May. 11, 2018
American Vanguard's sales increased by 47.2% to $104.1 million in the first quarter of 2018. Net income increased 35.1% in this quarter to $4.66 million.
Eric Wintemute, Chairman and CEO of American Vanguard commented, “Our overall financial performance for this year’s first quarter improved significantly, aided by our 2017 product and company acquisitions as well as our diversified participation in many markets. Net sales rose 47%, driven by a 41% increase attributable to acquisitions and a 6% gain in AMVAC’s traditional base business. Our domestic sales experienced solid performance from granular soil insecticides, herbicides, and soil fumigants. Further, our international business grew significantly with the inclusion of AgriCenter’s Central American franchise.”
Mr. Wintemute continued, “Gross profit increased as a result of improved factory performance, organic growth in the Company’s sales and the addition of products and businesses acquired during 2017. As we anticipated in our last conference call, gross margins decreased slightly due to a product mix influenced by the AgriCenter distribution business. Our operating expenses declined as a percentage of sales, but rose on an absolute basis, as we integrated acquired businesses, made new product introductions, funded regulatory defense of important products, incurred bulk freight costs to meet strong soil fumigant demand and advanced the development of our SIMPAS precision application technology. With modest interest expenses and a reduced tax rate, we posted a 35% year-over-year increase in net income and a 27% increase in EBITDA,2 as compared to the first quarter of 2017.”
Mr. Wintemute concluded, “During the balance of 2018, we expect continued growth in our herbicide products, our Central American region and our non-crop business. We also anticipate strong demand for our products in cotton, fruit and vegetables, strong sales of our Dibrom® mosquito adulticide in light of predicted Gulf Coast hurricane activity and stable demand for our corn products in spite of weather-related delays in Midwest planting. In addition, we are scheduled to introduce several new products from our development pipeline. We look forward to providing further detail on our financial performance, market outlook and future initiatives during our upcoming conference call.”