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Balchem Corporation Announces Second Quarter 2013 Results

Stocks in this article: BCPC

NEW HAMPTON, N.Y., July 31, 2013 (GLOBE NEWSWIRE) -- Balchem Corporation (Nasdaq:BCPC) reported as follows (unaudited) for the period ended June 30, 2013.

($000 Omitted Except for Net Earnings per Share)
 
For the Three Months Ended June 30,
     
  2013 2012
  Unaudited
 Net sales  $83,296 $79,014
 Gross margin 24,885 22,584
 Operating expenses 8,269 7,759
 Earnings from operations  16,616 14,825
 Other (income) expense  (66) 1
 Earnings before income tax expense 16,682 14,824
 Income tax expense  5,100 4,852
 Net earnings  $11,582 $9,972
     
 Diluted net earnings per common share  $0.38 $0.33
     
Shares used in the calculation of diluted net earnings per common share 30,785 30,273
     
For the Six Months Ended June 30,
     
  2013 2012
  Unaudited
 Net sales  $167,947 $155,217
 Gross margin 49,117 43,742
 Operating expenses 16,636 15,242
 Earnings from operations  32,481 28,500
 Other income (64) (12)
 Earnings before income tax expense 32,545 28,512
 Income tax expense  10,075 9,272
 Net earnings  $22,470 $19,240
     
 Diluted net earnings per common share  $0.73 $0.64
     
Shares used in the calculation of diluted net earnings per common share 30,701 30,295

Record Quarterly Sales, Record Net Earnings

For the quarter ended June 30, 2013, the company achieved record second quarter net sales of $83.3 million, which is an increase of approximately 5.4% above the $79.0 million result of the prior year comparative quarter. Record quarterly net earnings were achieved of $11.6 million, an increase of $1.6 million, or 16.1% as compared with the same period last year. The $11.6 million generated diluted net earnings of $0.38 per common share versus $0.33 per common share for the prior year comparable period, an increase of 15.2%. These increases reflect overall higher volumes sold in the quarter despite a disruption to production and sales in June due to the declaration of force majeure by a key raw material supplier, primarily impacting our various choline and choline derivative products reported in our Animal Nutrition & Health ("ANH") segment. This situation was corrected in early July and full production capability has been restored.

The ANH segment, including specialties, choline and industrial derivative products, realized sales of $58.0 million, an increase of 5.8%, or $3.1 million over the prior year comparable quarter. Our global feed grade choline product sales were down approximately 3.5%, particularly from our North American customer base, where volumes sold were adversely impacted by the above noted force majeure. Our customers worked very closely with us on inventory level management and order patterns to work through this issue. Marketwise, broiler chick placements and egg sets were slightly higher in North America, and the USDA projection for broiler meat production continues to forecast modest growth for 2013. Such improvement however, is dependent on more normal crop and grain growing conditions resulting in declining feed prices. Sales of Italian-produced choline improved over the prior year quarter, primarily due to product mix.

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