Diversified specialty chemicals maker
American Vanguard Corp.
) posted a solid jump in its third-quarter 2012 profit riding on
strong market demand for its products.
The California-based company logged earnings of 28 cents a share
in the quarter, which topped the Zacks Consensus Estimate of 23
cents and surpassed the year-ago quarter's earnings of 16 cents.
Profit shot up 75% year over year to $8.1 million, boosted by
healthy sales of its soil fumigants and insecticides.
Revenues soared 23% year over year to $90.8 million, comfortably
beating the Zacks Consensus Estimate of $83 million. Gross margin
rose to 43.7% from 41.4% a year ago, aided by better mix, higher
pricing and manufacturing efficiency.
Operating expenses climbed 18% year over year to $26.4 million.
Operating margin rose to 14.5% from 11.1% a year ago as higher
operating costs were more than masked by a healthy increase in
the top line.
The company's balance sheet remains healthy with cash increasing
more than six-fold year over year to $23.6 million at the end of
the quarter. Long-term debt declined 21% year over year to $54.1
million. American Vanguard said that it has adequate liquidity to
support capital spending and product acquisitions in the
Moving ahead, American Vanguard feels that its results will be
supported by the successful roll out of its herbicide
co-marketing program with
). The company also noted that its crop protection products will
aid to sales growth and profitability.
American Vanguard makes specialty chemical products for
agricultural and commercial applications. The company develops
and markets an array of chemicals, including insecticides,
fungicides and herbicides, for crops, human and animal health
protection. American Vanguard has the largest assortment of corn
soil insecticides coupled with the most advanced dispensing
American Vanguard is leveraging the growing demand for soil
insecticides as the U.S. corn growers contend with pest problems.
Earnings momentum for the company looks to continue thanks to the
favorable industry trends.
American Vanguard currently retains a Zacks #1 Rank, which
translates into a short-term Strong Buy rating.
AMER VANGUARD (AVD): Free Stock Analysis
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