Animal Health International Inc. (AHII) filed Quarterly Report for the period ended 2009-09-30.
Animal Health International Inc. is a leading distributor of animal health products in the United States. The Company sells more than fourty thousand products sourced from over one thousand five hundred animal health products manufacturers. The Company also provides consultative services to our customers in the highly fragmented animal health products industry. Products the Company distributes include pharmaceuticals vaccines parasiticides diagnostics capital equipment sanitizers devices and supplies. Company's principal customers are veterinarians production animal operators and animal health product retailers. Animal Health International Inc. has a market cap of $59.4 million; its shares were traded at around $2.44 with and P/S ratio of 0.1.
Highlight of Business Operations:
Other expenses. Other expenses increased $272, or 12.9%, to $2,377 for the three months ended September 30, 2009, from $2,105 for the three months ended September 30, 2008. The increase in other expenses was primarily due to an increase in interest expense of $177 to $2,511 in the three months ended September 30, 2009, as compared to $2,334 in the three months ended September 30, 2008. This increase was due to higher debt outstanding than in the prior year as a result of an increased investment in working capital.
Operating activities. For the three months ended September 30, 2009, net cash used for operating activities was $8,465, and was attributable to $747 in net losses, an increase in working capital of $9,842, and a change in deferred income taxes of $395, all partially offset by $2,519 of non-cash costs. The change in working capital included an increase in accounts receivable of $14,535, an increase in inventories of $11,758, and a decrease in accrued liabilities of $1,538, all partially offset by an increase in accounts payable of $17,856. The increase in accounts receivable resulted from stronger sales at the close of the quarter that converted to cash early in the second quarter. The increase in inventories was due to increased purchases in anticipation of higher fall sales volume, which drove the corresponding increase in accounts payable. The decrease in accrued liabilities resulted primarily from the payment of accruals for customer rebates, bonuses, and miscellaneous expenses. The non-cash costs included $1,978 of depreciation and amortization, $273 of debt issue cost amortization, and $159 of bad debt expense. For the three months ended September 30, 2008, net cash used for operating activities was $3,387, and was attributable to $284 in net income and $2,241 of non-cash costs offset by an increase in working capital of $5,148 and a change in deferred income taxes of $764. The non-cash costs included $2,076 of depreciation and amortization and $168 of debt issue cost amortization. The change in working capital included an increase in inventories of $14,988, an increase in accounts receivable of $6,531, and a decrease in accrued liabilities of $1,116, all partially offset by an increase in accounts payable of $16,496 and a change in income taxes receivable/payable of $707. The increase in inventories was due to increased purchases in anticipation of higher fall sales volume, which drove the corresponding increase in accounts payable. The increase in accounts receivable resulted from strong sales at the close of the quarter that converted to cash early in the second quarter. The decrease in accrued liabilities resulted primarily from the payment of accrued bonuses. The change in income taxes receivable/payable resulted from a net increase in tax accruals.
Investing activities. For the three months ended September 30, 2009, net cash used for investing activities was $806, and was primarily attributable to $869 of purchases of property, plant, and equipment. For the three months ended September 30, 2008, net cash used for investing activities was $423, and was primarily attributable to $1,105 of purchases of property, plant and equipment offset by $415 of changes in notes receivable and $237 of proceeds from the sale of equipment.
Financing activities. For the three months ended September 30, 2009, net cash provided by financing activities was $8,059, and was primarily attributable to net borrowings on the revolving credit facility totaling $13,583 partially offset by an unfavorable change in overdraft balances of $2,773 and principal payments on other debt totaling $2,692. For the three months ended September 30, 2008, net cash provided by financing activities was $4,673, and was primarily attributable to net borrowings from revolving credit facilities totaling $4,691.
Capital resources. In August 2007, the Company entered into a new $44,550 first lien term loan and with borrowings thereunder paid in full the $44,550 balance of our then existing $45,000 first lien term loan. The $44,550 first lien term loan matures on May 31, 2011, and bears interest at an annual rate equal to LIBOR plus 2.0%, which is paid quarterly. Borrowings are collateralized by a first priority interest in and lien on all of the Company s assets.
In October 2007, the revolving credit facility (the Revolver) was amended to a $135,000 facility, which matures on June 30, 2010. The amended Revolver included a $10,000 overcollateralization first drawn sub-limit that amortizes and expired on March 31, 2009. The outstanding borrowings under the $10,000 overcollateralization first drawn sub-limit bore interest at the rate of 0.75% above the rate as defined per the terms of the September 2006 Revolver amendment. The outstanding borrowings under the Revolver s base $135,000 facility bore interest at the rate defined per the terms of the September 2006 Revolver amendment.
Rate This Article: |
  |