      )
       (3,153 )
 
 
 
Total stockholders’ equity...................................................
       157,650                      
   153,087
 
 
 
 
$     258,212                      
$   254,711
 
 
 
Note: The balance sheet at December 31, 2009 has been derived from the audited financial statements at that date.  
AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Numbers in thousands, except share data)
 
For The Six Months Ended June 30, 2010 and 2009
(Unaudited)
 
 
 
 
Increase (decrease) in cash
 
2010
 
2009
 
Cash flows from operating activities:
 
 
Net income............................................................
$    3,470
$       695
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
Depreciation and amortization of fixed and intangible assets..........................................
      5,444
      5,441
Amortization of other long-term assets................
      1,566
      1,377
Stock-based compensation expense related to stock options and employee stock purchases.............
         504
         580
Changes in assets and liabilities associated with operations:
 
 
(Increase) Decrease in receivables................
                     (2,540)
    10,217
Increase in inventories..............................
     (2,027 )
   (21,808 )
Increase in prepaid expenses and other assets
        (785 )
     (2,095 )
Increase (Decrease) in accounts payable........
      4,581
    (3,155)
Decrease in other current liabilities.............
      (1,786)
    (3,443)
 
 
 
Net cash provided by (used in) operating activities......................
      8,427
   (12,191 )
 
 
 
Cash flows from investing activities:
 
 
Capital expenditures................................................
     (4,613 )
     (2,249 )
 
 
 
Net cash used in investing activities...
      (4,613)
    (2,249)
 
 
 
Cash flows from financing activities:
 
 
Net borrowings under line of credit agreement...............
         600
    17,500
Principal payments on long-term debt.........................
     (4,053 )
     (2,053 )
Proceeds from the issuance of common stock (sale of stock under ESPP)..............................................
         277
         238
Payment of cash dividends........................................
        (271 )
     (1,341 )
 
 
 
Net cash (used) provided by financing activities....
      (3,447)             
    14,344
 
 
 
Net increase (decrease) in cash............................
         367
        (96)
Cash and cash equivalents at beginning of period..................
         383
      1,229
Effect of exchange rate changes on cash................................
         179
         173
 
 
 
Cash and cash equivalents as of June 30,.............................
$       929
$    1,306
 
 
 

 

 

 

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