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Aceto Corp. Reports Operating Results (10-Q)

February 08, 2013 | About:
10qk

10qk

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Aceto Corp. (ACET) filed Quarterly Report for the period ended 2012-12-31.

Aceto Corporation has a market cap of $277.284 million; its shares were traded at around $10.25 with a P/E ratio of 14.6628 and P/S ratio of 0.6046. The dividend yield of Aceto Corporation stocks is 2.06%. Aceto Corporation had an annual average earning growth of 4.4% over the past 10 years. GuruFocus rated Aceto Corporation the business predictability rank of 3.5-star.

Highlight of Business Operations:

We are reporting net sales of $225,704 for the six months ended December 31, 2012, which represents a 6.5% increase from the $212,024 reported in the comparable prior period. Gross profit for the six months ended December 31, 2012 was $42,213 and our gross margin was 18.7% as compared to gross profit of $39,163 and gross margin of 18.5% in the comparable prior period. Our selling, general and administrative costs (SG&A) for the six months ended December 31, 2012 increased to $27,988 from $27,097 which we reported in the prior period. Our net income increased to $9,333, or $0.34 per diluted share, compared to net income of $7,621, or $0.29 per diluted share in the prior period.

Gross profit for the Performance Chemicals segment increased to $13,156 for the six months ended December 31, 2012, versus $11,632 for the prior period, an increase of $1,524 or 13.1%. The gross margin at 14.8% for the six months ended December 31, 2012 was relatively flat compared to the prior period s gross margin of 14.4%. The increase in gross profit is related to sales volume increase in sales of agricultural protection products.

SG&A increased $891 or 3.3%, to $27,988 for the six months ended December 31, 2012 compared to $27,097 for the prior period. As a percentage of sales, SG&A decreased to 12.4% for the six months ended December 31, 2012 versus 12.8% for the prior period. The primary reason for the increase in SG&A is due to increased research and development expenses related to certain Rising products. In addition, the Company recorded during the six months ended December 31, 2011, approximately $884 of one-time costs associated with the separation of certain executive management employees.

SG&A increased $568 or 4.2%, to $14,096 for the three months ended December 31, 2012 compared to $13,528 for the prior period. As a percentage of sales, SG&A increased to 12.4% for the three months ended December 31, 2012 versus 12.2% for the prior period. The primary reason for the increase in SG&A is due to increased research and development expenses related to certain Rising products, as well increased stock-based compensation expense due to increased financial performance and increased attorney costs related to the UPL lawsuit.

Our cash position at December 31, 2012 increased $464 from the amount at June 30, 2012. Operating activities for the six months ended December 31, 2012 provided cash of $2,049, for this period, as compared to $5,084 for the comparable period. The $2,049 was comprised of $9,333 in net income and $3,142 derived from adjustments for non-cash items less a net $10,426 decrease from changes in operating assets and liabilities. The non-cash items included $3,475 in depreciation and amortization expense, $1,217 of earnings on an equity investment in a joint venture and $906 in non-cash stock compensation expense. Trade accounts receivable increased $2,118 during the six months ended December 31, 2012, due to a slight increase in days sales outstanding, from June 30, 2012, as well as an increase in sales in this quarter as compared to the fourth quarter of fiscal 2012. Inventories increased by $11,279 due primarily to an increase in inventories of certain APIs and nutritional products held in stock at our German subsidiaries, for anticipated sales in the third and fourth quarters of fiscal 2013, as well as for the first quarter in fiscal 2014. In addition, inventories also increased due to in-transit inventory at December 31, 2012, of a broad-spectrum herbicide, which was sold in the third quarter of fiscal 2013. Accounts payable increased by $1,332 due to timing of payments processed at the end of the quarter. Accrued expenses and other liabilities increased $2,388 due primarily to an increase in Value Added Tax (VAT) for our foreign subsidiaries, particularly Germany and an increase in price concessions and partnered products liabilities related to increased sales from Rising. These increases are offset in part by a decrease in accrued compensation as fiscal 2012 performance award payments were made in September 2012. Our cash position at December 31, 2011 decreased $422 from the amount at June 30, 2011. Operating activities for the six months ended December 31, 2011 provided cash of $5,084, for this period, as compared to cash provided by operations of $2,698 for the six months ended December 31, 2010. The $5,084 was comprised of $7,621 in net income and $2,624 derived from adjustments for non-cash items less a net $5,161 decrease from changes in operating assets and liabilities.

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