|
Delaware
|
| |
13-1840497
|
|
|
(State or other jurisdiction of
incorporation or organization) |
| |
(I.R.S. Employer
Identification No.) |
|
|
Glenpointe Centre East, 3rd Floor
300 Frank W. Burr Boulevard, Suite 21 Teaneck, New Jersey (Address of Principal Executive Offices) |
| |
07666-6712
(Zip Code) |
|
| Large accelerated filer | | | ☐ | | | | | | Accelerated filer | | | ☒ | |
| Non-accelerated filer | | | ☐ | | | (Do not check if a smaller reporting company) | | |
Smaller reporting company
|
| | ☐ | |
| Emerging growth company | | | ☒ | | | | | | | | | | |
| | |
Page
|
| |||
PART I—FINANCIAL INFORMATION | | | |||||
| | | | 3 | | | |
| | | | 3 | | | |
| | | | 4 | | | |
| | | | 5 | | | |
| | | | 6 | | | |
| | | | 7 | | | |
| | | | 18 | | | |
| | | | 31 | | | |
| | | | 31 | | | |
PART II—OTHER INFORMATION | | | |||||
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 33 | | | |
| | | | 34 | | |
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
| | |
(unaudited)
(in thousands, except per share amounts) |
| |||||||||||||||||||||
Net sales
|
| | | $ | 205,876 | | | | | $ | 191,598 | | | | | $ | 399,288 | | | | | $ | 379,585 | | |
Cost of goods sold
|
| | | | 138,957 | | | | | | 128,100 | | | | | | 268,987 | | | | | | 255,088 | | |
Gross profit
|
| | | | 66,919 | | | | | | 63,498 | | | | | | 130,301 | | | | | | 124,497 | | |
Selling, general and administrative expenses
|
| | | | 42,981 | | | | | | 40,870 | | | | | | 83,976 | | | | | | 80,056 | | |
Operating income
|
| | | | 23,938 | | | | | | 22,628 | | | | | | 46,325 | | | | | | 44,441 | | |
Interest expense, net
|
| | | | 3,050 | | | | | | 3,872 | | | | | | 6,168 | | | | | | 7,779 | | |
Foreign currency (gains) losses, net
|
| | | | (323) | | | | | | (548) | | | | | | 2 | | | | | | (214) | | |
Income before income taxes
|
| | | | 21,211 | | | | | | 19,304 | | | | | | 40,155 | | | | | | 36,876 | | |
Provision (benefit) for income taxes
|
| | | | 14,179 | | | | | | 5,887 | | | | | | 17,231 | | | | | | 11,282 | | |
Net income
|
| | | $ | 7,032 | | | | | $ | 13,417 | | | | | $ | 22,924 | | | | | $ | 25,594 | | |
Net income per share | | | | | | ||||||||||||||||||||
basic
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | 0.57 | | | | | $ | 0.65 | | |
diluted
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | 0.57 | | | | | $ | 0.64 | | |
Weighted average common shares outstanding | | | | | | ||||||||||||||||||||
basic
|
| | | | 40,186 | | | | | | 39,411 | | | | | | 40,065 | | | | | | 39,409 | | |
diluted
|
| | | | 40,364 | | | | | | 40,002 | | | | | | 40,329 | | | | | | 39,954 | | |
Dividends per share
|
| | | $ | 0.10 | | | | | $ | 0.10 | | | | | $ | 0.20 | | | | | $ | 0.20 | | |
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
| | |
(unaudited)
(in thousands) |
| |||||||||||||||||||||
Net income
|
| | | $ | 7,032 | | | | | $ | 13,417 | | | | | $ | 22,924 | | | | | $ | 25,594 | | |
Change in fair value of derivative instruments
|
| | | | (276) | | | | | | 270 | | | | | | (898) | | | | | | 304 | | |
Foreign currency translation adjustment
|
| | | | (5,005) | | | | | | (2,296) | | | | | | (1,772) | | | | | | (3,189) | | |
Unrecognized net pension gains (losses)
|
| | | | 95 | | | | | | 4,671 | | | | | | 226 | | | | | | 11,840 | | |
(Provision) benefit for income taxes
|
| | | | 809 | | | | | | (1,894) | | | | | | 996 | | | | | | (4,644) | | |
Other comprehensive income (loss)
|
| | | | (4,377) | | | | | | 751 | | | | | | (1,448) | | | | | | 4,311 | | |
Comprehensive income
|
| | | $ | 2,655 | | | | | $ | 14,168 | | | | | $ | 21,476 | | | | | $ | 29,905 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
| | |
(unaudited)
(in thousands, except share and per share amounts) |
| |||||||||
ASSETS | | | | ||||||||||
Cash and cash equivalents
|
| | | $ | 40,185 | | | | | $ | 56,083 | | |
Short-term investments
|
| | | | 27,000 | | | | | | — | | |
Accounts receivable, net
|
| | | | 132,242 | | | | | | 125,847 | | |
Inventories, net
|
| | | | 173,613 | | | | | | 161,233 | | |
Other current assets
|
| | | | 23,407 | | | | | | 20,502 | | |
Total current assets
|
| | | | 396,447 | | | | | | 363,665 | | |
Property, plant and equipment, net
|
| | | | 127,940 | | | | | | 127,351 | | |
Intangibles, net
|
| | | | 56,454 | | | | | | 54,602 | | |
Goodwill
|
| | | | 29,624 | | | | | | 23,982 | | |
Other assets
|
| | | | 52,665 | | | | | | 53,797 | | |
Total assets
|
| | | $ | 663,130 | | | | | $ | 623,397 | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | ||||||||||
Current portion of long-term debt
|
| | | $ | 9,458 | | | | | $ | 6,250 | | |
Accounts payable
|
| | | | 64,779 | | | | | | 56,894 | | |
Accrued expenses and other current liabilities
|
| | | | 52,999 | | | | | | 52,652 | | |
Total current liabilities
|
| | | | 127,236 | | | | | | 115,796 | | |
Revolving credit facility
|
| | | | 71,000 | | | | | | 65,000 | | |
Long-term debt
|
| | | | 235,910 | | | | | | 241,891 | | |
Other liabilities
|
| | | | 60,659 | | | | | | 49,553 | | |
Total liabilities
|
| | | | 494,805 | | | | | | 472,240 | | |
Commitments and contingencies (Note 9) | | | | ||||||||||
Common stock, par value $0.0001 per share; 300,000,000 Class A shares authorized, 19,585,889 and 19,249,132 shares issued and outstanding at December 31, 2017, and June 30, 2017, respectively; 30,000,000 Class B shares authorized, 20,602,836 and 20,626,836 shares issued and outstanding at December 31, 2017, and June 30, 2017, respectively
|
| | | | 4 | | | | | | 4 | | |
Preferred stock, par value $0.0001 per share; 16,000,000 shares authorized, no shares issued and outstanding
|
| | | | — | | | | | | — | | |
Paid-in capital
|
| | | | 127,540 | | | | | | 123,840 | | |
Retained earnings
|
| | | | 97,666 | | | | | | 82,750 | | |
Accumulated other comprehensive income (loss)
|
| | | | (56,885) | | | | | | (55,437) | | |
Total stockholders’ equity
|
| | | | 168,325 | | | | | | 151,157 | | |
Total liabilities and stockholders’ equity
|
| | | $ | 663,130 | | | | | $ | 623,397 | | |
|
| | |
Six Months
|
| |||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| ||||||
| | |
(unaudited)
(in thousands) |
| |||||||||
OPERATING ACTIVITIES | | | | ||||||||||
Net income
|
| | | $ | 22,924 | | | | | $ | 25,594 | | |
Adjustments to reconcile net income to net cash provided (used) by operating activities:
|
| | | ||||||||||
Depreciation and amortization
|
| | | | 13,275 | | | | | | 12,762 | | |
Amortization of debt issuance costs and debt discount
|
| | | | 441 | | | | | | 508 | | |
Acquisition-related cost of goods sold
|
| | | | 1,671 | | | | | | — | | |
Acquisition-related accrued compensation
|
| | | | 924 | | | | | | 840 | | |
Acquisition-related accrued interest
|
| | | | 505 | | | | | | 855 | | |
Pension settlement cost
|
| | | | — | | | | | | 1,702 | | |
Deferred income taxes
|
| | | | 5,725 | | | | | | 3,736 | | |
Foreign currency (gains) losses, net
|
| | | | 11 | | | | | | 293 | | |
Other
|
| | | | 418 | | | | | | 310 | | |
Changes in operating assets and liabilities, net of business acquisition: | | | | ||||||||||
Accounts receivable, net
|
| | | | (5,075) | | | | | | (1,583) | | |
Inventories, net
|
| | | | (10,845) | | | | | | 7,017 | | |
Other current assets
|
| | | | (4,751) | | | | | | 919 | | |
Other assets
|
| | | | 664 | | | | | | (512) | | |
Accounts payable
|
| | | | 7,473 | | | | | | (4,667) | | |
Accrued expenses and other liabilities
|
| | | | 3,733 | | | | | | (41) | | |
Net cash provided (used) by operating activities
|
| | | | 37,093 | | | | | | 47,733 | | |
INVESTING ACTIVITIES | | | | ||||||||||
Purchases of short-term investments
|
| | | | (27,000) | | | | | | — | | |
Capital expenditures
|
| | | | (8,851) | | | | | | (10,564) | | |
Business acquisition
|
| | | | (15,000) | | | | | | — | | |
Other, net
|
| | | | (716) | | | | | | (201) | | |
Net cash provided (used) by investing activities
|
| | | | (51,567) | | | | | | (10,765) | | |
FINANCING ACTIVITIES | | | | ||||||||||
Revolving credit facility borrowings
|
| | | | 109,870 | | | | | | 73,000 | | |
Revolving credit facility repayments
|
| | | | (103,870) | | | | | | (93,500) | | |
Payments of long-term debt, capital leases and other
|
| | | | (3,236) | | | | | | (2,776) | | |
Proceeds from common shares issued
|
| | | | 3,700 | | | | | | 110 | | |
Dividends paid
|
| | | | (8,008) | | | | | | (7,882) | | |
Net cash provided (used) by financing activities
|
| | | | (1,544) | | | | | | (31,048) | | |
Effect of exchange rate changes on cash
|
| | | | 120 | | | | | | (305) | | |
Net increase (decrease) in cash and cash equivalents
|
| | | | (15,898) | | | | | | 5,615 | | |
Cash and cash equivalents at beginning of period
|
| | | | 56,083 | | | | | | 33,605 | | |
Cash and cash equivalents at end of period
|
| | | $ | 40,185 | | | | | $ | 39,220 | | |
|
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
Net income
|
| | | $ | 7,032 | | | | | $ | 13,417 | | | | | $ | 22,924 | | | | | $ | 25,594 | | |
Weighted average number of shares – basic
|
| | | | 40,186 | | | | | | 39,411 | | | | | | 40,065 | | | | | | 39,409 | | |
Dilutive effect of stock options
|
| | | | 178 | | | | | | 591 | | | | | | 264 | | | | | | 545 | | |
Weighted average number of shares – diluted
|
| | | | 40,364 | | | | | | 40,002 | | | | | | 40,329 | | | | | | 39,954 | | |
Net income per share | | | | | | ||||||||||||||||||||
basic
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | 0.57 | | | | | $ | 0.65 | | |
diluted
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | 0.57 | | | | | $ | 0.64 | | |
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
Interest expense, net | | | | | | ||||||||||||||||||||
Term loan
|
| | | $ | 2,110 | | | | | $ | 2,866 | | | | | $ | 4,143 | | | | | $ | 5,771 | | |
Revolving credit facility
|
| | | | 739 | | | | | | 731 | | | | | | 1,420 | | | | | | 1,686 | | |
Amortization of debt issuance costs and debt discount
|
| | | | 220 | | | | | | 255 | | | | | | 441 | | | | | | 508 | | |
Acquisition-related accrued interest
|
| | | | 252 | | | | | | 462 | | | | | | 505 | | | | | | 855 | | |
Other
|
| | | | 2 | | | | | | 47 | | | | | | 241 | | | | | | 128 | | |
Interest expense
|
| | | | 3,323 | | | | | | 4,361 | | | | | | 6,750 | | | | | | 8,948 | | |
Interest (income)
|
| | | | (273) | | | | | | (489) | | | | | | (582) | | | | | | (1,169) | | |
| | | | $ | 3,050 | | | | | $ | 3,872 | | | | | $ | 6,168 | | | | | $ | 7,779 | | |
Depreciation and amortization | | | | | | ||||||||||||||||||||
Depreciation of property, plant and equipment
|
| | | $ | 5,222 | | | | | $ | 4,952 | | | | | $ | 10,405 | | | | | $ | 9,683 | | |
Amortization of intangible assets
|
| | | | 1,397 | | | | | | 1,434 | | | | | | 2,846 | | | | | | 2,962 | | |
Amortization of other assets
|
| | | | 12 | | | | | | 58 | | | | | | 24 | | | | | | 117 | | |
| | | | $ | 6,631 | | | | | $ | 6,444 | | | | | $ | 13,275 | | | | | $ | 12,762 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Inventories | | | | | | | | | | | | | |
Raw materials
|
| | | $ | 65,976 | | | | | $ | 54,861 | | |
Work-in-process
|
| | | | 13,325 | | | | | | 12,402 | | |
Finished goods
|
| | | | 94,312 | | | | | | 93,970 | | |
| | | | $ | 173,613 | | | | | $ | 161,233 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Goodwill roll-forward | | | | ||||||||||
Balance at beginning of period
|
| | | $ | 23,982 | | | | | $ | 21,121 | | |
Purchase price allocation adjustment
|
| | | | — | | | | | | 2,861 | | |
Acquisition
|
| | | | 5,642 | | | | | | — | | |
Balance at end of period
|
| | | $ | 29,624 | | | | | $ | 23,982 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Accrued expenses and other current liabilities | | | | | | | | | | | | | |
Employee related
|
| | | $ | 22,590 | | | | | $ | 26,553 | | |
Commissions and rebates
|
| | | | 5,830 | | | | | | 6,443 | | |
Insurance related
|
| | | | 1,549 | | | | | | 1,515 | | |
Professional fees
|
| | | | 3,944 | | | | | | 3,823 | | |
Income and other taxes
|
| | | | 4,000 | | | | | | 3,035 | | |
Other
|
| | | | 15,086 | | | | | | 11,283 | | |
| | | | $ | 52,999 | | | | | $ | 52,652 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Accumulated other comprehensive income (loss) | | | | ||||||||||
Derivative instruments
|
| | | $ | 1,788 | | | | | $ | 2,686 | | |
Foreign currency translation adjustment
|
| | | | (45,328) | | | | | | (43,556) | | |
Unrecognized net pension gains (losses)
|
| | | | (17,833) | | | | | | (18,059) | | |
(Provision) benefit for income taxes on derivative instruments
|
| | | | (483) | | | | | | (1,553) | | |
(Provision) benefit for incomes taxes on long-term intercompany investments
|
| | | | 8,166 | | | | | | 8,166 | | |
(Provision) benefit for income taxes on pension gains (losses)
|
| | | | (3,195) | | | | | | (3,121) | | |
| | | | $ | (56,885) | | | | | $ | (55,437) | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Term A Loan due June 2022
|
| | | $ | 246,875 | | | | | $ | 250,000 | | |
Capitalized lease obligations
|
| | | | 166 | | | | | | — | | |
| | | | | 247,041 | | | | | | 250,000 | | |
Unamortized debt issuance costs and debt discount
|
| | | | (1,673) | | | | | | (1,859) | | |
| | | | | 245,368 | | | | | | 248,141 | | |
Less: current maturities
|
| | | | (9,458) | | | | | | (6,250) | | |
| | | | $ | 235,910 | | | | | $ | 241,891 | | |
|
Instrument
|
| |
Hedge
|
| |
Notional
Amount at December 31, 2017 |
| |
Consolidated
Balance Sheet |
| |
Fair value as of
|
| |||||||||
|
December 31,
2017 |
| |
June 30,
2017 |
| |||||||||||||||||
Options
|
| |
Brazilian Real calls
|
| | R$— | | |
Other current assets
|
| | | $ | — | | | | | $ | 2,686 | | |
Swap
|
| | Interest rate swap | | |
$150,000
|
| | Other assets | | | | $ | 1,788 | | | | | $ | — | | |
For the Three Months Ended December 31
|
| ||||||||||||||||||||||||||||||||||||||||||
Instrument
|
| |
Hedge
|
| |
Gain (Loss) recorded in OCI
|
| |
Gain (Loss) recognized in
consolidated statements of operations |
| |
Consolidated Statement
of Operations Line Item Total |
| ||||||||||||||||||||||||||||||
|
2017
|
| |
2016
|
| |
Consolidated
Statement of Operations |
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| |||||||||||||||||||||||
Options
|
| |
Brazilian
Real calls |
| | | $ | (1,781) | | | | | $ | 270 | | | | Cost of goods sold | | | | $ | 517 | | | | | $ | (393) | | | | | $ | 138,957 | | | | | $ | 128,100 | | |
Swap
|
| | Interest rate swap |
| | | $ | 1,505 | | | | | $ | — | | | |
Interest expense, net
|
| | | $ | — | | | | | $ | — | | | | | $ | 3,050 | | | | | $ | 3,872 | | |
For the Six Months Ended December 31
|
| ||||||||||||||||||||||||||||||||||||||||||
Instrument
|
| |
Hedge
|
| |
Gain (Loss) recorded in OCI
|
| |
Gain (Loss) recognized in
consolidated statements of operations |
| |
Consolidated Statement
of Operations Line Item Total |
| ||||||||||||||||||||||||||||||
|
2017
|
| |
2016
|
| |
Consolidated
Statement of Operations |
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| |||||||||||||||||||||||
Options
|
| | Brazilian Real calls | | | | $ | (2,686) | | | | | $ | 304 | | | | Cost of goods sold | | | | $ | 703 | | | | | $ | (1,528) | | | | | $ | 268,987 | | | | | $ | 255,088 | | |
Swap
|
| | Interest rate swap |
| | | $ | 1,788 | | | | | $ | — | | | |
Interest expense, net
|
| | | $ | — | | | | | $ | — | | | | | $ | 6,168 | | | | | $ | 7,779 | | |
As of
|
| |
December 31, 2017
|
| |
June 30, 2017
|
| ||||||||||||||||||||||||||||||
| | |
Level 1
|
| |
Level 2
|
| |
Level 3
|
| |
Level 1
|
| |
Level 2
|
| |
Level 3
|
| ||||||||||||||||||
Short-term investments
|
| | | $ | 27,000 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Derivatives asset
|
| | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 2,686 | | | | | $ | — | | |
Interest rate swap
|
| | | $ | — | | | | | $ | 1,788 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Contingent consideration on
acquisitions |
| | | $ | — | | | | | $ | — | | | | | $ | (8,079) | | | | | $ | — | | | | | $ | — | | | | | $ | (7,644) | | |
| | | | |||||
|
Balance, June 30, 2017
|
| | | $ | (7,644) | | |
|
Acquisition-related accrued interest
|
| | | | (505) | | |
|
Payment
|
| | | | 70 | | |
|
Balance, December 31, 2017
|
| | | $ | (8,079) | | |
|
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
Net sales | | | | | | ||||||||||||||||||||
Animal Health
|
| | | $ | 132,845 | | | | | $ | 123,673 | | | | | $ | 261,686 | | | | | $ | 248,174 | | |
Mineral Nutrition
|
| | | | 59,616 | | | | | | 56,699 | | | | | | 111,689 | | | | | | 108,291 | | |
Performance Products
|
| | | | 13,415 | | | | | | 11,226 | | | | | | 25,913 | | | | | | 23,120 | | |
Total segments
|
| | | $ | 205,876 | | | | | $ | 191,598 | | | | | $ | 399,288 | | | | | $ | 379,585 | | |
Depreciation and amortization | | | | | | ||||||||||||||||||||
Animal Health
|
| | | $ | 5,265 | | | | | $ | 5,011 | | | | | $ | 10,519 | | | | | $ | 9,909 | | |
Mineral Nutrition
|
| | | | 584 | | | | | | 542 | | | | | | 1,169 | | | | | | 1,084 | | |
Performance Products
|
| | | | 259 | | | | | | 235 | | | | | | 505 | | | | | | 453 | | |
Total segments
|
| | | $ | 6,108 | | | | | $ | 5,788 | | | | | $ | 12,193 | | | | | $ | 11,446 | | |
Adjusted EBITDA | | | | | | ||||||||||||||||||||
Animal Health
|
| | | $ | 35,036 | | | | | $ | 34,609 | | | | | $ | 68,778 | | | | | $ | 67,228 | | |
Mineral Nutrition
|
| | | | 5,614 | | | | | | 4,741 | | | | | | 9,330 | | | | | | 8,729 | | |
Performance Products
|
| | | | 264 | | | | | | 260 | | | | | | 512 | | | | | | 1,002 | | |
Total segments
|
| | | $ | 40,914 | | | | | $ | 39,610 | | | | | $ | 78,620 | | | | | $ | 76,959 | | |
|
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
2017
|
| |
2016
|
| ||||||||||||
Reconciliation of income before income taxes to Adjusted EBITDA
|
| | | | | ||||||||||||||||||||
Income before income taxes
|
| | | $ | 21,211 | | | | | $ | 19,304 | | | | | $ | 40,155 | | | | | $ | 36,876 | | |
Interest expense, net
|
| | | | 3,050 | | | | | | 3,872 | | | | | | 6,168 | | | | | | 7,779 | | |
Depreciation and amortization – Total segments
|
| | | | 6,108 | | | | | | 5,788 | | | | | | 12,193 | | | | | | 11,446 | | |
Depreciation and amortization – Corporate
|
| | | | 523 | | | | | | 656 | | | | | | 1,082 | | | | | | 1,316 | | |
Corporate costs
|
| | | | 8,436 | | | | | | 8,416 | | | | | | 16,025 | | | | | | 15,940 | | |
Acquisition-related cost of goods sold
|
| | | | 1,422 | | | | | | — | | | | | | 1,671 | | | | | | — | | |
Acquisition-related accrued compensation
|
| | | | 487 | | | | | | 420 | | | | | | 924 | | | | | | 840 | | |
Acquisition-related transaction costs
|
| | | | — | | | | | | — | | | | | | 400 | | | | | | 1,274 | | |
Pension settlement cost
|
| | | | — | | | | | | 1,702 | | | | | | — | | | | | | 1,702 | | |
Foreign currency (gains) losses, net
|
| | | | (323) | | | | | | (548) | | | | | | 2 | | | | | | (214) | | |
Adjusted EBITDA – Total segments
|
| | | $ | 40,914 | | | | | $ | 39,610 | | | | | $ | 78,620 | | | | | $ | 76,959 | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| ||||||
Identifiable assets | | | | ||||||||||
Animal Health
|
| | | $ | 465,058 | | | | | $ | 442,521 | | |
Mineral Nutrition
|
| | | | 63,407 | | | | | | 55,184 | | |
Performance Products
|
| | | | 23,541 | | | | | | 23,681 | | |
Total segments
|
| | | | 552,006 | | | | | | 521,386 | | |
Corporate
|
| | | | 111,124 | | | | | | 102,011 | | |
Total
|
| | | $ | 663,130 | | | | | $ | 623,397 | | |
|
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||||||||||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
Change
|
| |
2017
|
| |
2016
|
| |
Change
|
| ||||||||||||||||||||||||||||||
| | |
(in thousands, except per share amounts and percentages)
|
| |||||||||||||||||||||||||||||||||||||||||||||
Net sales
|
| | | $ | 205,876 | | | | | $ | 191,598 | | | | | $ | 14,278 | | | | |
|
7%
|
| | | | $ | 399,288 | | | | | $ | 379,585 | | | | | $ | 19,703 | | | | |
|
5%
|
| |
Gross profit
|
| | | | 66,919 | | | | | | 63,498 | | | | | | 3,421 | | | | |
|
5%
|
| | | | | 130,301 | | | | | | 124,497 | | | | | | 5,804 | | | | |
|
5%
|
| |
Selling, general and administrative expenses
|
| | | | 42,981 | | | | | | 40,870 | | | | | | 2,111 | | | | |
|
5%
|
| | | | | 83,976 | | | | | | 80,056 | | | | | | 3,920 | | | | |
|
5%
|
| |
Operating income
|
| | | | 23,938 | | | | | | 22,628 | | | | | | 1,310 | | | | |
|
6%
|
| | | | | 46,325 | | | | | | 44,441 | | | | | | 1,884 | | | | |
|
4%
|
| |
Interest expense, net
|
| | | | 3,050 | | | | | | 3,872 | | | | | | (822) | | | | |
|
(21)%
|
| | | | | 6,168 | | | | | | 7,779 | | | | | | (1,611) | | | | |
|
(21)%
|
| |
Foreign currency (gains) losses, net
|
| | | | (323) | | | | | | (548) | | | | | | 225 | | | | |
|
*
|
| | | | | 2 | | | | | | (214) | | | | | | 216 | | | | |
|
*
|
| |
Income before income taxes
|
| | | | 21,211 | | | | | | 19,304 | | | | | | 1,907 | | | | |
|
10%
|
| | | | | 40,155 | | | | | | 36,876 | | | | | | 3,279 | | | | |
|
9%
|
| |
Provision (benefit) for income taxes
|
| | | | 14,179 | | | | | | 5,887 | | | | | | 8,292 | | | | |
|
141%
|
| | | | | 17,231 | | | | | | 11,282 | | | | | | 5,949 | | | | |
|
53%
|
| |
Net income
|
| | | $ | 7,032 | | | | | $ | 13,417 | | | | | $ | (6,385) | | | | |
|
(48)%
|
| | | | $ | 22,924 | | | | | $ | 25,594 | | | | | $ | (2,670) | | | | |
|
(10)%
|
| |
Net income per share | | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
basic
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | (0.17) | | | | | | | | | | | $ | 0.57 | | | | | $ | 0.65 | | | | | $ | (0.08) | | | | |||||
diluted
|
| | | $ | 0.17 | | | | | $ | 0.34 | | | | | $ | (0.17) | | | | | | | | | | | $ | 0.57 | | | | | $ | 0.64 | | | | | $ | (0.07) | | | | |||||
Weighted average number of shares outstanding
|
| | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
basic
|
| | | | 40,186 | | | | | | 39,411 | | | | | | | | | | | | | | | | | | 40,065 | | | | | | 39,409 | | | | | ||||||||||
diluted
|
| | | | 40,364 | | | | | | 40,002 | | | | | | | | | | | | | | | | | | 40,329 | | | | | | 39,954 | | | | | ||||||||||
Ratio to net sales | | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
Gross profit
|
| | | | 32.5% | | | | | | 33.1% | | | | | | | | | | | | | | | | | | 32.6% | | | | | | 32.8% | | | | | ||||||||||
Selling, general and administrative expenses
|
| | | | 20.9% | | | | | | 21.3% | | | | | | | | | | | | | | | | | | 21.0% | | | | | | 21.1% | | | | | ||||||||||
Operating income
|
| | | | 11.6% | | | | | | 11.8% | | | | | | | | | | | | | | | | | | 11.6% | | | | | | 11.7% | | | | | ||||||||||
Income before income taxes
|
| | | | 10.3% | | | | | | 10.1% | | | | | | | | | | | | | | | | | | 10.1% | | | | | | 9.7% | | | | | ||||||||||
Net income
|
| | | | 3.4% | | | | | | 7.0% | | | | | | | | | | | | | | | | | | 5.7% | | | | | | 6.7% | | | | | ||||||||||
Effective tax rate
|
| | | | 66.8% | | | | | | 30.5% | | | | | | | | | | | | | | | | | | 42.9% | | | | | | 30.6% | | | | |
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||||||||||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
Change
|
| |
2017
|
| |
2016
|
| |
Change
|
| ||||||||||||||||||||||||||||||
| | |
(in thousands, except percentages)
|
| |||||||||||||||||||||||||||||||||||||||||||||
Net sales | | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
MFAs and other
|
| | | $ | 82,018 | | | | | $ | 77,475 | | | | | $ | 4,543 | | | | |
|
6%
|
| | | | $ | 161,621 | | | | | $ | 160,894 | | | | | $ | 727 | | | | |
|
0%
|
| |
Nutritional specialties
|
| | | | 32,623 | | | | | | 29,247 | | | | | | 3,376 | | | | |
|
12%
|
| | | | | 63,400 | | | | | | 55,551 | | | | | | 7,849 | | | | |
|
14%
|
| |
Vaccines
|
| | | | 18,204 | | | | | | 16,951 | | | | | | 1,253 | | | | |
|
7%
|
| | | | | 36,665 | | | | | | 31,729 | | | | | | 4,936 | | | | |
|
16%
|
| |
Animal Health
|
| | | | 132,845 | | | | | | 123,673 | | | | | | 9,172 | | | | |
|
7%
|
| | | | | 261,686 | | | | | | 248,174 | | | | | | 13,512 | | | | |
|
5%
|
| |
Mineral Nutrition
|
| | | | 59,616 | | | | | | 56,699 | | | | | | 2,917 | | | | |
|
5%
|
| | | | | 111,689 | | | | | | 108,291 | | | | | | 3,398 | | | | |
|
3%
|
| |
Performance Products
|
| | | | 13,415 | | | | | | 11,226 | | | | | | 2,189 | | | | |
|
19%
|
| | | | | 25,913 | | | | | | 23,120 | | | | | | 2,793 | | | | |
|
12%
|
| |
Total
|
| | | $ | 205,876 | | | | | $ | 191,598 | | | | | $ | 14,278 | | | | |
|
7%
|
| | | | $ | 399,288 | | | | | $ | 379,585 | | | | | $ | 19,703 | | | | |
|
5%
|
| |
Adjusted EBITDA | | | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
Animal Health
|
| | | $ | 35,036 | | | | | $ | 34,609 | | | | | $ | 427 | | | | |
|
1%
|
| | | | $ | 68,778 | | | | | $ | 67,228 | | | | | $ | 1,550 | | | | |
|
2%
|
| |
Mineral Nutrition
|
| | | | 5,614 | | | | | | 4,741 | | | | | | 873 | | | | |
|
18%
|
| | | | | 9,330 | | | | | | 8,729 | | | | | | 601 | | | | |
|
7%
|
| |
Performance Products
|
| | | | 264 | | | | | | 260 | | | | | | 4 | | | | |
|
2%
|
| | | | | 512 | | | | | | 1,002 | | | | | | (490) | | | | |
|
(49)%
|
| |
Corporate
|
| | | | (8,436) | | | | | | (8,416) | | | | | | (20) | | | | |
|
*
|
| | | | | (16,025) | | | | | | (15,940) | | | | | | (85) | | | | |
|
*
|
| |
Total
|
| | | $ | 32,478 | | | | | $ | 31,194 | | | | | $ | 1,284 | | | | |
|
4%
|
| | | | $ | 62,595 | | | | | $ | 61,019 | | | | | $ | 1,576 | | | | |
|
3%
|
| |
Adjusted EBITDA ratio to segment net sales
|
| | | | | | | | | ||||||||||||||||||||||||||||||||||||||||
Animal Health
|
| | | | 26.4% | | | | | | 28.0% | | | | | | | | | | | | | | | | | | 26.3% | | | | | | 27.1% | | | | | ||||||||||
Mineral Nutrition
|
| | | | 9.4% | | | | | | 8.4% | | | | | | | | | | | | | | | | | | 8.4% | | | | | | 8.1% | | | | | ||||||||||
Performance Products
|
| | | | 2.0% | | | | | | 2.3% | | | | | | | | | | | | | | | | | | 2.0% | | | | | | 4.3% | | | | | ||||||||||
Corporate (1)
|
| | | | (4.1)% | | | | | | (4.4)% | | | | | | | | | | | | | | | | | | (4.0)% | | | | | | (4.2)% | | | | | ||||||||||
Total (1)
|
| | | | 15.8% | | | | | | 16.3% | | | | | | | | | | | | | | | | | | 15.7% | | | | | | 16.1% | | | | |
| | |
Three Months
|
| |
Six Months
|
| ||||||||||||||||||||||||||||||||||||||||||
For the Periods Ended December 31
|
| |
2017
|
| |
2016
|
| |
Change
|
| |
2017
|
| |
2016
|
| |
Change
|
| ||||||||||||||||||||||||||||||
| | |
(in thousands, except percentages)
|
| |||||||||||||||||||||||||||||||||||||||||||||
Net income
|
| | | $ | 7,032 | | | | | $ | 13,417 | | | | | $ | (6,385) | | | | |
|
(48)%
|
| | | | $ | 22,924 | | | | | $ | 25,594 | | | | | $ | (2,670) | | | | |
|
(10)%
|
| |
Interest expense, net
|
| | | | 3,050 | | | | | | 3,872 | | | | | | (822) | | | | |
|
(21)%
|
| | | | | 6,168 | | | | | | 7,779 | | | | | | (1,611) | | | | |
|
(21)%
|
| |
Provision (benefit) for income taxes
|
| | | | 14,179 | | | | | | 5,887 | | | | | | 8,292 | | | | |
|
141%
|
| | | | | 17,231 | | | | | | 11,282 | | | | | | 5,949 | | | | |
|
53%
|
| |
Depreciation and amortization
|
| | | | 6,631 | | | | | | 6,444 | | | | | | 187 | | | | |
|
3%
|
| | | | | 13,275 | | | | | | 12,762 | | | | | | 513 | | | | |
|
4%
|
| |
EBITDA
|
| | | | 30,892 | | | | | | 29,620 | | | | | | 1,272 | | | | |
|
4%
|
| | | | | 59,598 | | | | | | 57,417 | | | | | | 2,181 | | | | |
|
4%
|
| |
Acquisition-related cost of goods
sold |
| | | | 1,422 | | | | | | — | | | | | | 1,422 | | | | |
|
*
|
| | | | | 1,671 | | | | | | — | | | | | | 1,671 | | | | |
|
*
|
| |
Acquisition-related accrued compensation
|
| | | | 487 | | | | | | 420 | | | | | | 67 | | | | |
|
16%
|
| | | | | 924 | | | | | | 840 | | | | | | 84 | | | | |
|
10%
|
| |
Acquisition-related transaction costs
|
| | | | — | | | | | | — | | | | | | — | | | | |
|
*
|
| | | | | 400 | | | | | | 1,274 | | | | | | (874) | | | | |
|
(69)%
|
| |
Pension settlement cost
|
| | | | — | | | | | | 1,702 | | | | | | (1,702) | | | | |
|
*
|
| | | | | — | | | | | | 1,702 | | | | | | (1,702) | | | | |
|
*
|
| |
Foreign currency (gains) losses, net
|
| | | | (323) | | | | | | (548) | | | | | | 225 | | | | |
|
*
|
| | | | | 2 | | | | | | (214) | | | | | | 216 | | | | |
|
*
|
| |
Adjusted EBITDA
|
| | | $ | 32,478 | | | | | $ | 31,194 | | | | | $ | 1,284 | | | | |
|
4%
|
| | | | $ | 62,595 | | | | | $ | 61,019 | | | | | $ | 1,576 | | | | |
|
3%
|
| |
|
| | |
Six Months
|
| |||||||||||||||
For the Periods December 31
|
| |
2017
|
| |
2016
|
| |
Change
|
| |||||||||
| | |
(in thousands)
|
| |||||||||||||||
Cash provided by/(used in): | | | | | |||||||||||||||
Operating activities
|
| | | $ | 37,093 | | | | | $ | 47,733 | | | | | $ | (10,640) | | |
Investing activities
|
| | | | (51,567) | | | | | | (10,765) | | | | | | (40,802) | | |
Financing activities
|
| | | | (1,544) | | | | | | (31,048) | | | | | | 29,504 | | |
Effect of exchange-rate changes on cash and cash equivalents
|
| | | | 120 | | | | | | (305) | | | | | | 425 | | |
Net increase/(decrease) in cash and cash equivalents
|
| | | $ | (15,898) | | | | | $ | 5,615 | | | | | $ | (21,513) | | |
|
| | |
Six Months
|
| |||||||||||||||
For the Periods December 31
|
| |
2017
|
| |
2016
|
| |
Change
|
| |||||||||
| | |
(in thousands)
|
| |||||||||||||||
EBITDA
|
| | | $ | 59,598 | | | | | $ | 57,417 | | | | | $ | 2,181 | | |
Adjustments | | | | | |||||||||||||||
Acquisition-related cost of goods sold
|
| | | | 1,671 | | | | | | — | | | | | | 1,671 | | |
Acquisition-related accrued compensation
|
| | | | 924 | | | | | | 840 | | | | | | 84 | | |
Acquisition-related transaction costs
|
| | | | 400 | | | | | | 1,274 | | | | | | (874) | | |
Pension settlement cost
|
| | | | — | | | | | | 1,702 | | | | | | (1,702) | | |
Foreign currency (gains) losses, net
|
| | | | 2 | | | | | | (214) | | | | | | 216 | | |
Interest paid
|
| | | | (5,595) | | | | | | (7,651) | | | | | | 2,056 | | |
Income taxes paid
|
| | | | (9,708) | | | | | | (6,305) | | | | | | (3,403) | | |
Changes in operating assets and liabilities and other items
|
| | | | (9,799) | | | | | | 1,944 | | | | | | (11,743) | | |
Cash used for acquisition-related transaction costs
|
| | | | (400) | | | | | | (1,274) | | | | | | 874 | | |
Net cash provided (used) by operating activities
|
| | | $ | 37,093 | | | | | $ | 47,733 | | | | | $ | (10,640) | | |
|
As of
|
| |
December 31,
2017 |
| |
June 30,
2017 |
| |
Change
|
| |||||||||
| | |
(in thousands, except ratios)
|
| |||||||||||||||
Cash and cash equivalents and short-term investments
|
| | | $ | 67,185 | | | | | $ | 56,083 | | | | | $ | 11,102 | | |
Working capital
|
| | | | 211,484 | | | | | | 198,036 | | | | | | 13,448 | | |
Ratio of current assets to current liabilities
|
| | | | 2.80:1 | | | | | | 2.81:1 | | | |
| | | | Exhibit 31.1 Chief Executive Officer—Certification pursuant to Sarbanes-Oxley Act of 2002 Section 302 | |
| | | | Exhibit 31.2 Chief Financial Officer—Certification pursuant to Sarbanes-Oxley Act of 2002 Section 302 | |
| | | | Exhibit 32.1 Chief Executive Officer—Certification pursuant to Sarbanes-Oxley Act of 2002 Section 906 | |
| | | | Exhibit 32.2 Chief Financial Officer—Certification pursuant to Sarbanes-Oxley Act of 2002 Section 906 | |
| | | | Exhibit 101.INS* XBRL Instance Document | |
| | | | Exhibit 101.SCH* XBRL Taxonomy Extension Schema Document | |
| | | | Exhibit 101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document | |
| | | | Exhibit 101.DEF* XBRL Taxonomy Extension Definition Linkbase Document | |
| | | | Exhibit 101.LAB* XBRL Taxonomy Extension Label Linkbase Document | |
| | | | Exhibit 101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document | |
| | | | Phibro Animal Health Corporation | | |||
| February 5, 2018 | | | By: | | |
/s/ Jack C. Bendheim
Jack C. Bendheim
Chairman, President and Chief Executive Officer |
|
| February 5, 2018 | | | By: | | |
/s/ Richard G. Johnson
Richard G. Johnson
Chief Financial Officer |
|