AdvanSix Adjusted EPS Falls 85% on Volume Declines
The chemical manufacturer reported adjusted earnings per share of $0.19 for the second quarter.
AdvanSix (ASIX), the chemical manufacturer, reported a sharp decline in quarterly profitability as volume losses and tax headwinds offset pricing gains.
Sales rose 3% year-over-year to $421.3 million in the second quarter. The modest increase followed an 18% rise in pricing, which was largely neutralized by a 15% decline in volume.
Adjusted earnings per share fell 85% to $0.19 from $1.24 in the prior-year period. The drop was due to lower sales volumes and a higher effective tax rate, as the company did not claim the 45Q carbon capture tax credits that had benefited results in the previous year.
Profitability metrics compressed across the board. Adjusted EBITDA decreased 43% to $31.9 million from $55.7 million a year ago. Consequently, the adjusted EBITDA margin fell 600 basis points to 7.6%, compared to 13.6% in the second quarter of 2024. Reduced production output and lower sales volume in Plant Nutrients were primary drivers.
Performance diverged by segment. Nylon sales grew 26% year-over-year and Chemical Intermediates rose 18%. These gains were offset by a 16% decline in Plant Nutrients sales and a 6% drop in Caprolactam. Raw material pass-through pricing for benzene and propylene rose 13% during the quarter, reversing a 2% decrease reported in the first quarter.
Cash flow from operations decreased 52% to $10.0 million from $21.1 million in the prior-year quarter, due to lower net income. Capital expenditures for the period were $20.7 million, a 27% decrease from $28.3 million in the second quarter of 2024.
AdvanSix lowered its 2024 pre-tax income impact of plant turnarounds to approximately $17 million, down from the $17 million to $22 million range provided in the first quarter. The company reiterated its full-year capital expenditure guidance of $75 million to $95 million, a decrease from the $116 million spent in 2023.