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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED September 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

Commission file number 001-13795

AMERICAN VANGUARD CORPORATION


Delaware	95-2588080
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification Number)

4695 MacArthur Court, Newport Beach, California	92660
(Address of principal executive offices)	(Zip Code)

(949) 260-1200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, $.10 par value

     AVD

     New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer	☐	Accelerated Filer	☒
Non-Accelerated Filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Common Stock, $.10 Par Value — 28,468,140 shares as of November 4, 2025.

AMERICAN VANGUARD CORPORATION

INDEX


		Page Number
PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Operations	3

	Condensed Consolidated Statements of Comprehensive Loss	4

	Condensed Consolidated Balance Sheets	5

	Condensed Consolidated Statements of Stockholders’ Equity	6

	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27

Item 4.	Controls and Procedures	27

PART II—OTHER INFORMATION		29

Item 1.	Legal Proceedings	29

Item 1A.	Risks Factors	29
Item 2.	Purchases of Equity Securities by the Issuer	29
Item 6.	Exhibits	30

SIGNATURES		31

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2025			2024			2025			2024
Net sales	$	119,313		$	118,307		$	364,426		$	381,659
Cost of sales		(85,099	)		(101,014	)		(259,474	)		(284,185	)
Gross profit		34,214			17,293			104,952			97,474
Operating expenses
Selling, general and administrative		(26,747	)		(26,365	)		(81,998	)		(86,885	)
Research, product development and regulatory		(5,654	)		(11,177	)		(17,139	)		(25,482	)
Product liability claims		(7,029	)		—			(7,029	)		—
Transformation		(1,442	)		(8,139	)		(5,254	)		(16,636	)
Assets impairment		(93	)		—			(227	)		—
Gain from sale of asset		246			—			246			—
Operating loss		(6,505	)		(28,388	)		(6,449	)		(31,529	)
Change in fair value of equity investment		(511	)		—			(511	)		513
Interest expense, net		(4,920	)		(4,378	)		(13,135	)		(11,988	)
Loss before provision for income taxes		(11,936	)		(32,766	)		(20,095	)		(43,004	)
Income tax (expense) benefit		(422	)		7,024			(1,574	)		7,093
Net loss	$	(12,358	)	$	(25,742	)	$	(21,669	)	$	(35,911	)
Net loss per common share—basic	$	(0.43	)	$	(0.91	)	$	(0.76	)	$	(1.28	)
Net loss per common share—assuming dilution	$	(0.43	)	$	(0.91	)	$	(0.76	)	$	(1.28	)
Weighted average shares outstanding—basic		28,511			28,173			28,377			28,015
Weighted average shares outstanding—assuming dilution		28,511			28,173			28,377			28,015

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

(Unaudited)


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2025			2024			2025			2024
Net loss	$	(12,358	)	$	(25,742	)	$	(21,669	)	$	(35,911	)
Other comprehensive income (loss):
Foreign currency translation adjustment, net of tax effects		1,473			(593	)		7,323			(7,886	)
Comprehensive loss	$	(10,885	)	$	(26,335	)	$	(14,346	)	$	(43,797	)

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)


ASSETS	September 30, 2025			December 31, 2024
Current assets:
Cash	$	16,795		$	12,514
Receivables:
Trade, net of allowance for credit losses of $11,363 and $9,190, respectively		167,138			169,743
Other		8,009			4,699
Total receivables, net		175,147			174,442
Inventories		199,005			179,292
Prepaid expenses		10,087			7,615
Income taxes receivable		5,434			5,030
Total current assets		406,468			378,893
Property, plant and equipment, net		55,799			58,169
Operating lease right-of-use assets, net		17,749			19,735
Intangible assets, net of amortization		143,407			150,497
Goodwill		21,040			19,701
Deferred income tax assets		3,523			1,242
Other assets		7,027			8,484
Total assets	$	655,013		$	636,721

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	84,204		$	69,159
Customer prepayments		31,234			52,675
Accrued program costs		81,909			69,449
Accrued expenses and other payables		24,271			31,989
Operating lease liabilities, current		6,185			6,136
Income taxes payable		2,364			2,942
Total current liabilities		230,167			232,350
Long-term debt		182,250			147,332
Operating lease liabilities, long term		12,154			14,339
Deferred income tax liabilities		8,997			7,989
Other liabilities		457			1,601
Total liabilities		434,025			403,611
Commitments and contingent liabilities (Note 13)
Stockholders' equity:
Preferred stock, $0.10 par value per share; authorized 400,000 shares; none issued		—			—
Common stock, $0.10 par value per share; authorized 40,000,000 shares; issued 34,970,687 shares at September 30, 2025 and 34,794,548 shares at December 31, 2024		3,497			3,479
Additional paid-in capital		116,885			114,679
Accumulated other comprehensive loss		(11,406	)		(18,729	)
Retained earnings		183,213			204,882
		292,189			304,311
Less treasury stock at cost, 5,915,182 shares at September 30, 2025 and December 31, 2024		(71,201	)		(71,201	)
Total stockholders’ equity		220,988			233,110
Total liabilities and stockholders’ equity	$	655,013		$	636,721

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For The Three and Nine Months Ended September 30, 2025

(In thousands, except share data)

(Unaudited)


	Common Stock						Additional			Accumulated Other						Treasury Stock
	Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			Total
Balance, January 1, 2025		34,794,548		$	3,479		$	114,679		$	(18,729	)	$	204,882			5,915,182	$	(71,201	)	$	233,110
Stocks issued under ESPP		72,267			7			326			—			—			—		—			333
Foreign currency translation adjustment, net		—			—			—			1,825			—			—		—			1,825
Stock-based compensation		—			—			559			—			—			—		—			559
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(16,785	)		(1	)		(10	)		—			—			—		—			(11	)
Net loss		—			—			—			—			(8,462	)		—		—			(8,462	)
Balance, March 31, 2025		34,850,030		$	3,485		$	115,554		$	(16,904	)	$	196,420			5,915,182	$	(71,201	)	$	227,354
Foreign currency translation adjustment, net		—			—			—			4,025			—			—		—			4,025
Stock-based compensation		—			—			422			—			—			—		—			422
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(71,607	)		(7	)		(123	)		—			—			—		—			(130	)
Net loss		—			—			—			—			(849	)		—		—			(849	)
Balance, June 30, 2025		34,778,423		$	3,478		$	115,853		$	(12,879	)	$	195,571			5,915,182	$	(71,201	)	$	230,822
Stocks issued under ESPP		75,930		$	8		$	288			—			—			—		—		$	296
Foreign currency translation adjustment, net		—			—			—			1,473			—			—		—			1,473
Stock-based compensation		—			—			760			—			—			—		—			760
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		116,334			11			(16	)		—			—			—		—			(5	)
Net loss		—			—			—			—			(12,358	)		—		—			(12,358	)
Balance, September 30, 2025		34,970,687		$	3,497		$	116,885		$	(11,406	)	$	183,213			5,915,182	$	(71,201	)	$	220,988

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For The Three and Nine Months Ended September 30, 2024

(In thousands, except share data)

(Unaudited)


	Common Stock						Additional			Accumulated Other						Treasury Stock
	Shares			Amount			Paid-in Capital			Comprehensive Loss			Retained Earnings			Shares		Amount			AVD Total
Balance, January 1, 2024		34,676,787		$	3,467		$	110,810		$	(5,963	)	$	332,897			5,915,182	$	(71,201	)	$	370,010
Stocks issued under ESPP		38,702			4			426			—			—			—		—			430
Cash dividends on common stock declared ($0.030 per share)		—			—			—			—			(836	)		—		—			(836	)
Foreign currency translation adjustment, net		—			—			—			(1,564	)		—			—		—			(1,564	)
Stock-based compensation		—			—			2,005			—			—			—		—			2,005
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		39,145			4			(18	)		—			—			—		—			(14	)
Net income		—			—			—			—			1,552			—		—			1,552
Balance, March 31, 2024		34,754,634			3,475			113,223			(7,527	)		333,613			5,915,182		(71,201	)		371,583
Cash dividends on common stock declared ($0.030 per share)		—			—			—			—			(840	)		—		—			(840	)
Foreign currency translation adjustment, net		—			—			—			(5,729	)		—			—		—			(5,729	)
Stock-based compensation		—			—			747			—			—			—		—			747
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(99,205	)		(10	)		(805	)		—			—			—		—			(815	)
Net loss		—			—			—			—			(11,721	)		—		—			(11,721	)
Balance, June 30, 2024		34,655,429		$	3,465		$	113,165		$	(13,256	)	$	321,052			5,915,182	$	(71,201	)	$	353,225
Stocks issued under ESPP		54,065			6			465			—			—			—		—			471
Foreign currency translation adjustment, net		—			—			—			(593	)		—			—		—			(593	)
Stock-based compensation		—			—			1,135			—			—			—		—			1,135
Stock options exercised; grants, termination and vesting of restricted stock units (net of shares in lieu of taxes)		(183,511	)		(19	)		(569	)		—			—			—		—			(588	)
Net loss		—			—			—			—			(25,742	)		—		—			(25,742	)
Balance, September 30, 2024		34,525,983		$	3,452		$	114,196		$	(13,849	)	$	295,310			5,915,182	$	(71,201	)	$	327,908

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	For the Nine Months Ended September 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(21,669	)	$	(35,911	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation of property, plant and equipment and amortization of intangible assets		14,007			16,602
Amortization of other long-term assets		16			199
Amortization and accretion of deferred loan fees and discounted liabilities		1,167			342
Gain on disposal of property, plant and equipment		(246	)		—
Impairment of assets		227			—
Provision for estimated credit losses		1,944			1,278
Stock-based compensation		1,741			3,887
Change in deferred income taxes		(353	)		(9,110	)
Changes in liabilities for uncertain tax positions or unrecognized tax benefits		(522	)		106
Change in equity investment fair value		511			(513	)
Other		—			110
Unrealized foreign currency transactions (loss) gain		(704	)		121
Changes in assets and liabilities associated with operations:
Decrease in net receivables		935			33,475
Increase in inventories		(16,513	)		(29,429	)
Increase in prepaid expenses and other assets		(965	)		(4,107	)
Change in income tax receivable/payable, net		(1,083	)		(6,216	)
Decrease in net operating lease liability		(150	)		(48	)
Increase in accounts payable		11,859			14,512
Decrease in customer prepayments		(21,453	)		(38,375	)
Increase in accrued program costs		12,285			17,721
(Decrease) increase in other payables and accrued expenses		(8,178	)		13,878
Net cash used in operating activities		(27,144	)		(21,478	)
Cash flows from investing activities:
Capital expenditures		(2,398	)		(6,106	)
Proceeds from disposal of property, plant and equipment		492			66
Intangible assets		(136	)		(341	)
Net cash used in investing activities		(2,042	)		(6,381	)
Cash flows from financing activities:
Payments under line of credit agreement		(179,415	)		(214,259	)
Borrowings under line of credit agreement		214,334			245,737
Payment of deferred loan fees		(3,339	)		—
Net receipt from the issuance of common stock under ESPP		629			901
Net payment for tax withholding on stock-based compensation awards		(147	)		(1,416	)
Payment of cash dividends		—			(2,510	)
Net cash provided by financing activities		32,062			28,453
Net increase in cash and cash equivalents		2,876			594
Effect of exchange rate changes on cash and cash equivalents		1,405			(130	)
Cash and cash equivalents at beginning of period		12,514			11,416
Cash and cash equivalents at end of period	$	16,795		$	11,880

See notes to the unaudited Condensed Consolidated Financial Statements.

AMERICAN VANGUARD CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(In thousands, except share data)

(Unaudited)

1. Summary of Significant Accounting Policies — The accompanying unaudited condensed consolidated financial statements of American Vanguard Corporation and Subsidiaries (“AVD” or “the Company”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of consolidating adjustments, eliminations, accruals, and immaterial restatements) considered necessary for a fair presentation have been included for the interim period. Operating results for the three and nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. The condensed consolidated financial statements and related notes do not include all information and footnotes required by US GAAP for annual reports. This quarterly report should be read in conjunction with the consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2024.

Transformation — Transformation expenses on the condensed consolidated statements of operations include costs related to the Company’s digital and structural transformation project. The digital transformation effort is intended to ensure that business process owners have access to current and complete data that has been generated through standardized systems and processes. The structural transformation effort is intended to improve operating leverage by applying business analytics to current operations, structures, products and services and identifying process improvements, as well as pricing and go-to-market strategies. Transformation expenses primarily include costs for consulting services, severance costs relating to the Company’s former CEO, and costs incurred in connection with the staffing and execution of the Company’s transformation initiatives. In addition, the Company has incurred costs associated with write-offs and write downs of certain assets.

Recent Issued Accounting Guidance — In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” The ASU includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and should be applied either prospectively or retrospectively. This ASU is effective for the Company beginning with the Form 10-K for the year ending December 31, 2025. The Company is currently evaluating the impact of adopting this ASU on its income tax disclosures.

In November 2024, the FASB issued ASU No. 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", and in January 2025, the FASB issued ASU No. 2025-01, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date". ASU 2024-03 requires public companies to disclose, in interim and reporting periods, additional information about certain expenses in the financial statements. For public business entities, ASU 2024-03, as clarified by ASU 2025-01, is effective for the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption of ASU 2024-03 is permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements.

In July 2025, the FASB issued ASU No. 2025-05, "Financial Instruments - Credit Losses (Topic 326)". This update introduces a practical expedient for all entities and an accounting policy election other than public business entities related to applying Subtopic 326-20 to current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. It is effective for fiscal years beginning after December 15, 2025 and interim periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements..

The Company reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to its condensed consolidated financial statements.

Immaterial restatements — Subsequent to the issuance of the Company's condensed consolidated financial statements for the three and nine months ended September 30, 2024, the Company determined that it did not appropriately account for outstanding checks in the amount of $8,371, as of September 30, 2024. Specifically, the Company included these outstanding checks in long-term debt instead of accounts payable in the condensed consolidated balance sheet as of September 30, 2024. This error resulted in misstatements of the changes in accounts payable and borrowings under line of credit agreements in the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.

Further, the Company netted its borrowings against its repayments in the amount of $46,071 during the nine months ended September 30, 2024. This error resulted in understatements of both borrowings and payments under the credit agreement, in the condensed consolidated statement of cash flows for the nine months ended September 30, 2024.

Therefore, the accompanying condensed consolidated statement of cash flows for the nine months ended September 30, 2024 has been restated from the amounts previously reported.

The table below summarizes the effects of the restatement by financial-statement line item affected:


	Nine Months Ended September 30, 2024
	Previously Reported			Adjustments			As Restated
Increase in accounts payable	$	6,141		$	8,371			14,512
Net cash used in operating activities	$	(29,849	)	$	8,371		$	(21,478	)
Payments under line of credit agreement	$	(168,188	)	$	(46,071	)		(214,259	)
Borrowings under line of credit agreement	$	208,037		$	37,700			245,737
Net cash provided by financing activities	$	36,824		$	(8,371	)	$	28,453

The Company evaluated the materiality of these errors and concluded that they were not material individually or in the aggregate to the prior period condensed consolidated financial statements.

2. Revenue Recognition —The Company recognizes revenue from the sale of its products, which include crop and non-crop products. The Company sells its products to customers, which include distributors, retailers, and growers. Substantially all revenue is recognized at a point in time. The Company has one reportable segment. Selective enterprise information of sales disaggregated by category and geographic region is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Net sales:
U.S. crop	$	43,310	$	35,533	$	153,511	$	155,075
U.S. non-crop		19,233		22,454		54,067		59,241
Total U.S.		62,543		57,987		207,578		214,316
International		56,770		60,320		156,848		167,343
Total net sales:	$	119,313	$	118,307	$	364,426	$	381,659

Beginning January 1, 2025, the Company implemented a new organization structure, as part of its business transformation actions, and began servicing Canadian customers as part of its U.S. Crop business. The associated sales are now reported as U.S. Crop net sales. In 2024, Canadian sales were reported within international net sales and, for the three and nine months ended September 30, 2024, amounted to $351 and $4,672, respectively.

The Company sometimes receives payments from its customers in advance of goods being provided in return for early cash incentive programs. These payments are included in customer prepayments on the condensed consolidated balance sheets. Revenue recognized for the three and nine months ended September 30, 2025, that was included in customer prepayments at the beginning of 2025, was $445 and $52,664, respectively. All remaining customer prepayments were received in 2025 and are expected to be recognized as revenue in Q4 2025 and 2026.

3. Accrued Program Costs — The Company offers various discounts to customers based on the volume purchased within a defined period, other pricing adjustments, some grower volume incentives or other key performance indicator driven payments made to distributors, retailers or growers, usually at the end of a growing season. The Company describes these payments as “Programs.” Programs are a critical part of doing business in both the U.S. crop and non-crop chemicals marketplaces. These discount Programs represent variable consideration. Revenues from sales are recorded at the net sales price, which is the transaction price, less an estimate of variable consideration. Variable consideration includes amounts expected to be paid to its customers using the expected value method. Each quarter management compares individual sale transactions with Programs to determine what, if any, Program liabilities have been incurred. Once this initial calculation is made for the specific quarter, sales and marketing management, along with executive and financial management, review the accumulated Program balance and, for volume driven payments, make assessments of whether or not customers are tracking in a manner that indicates that they will meet the requirements set out in agreed upon terms and conditions attached to each Program. Following this assessment, management adjusts the accumulated accrual to properly reflect the liability at the balance sheet date. Programs are paid out predominantly on an annual basis, usually in the final quarter of the financial year or the first quarter of the following year.

4. Stock-Based Compensation — Under the Company’s Stock Incentive Plan, as amended and restated on June 1, 2022 (“the 2022 Stock Incentive Plan”), all employees are eligible to receive non-assignable and non-transferable restricted stock (RSUs), options to purchase common stock, and other forms of equity. During the three months ended September 30, 2025 and 2024, the Company's stock-based compensation expense amounted to $760 and $1,135, respectively. During the nine months ended September 30, 2025 and 2024, the Company's stock-based compensation expense amounted to $1,740 and $3,887, respectively.

RSUs

A summary of nonvested RSUs outstanding is presented below:


	Nine Months Ended September 30, 2025
	Number of Shares			Weighted Average Grant Date Fair Value
Nonvested shares at January 1, 2025		682,853		$	13.77
Granted		143,346			4.67
Vested		(290,981	)		15.19
Forfeited		(25,804	)		21.73
Nonvested shares at September 30, 2025		509,414		$	10.00

As of September 30, 2025, the total unrecognized stock-based compensation expense related to RSUs outstanding was $1,682 and is expected to be recognized over a weighted-average period of 2.3 years

Stock Options

A summary of the incentive stock option activity for the nine months ended September 30, 2025 is presented below:


	Options outstanding			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Balance as of January 1, 2025		424,511		$	10.28		6.1	$	—
Forfeited		(38,504	)	$	10.28		5.3	$	—
Balance as of September 30, 2025		386,007		$	10.28		5.3	$	—
Options vested and exercisable as of September 30, 2025		168,588		$	10.28		5.3	$	—

As of September 30, 2025, the total unrecognized stock-based compensation expense related to stock options outstanding was $573 and is expected to be recognized over a weighted-average period of 1.3 years.

5. Income Taxes —Income tax expense was $422 for the three months ended September 30, 2025, as compared to income tax benefit of $7,024 for the three months ended September 30, 2024. Income tax expense was $1,574 for the nine months ended September 30, 2025, as compared to an income tax benefit of $7,093 for the nine months ended September 30, 2024. The effective income tax rate was negative 3.53% for the three months ended September 30, 2025, as compared to 21.4% for the three months ended September 30, 2024. The effective income tax rate was negative 7.83% for the nine months ended September 30, 2025, as compared to 16.5%. for the nine months ended September 30, 2024. The decrease in the effective income tax rate for the three and nine months ended September 30, 2025, as compared to the same periods in the prior year is primarily attributed to losses incurred in the U.S. for the three and nine months ended September 30, 2025 which did not result in a benefit for income tax. The U.S. entities maintain a valuation allowance against their net deferred tax assets, which was established during the fourth quarter ended December 31, 2024.

It is expected that $311 of unrecognized tax benefits will be released within the next twelve months due to expiration of the statute of limitations.

On July 4, 2025, new U.S. tax legislation was signed into law (known as the “One Big Beautiful Bill Act” or “OBBBA”) which makes permanent many of the tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act that were set to expire at the end of 2025. The Company has accounted for the impact of the new legislation during the three months ended September 30, 2025 and the impact is not material on the results of operations.

6. Earnings Per Share — The components of basic and diluted net (loss) income per share were as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2025			2024			2025			2024
Numerator:
Net loss	$	(12,358	)	$	(25,742	)	$	(21,669	)	$	(35,911	)
Denominator: (in thousands)
Weighted average shares outstanding-basic and diluted		28,511			28,173			28,377			28,015

Due to net losses for the three and nine months ended September 30, 2025 and 2024, stock options and other grants were excluded from the computation of diluted net loss per share.

7. Comprehensive Loss — Total comprehensive loss includes, in addition to net loss, changes in equity that are excluded from the condensed consolidated statements of operations and are recorded directly into a separate section of stockholders’ equity on the condensed consolidated balance sheets. For the three- and nine month periods ended September 30, 2025 and 2024, total comprehensive loss consisted of net income loss and foreign currency translation adjustments.

8. Inventories —Inventory is stated at the lower of cost or net realizable value. Cost is determined by the average cost method, and includes material, labor, factory overhead and subcontracting services.


	September 30, 2025		December 31, 2024
Finished products	$	172,699	$	154,628
Raw materials		26,306		24,664
Total inventories	$	199,005	$	179,292

Finished products consist of products that are sold to customers in their current form as well as intermediate products that require further formulation to be saleable to customers.

9. Property, Plant and Equipment — Property, plant and equipment at September 30, 2025 and December 31, 2024 consists of the following:


	September 30, 2025			December 31, 2024
Land	$	2,760		$	2,755
Buildings and improvements		20,638			21,124
Machinery and equipment		148,907			146,662
Office furniture, fixtures and equipment		5,165			5,201
Automotive equipment		975			1,039
Construction in progress		2,235			2,299
Total gross value		180,680			179,080
Less accumulated depreciation		(124,881	)		(120,911	)
Total net value	$	55,799		$	58,169

The Company recognized depreciation expense related to property and equipment of $1,622 and $2,290 for the three-month periods ended September 30, 2025 and 2024, respectively, and $4,960 and $6,655 for the nine months ended September 30, 2025 and 2024, respectively.

Substantially all of the Company’s assets are pledged as collateral to its banks.

10. Leases — The Company has operating leases for warehouses, manufacturing facilities, offices, cars, railcars and certain equipment. The lease term includes the non-cancellable period of the lease plus any additional periods covered by either an option to extend (or not terminate) that the Company is reasonably certain to exercise. The Company has leases with a lease term ranging from one year to approximately 20 years.

The operating lease expense for the three months ended September 30, 2025 and 2024, was $1,895 and $1,972, respectively, and $5,584 and $5,863 for the nine months ended September 30, 2025 and 2024, respectively. Lease expenses related to variable lease payments and short-term leases were immaterial. Other information related to operating leases follows:


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2025		2024		2025		2024
Cash paid for amounts included in the measurement of lease liabilities	$	1,945	$	1,956	$	5,733	$	5,909
ROU assets obtained in exchange for new liabilities	$	1,040	$	541	$	3,049	$	4,211

The weighted-average remaining lease term and discount rate related to the operating leases as of September 30, 2025 were as follows:


Weighted-average remaining lease term (in years)	4.06
Weighted-average discount rate	5.11	%

Future minimum lease payments under non-cancellable operating leases as of September 30, 2025 were as follows:


2025 (excluding the nine months ended September 30, 2025)	$	1,895
2026		6,159
2027		4,257
2028		2,957
2029		2,094
Thereafter		2,897
Total lease payments		20,259
Less: imputed interest		(1,920	)
Total	$	18,339

Amounts recognized in the condensed consolidated balance sheets at September 30, 2025:


Operating lease liabilities, current	$	6,185
Operating lease liabilities, long-term	$	12,154

11. Goodwill and Intangibles — The following schedule represents the gross carrying amount and accumulated amortization of intangible assets as of September 30, 2025 and December 31, 2024. Product rights, patents, and trademarks are amortized over the lesser of the useful life ranging from 10 to 25 years, or the patent life. Customer lists are amortized over their expected useful lives of nine to ten years. The amortization expense is included in operating expenses on the consolidated statements of operations.


	September 30, 2025						December 31, 2024
	Gross		Accumulated Amortization		Net Book Value		Gross		Accumulated Amortization		Net Book Value
Product rights and patents	$	262,572	$	145,461	$	117,111	$	260,928	$	138,090	$	122,838
Trademarks		38,760		15,443		23,317		38,475		14,375		24,100
Customer lists		12,456		9,477		2,979		11,874		8,315		3,559
Total intangibles assets	$	313,788	$	170,381	$	143,407	$	311,277	$	160,780	$	150,497

Domestic intangible assets		173,881		106,896		66,985		172,755		102,347		70,408
International intangible assets		139,907		63,485		76,422		138,522		58,433		80,089
Total intangibles assets - domestic and international	$	313,788	$	170,381	$	143,407	$	311,277	$	160,780	$	150,497

The following schedule represents future amortization charges related to intangible assets:


Year ending December 31,	Amount
2025	$	3,060
2026		12,195
2027		12,195
2028		11,281
2029		10,876
Thereafter		93,800
	$	143,407

Amortization expense was $2,932 and $3,459 during the three months ended September 30, 2025 and 2024, respectively, and $9,047 and $10,018 during the nine months ended September 30, 2025 and 2024, respectively.

The following schedule represents goodwill activity for the nine months ended September 30, 2025:


	Amount

Goodwill at January 1, 2025	$	19,701
Impact of movement in exchange rates		590
Goodwill at March 31, 2025		20,291
Impact of movement in exchange rates		514
Goodwill at June 30, 2025	$	20,805
Impact of movement in exchange rates		235
Goodwill at September 30, 2025	$	21,040

12. Debt — The Company has a revolving line of credit that is shown as long-term debt in the condensed consolidated balance sheets at September 30, 2025 and December 31, 2024. The Company has no short-term debt as of September 30, 2025 and December 31, 2024. The debt is summarized in the following table:


Long-term indebtedness ($000's)	September 30, 2025			December 31, 2024
Revolving line of credit	$	182,250		$	147,332
Deferred loan fees		(3,705	)		(1,532	)
Total indebtedness, net of deferred loan fees	$	178,545		$	145,800

The short-term portion of deferred loan fees is included in prepaid expenses on the condensed consolidated balance sheets and amounted to $2,971 and $776 as of September 30, 2025 and December 31, 2024, respectively. The long-term portion of deferred loan fees is included in other assets on the condensed consolidated balance sheets and amounted to $733 and $756 as of September 30, 2025 and December 31, 2024, respectively.

The Company and certain of its affiliates are parties to a senior credit facility agreement entitled the “Third Amended and Restated Loan and Security Agreement” dated as of August 5, 2021 (the “Credit Agreement”), which is a senior secured lending facility among AMVAC, the Company’s principal operating subsidiary, as Agent (including the Company and AMVAC BV), as "Borrowers", on the one hand, and a group of commercial lenders led by BMO Bank, N.A. (formerly Bank of the West) as administrative agent, documentation agent, syndication agent, collateral agent and sole lead arranger, on the other hand. The Credit Agreement initially consisted of a line of credit of up to $275,000, an accordion feature of up to $150,000, a letter of credit and swingline sub-facility (each having limits of $25,000) and had a maturity date of August 5, 2026. The Credit Agreement has undergone eleven amendments since 2021.

In its original form, the Credit Agreement featured two financial covenants: a Maximum Total Leverage Ratio, under which the Company’s borrowing capacity varies with its financial performance, measured in terms of Consolidated EBITDA as defined in the Credit Agreement, for the trailing twelve-month period; and a Fixed Charge Coverage Ratio. Under the Credit Agreement, revolving loans bear interest at a variable rate based, at borrower’s election with proper notice, on either (i) SOFR plus 0.1% per annum and the “Applicable Margin” or (ii) the greater of (x) the Prime Rate, (y) the Federal Funds Rate plus 0.5%, and (z) the Daily One-Month SOFR Rate plus 1.10%, plus, in the case of (x), (y) or (z), the Applicable Margin (“Adjusted Base Rate Revolver Loan”). Interest payments for SOFR Revolver Loans are payable on the last day of each interest period (either one-, three- or nine- months, as selected by the Company) and the maturity date, while interest payments for Adjusted Base Rate Revolver Loans are payable on the last business day of each month and the maturity date.

The current version of the Credit Agreement was agreed upon on May 27, 2025, through Amendment Number Eleven, under which events of default arising from the failure of Borrowers to be in compliance with both the Total Leverage Ratio and the Fixed Charge Coverage Ratio as of March 31, 2025, were waived. In addition, the Total Revolver Commitment was reduced from $275,000 to the following: $245,000, effective from the Closing Date through November 29, 2025; $225,000 effective from November 30, 2025, through December 30, 2025; and $200,000 from December 31, 2025, through the expiration of the agreement. In addition, the due date for audited fiscal year-end financial statements was extended to one hundred fifty-seven (157) days (after the end of the fiscal year) for 2025 only, and the due date for first quarter financial statements was extended to sixty-seven (67) days after March 31, 2025. In addition, the Maximum Total Leverage Ratio covenant was suspended for the quarters ending on June 30, 2025, September 30, 2025, and December 31, 2025, and set at 4.00 to 1.00 for the quarter ending March 31, 2026, and thereafter. Further, the Fixed Charge Coverage Ratio covenant was suspended for the quarter ending June 30, 2025, then set at 1.00 to 1.00 for the quarter ending September 30, 2025, then set at 1.25 to 1.00 for the quarter ending December 31, 2025, and thereafter.

In addition, under the terms of the Eleventh Amendment, two new covenants were added. First, commencing June 30, 2025, Borrowers must maintain Liquidity (unused Revolver Commitment plus 100% cash held at Agent and 50% cash held at bank accounts outside the U.S.) measured on a monthly basis of not less than: $30,000 for the month ending June 30, 2025; $35,000 for the month ending July 31, 2025; $4,042 for the month ending August 31, 2025; $25,000 for the month ending September 30, 2025; $3,000 for the month ending October 31, 2025; $9,292 for the month ending November 31, 2025; and $20,000 for the month ending December 31, 2025, it being understood that liquidity will include the sum of Borrowers’ cash, plus 50% of cash held in accounts outside of the U.S. plus the amount by which the revolver commitments exceed the revolver balance (net of letters of credit). Second, Borrowers must attain minimum, year-to-date Consolidated EBITDA (reflecting the exclusion of non-recurring non-cash charges and certain other charges as per the Eighth Amendment) as measured quarterly in the following amounts: $4,500 as of June 30, 2025; $9,500 as of September 30, 2025; and $35,000 as of December 31, 2025. With these changes, with respect to Revolver Loans, the Applicable Margins for SOFR are set at 3.75% from the Closing through September 30, 2025, and then rises to 4.75% as of October 1, 2025, and thereafter, while the Adjusted Base Rate increases to 2.75% and 3.75% during those respective periods.

On August 18, 2025, AMVAC, as borrower, and affiliates (including Registrant), as guarantors and/or borrowers, entered into Amendment Number Twelve (the “Amendment”) to the Credit Agreement. The Amendment extends the maturity date of the Credit Agreement from August 5, 2026, to December 31, 2026, and amends the borrowing capacity under the revolving credit facility to $245,000,000 through November 29, 2025, then $225,000,000 until December 30, 2025, then $200,000,000 until March 31, 2026 and then $180,000,000 through December 31, 2026. The Amendment also included additional changes to the Credit Agreement, including: (i) amending the applicable margins for the applicable interest rates and unused line fee and letter of credit fee; (ii) adding a year-to-date Consolidated EBIDTA requirement of $4,500,000 as of June 30, 2025, $9,500,00 as of September 30, 2025 and $35,000,000 as of December 31, 2025 and a TTM Consolidated EBITDA requirement of not less than $37,500,000 as of March 31, 2026; (iii) requiring the Company to make prepayments on the loans once the Company’s cash balance exceeds a threshold; and (iv) suspending the Total Leverage Ratio covenant until June 30, 2026 and then applying a fiscal quarter end ratio of 4.00:1.00.

The interest rate on September 30, 2025, was 8.01%. Interest was $4,912 and $4,435 for the three months ended September 30, 2025 and 2024, respectively, and $13,141 and $12,296 for the nine months ended September 30, 2025 and 2024, respectively.

As of September 30, 2025, the Company is deemed to be in compliance with its financial covenants. Furthermore, according to the terms of the Credit Agreement, as amended, and based on the Total Revolver Commitment and the Liquidity requirement as of September 30, 2025 listed above, the Company had the capacity to increase its borrowings by up to $46,862 as of September 30, 2025.

13.

AMERICAN VANGUARD CORP 10-Q