AdvanSix third-quarter net income was down at $10 million from the year-ago $43.9 million, with the company citing an extended turnaround that impacted production and sales volumes (GM Oct. 7, p. 26). Adjusted EBITDA dropped to $33.3 million from $77.7 million.
Sales were up 7% to $478.8 million from $446.5 million, driven by an 18% favorable impact of market-based pricing, 4% higher raw material pass-through pricing, and a 3% contribution from acquisitions, partially offset by 18% lower volumes. Ammonium sulfate made up 28% of third-quarter sales ($131.7 million) versus 26% ($113.2 million) during the year-ago quarter.
“Our third-quarter performance reflects the resilience of our business model and our ability to navigate challenging conditions,” said Erin Kane, AdvanSix President and CEO. “Despite the unfavorable impact of the extended plant turnaround as previously announced on Oct. 7, sales grew year-over-year as our commercial execution offset lower sales volume.
“Our healthy cash flow performance continued to support smart and disciplined deployment of capital in the quarter into reinvestment in the business, $17 million of cash returned to shareholders in the form of dividends and share repurchases, and further debt reduction,” Kane said.
In addition to the turnaround, the company also cited lower sales volume, inflation, and higher utilities cost driven by natural gas prices, partially offset by higher market-based pricing, net of increased raw materials costs.
“Our outlook is supported by our diverse product portfolio, advantage of our business model, and strong underlying agriculture and fertilizer industry fundamentals,” added Kane. “The growth prospects of AdvanSix remain robust, and we are committed to delivering long-term value to our shareholders. We’ve demonstrated our ability to successfully perform through all market conditions and expand our earnings base while generating robust cash flow and look forward to closing out 2022 with another strong quarter.”
The company expects the pretax impact of planned plant turnarounds to be $28-$33 million in 2023, versus approximately $50 million in 2022.
Nine-month net income was $138.3 million on sales of $1.54 billion, up from the year-ago $116.2 million and $1.26 billion, respectively. Adjusted EBITDA was up at $241.9 million from the year-ago $215 million.