Pyxus International, Inc. Reports Fourth Quarter Results, Completes Strong Fiscal Year 2024
— Full-year Revenue and Margin Gains on Favorable Mix and Cost Efficiencies for Global Footprint Utilization —
— Full-year Operating Income Grows to
— Adjusted EBITDA Near Top of Guidance at
— Executed
Full Year 2024 Results
The Company grew sales and other operating revenues for the fiscal year ended
Gross margin for fiscal 2024 improved to 15.4% from 13.6% for fiscal 2023. This improvement in gross profitability was driven by several factors, including leverage over fixed costs from more efficient global footprint utilization, an increase in full-service crop volumes in certain geographies, and a generally more favorable mix by customer and by region. Average gross profit per kilogram for fiscal 2024 increased by 27.9%, rising from
Operating income increased 46.3% to
Sikkel continued, "Our disciplined execution and continued achievement of efficiency in our management of working capital enabled us to meaningfully improve both our operations and our balance sheet, including the elimination of significant long-term debt, which will yield permanent benefits to our results. Our key credit profile indicators, including a leverage ratio that now stands at 4.8 and an interest coverage ratio at 1.5, are strong and continue to improve. We intend to pursue negotiated reductions in our cost of borrowing and will continue to evaluate a range of financial market opportunities to further strengthen our capital structure."
Debt Repurchase and Retirement Update
As previously announced, in
Fiscal 2025 Guidance
For the full year,
Financial Results Investor Call
The Company will hold an earnings conference call and webcast on on
A presentation of fourth quarter and fiscal year ended
Any replay, rebroadcast, transcript, or other reproduction of this conference call, other than the replay accessible by calling the number above, has not been authorized by
Cautionary Statement Regarding Forward-Looking Statements
Readers are cautioned that the statements contained in this report regarding expectations of our performance or other matters that may affect our business, results of operations, or financial condition are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements, which are based on current expectations of future events, may be identified by the use of words such as "strategy," "expects," "continues," "plans," "anticipates," "believes," "will," "estimates," "intends," "projects," "goals," "targets," and other words of similar meaning. These statements also may be identified by the fact that they do not relate strictly to historical or current facts. If underlying assumptions prove inaccurate, or if known or unknown risks or uncertainties materialize, actual results could vary materially from those anticipated, estimated, or projected. These risks and uncertainties include those discussed in our Annual Report on Form 10-K for the year ended
Non-GAAP Financial Information
This press release contains financial measures that have not been prepared in accordance with generally accepted accounting principles in
About
Consolidated Statements of Operations |
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Three Months Ended |
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(in thousands, except per share data) |
2024 |
2023 |
2022 |
Sales and other operating revenues |
$ 401,398 |
$ 407,145 |
$ 483,429 |
Cost of goods and services sold |
343,422 |
342,003 |
415,772 |
Gross profit |
57,976 |
65,142 |
67,657 |
Selling, general, and administrative expenses |
44,433 |
44,837 |
36,016 |
Other expense, net |
3,403 |
1,917 |
1,239 |
Restructuring and asset impairment charges |
3,420 |
305 |
379 |
|
— |
— |
32,186 |
Operating income (loss) |
6,720 |
18,083 |
(2,163) |
Loss on deconsolidation/disposition of subsidiaries |
— |
— |
1,176 |
Loss on pension settlement |
— |
— |
— |
(Gain) loss on debt retirement |
(15,914) |
— |
1,997 |
Interest expense, net |
29,835 |
27,515 |
25,563 |
Loss before income taxes and other items |
(7,201) |
(9,432) |
(30,899) |
Income tax expense |
10,921 |
18,317 |
3,398 |
Income from unconsolidated affiliates, net |
8,461 |
7,804 |
3,951 |
Net loss |
(9,661) |
(19,945) |
(30,346) |
Net income attributable to noncontrolling interests |
410 |
663 |
484 |
Net loss attributable to |
$ (10,071) |
$ (20,608) |
$ (30,830) |
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|
|
Loss per share: |
|
|
|
Basic and diluted |
$ (0.40) |
$ (0.83) |
$ (1.23) |
Consolidated Statements of Operations |
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Years Ended |
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(in thousands, except per share data) |
2024 |
2023 |
2022 |
Sales and other operating revenues |
$ 2,032,559 |
$ 1,914,881 |
$ 1,639,862 |
Cost of goods and services sold |
1,720,224 |
1,653,864 |
1,412,805 |
Gross profit |
312,335 |
261,017 |
227,057 |
Selling, general, and administrative expenses |
160,910 |
151,531 |
142,021 |
Other expense, net |
9,439 |
11,023 |
3,102 |
Restructuring and asset impairment charges |
4,799 |
4,685 |
8,031 |
|
— |
— |
32,186 |
Operating income |
137,187 |
93,778 |
41,717 |
Loss on deconsolidation/disposition of subsidiaries |
— |
648 |
10,701 |
Loss on pension settlement |
12,008 |
2,588 |
— |
(Gain) loss on debt retirement |
(15,914) |
— |
1,997 |
Interest expense, net |
125,620 |
113,164 |
108,383 |
Income (loss) before income taxes and other items |
15,473 |
(22,622) |
(79,364) |
Income tax expense |
27,281 |
34,127 |
12,640 |
Income from unconsolidated affiliates, net |
14,992 |
18,512 |
9,950 |
Net income (loss) |
3,184 |
(38,237) |
(82,054) |
Net income attributable to noncontrolling interests |
521 |
904 |
65 |
Net income (loss) attributable to |
$ 2,663 |
$ (39,141) |
$ (82,119) |
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|
|
|
Earnings (loss) per share: |
|
|
|
Basic and diluted |
$ 0.11 |
$ (1.57) |
$ (3.28) |
Consolidated Balance Sheets |
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(in thousands) |
|
|
Assets |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 92,569 |
$ 136,733 |
Restricted cash |
7,224 |
2,176 |
Trade receivables, net |
168,764 |
185,351 |
Other receivables |
18,704 |
17,387 |
Inventories, net |
931,654 |
775,071 |
Advances to suppliers, net |
20,397 |
42,305 |
Recoverable income taxes |
4,455 |
5,815 |
Prepaid expenses |
50,185 |
37,555 |
Other current assets |
16,254 |
18,172 |
Total current assets |
1,310,206 |
1,220,565 |
Investments in unconsolidated affiliates |
101,255 |
100,750 |
Intangible assets, net |
33,879 |
38,572 |
Deferred income taxes, net |
7,196 |
6,662 |
Long-term recoverable income taxes |
2,963 |
2,863 |
Other noncurrent assets |
32,617 |
43,761 |
Right-of-use assets |
35,639 |
35,892 |
Property, plant, and equipment, net |
134,158 |
133,398 |
Total assets |
$ 1,657,913 |
$ 1,582,463 |
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|
|
Liabilities and Stockholders' Equity |
|
|
Current liabilities |
|
|
Notes payable |
$ 499,312 |
$ 382,544 |
Accounts payable |
181,247 |
170,287 |
Advances from customers |
90,719 |
42,472 |
Accrued expenses and other current liabilities |
96,954 |
92,693 |
Income taxes payable |
8,539 |
18,264 |
Operating leases payable |
8,100 |
8,723 |
Current portion of long-term debt |
20,294 |
75 |
Total current liabilities |
905,165 |
715,058 |
Long-term taxes payable |
2,678 |
4,978 |
Long-term debt |
497,734 |
618,430 |
Deferred income taxes |
7,934 |
9,900 |
Liability for unrecognized tax benefits |
17,742 |
14,175 |
Long-term leases |
26,136 |
25,581 |
Pension, postretirement, and other long-term liabilities |
53,701 |
52,511 |
Total liabilities |
1,511,090 |
1,440,633 |
Commitments and contingencies |
|
|
Stockholders' equity |
|
|
Common stock—no par value: |
|
|
250,000 authorized shares and 25,000 issued and outstanding for all periods |
389,789 |
390,290 |
Retained deficit |
(255,291) |
(257,954) |
Accumulated other comprehensive income |
7,786 |
5,515 |
Total stockholders' equity of |
142,284 |
137,851 |
Noncontrolling interests |
4,539 |
3,979 |
Total stockholders' equity |
146,823 |
141,830 |
Total liabilities and stockholders' equity |
$ 1,657,913 |
$ 1,582,463 |
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Segment Results |
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Years Ended |
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Years Ended |
Change |
||
(in millions, except per kilo amounts) |
2024 |
2023 |
$ |
% |
Leaf: |
|
|
|
|
Product revenue |
$ 1,912.4 |
$ 1,812.2 |
100.2 |
5.5 |
Tobacco costs |
1,535.3 |
1,474.0 |
61.3 |
4.2 |
Transportation, storage, and other period costs |
89.1 |
98.9 |
(9.8) |
(9.9) |
Total cost of goods sold |
1,624.4 |
1,572.9 |
51.5 |
3.3 |
Product revenue gross profit |
288.0 |
239.3 |
48.7 |
20.4 |
Product revenue gross profit as a percent of sales |
15.1 % |
13.2 % |
|
|
|
|
|
|
|
Kilos sold |
370.7 |
387.8 |
(17.1) |
(4.4) |
Average price per kilo |
$ 5.16 |
$ 4.67 |
0.49 |
10.5 |
Average cost per kilo |
4.38 |
4.06 |
0.32 |
7.9 |
Average gross profit per kilo |
0.78 |
0.61 |
0.17 |
27.9 |
|
|
|
|
|
Processing and other revenues |
$ 117.2 |
$ 88.4 |
28.8 |
32.6 |
Processing and other revenues costs of services sold |
89.6 |
64.0 |
25.6 |
40.0 |
Processing and other gross profit |
27.6 |
24.4 |
3.2 |
13.1 |
Processing and other gross profit as a percent of sales |
23.5 % |
27.6 % |
|
|
|
|
|
|
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All Other: |
|
|
|
|
Sales and other operating revenues |
$ 2.9 |
$ 14.3 |
(11.4) |
(79.7) |
Cost of goods and services sold |
6.2 |
16.9 |
(10.7) |
(63.3) |
Gross loss |
(3.3) |
(2.6) |
(0.7) |
(26.9) |
Gross loss as a percent of sales |
(113.8) % |
(18.2) % |
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Reconciliation of Certain Non-GAAP Financials Measures (1)(Unaudited) |
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Three Months Ended |
Fiscal Years Ended |
||||
(in thousands) |
2024 |
2023 |
2022 |
2024 |
2023 |
2022 |
Net (loss) income attributable to |
$ (10,071) |
$ (20,608) |
$ (30,830) |
$ 2,663 |
$ (39,141) |
$ (82,119) |
Plus: Interest expense |
31,395 |
28,654 |
26,668 |
132,174 |
118,458 |
111,043 |
Plus: Income tax expense |
10,921 |
18,317 |
3,398 |
27,281 |
34,127 |
12,640 |
Plus: Depreciation and amortization expense |
5,022 |
4,459 |
4,693 |
19,250 |
19,137 |
16,676 |
EBITDA (1) |
37,267 |
30,822 |
3,929 |
181,368 |
132,581 |
58,240 |
Plus: (Recoveries) reserves for doubtful customer receivables |
(151) |
555 |
1,136 |
640 |
426 |
4,404 |
Plus: Other expense, net |
3,403 |
1,917 |
1,858 |
9,439 |
11,023 |
3,349 |
Plus: Restructuring and asset impairment charges (2) |
3,420 |
305 |
379 |
4,799 |
6,160 |
8,031 |
Plus: |
— |
— |
31,814 |
— |
— |
32,186 |
Plus: (Gain) loss on debt retirement |
(15,914) |
— |
— |
(15,914) |
— |
1,997 |
Plus: Debt restructuring (3) |
155 |
4,783 |
264 |
330 |
5,496 |
3,550 |
Plus: Pension retirement expense (4) |
— |
— |
— |
12,008 |
2,724 |
— |
Plus: Development of and exit from non-leaf-tobacco businesses (5) |
— |
16 |
1,283 |
3 |
713 |
13,589 |
Plus: Other adjustments (6) |
459 |
237 |
2,405 |
1,244 |
(316) |
1,350 |
Adjusted EBITDA (1) |
$ 28,639 |
$ 38,635 |
$ 43,068 |
$ 193,917 |
$ 158,807 |
$ 126,696 |
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Total debt |
|
|
|
$ 1,017,340 |
$ 1,001,049 |
$ 1,066,945 |
Less: Cash |
|
|
|
92,569 |
136,733 |
198,777 |
Net debt (1) |
|
|
|
$ 924,771 |
$ 864,316 |
$ 868,168 |
Net debt /Adjusted EBITDA (1) |
|
|
|
4.77x |
5.44x |
6.85x |
|
|
|
|
|
|
|
Adjusted EBITDA (1) |
|
|
|
$ 193,917 |
$ 158,807 |
$ 126,696 |
Interest expense |
|
|
|
132,174 |
118,458 |
111,043 |
Interest coverage |
|
|
|
1.47x |
1.34x |
1.14x |
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities |
1,864 |
(27,223) |
(13,934) |
(214,970) |
(137,822) |
(198,765) |
Capital expenditures |
(6,692) |
(6,376) |
(2,626) |
(21,043) |
(16,307) |
(14,827) |
Collections from beneficial interests in securitized trade receivables (7) |
48,613 |
42,624 |
34,214 |
175,911 |
165,262 |
189,440 |
Adjusted Cash Flow (1) |
$ 43,785 |
$ 9,025 |
$ 17,654 |
$ (60,102) |
$ 11,133 |
$ (24,152) |
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(1) |
Earnings before interest, taxes, depreciation and amortization ("EBITDA"), adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"), Adjusted Cash Flow, and Net Debt are not measures of results of operations, cash flows from operations or indebtedness under generally accepted accounting principles in |
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(2) |
Amounts incurred during the three and twelve months ended |
|
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(3) |
Amounts incurred during the three and twelve months ended |
|
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(4) |
During the fiscal year ended |
|
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(5) |
Includes the aggregate amount of certain items related to the Company's development of and subsequent exits from its non-leaf-tobacco businesses (that is, the production and sale of legal cannabis in |
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(6) |
Includes the following items: (i) the addition of amortization of basis difference related to a former Brazilian subsidiary that is now deconsolidated following the completion of a joint venture in |
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(7) |
Represents cash receipts from the beneficial interest in sold receivables under the Company's the accounts receivable securitization programs and were classified as investing activities within the consolidated statements of cash flows. |
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