What changed in this filing

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Item 1. Financial Statements

2024-11-01 compared with 2024-08-02 · 98 added, 64 removed, 341 unchanged (32% of the section changed)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

6 unchanged sentences

Total costs, expenses and other 368,442 332,960 1,130,095 1,073,933

Income before taxes 52,072 43,283 28,655 87,511

Income tax expense 13,145 10,555 7,124 19,829

Net income $ 38,927 $ 32,728 $ 21,531 $ 67,682

Income (loss) before taxes 29,745 ( 10,053 ) 58,400 77,458

Income tax expense (benefit) 7,479 ( 2,076 ) 14,603 17,753

Net income (loss) $ 22,266 $ ( 7,977 ) $ 43,797 $ 59,705

Earnings per common share

6 unchanged sentences

ADVANSIX INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Dollars in thousands)

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Net income $ 38,927 $ 32,728 $ 21,531 $ 67,682

Net income (loss) $ 22,266 $ ( 7,977 ) $ 43,797 $ 59,705

Foreign exchange translation adjustment ( 24 ) 197 ( 66 ) 39

Cash-flow hedges — — 7 ( 150 )

Other comprehensive loss, net of tax ( 27 ) ( 125 ) ( 35 ) ( 308 )

Comprehensive income $ 38,900 $ 32,603 $ 21,496 $ 67,374

Other comprehensive income (loss), net of tax ( 24 ) 197 ( 59 ) ( 111 )

Comprehensive income (loss) $ 22,242 $ ( 7,780 ) $ 43,738 $ 59,594

See accompanying notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(Dollars in thousands, except share and per share amounts)

September 30,

2024 December 31,

29 unchanged sentences

200,000,000 shares authorized;

32,959,588 shares issued and 26,709,407 outstanding at June 30, 2024;

32,982,868 shares issued and 26,730,739 outstanding at September 30, 2024;

32,598,946 shares issued and 26,750,471 outstanding at December 31, 2023

Preferred stock, par value $ 0.01 ;

50,000,000 shares authorized and 0 shares issued and outstanding at June 30, 2024 and December 31, 2023

Treasury stock at par ( 6,250,181 shares at June 30, 2024;

50,000,000 shares authorized and 0 shares issued and outstanding at September 30, 2024 and December 31, 2023

Treasury stock at par ( 6,252,129 shares at September 30, 2024;

5,848,475 shares at December 31, 2023)

9 unchanged sentences

(Dollars in thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

28 unchanged sentences

Issuance of common stock 755 876

Net cash provided by (used for) financing activities 40,958 ( 11,100 )

Net cash provided by financing activities 21,708 5,173

Net change in cash and cash equivalents ( 12,470 ) ( 8,875 )

34 unchanged sentences

Balance at June 30, 2024 32,959,588 330 132,786 617,723 ( 63 ) ( 4,179 ) 746,597

Net income — — — 22,266 — — 22,266

Comprehensive income

Foreign exchange translation adjustments — — — — — ( 24 ) ( 24 )

Other comprehensive loss, net of tax — — — — — ( 24 ) ( 24 )

Issuance of common stock 23,280 — 328 — — — 328

Purchase of treasury stock ( 1,948 shares)

— — ( 42 ) — — — ( 42 )

Stock-based compensation — — 1,559 — — — 1,559

Dividends — — 104 ( 4,380 ) — — ( 4,276 )

Balance at September 30, 2024 32,982,868 $ 330 $ 134,735 $ 635,609 $ ( 63 ) $ ( 4,203 ) $ 766,408

ADVANSIX INC.

25 unchanged sentences

Balance at June 30, 2023 32,577,862 326 151,706 626,885 ( 53 ) ( 4,505 ) 774,359

Net income loss — — — ( 7,977 ) — — ( 7,977 )

Comprehensive income —

Foreign exchange translation adjustments — — — — — 197 197

Other comprehensive income, net of tax — — — — — 197 197

Issuance of common stock 19,153 — 131 — — — 131

Purchase of treasury stock ( 266,959 shares)

— — ( 9,264 ) — ( 2 ) — ( 9,266 )

Stock-based compensation — — 1,391 — — — 1,391

Dividends — — 1 ( 4,351 ) — — ( 4,350 )

Balance at September 30, 2023 32,597,015 $ 326 $ 143,965 $ 614,557 $ ( 55 ) $ ( 4,308 ) $ 754,485

See accompanying notes to Condensed Consolidated Financial Statements.

13 unchanged sentences

GAAP for complete financial statements.

In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company's financial position as of June 30, 2024, and its results of operations for the three and six months ended June 30, 2024 and 2023 and cash flows for the six months ended June 30, 2024 and 2023.

In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company's financial position as of September 30, 2024, and its results of operations for the three and nine months ended September 30, 2024 and 2023 and cash flows for the nine months ended September 30, 2024 and 2023.

The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements but does not include all disclosures required by U.S.

6 unchanged sentences

In the event that differences in actual closing dates are material to year-over-year comparisons of quarterly or year-to-date results, we will provide the appropriate disclosures.

Our actual closing dates for the three and six months ended June 30, 2024 and 2023 were June 29, 2024 and July 1, 2023, respectively.

Liabilities to creditors to whom we have issued checks that remained outstanding at June 30, 2024 and December 31, 2023 aggregated to $ 3.4 million and $ 2.9 million, respectively, and were included in Cash and cash equivalents and Accounts payable in the Condensed Consolidated Balance Sheets.

Our actual closing dates for the three and nine months ended September 30, 2024 and 2023 were September 28, 2024 and September 30, 2023, respectively.

Liabilities to creditors to whom we have issued checks that remained outstanding at September 30, 2024 and December 31, 2023 aggregated to $ 2.4 million and $ 2.9 million, respectively, and were included in Cash and cash equivalents and Accounts payable in the Condensed Consolidated Balance Sheets.

The Company's Board of Directors (the "Board") has authorized share repurchase programs to repurchase shares of the Company's common stock as follows:

Date of Authorization Authorized Amount

Authorized Amount Remaining as of June 30, 2024

Authorized Amount Remaining as of September 30, 2024

May 4, 2018 $ 75.0 $ —

2 unchanged sentences

Totals $ 225.0 $ 62.0

Repurchases may be made from time to time on the open market in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including through the use of trading plans intended to qualify under Rule 10b5-1 of the Exchange Act.

The size and timing of these repurchases will depend on pricing, market and economic conditions,

ADVANSIX INC.

1 unchanged sentence

(Dollars in thousands, except share and per share amounts and as otherwise noted)

legal and contractual requirements and other factors.

10b5-1 of the Exchange Act.

The size and timing of these repurchases will depend on pricing, market and economic conditions, legal and contractual requirements and other factors.

The share repurchase program has no expiration date and may be modified, suspended or discontinued at any time.

The par value of the shares repurchased is applied to Treasury stock and the excess of the purchase price over par value is applied to Additional paid-in capital.

As of June 30, 2024, the Company has repurchased a total of 6,250,181 shares of common stock, including 1,004,725 shares withheld to cover tax withholding obligations in connection with the vesting of awards, for an aggregate of $ 192.4 million at a weighted average market price of $ 30.78 per share.

As of June 30, 2024, $ 62.0 million remained available for share repurchases under the current authorization.

During the period July 1, 2024 through July 26, 2024, 1,933 additional shares were repurchased for tax withholding obligations in connection with the vesting of equity awards at a weighted average market price of $ 21.64 , and no additional shares were repurchased under the currently authorized repurchase program.

As of September 30, 2024, the Company has repurchased a total of 6,252,129 shares of common stock, including 1,006,673 shares withheld to cover tax withholding obligations in connection with the vesting of awards, for an aggregate of $ 192.4 million at a weighted average market price of $ 30.78 per share.

As of September 30, 2024, $ 62.0 million remained available for share repurchases under the current authorization.

During the period October 1, 2024 through October 25, 2024, no additional shares were repurchased for tax withholding obligations or under the currently authorized repurchase program.

Recent Accounting Pronouncements

18 unchanged sentences

Revenue Recognition

We serve approximately 400 customers annually in approximately 45 countries across a wide variety of industries.

For the three months ended June 30, 2024 and 2023, the Company's ten largest customers accounted for approximately 39 % and 40 % of total sales, respectively.

For each of the six months ended June 30, 2024 and 2023, the Company's ten largest customers accounted for approximately 38 % of total sales.

AdvanSix serves around 400 customers annually, primarily in the United States, spanning a wide variety of industries worldwide.

For each of the three months ended September 30, 2024 and 2023, the Company's ten largest customers accounted for approximately 41 % of total sales.

For the nine months ended September 30, 2024 and 2023, the Company's ten largest customers accounted for approximately 38 % and 39 % of total sales, respectively.

ADVANSIX INC.

5 unchanged sentences

(“Shaw”), a significant consumer of caprolactam and Nylon 6 resin, to whom we sell under a long-term agreement.

For the three months ended June 30, 2024 and 2023 the Company's sales to Shaw were 9 % and 10 % of our total sales, respectively.

For the six months ended June 30, 2024 and 2023, the Company's sales to Shaw were 9 % and 10 % of our total sales, respectively.

The Company's revenue by product line, and related approximate percentage of total sales, for the three and six months ended June 30, 2024 and 2023 were as follows:

For the three months ended September 30, 2024 and 2023 the Company's sales to Shaw were 10 % and 12 % of our total sales, respectively.

For the nine months ended September 30, 2024 and 2023, the Company's sales to Shaw were 9 % and 11 % of our total sales, respectively.

The Company's revenue by product line, and related approximate percentage of total sales, for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

4 unchanged sentences

Total $ 398,187 100 % $ 322,907 100 % $ 1,188,495 100 % $ 1,151,391 100 %

The Company's revenues by geographic area, and related approximate percentage of total sales, for the three and six months ended June 30, 2024 and 2023 were as follows:

* The previously reported amounts have been corrected for a misclassification which overstated Ammonium Sulfate and understated Chemical Intermediates by $ 5.5 million ( 2 %) and $ 26.6 million ( 2 %) for the three and nine months ended September 30, 2023, respectively.

Total revenue amounts were not impacted for either period.

The Company's revenues by geographic area, and related approximate percentage of total sales, for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

4 unchanged sentences

The Company defers revenues when cash payments are received in advance of our performance.

Below is a roll-forward of Deferred income and customer advances for the six months ended June 30, 2024:

Below is a roll-forward of Deferred income and customer advances for the nine months ended September 30, 2024:

Opening balance January 1, 2024 $ 15,678

1 unchanged sentence

Less amounts recognized in revenues ( 15,614 )

Ending balance June 30, 2024 $ 1,148

The Company expects to recognize as revenue the June 30, 2024 ending balance of Deferred income and customer advances within one year or less.

Ending balance September 30, 2024 $ 1,517

The Company expects to recognize as revenue the September 30, 2024 ending balance of Deferred income and customer advances within one year or less.

Earnings Per Share

The computation of basic and diluted earnings per share ("EPS") is based on Net income divided by the basic weighted average number of common shares outstanding and diluted weighted average number of common shares outstanding, respectively.

The details of the basic and diluted EPS calculations for the three and six months ended June 30, 2024 and 2023 were as follows:

The computation of basic and diluted earnings per share ("EPS") is based on Net income (loss) divided by the basic weighted average number of common shares outstanding and diluted weighted average number of common shares outstanding, respectively.

The details of the basic and diluted EPS calculations for the three and nine months ended September 30, 2024 and 2023 were as follows:

ADVANSIX INC.

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Net income $ 38,927 $ 32,728 $ 21,531 $ 67,682

Net income (loss) $ 22,266 $ ( 7,977 ) $ 43,797 $ 59,705

Weighted average common shares outstanding 26,790,752 27,209,521 26,836,114 27,433,851

5 unchanged sentences

The diluted EPS calculations exclude the effect of stock options when the options’ assumed proceeds exceed the average market price of the common shares during the period.

The anti-dilutive common stock equivalents outstanding at the three and six months ended June 30, 2024 and 2023 were as follows:

The anti-dilutive common stock equivalents outstanding at the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Options and stock equivalents 573,586 498,652 976,699 447,950

Dividend activity for the three and six months ended June 30, 2024 and 2023 was as follows:

Dividend activity for the three and nine months ended September 30, 2024 and 2023 was as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

2 unchanged sentences

Accounts and Other Receivables – Net

September 30,

2024 December 31,

7 unchanged sentences

(Dollars in thousands, except share and per share amounts and as otherwise noted)

September 30,

2024 December 31,

6 unchanged sentences

Total inventories $ 213,434 $ 211,831

Substantially all of the Company’s inventories at June 30, 2024 and December 31, 2023 are valued at the lower of cost or market using the last-in, first-out (“LIFO”) method.

However, approximately 11 % was valued at average cost using the first-in, first-out (“FIFO”) method at June 30, 2024.

The excess of replacement cost over the carrying value of total inventories subject to LIFO was $ 65.7 million and $ 65.3 million at June 30, 2024 and December 31, 2023, respectively.

Substantially all of the Company’s inventories at September 30, 2024 and December 31, 2023 are valued at the lower of cost or market using the last-in, first-out (“LIFO”) method.

However, approximately 8 % was valued at average cost using the first-in, first-out (“FIFO”) method at September 30, 2024.

The excess of replacement cost over the carrying value of total inventories subject to LIFO was $ 65.1 million and $ 65.3 million at September 30, 2024 and December 31, 2023, respectively.

We determine if an arrangement is a lease at inception.

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

6 unchanged sentences

Total lease cost $ 11,794 $ 13,869 $ 37,196 $ 39,726

As of June 30, 2024, we have additional operating leases that have not yet commenced for approximately $ 99.2 million.

As of September 30, 2024, we have additional operating leases that have not yet commenced for approximately $ 93.1 million.

These leases are expected to commence during the second half of 2024 and in 2025 with lease terms of up to 6 years.

2 unchanged sentences

Customer relationships and trade-names are amortized on a straight-line basis over their expected useful lives of 15 to 20 years and 5 years, respectively.

There was no change in the carrying amount of goodwill for the six months ended June 30, 2024.

There was no change in the carrying amount of goodwill for the nine months ended September 30, 2024.

Finite-Lived Intangible Assets

3 unchanged sentences

(Dollars in thousands, except share and per share amounts and as otherwise noted)

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value

3 unchanged sentences

Total $ 56,371 $ ( 12,465 ) $ 43,906 $ 56,371 $ ( 10,178 ) $ 46,193

For each of the three months ended June 30, 2024 and June 30, 2023, the Company recorded amortization expense on intangible assets of $ 0.8 million.

For each of the six months ended June 30, 2024 and June 30, 2023, the Company recorded amortization expense on intangible assets of $ 1.5 million.

For each of the three months ended September 30, 2024 and September 30, 2023, the Company recorded amortization expense on intangible assets of $ 0.8 million.

For each of the nine months ended September 30, 2024 and September 30, 2023, the Company recorded amortization expense on intangible assets of $ 2.3 million.

Commitments and Contingencies

9 unchanged sentences

Although we have ongoing environmental remedial obligations at certain of our facilities, in the past three years, the associated remediation costs have not been material, and we do not expect our known remediation costs to have a material adverse effect on the Company's consolidated financial position or results of operations.

The provision for income taxes was $ 13.1 million and $ 10.6 million for the three months ended June 30, 2024 and 2023, respectively, resulting in an effective tax rate of 25.2 % and 24.4 %, respectively.

The provision for income taxes was $ 7.1 million and $ 19.8 million for the six months ended June 30, 2024 and 2023, respectively, resulting in an effective tax rate of 24.9 % and 22.7 %, respectively.

The Company’s provision for income taxes in interim periods is computed by applying an estimated annual effective tax rate against Income before taxes for the period in addition to recording any tax effects of discrete items for the quarter.

The Company’s effective tax rate for the three and six months ended June 30, 2024 was higher than the U.S.

federal statutory rate, due to the impacts of state taxes and executive compensation deduction limitations which generally increase the tax rate, partially offset by tax credits which generally decrease the tax rate.

The Company’s effective tax rate for the three and six months ended June 30, 2023 differed from the U.S.

federal statutory rate, due to the impacts of state taxes and executive compensation deduction limitations which generally increase the tax rate, offset by tax credits and the foreign-derived intangible income deduction which generally decrease the tax rate.

Additionally, discrete tax adjustments recorded in the first

The provision (benefit) for income taxes was $ 7.5 million and ($ 2.1 million) for the three months ended September 30, 2024 and 2023, respectively, resulting in an effective tax rate of 25.1 % and 20.7 %, respectively.

The provision for income taxes was $ 14.6 million and $ 17.8 million for the nine months ended September 30, 2024 and 2023, respectively, resulting in an effective tax rate of 25.0 % and 22.9 %, respectively.

The Company’s provision (benefit) for income taxes in interim periods is computed by applying an estimated annual effective tax rate against Income before taxes for the period in addition to recording any tax effects of discrete items for the quarter.

The Company’s effective tax rate for the three and nine months ended September 30, 2024 and 2023 differed from the U.S.

federal statutory rate, due primarily to the impacts of state taxes and executive compensation deduction limitations, offset by tax credits and the foreign-derived intangible income deduction.

In 2024, the Company recorded discrete tax adjustments related to the vesting of equity compensation, changes to state tax legislation, and return to provision adjustments related to the filing of the Company's 2023 U.S.

federal income tax return which resulted in a net 3.3 % increase to the quarterly effective tax rate and a net 1.5 % increase to the year-to-date effective tax rate.

Additionally for 2023, discrete tax adjustments relating to the vesting of equity compensation, changes in state tax legislation, and return to provision adjustments related to the filing of the Company's

ADVANSIX INC.

1 unchanged sentence

(Dollars in thousands, except share and per share amounts and as otherwise noted)

half of 2023 relating to the vesting of equity compensation and changes in state tax legislation resulted in a net 0.9 % decrease to the year-to-date effective tax rate.

federal income tax return resulted in a net 4.4 % increase to the quarterly effective tax rate and a net 1.6 % decrease to the year-to-date effective tax rate.

Fair Value Measurements

13 unchanged sentences

All related agreements are terminable by either party upon at least 30 days’ notice.

The total amount due to the financial intermediaries to settle supplier invoices under the supplier finance programs was approximately $ 14 million as of June 30, 2024 and approximately $ 17 million as of December 31, 2023.

The total amount due to the financial intermediaries to settle supplier invoices under the supplier finance programs was approximately $ 15 million as of September 30, 2024 and approximately $ 17 million as of December 31, 2023.

These amounts outstanding are included in Accounts payable .

Subsequent Events

As announced on August 2, 2024, the Board declared a quarterly cash dividend of $ 0.16 per share on the Company's common stock, payable on August 27, 2024 to stockholders of record as of the close of business on August 13, 2024.

As announced on November 1, 2024, the Board declared a quarterly cash dividend of $ 0.16 per share on the Company's common stock, payable on November 26, 2024 to stockholders of record as of the close of business on November 12, 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements