American Vanguard Corporation 2026 Q2 Earnings Call
Review the key takeaways and the transcript of this earnings call.
- American Vanguard reported second quarter 2026 sales of $117 million, down from $129 million in the same period of 2025, primarily due to weaker international sales which declined 18%.
- U.S. crop sales decreased 9% in the quarter due to timing shifts in the cotton portfolio and cautious grower spending, but specialty business sales grew 11%.
- For the first half of 2026, total sales were $240 million, down 2% year over year, with U.S. sales up 6% and international sales down 13%.
- Gross margin for Q2 2026 was 30%, down from 31% in Q2 2025, impacted by $2 million in higher freight costs and weaker factory absorption, but first half gross margin improved by 100 basis points to 30%.
- Adjusted EBITDA for Q2 2026 was $6.6 million, down from $11 million in Q2 2025, but year-to-date adjusted EBITDA increased over 20% to $17 million from $14 million in the prior year.
- Operating expenses excluding transformation costs improved by 3% year over year for the quarter, with a 12% increase in R&D spending reflecting focus on new product development.
- Cash at quarter end was $43.9 million, down from $70.9 million at the end of Q1 2026, with total debt at $267.6 million and net debt at $224.7 million.
- Inventories improved by $10 million compared to Q2 2025, reflecting tighter production planning and working capital discipline.
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Transcript
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Please note this conference is being recorded. I will now turn the conference over to your host, Bobby Winters, Director of Investor Relations.
You may begin. Thank you, operator.
Good afternoon, and welcome to American Vanguard's second quarter 2026 earnings review conference call. Our prepared remarks will be led by Dak Kay, Chief Executive Officer, and David Johnson, Chief Financial Officer. After their prepared remarks, we will open up the call for questions. A copy of today's press release, along with supplemental slides, are available on our website. A replay of the webcast and a transcript from this event will be made available on our website shortly after the call. Before we begin our presentation, we would like to remind everyone that today's press release and certain comments on the call include non-GAAP figures and forward-looking statements, and actual results may differ materially from these forecasts. Please refer to the cautionary language in our press release and slides, and to the risk factors described in our SEC filings, all of which are available on our website.
It's now my pleasure to turn the call over to CEO, Dak Kay.
Thank you, Bobby, and welcome everyone to our second quarter 2026 earnings conference call. Results for the quarter and the first half of this year reflect ongoing and dynamic crosscurrents affecting our agricultural markets and customers around the world, but more importantly, the progress we are making on lowering cost and driving commercial improvement regardless of the environment. I want to make three major points today. First, despite these difficult market conditions, we are outperforming our peers in the U.S. markets. Second, with the implementation of our business improvement plans, we are gaining greater operating leverage. Third, our investment in new product development is paving the way for future growth and profitability. In our initiative to reorganize, refocus, and invigorate the commercial effort across the company, we are making good progress so far.
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