American Vanguard Reports First Quarter 2026 Results

First Quarter Revenue Growth of 7% to $124 million Gross Margin Expansion of 500 bps Reaffirm Full-Year Outlook; Adjusted EBITDA $44 million to $48 million on Sales of $530 million to $550 million American Vanguard Corporation, a diversified specialty and agricultural products company that develops, manufactures, and markets solutions for crop protection and nutrition, turf and ornamental management and commercial pest control, today reported financial results for the first quarter ended March 31, 2026. Financial and Operational Highlights First Quarter 2026 - versus First Quarter 2025: Net sales of $124 million vs. $116 million; Gross profit margin of 31% vs. 26%; Operating income of $1.9 million vs. an operating loss of $4.3 million: Net loss of $4.1 million vs. $8.5 million; Adjusted EBITDA1 of $10.3 million vs. $3.0 million; EPS of $(0.14) vs. ($0.30); Dak Kaye, CEO of American Vanguard, stated "American Vanguard got off to a good start in the first quarter of 2026, with Net Sales of $124 million, up approximately 7% year-over-year, driven by strong demand in our domestic crop business. Adjusted EBITDA improved significantly year-over-year, reflecting better margins, cost discipline, and the benefits of the business improvements we have been implementing. While the agricultural environment remains challenging with farmers continuing to buy on a just-in-time basis and geopolitical uncertainty adding to that caution, we are controlling what we can control and executing our plan." Mr. Kaye concluded, "As part of our business improvement initiative, we have begun the optimization of activities at our Los Angeles manufacturing facility and are relocating synthesis operations to build on the strengths of our Axis site. The manufacturing optimization initiative is progressing as planned, and we expect annualized savings of at least $4 million. Our new capital structure, anchored by the two term loans, provides the longer-term financial foundation we need to execute our growth strategy without being constrained by seasonal working capital dynamics. Our growth strategy is focused on incremental increases in sales and margin improvement alongside balance sheet strengthening. This strategy is focused on improving our net working capital and lowering our net debt2, putting us in a position to refinance our debt by the end of 2028, if we chose to do so." _________________________________ 1Adjusted earnings before interest, taxes, depreciation, and amortization (Adjusted EBITDA) is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net (loss) income, operating (loss) income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company's competitors) may define adjusted EBITDA differently. 2Net debt, a non-GAAP measure, is presented as supplemental disclosure because we believe it is useful in understanding our financial condition. Net debt is calculated as total outstanding indebtedness less cash. David Johnson, Chief Financial Officer stated, "Our first quarter financial results reflect meaningful progress across the business. Gross margin reached 31%, up 500 basis points, as compared to the year-ago period, driven by a favorable mix of higher-margin domestic crop products, strong performance in our OHP Specialty business, and continued factory efficiency. Operating expenses ended the quarter slightly lower than prior year, when expressed as a percentage of net sales, a clear reflection of our continued cost discipline." Mr. Johnson continued, "With the refinancing, the balance sheet included cash of $71 million at quarter-end, as compared to cash of $12 million this time last year. Net debt at the end of the quarter was $196 million. Our accounts receivable increased compared to the same time last year because of the lower level of customer prepayments in December 2025, as compared to the prior year. We expect to receive those payments in June and in July, thereby further strengthening our cash position. Inventories declined by nearly $10 million year-over-year to $175 million, demonstrating that our Sales and Inventory planning process ("SIOP") improvements and supply chain discipline are gaining traction. We remain focused on lowering our net trade working capital and reducing net debt." Earnings Conference Call The company will be hosting an earnings conference call on May 6, 2026 at 4:30 pm Eastern Time/1:30 pm Pacific Time. The conference call will be webcast on the Company's website at https://www.investors-american vanguard.com/ or by going to the following link: https://www.webcaster5.com/Webcast/Page/3070/53902 If you are unable to listen live, the conference call will be archived for one year and may be accessed using the company's website: https://www.investors-american-vanguard.com/ About American Vanguard American Vanguard Corporation is a diversified specialty and agriculture products company that develops and markets products for crop protection and management, turf and ornamentals management, and public health. Over the past 20 years, through product and business acquisitions, the Company has significantly expanded its operations and now has more than 1,000 product registrations worldwide. To learn more about the Company, please reference www.american-vanguard.com. The Company, from time to time, may discuss forward-looking information. Except for the historical information contained in this release the matters set forth in this press release include forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward looking statements often use words such as "believe," "expect," "anticipate," "intend," "estimate," "project," "outlook," "forecast," "target," "trend," "plan," "goal," or other words of comparable meaning or future-tense or conditional verbs such as "may," "will," "should," "would," or "could." These forward-looking statements are based on the current expectations and 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 risks 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. The company disclaims any intent or obligation to update these forward-looking statements. Non-GAAP Financial Measures In addition to providing results that are determined in accordance with accounting principles generally accepted in the United States of America (GAAP), we present Adjusted EBITDA and Net Debt, which are non-GAAP financial measures. These measures should not be considered in isolation or as an alternative to GAAP measures such as net income, or diluted earnings per share, as applicable, or other financial statement data presented in our financial statements as an indicator of our financial performance or liquidity. We define Net Debt as outstanding indebtedness less cash and EBITDA as net (loss) income, adjusted for depreciation and amortization, provision for income taxes and interest expense. We define Adjusted EBITDA as EBITDA as further adjusted for stock compensation expense and for certain items management believe are not reflective of the underlying operations of our business, including but not limited to the exclusion of charges that are considered by management to be unusual and not representative of the Company's underlying performance and future prospects. In 2026 and 2025 that included non-recurring expenses. The resulting Adjusted EBITDA measure is aligned with the Company's metric for its credit facility agreement in the applicable periods. We use Adjusted EBITDA to assess the operating results and effectiveness and efficiency of our business. We present this non-GAAP financial measure because we believe that investors consider Adjusted EBITDA to be an important supplemental measure of performance, and we believe that this measure is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. As the Company continues to work through its transformation efforts, management believes that presenting Adjusted EBITDA provides an effective comparison between the Company and its industry peers. Non-GAAP financial measures as reported by us may not be comparable to similarly titled metrics reported by other companies and may not be calculated in the same manner. These measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. The Company is not able to provide a reconciliation without unreasonable efforts of its forward-looking guidance related to adjusted EBITDA to the most directly comparable GAAP financial measure due to the inherent difficulty in predicting with reasonable certainty the timing and amount of certain items that are excluded from Adjusted EBITDA, such as share-based compensation, acquisition-related expenses, and foreign exchange gains or losses, which could be material to the Company's results computed in accordance with GAAP. Investor Representative Alpha IR Group Robert Winters [email protected] (917) 821-6305 CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (Unaudited) ASSETS March 31, 2026 December 31, 2025 Current assets: Cash $ 70,914 $ 12,425 Receivables: Trade, net of allowance for credit losses of $12,293 and $11,733, respectively 179,336 160,511 Other 7,372 7,278 Total receivables, net 186,708 167,789 Inventories 175,038 176,034 Prepaid expenses 7,687 9,668 Income taxes receivable 3,203 4,606 Total current assets 443,550 370,522 Property, plant and equipment, net 51,721 53,036 Operating lease right-of-use assets, net 16,031 16,793 Intangible assets, net 136,071 138,746 Deferred income tax assets 3,369 2,637 Other assets 14,501 14,803 Total assets $ 665,243 $ 596,537 Liabilities and Stockholders' Equity Current liabilities: Current portion of long-term debt $ 2,250 $ - Accounts payable 90,672 87,505 Customer prepayments 14,438 33,094 Accrued program costs 46,099 52,227 Accrued expenses and other payables 30,436 28,261 Operating lease liabilities, current 5,517 5,765 Income taxes payable 1,512 2,594 Total current liabilities 190,924 209,446 Long-term debt, net of current portion(2) 264,384 174,000 Operating lease liabilities, long-term 10,991 11,621 Deferred income tax liabilities 8,209 8,150 Other liabilities 1,115 923 Total liabilities 475,623 404,140 Commitments and contingent liabilities (Note 13) Stockholders' equity: Preferred stock, $0.10 par value per share; authorized 400,000 shares; none issued - - Common stock, $0.10 par value per share; authorized 40,000,000 shares; issued 34,979,775 shares at March 31, 2026 and 34,923,562 shares at December 31, 2025 3,498 3,492 Additional paid-in capital 117,530 117,106 Accumulated other comprehensive loss (11,062 ) (12,000 ) Retained earnings 150,855 155,000 260,821 263,598 Less treasury stock at cost, 5,915,182 shares at March 31, 2026 and December 31, 2025 (71,201 ) (71,201 ) Total stockholders' equity 189,620 192,397 Total liabilities and stockholders' equity $ 665,243 $ 596,537 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) For the three months ended March 31 2026 2025 Net sales $ 123,568 $ 115,800 Cost of sales (85,151 ) (85,609 ) Gross profit 38,417 30,191 Operating expenses Selling, general and administrative (27,713 ) (26,628 ) Research, product development and regulatory (5,271 ) (5,682 ) Product liability claims (81 ) - Transformation (2,804 ) (2,191 ) Asset impairments (659 ) - Operating income (loss) 1,889 (4,310 ) Change in fair value of an equity investment (120 ) - Interest expense, net (5,790 ) (3,765 ) Loss before provision for income taxes (4,021 ) (8,075 ) Income tax expense (124 ) (387 ) Net loss $ (4,145 ) $ (8,462 ) Net loss per common share - basic $ (0.14 ) $ (0.30 ) Net loss per common share - assuming dilution $ (0.14 ) $ (0.30 ) Weighted average shares outstanding - basic 28,649 28,271 Weighted average shares outstanding - assuming dilution 28,649 28,271 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES ANALYSIS OF SALES (In thousands) (Unaudited) For the three months ended March 31, 2026 2025 Change % Change Net sales: U.S. crop $ 67,028 $ 57,176 $ 9,852 17 % U.S. Specialty 16,502 15,601 901 6 % Total U.S. 83,530 72,777 10,753 15 % International 40,038 43,023 (2,985 ) -7 % Total net sales $ 123,568 $ 115,800 $ 7,768 7 % Total cost of sales $ (85,151 ) $ (85,609 ) $ 458 -1 % Total gross profit $ 38,417 $ 30,191 $ 8,226 27 % Total gross margin 31 % 26 % CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) For the three months ended March 31 2026 2025 Cash flows from operating activities: Net loss $ (4,145 ) $ (8,462 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization of property, plant and equipment and intangible assets 4,685 4,744 Amortization of other long-term assets 5 5 Provision for estimated credit losses 444 1,056 Stock-based compensation 186 559 Deferred income taxes (204 ) 1,348 Change in liabilities for uncertain tax positions or unrecognized tax benefits (17 ) 90 Change in equity investment fair value 120 - Impairment of assets 659 - Payment-in-Kind interest 112 - Amortization of deferred loan fees 738 235 Lease obligations and non-cash lease expense, net (115 ) (109 ) Foreign currency transaction (losses) gains 28 (99 ) Changes in assets and liabilities associated with operations: (Increase) decrease in net receivables (19,088 ) 6,892 Decrease (increase) in inventories 1,530 (4,721 ) Increase in prepaid expenses and other assets (877 ) (856 ) Change in income tax receivable and payable, net 385 (1,885 ) Increase in accounts payable 2,871 22,966 Decrease in customer prepayments (18,656 ) (28,215 ) (Decrease) increase in accrued program costs (6,170 ) 837 Increase (decrease) in other payables and accrued expenses 2,067 (14,961 ) Net cash used in operating activities (35,442 ) (20,576 ) Cash flows from investing activities: Capital expenditures (971 ) (431 ) Proceeds from disposal of property, plant and equipment 7 12 Intangible assets (9 ) (27 ) Net cash used in investing activities (973 ) (446 ) Cash flows from financing activities: Payments under line of credit agreement (140,000 ) (89,098 ) Borrowings under line of credit agreement 26,000 109,265 Borrowings under term loans 225,000 - Payment of deferred loan fees (16,234 ) (687 ) Net receipt from the issuance of common stock under ESPP 263 332 Net payment from common stock purchased for tax withholding (19 ) (11 ) Net cash provided by financing activities 95,010 19,801 Net increase (decrease) in cash 58,595 (1,221 ) Effect of exchange rate changes on cash and cash equivalents (106 ) 512 Cash at beginning of period 12,425 12,514 Cash at end of period $ 70,914 $ 11,805 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA (In thousands) (Unaudited) For the three months ended March 31 2026 2025 Net loss $ (4,145 ) $ (8,462 ) Provision for income taxes 124 387 Interest expense, net 5,790 3,765 Depreciation and amortization 4,624 4,749 Stock compensation expense 186 559 Transformation costs 2,804 2,191 Asset impairments 659 - Other 217 (216 ) Adjusted EBITDA(1) $ 10,259 $ 2,973 AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES RECONCILIATION OF TOTAL INDEBTEDNESS TO NET DEBT (In thousands) (Unaudited) March 31, 2026 December 31, 2025 Current portion of long-term debt $ 2,250 $ - Long-term debt, net of current portion 264,384 174,000 Total indebtedness $ 266,634 $ 174,000 Less: Cash (70,914 ) (12,425 ) Net Debt(2) $ 195,720 $ 161,575 1 Adjusted earnings before interest, taxes, depreciation, and amortization (Adjusted EBITDA) is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net (loss) income, operating (loss) income or any other financial measure so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. The items excluded from adjusted EBITDA are detailed in the reconciliation attached to this news release. Other companies (including the Company's competitors) may define adjusted EBITDA differently. 2 Net debt, a non-GAAP measure, is presented as supplemental disclosure because we believe it is useful in understanding our financial condition. Net debt is calculated as total outstanding indebtedness less cash. SOURCE: American Vanguard View the original press release on ACCESS Newswire