AMVAC's sales increased by 9% in Q3 2017

Date:11-08-2017

American Vanguard's sales increased by 9.2 % to $72.7 million in the third quarter of 2017. Net income increased 41.4% in this quarter to $4.1 million.

For the first nine- year of 2017, American Vanguard's sales increased 6.2% to $ 238.6 million, and net income increased 32.6% to $11.8 million.

Eric Wintemute, Chairman and CEO of American Vanguard, stated: “We are pleased to report revenue increases of 9% for the third quarter and 6% for the first nine months of 2017. Our top line performance was driven by three positive factors: strong demand for our cotton products, extraordinary demand for our mosquito adulticide in the aftermath of domestic hurricanes, and incremental sales of new products acquired in June. These gains were partially offset by weather events in the soil fumigant market and competitive pressure in the Midwest herbicide market.”

Mr. Wintemute continued, “With respect to profitability, a diversified product mix and efficient manufacturing performance allowed us to record improved gross profit margins for both the third quarter (42% versus 40% in the prior year) and year-to-date (43% versus 41% in the prior year). Further, we achieved a significant increase in net income, despite higher operating expenses in both the three and nine month periods. These expenses relate largely to maintaining, acquiring and developing product lines and commercializing technology.While we remain committed to exercising financial discipline, we believe that part of this discipline involves planning for the future.Consequently, during the third quarter, we incurred legal and due diligence costs in connection with acquisitions, funded increased regulatory costs for the re-registration of several important organophosphate products, expanded field trials for our product pipeline, and invested in further development of SIMPAS.We believe that these near-term expenses for portfolio extension, geographic expansion and technology innovation provide significant growth potential for American Vanguard.”

Mr. Wintemute concluded: “Our outlook for the final quarter of 2017 remains positive, as we integrate recent acquisitions and position our business for the upcoming spring planting season. During 2018, we expect that, with the addition of the AgriCenter companies, our International business will double. Further, our non-crop business should increase by about 50% with the addition of OHP’s horticulture business.  This is an exciting time for American Vanguard, and we look forward to giving further comments during our earnings conference call.”