American Vanguard Reports Preliminary Results for Fourth Quarter & Full Year 2024

Rhea-AI Summary

American Vanguard (NYSE:AVD) has released preliminary Q4 and full-year 2024 results. The company reported Q4 net sales of $169M (vs $172M in Q4 2023) and Adjusted EBITDA of $18M (vs $22M in 2023). For full-year 2024, net sales were approximately $550M ($563M excluding Dacthal recall impact) compared to $579M in 2023, with Adjusted EBITDA of $42M vs $53M.

Key achievements include reducing inventory by $47M and debt by $22M in Q4. The company recorded approximately $118M in non-recurring charges in 2024 as part of management's repositioning efforts. For 2025, AVD projects revenue of $565-585M and Adjusted EBITDA of $45-52M, with expected capex of $10M.

CEO Douglas Kaye aims to double the current 7.5% EBITDA margin over the next 3-4 years, focusing on simplifying operations and delivering profitable growth.

Positive

• Achieved 2024 EBITDA target within guidance range
• Significant debt reduction of $22M in Q4 2024
• Major inventory reduction of $47M in Q4
• Projected revenue growth to $565-585M in 2025
• Expected EBITDA improvement to $45-52M in 2025

Negative

• Q4 2024 sales declined to $169M vs $172M in Q4 2023
• Full-year 2024 sales dropped to $550M from $579M in 2023
• 2024 Adjusted EBITDA decreased to $42M from $53M in 2023
• $118M in non-recurring charges recorded in 2024
• Low current EBITDA margin of 7.5%

Insights

Financial Analyst

American Vanguard's Q4 results reflect a company in transition, with mixed signals for investors. While Q4 sales declined slightly to $169 million (versus $172 million in Q4 2023) and full-year revenue dropped to $550 million from $579 million, management successfully achieved their adjusted EBITDA target range at $42 million.

The most impressive aspects of this report are the significant balance sheet improvements. AVD reduced inventory by $47 million and decreased debt by $22 million in Q4 alone, ending the year at $156 million total debt - down substantially from $211 million at mid-year. These actions significantly strengthen the company's financial position.

The $118 million in non-recurring charges signals aggressive restructuring as new CEO Douglas Kaye repositions the business. His statement that current EBITDA margins of 7.5% are "about half of what our full cycle earnings power can be" indicates substantial improvement potential.

For 2025, management projects revenue of $565-585 million and adjusted EBITDA of $45-52 million, representing modest growth from 2024. With reduced capital expenditures of approximately $10 million, improved free cash flow should enable continued debt reduction.

The CEO's focus on simplifying operations addresses the "significant complexity" he's identified, which could unlock value if successful. While current results show year-over-year declines, the balance sheet improvements and forward-looking strategy suggest a company taking necessary steps toward sustainable long-term performance.

Achieved Full-Year Adjusted EBITDA In-Line with Target Range

Reduced Inventory by $47 million and reduced Debt by $22 Million in Fourth Quarter

2025 Revenue and Adj. EBITDA Target Range of $565-$585 Million and $45-$52 Million

NEWPORT BEACH, Calif.--(BUSINESS WIRE)-- American Vanguard^® Corporation (NYSE:AVD), 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 preliminary, financial results for the fourth quarter and full year ended December 31, 2024. The results reported herein are preliminary. Final results will appear in the company’s 10-K for the fiscal year ended December 31, 2024.

Fourth Quarter 2024 Preliminary Financial and Operational Highlights – versus Fourth Quarter 2023:

• Net sales of approximately $169 million v. $172 million in the fourth quarter of 2023;
• Adjusted EBITDA¹ of approximately $18 million v. $22 million in 2023;
• Decreased debt by $22 million from $179 million that we reported as of September 30, 2024

Fiscal 2024 Full Year Preliminary Financial Highlights – versus Fiscal 2023 Full Year:

• Net sales of approximately $550 million ($563 million when excluding Dacthal product recall impact) v. $579 million in 2023;
• Adjusted EBITDA of approximately $42 million v. $53 million in 2023;
• Approximately $118 million in non-recurring cash and non-cash charges in 2024 as management repositions the Company

“While we are pleased to have achieved our 2024 EBITDA target, in my opinion this result is just the starting point for what is possible at this company,” said Chief Executive Officer Douglas “Dak” Kaye III. “With an adjusted EBITDA margin of 7.5%, we would view this level of profitability as being about half of what our full cycle earnings power can be. On a percentage basis, we believe that we can achieve double digit EBITDA growth over each of the next 3 – 4 years.”

Mr. Kaye continued, “We took a number of decisions in the fourth quarter which resulted in asset impairment charges, these measures are designed to focus our resources on the products and services that our customers most value and need, and positions American Vanguard for long-term, profitable growth. As a result of these decisive actions, I am confident that 2025 will be better than 2024, but the improvement will be gradual, and the interest rate environment coupled with the uncertainty of potential tariffs will lead to farmers remaining cautious. Taking into consideration these factors, for 2025, we have an adjusted EBITDA target range of $45 - $52 million and expect sales to fall in the range of $565 - $585 million. We expect capex of approximately $10 million for 2025, so free cash flow should show a meaningful improvement, which we will allocate towards the Debt reduction. As we continue to transform and update this business, we believe that future margins will improve, and further margin enhancement in 2026 and beyond is likely.”

David T. Johnson, Vice President, CFO and Treasurer, stated “As we continue to complete work associated with the year-end audit, we are pleased to provide preliminary, unaudited financial information, including adjusted EBITDA within the target range of $40 - $50 million that we communicated to investors in the middle of the year. Furthermore, we more than achieved the goal to reduce inventory ending at approximately $178 million (including some impairment charges) which was down approximately $42 million in comparison to the closing position for 2023. We ended the year with total debt of $156 million, down from $179 million last quarter and $211 million at mid-year 2024. Finally, we continued to right-size the business in the 4^th quarter and have taken a total of approximately $118 million in non-recurring cash and non-cash charges in 2024 as we continue to strengthen our balance sheet and position American Vanguard for a return to growth in 2025 and put the company on a path towards higher EBITDA margins.”

				2024*		2025 estimate
Revenue			approximately	$563**		$565 - $585
Adjusted EBITDA			approximately	$42		$45 - $52
* Unaudited, ** Adjusted to exclude $12 million reversal as the result of the Dacthal recall

Mr. Kaye concluded, “We closed the year by continuing to execute on the important initiatives underway at the Company, making steady progress with our business transformation. In my short period so far with the Company, I have noticed a significant amount of complexity in the business, and I believe that simplifying many of the things we do will allow us to better understand what is important and be able to deliver against these high priority tasks. My message across the organization in this regard is straightforward – SIMPLIFY, PRIORITIZE and DELIVER.”

Conference Call

American Vanguard will be hosting a conference call at 9 am Eastern time/6 am Pacific time. The webcast of the conference call can be accessed through the company’s webpage: www.american-vanguard.com/investors or by using the following link: https://www.webcaster4.com/Webcast/Page/3070/52044

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 and animal 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 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 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. The company disclaims any intent or obligation to update these forward-looking statements.

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 income (loss), operating income (loss) 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 non-cash stock compensation, non-recurring transformation costs and non-recurring asset impairment charges (including Goodwill). Other companies (including the Company’s competitors) may define adjusted EBITDA differently.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250314481434/en/

Company Contact

American Vanguard Corporation

Anthony Young, Director of Investor Relations

anthonyy@amvac.com

(949) 221-6119



Investor Representative

Alpha IR Group

Robert Winters

Robert.winters@alpha-ir.com

(929) 266-6315

Source: American Vanguard Corporation

FAQ

What are American Vanguard's (AVD) revenue targets for 2025?

AVD targets revenue between $565-585 million for 2025.

How much did AVD reduce its debt in Q4 2024?

AVD reduced its debt by $22 million in Q4 2024, from $179 million to $156 million.

What was AVD's inventory reduction in 2024?

AVD reduced inventory by approximately $42 million compared to 2023, ending at $178 million.

What is AVD's projected EBITDA margin improvement goal?

AVD aims to double its current 7.5% EBITDA margin over the next 3-4 years.

What is AVD's expected capital expenditure for 2025?

AVD expects approximately $10 million in capital expenditure for 2025.