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Mar 31, 2023
American Vanguard Q1 2023 Earnings Report
American Vanguard's Q1 2023 earnings were impacted by supply chain delays and generic herbicide glut, leading to lower sales and profitability.
Key Takeaways
American Vanguard reported a decrease in net sales and net income for Q1 2023 compared to Q1 2022, primarily due to supply chain disruptions and a glut of generic herbicides affecting domestic crop product sales. Despite the setback, the company reaffirms its double-digit full-year 2023 EBITDA growth target, anticipating stronger performance in the second half of the year.
Q1 2023 net sales decreased to $124.89 million from $149.59 million in Q1 2022.
Q1 2023 net income declined to $1.92 million from $9.94 million in Q1 2022.
The company experienced supply chain delays that impacted production and sales of its leading corn soil insecticide, Aztec®.
American Vanguard anticipates higher sales of US crop products in the second half of 2023 due to low inventories in the distribution channel.
American Vanguard
American Vanguard
American Vanguard Revenue by Segment
American Vanguard Revenue by Geographic Location
Revenue by Segment
U.S. crop Revenue
CapyFin.comU.S. non-crop Revenue
CapyFin.comInternational Revenue
CapyFin.comRevenue by Geographic Location
International Revenue
CapyFin.com Forward Guidance
American Vanguard expects to achieve higher adjusted EBITDA (between $84MM - $86MM) than in 2022, despite a first quarter setback arising from delays in restarting our supply chain, which is now back at capacity.
Positive Outlook
- Expect higher sales of US crop products in the second half of 2023 due to low inventories.
- Expect to continue the positive trajectories of our non-crop and international businesses.
- Company expects to achieve higher adjusted EBITDA (between $84MM - $86MM) than in 2022.
- Supply chain is now back at capacity.
- Revised 2023 targets show better year-over-year performance.
Challenges Ahead
- Experienced a first quarter setback arising from delays in restarting our supply chain.
- China-based supplier was unable to deliver intermediates in sufficient quantities.
- Only able to produce and sell about one-third of seasonal demand for Aztec.
- A glut of generic herbicides in the distribution channel, led to lower sales of domestic crop products during the quarter.
- Decrease in sales of higher-margin US crop products led to lower overall profitability.
Revenue & Expenses
Visualization of income flow from segment revenue to net income