AdvanSix Reports Q4 and Full-Year 2024 Financial Results

AdvanSix, Reports a diversified chemistry company, has announced its financial results for the fourth quarter and full year ending December 31, 2024. Despite facing operational challenges throughout the year, the company successfully navigated the business environment and achieved commercial success while advancing its targeted growth initiatives.

Full Year 2024 Financial Summary

For the full year 2024, AdvanSix experienced a slight decline in overall sales, with a decrease of approximately 1% compared to the previous year. This was primarily driven by a 2% decrease in sales volume, which resulted from previously disclosed operational disruptions. However, the company was able to partially offset this decline with a 1% favorable net pricing impact.

Sales Performance: Sales declined by approximately 1% year-over-year, attributed to a 2% decrease in volume due to operational challenges, though pricing improvements provided a slight offset.
Net Income: AdvanSix reported a net income of $44.1 million, reflecting a decrease of $10.5 million from the prior year.
Adjusted EBITDA: The company’s adjusted EBITDA for the year was $142.1 million, a decrease of $11.4 million compared to 2023.
Adjusted EBITDA Margin: The adjusted EBITDA margin stood at 9.4%, down by 60 basis points compared to the prior year.
Cash Flow from Operations: The company generated $135.4 million in cash flow from operations, an increase of $17.9 million from the previous year.
Capital Expenditures: Capital expenditures reached $133.7 million, an increase of $26.3 million year-over-year, reflecting continued investments in growth initiatives and operational improvements.
Free Cash Flow: Free cash flow was reported at $1.7 million, representing a decline of $8.5 million from 2023.

Despite the challenging environment, AdvanSix leveraged its diversified portfolio and business model advantages, particularly in the Plant Nutrients and Acetone segments, to maintain its financial strength. “Our diverse portfolio, advantage of our business model, and favorable industry dynamics—particularly in Plant Nutrients and Acetone—enabled us to successfully navigate a challenging operational year and deliver full-year Adjusted EBITDA of $142 million, Adjusted Earnings Per Share of $1.96, and positive Free Cash Flow,” said Erin Kane, President and CEO of AdvanSix.

The company also made strategic investments and progress in several key initiatives, including:

SUSTAIN Program: AdvanSix continued funding for its SUSTAIN (Sustainable U.S. Sulfate to Accelerate Increased Nutrition) program, which aims to drive sustainable agricultural solutions.
Shareholder Returns and Balance Sheet Strength: The company returned cash to shareholders and maintained a healthy balance sheet, ensuring financial stability for future growth.
Recovery from PES Cumene Supplier Shutdown: The company successfully concluded its multi-year effort to recover losses from the 2019 PES cumene supplier shutdown. This included securing $5.3 million in insurance proceeds in Q4 2024 and a final omnibus settlement of approximately $26 million in Q1 2025.
Carbon Capture Recognition and Tax Credits: AdvanSix became one of the first industrial companies recognized for utilizing carbon capture technology in manufacturing. The company secured $9.7 million in 45Q tax credits for the 2018 and 2019 tax years, marking a meaningful medium- to long-term value driver as it continues pursuing similar credits for subsequent periods.

Fourth Quarter 2024 Financial Summary

AdvanSix faced a more significant decline in sales during the fourth quarter, with a year-over-year decrease of approximately 14%. This was primarily due to a 16% drop in sales volume, driven by an extended plant turnaround. However, this was partially offset by a 2% favorable impact of market-based pricing.

Sales Performance: Sales for Q4 2024 totaled $329 million, marking a 14% decline compared to the prior year. The decline was primarily due to a 16% decrease in volume, resulting from the delayed ramp-up to full operating rates following a planned plant turnaround.
Net Income: The company reported net income of $0.4 million for the quarter, representing an increase of $5.4 million compared to the same period in 2023.
Adjusted EBITDA: Adjusted EBITDA for the quarter was $10.2 million, reflecting a $4.9 million decline from the prior year, primarily due to the timing and impact of plant turnarounds.
Adjusted EBITDA Margin: The adjusted EBITDA margin for the quarter stood at 3.1%, a decrease of 90 basis points year-over-year.
Cash Flow from Operations: The company generated $64.2 million in cash flow from operations in Q4 2024, an increase of $4.0 million compared to the same quarter in 2023, largely due to favorable changes in working capital, including higher ammonium sulfate pre-buy cash advances.
Capital Expenditures: Capital expenditures for Q4 2024 totaled $34.3 million, reflecting a $4.0 million decrease compared to the previous year.
Free Cash Flow: The company reported free cash flow of $29.8 million for the quarter, marking an $8.0 million increase from Q4 2023.

One of the highlights of the fourth quarter was AdvanSix’s continued success in securing financial benefits related to its carbon capture initiatives. The company recognized $9.7 million in 45Q tax credits for the 2018 and 2019 tax periods, further reinforcing its commitment to sustainability and innovation in the chemical industry.

Key Takeaways and Future Outlook

Despite facing operational headwinds, AdvanSix maintained its financial resilience and continued executing its long-term strategic initiatives. The company’s ability to navigate disruptions while sustaining its market position in key segments such as Plant Nutrients and Acetone demonstrates the strength of its diversified business model.

Moving forward, AdvanSix is committed to:

Enhancing Operational Efficiency: The company aims to optimize production processes and minimize the impact of plant turnarounds on overall performance.
Investing in Growth Initiatives: Capital expenditure plans remain focused on driving long-term value through innovation and sustainable solutions.
Expanding Carbon Capture Benefits: The company will continue to explore opportunities to leverage carbon capture tax credits for future periods, further solidifying its leadership in sustainable manufacturing.
Maintaining Financial Strength: By balancing capital investments, shareholder returns, and a disciplined financial strategy, AdvanSix intends to remain well-positioned for future growth.

CEO Erin Kane reiterated the company’s focus on long-term value creation, stating, “As we worked to deliver outcomes in the year, we also made significant progress on two key enterprise developments. The conclusion of our PES cumene supplier settlement and recognition for our carbon capture initiatives are milestones that will provide financial and operational benefits in the years ahead.”

In conclusion, while 2024 presented challenges, AdvanSix successfully managed its business through strategic initiatives, financial discipline, and a commitment to innovation. As the company moves into 2025, it remains focused on strengthening its market position, enhancing operational efficiencies, and delivering sustainable growth.

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