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TheStreet Open House

American Vanguard Reports Fourth Quarter & Full Year 2012 Results

Conference Call

Eric Wintemute, Chairman & CEO and David T. Johnson, VP & CFO, will conduct a conference call focusing on the financial results at 12:00 pm ET / 9:00 am PT on Thursday, February 28, 2013. Interested parties may participate in the call by dialing (201) 493-6744 – please call in 10 minutes before the call is scheduled to begin, and ask for the American Vanguard call. 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 and the Standard & Poor’s Small Cap 600 Index. 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 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.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
 
Years ended December 31, 2012, 2011 and 2010
(Dollars in thousands, except per share data)
     

2012

2011 2010
Net sales $ 366,190 $ 301,080 $ 226,859
Cost of sales   205,065     178,012     140,538  
 
Gross profit 161,125 123,068 86,321
Operating expenses   101,802     83,842     67,130  
 
Operating income 59,323 39,226 19,191
Interest expense 2,872 3,569 3,171
Interest income (1 ) (3 )
Interest capitalized (400 ) (109 ) (154 )
Extinguishment of debt       546      
 
Income before provision for income taxes 56,852 35,223 16,174
Income taxes expense   20,026     13,155     5,190  
 
Net income 36,826 22,068 10,984
Net loss attributable to non-controlling interest   41          
 
Net income attributable to American Vanguard $ 36,867   $ 22,068   $ 10,984  
 
Change in fair value of interest rate swaps 158 (869 ) 1,094
Foreign currency translation adjustment   330     (933 )   201  
 
Comprehensive income $ 37,355   $ 20,266   $ 12,279  
 
Earnings per common share—basic $ 1.32   $ 0.80   $ 0.40  
 
Earnings per common share—assuming dilution $ 1.28   $ 0.79   $ 0.40  
 
Weighted average shares outstanding—basic   27,914     27,559     27,385  
 
Weighted average shares outstanding—assuming dilution   28,756     27,875     27,652  
 
 
AMERICAN VANGUARD CORPORATION
AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
 
December 31, 2012 and 2011
(Dollars in thousands, except per share data)
   
 
2012 2011
Assets
Current assets:
Cash $ 38,476 $ 35,085
Receivables:
Trade, net of allowance for doubtful accounts of $623 and $340, respectively 76,073 68,611
Other   1,230     1,187  
 
  77,303     69,798  
 
Inventories 87,951 71,068
Prepaid expenses 13,710 4,167
Income taxes receivable 203
Deferred income tax assets   4,877     3,417  
 
Total current assets 222,317 183,738
Property, plant and equipment, net 45,701 35,537
Intangible assets, net 113,521 116,189
Other assets   18,351     7,094  
 
$ 399,890   $ 342,558  
 
Liabilities and Stockholders’ Equity
Current liabilities:
Current installments of long-term debt $ 16,247 $ 14,460
Current installments of other liabilities 1,839 1,038
Accounts payable 32,838 23,214
Deferred revenue 20,427 7,571
Accrued program costs 32,335 25,910
Tax payable 1,313
Accrued expenses and other payables   8,671     6,832  
 
Total current liabilities 113,670 79,025
Long-term debt, excluding current installments 36,196 51,917
Other liabilities, excluding current installments 5,425 5,955
Deferred income tax liabilities   19,163     18,589  
 
Total liabilities   174,454     155,486  
 
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 30,766,730 shares in 2012 and 29,845,047 shares in 2011 3,077 2,985
Additional paid-in capital 54,323 45,966
Accumulated other comprehensive loss (1,762 ) (2,250 )
Retained earnings   174,243     143,524  
 
229,881 190,225
Less treasury stock at cost, 2,310,634 shares in 2012 and 2,260,996 shares in 2011   (4,804 )   (3,153 )
 
American Vanguard stockholders’ equity 225,077 187,072
Non-controlling interest   359      
 
Total stockholders’ equity   225,436     187,072  
 
$ 399,890   $ 342,558  
 
 
AMERICAN VANGUARD CORPORATION
AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
 
Years ended December 31, 2012, 2011 and 2010
(Dollars in thousands, except per share data)
     
 
2012 2011 2010
Increase in cash
Cash flows from operating activities:
Net income $ 36,826 $ 22,068 $ 10,984
Adjustments to reconcile net income to net cash provided byoperating activities:
Depreciation and amortization of fixed and intangible assets 13,487 13,546 11,123
Amortization of other long term assets 2,925 1,983 3,258
Amortization of discounted liabilities 818 1,371
Stock-based compensation 2,950 1,994 1,122
Tax benefit from exercise of stock options (621 )
(Decrease) increase in deferred income taxes (886 ) 4,711 5,342
Changes in assets and liabilities associated with operations:
(Increase) decrease in net receivables (7,505 ) (35,021 ) 6,967
(Increase) decrease in inventories (16,883 ) 2,986 (1,542 )
Decrease (increase) in income tax receivable/payable, net 2,137 6,512 (2,583 )
Increase in prepaid expenses and other assets (23,725 ) (1,823 ) (2,235 )
Increase in accounts payable 9,781 8,384 3,095
Increase in deferred revenue 12,856 2,003 5,568
Increase (decrease) in other payables and accrued expenses   8,264     10,552     (7,909 )
 
Net cash provided by operating activities   40,424     39,266     33,190  
 
Cash flows from investing activities:
Capital expenditures (17,628 ) (6,261 ) (8,004 )
Acquisitions of intangible assets   (3,473 )   (316 )   (32,677 )
 
Net cash used in investing activities   (21,101 )   (6,577 )   (40,681 )
 
Cash flows from financing activities:
Net (repayments) borrowings under line of credit agreement (7,300 ) 4,700
Payments on long-term debt (8,443 ) (8,429 ) (8,107 )
Payment on other long-term liabilities (6,035 ) (401 )
Tax benefit from exercise of stock options 621
Increase in other notes payable (51 ) 20,063 11,586
Proceeds from the issuance of common stock (sale of stock under ESPP and exercise of stock options) 3,227 580 768
Non-controlling interest contribution 400
Payment of cash dividends   (6,148 )   (2,205 )   (819 )
 
Net cash (used in) provided by financing activities   (16,429 )   2,308     8,128  
 
Net increase in cash 2,894 34,997 637
Effect of exchange rate changes on cash 497 (1,070 ) 138
Cash at beginning of year   35,085     1,158     383  
 
Cash at end of year $ 38,476   $ 35,085   $ 1,158  
 
Supplemental cash flow information:
Cash paid during the year for:
Interest $ 1,891   $ 2,055   $ 3,661  
 
Income taxes $ 18,048   $ 6,359   $ 2,205  
 
 




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