MONTVALE, N.J., May 03, 2024 (GLOBE NEWSWIRE) -- Balchem Corporation (NASDAQ:BCPC) reported today financial results for its 2024 fiscal first quarter ended March 31, 2024. The Company reported quarterly net sales of $239.7 million, quarterly net earnings of $29.0 million, adjusted EBITDA(a) of $60.9 million, and free cash flow(a) of $26.8 million. Ted Harris, Chairman, President and CEO of Balchem said, "The first quarter was a very good start to the year for Balchem. We delivered record net sales, adjusted EBITDA, and net earnings, as well as solid first quarter cash flows, despite the continued challenging environment in parts of our portfolio." First Quarter 2024 Financial Highlights: Net sales were a record $239.7 million, an increase of 3.1% compared to the prior year quarter. Adjusted EBITDA was a record $60.9 million, an increase of 8.0% from the prior year quarter. GAAP net earnings were $29.0 million, an increase of 27.6% from the prior year quarter. GAAP earnings per share of $0.89 compared to $0.70 in the prior year quarter and adjusted earnings per share(a) of $1.03 compared to $0.94 in the prior year quarter. Cash flows from operations were $33.4 million for the first quarter of 2024, with quarterly free cash flow(a) of $26.8 million. Record Human Nutrition & Health segment sales of $152.7 million, an increase of 15.1% compared to the prior year quarter with record earnings from operations of $33.3 million, up 80.4%. Recent Highlights: On April 22, we released our 2023 Sustainability Report, highlighting the Company's Corporate Social Responsibility initiatives and accomplishments. Guided by our core values and our vision of making the world a healthier place, our Sustainability Report demonstrates both the Company's commitment to our corporate social responsibilities and our continued promise to provide our employees, customers, shareholders and the communities within which we operate with important information on our various initiatives. VitaCholine®, Balchem's market leading brand of the essential nutrient choline, has become a Proud Partner of the New York Jets, a major professional NFL sports team. This is the first sponsorship for VitaCholine® and the first sponsorship in the Nutritional Ingredient category for the Jets. The partnership will help VitaCholine® reach a large and health-conscious audience and promote its message of improving well-being of body and mind. VitaCholine® is a nutrient that supports both mental and physical performance by enhancing memory, accuracy and muscle control. Mr. Harris said, "I am very pleased with the progress Balchem continues to make in advancing our sustainability efforts, as detailed in our 2023 Sustainability Report. Our performance, notably on our 2030 goals to reduce both greenhouse gas emissions and water usage by 25 percent, shows our commitment to our two main objectives: providing innovative solutions for the health and nutritional needs of the world and operating with excellence as strong stewards of our people, communities, and shareholders." Mr. Harris continued, "I am excited about 2024. We had a very good start to the year financially and we continue to make good progress on our strategic initiatives that will support our growth over the longer term." Results for Period Ended March 31, 2024 (unaudited) (Dollars in thousands, except per share data)     Three Months Ended March 31,       2024     2023 Net sales   $ 239,659   $ 232,540 Gross margin     81,514     73,170 Operating expenses     39,838     38,762 Earnings from operations     41,676     34,408 Interest and other expenses     4,826     5,289 Earnings before income tax expense     36,850     29,119 Income tax expense     7,864     6,409 Net earnings   $ 28,986   $ 22,710           Diluted net earnings per common share   $ 0.89   $ 0.70           Adjusted EBITDA(a)   $ 60,866   $ 56,357 Adjusted net earnings(a)   $ 33,584   $ 30,581 Adjusted net earnings per common share(a)   $ 1.03   $ 0.94           Shares used in the calculations of diluted and adjusted net earnings per common share     32,627     32,415 (a) See "Non-GAAP Financial Information" for a reconciliations of GAAP and non-GAAP financial measures.     Financial Results for the First Quarter of 2024: The Human Nutrition & Health segment generated record sales of $152.7 million, an increase of $20.1 million, or 15.1%, compared to the prior year quarter. The increase was primarily driven by higher sales within the minerals and nutrients business. Record earnings from operations for this segment of $33.3 million increased $14.8 million, or 80.4%, compared to $18.4 million in the prior year quarter, primarily due to the aforementioned higher sales and lower manufacturing input costs. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, adjusted earnings from operations(a) for this segment were a record $38.5 million, compared to $26.9 million in the prior year quarter, an increase of 43.3%. The Animal Nutrition & Health segment generated quarterly sales of $53.9 million, a decrease of $11.0 million, or 16.9%, compared to the prior year quarter. The decrease was driven by lower sales in both the monogastric and ruminant species markets. First quarter earnings from operations for this segment of $2.1 million decreased $7.4 million, or 78.3%, compared to $9.5 million in the prior year quarter, primarily due to the aforementioned lower sales, partially offset by lower manufacturing input costs. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, adjusted earnings from operations for this segment were $2.4 million compared to $10.0 million in the prior year quarter, a decrease of 75.8%. The Specialty Products segment generated quarterly sales of $31.6 million, a decrease of $0.6 million, or 1.9%, compared to the prior year quarter, due to lower sales in the plant nutrition business, partially offset by higher sales in the performance gases business. Earnings from operations for this segment were $8.2 million, compared to $7.9 million in the prior year comparable quarter, an increase of $0.3 million, or 3.2%, primarily driven by lower manufacturing input costs, partially offset by an increase in operating expenses. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, adjusted earnings from operations for this segment were $9.3 million, compared to $9.1 million in the prior year quarter, an increase of 3.1%. Record quarterly consolidated gross margin of $81.5 million increased by $8.3 million, or 11.4%, compared to $73.2 million for the prior year comparable period. Gross margin as a percentage of sales was 34.0% as compared to 31.5% in the prior year period, an increase of 255 basis points, primarily due to a favorable mix and decreases in certain manufacturing input costs. Operating expenses of $39.8 million for the quarter increased $1.1 million from the prior year comparable quarter, primarily due to higher compensation-related expenses and the impact of a gain on sale of fixed assets recognized in the prior year, partially offset by lower transaction and integration-related expenses. Excluding non-cash operating expenses associated with amortization of intangible assets of $5.7 million, operating expenses were $34.1 million, or 14.2% of sales. Interest expense was $5.4 million and $5.6 million in the first quarters of 2024 and 2023, respectively. Our effective tax rates for the three months ended March 31, 2024 and 2023 were 21.3% and 22.0%, respectively. The lower effective tax rate was primarily due to higher tax benefits from stock-based compensation and certain lower foreign taxes. First quarter cash flows provided by operating activities were $33.4 million and free cash flow was $26.8 million. The $200.4 million of net working capital on March 31, 2024 included a cash balance of $60.3 million. Significant cash payments during the quarter included a dividend payment of $25.6 million, net repayments on the revolving loan of $8.0 million and capital expenditures and intangible assets acquired of $6.9 million. Ted Harris said, "The Balchem team delivered record first quarter sales and adjusted EBITDA results, once again highlighting the resilience of our business model. Two of our three reporting segments are performing very well, with our Human Nutrition and Health segment delivering all-time record results which are more than offsetting the challenges we are experiencing in our Animal Nutrition and Health segment. We are well positioned in the markets we serve and remain confident in the long-term growth outlook for our markets as we continue to focus on progressing our strategic growth initiatives in 2024 and beyond." Quarterly Conference Call A quarterly conference call will be held on Friday, May 3, 2024, at 11:00 AM Eastern Time (ET) to review first quarter 2024 results. Ted Harris, Chairman, President and CEO and Martin Bengtsson, CFO will host the call. We invite you to listen to the conference by calling toll-free 1-877-407-8289 (local dial-in 1-201-689-8341), five minutes prior to the scheduled start time of the conference call. The conference call will be available for replay three hours after the conclusion of the call through end of day Friday, May 17, 2024. To access the replay of the conference call, dial 1-877-660-6853 (local dial-in 1-201-612-7415), and use conference ID #13745950. Segment Information Balchem Corporation reports three business segments: Human Nutrition & Health, Animal Nutrition & Health, and Specialty Products. The Human Nutrition & Health segment delivers customized food and beverage ingredient systems, as well as key nutrients into a variety of applications across the food, supplement and pharmaceutical industries. The Animal Nutrition & Health segment manufactures and supplies products to numerous animal health markets. Through Specialty Products, Balchem provides specialty-packaged chemicals for use in healthcare and other industries, and also provides chelated minerals to the micronutrient agricultural market. Sales and production of products outside of our reportable segments and other minor business activities are included in "Other and Unallocated". Forward-Looking Statements This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect our expectation or belief concerning future events that involve risks and uncertainties. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "likely," "estimate," "forecast," "outlook," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," or the negative thereof or variations thereon or similar expressions generally intended to identify forward-looking statements. Actions and performance could differ materially from what is contemplated by the forward-looking statements contained in this release. Factors that might cause differences from the forward-looking statements include those referred to or identified in Balchem's Annual Report on Form 10-K for the year ended December 31, 2023 and other factors that may be identified elsewhere in this release or in our other SEC filings. Reference should be made to such factors and all forward-looking statements are qualified in their entirety by the above cautionary statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Contact: Jacqueline Yarmolowicz Balchem Corporation (Telephone: 845-326-5600) Selected Financial Data (unaudited) ($ in 000's) Business Segment Net Sales:   Three Months Ended March 31,       2024     2023 Human Nutrition & Health   $ 152,744   $ 132,653 Animal Nutrition & Health     53,921     64,889 Specialty Products     31,613     32,231 Other and Unallocated (b)     1,381     2,767 Total   $ 239,659   $ 232,540 Business Segment Earnings Before Income Taxes:   Three Months Ended March 31,       2024       2023   Human Nutrition & Health   $ 33,257     $ 18,435   Animal Nutrition & Health     2,060       9,498   Specialty Products     8,199       7,946   Other and Unallocated (b)     (1,840 )     (1,471 ) Interest and other expenses     (4,826 )     (5,289 ) Total   $ 36,850     $ 29,119             (b) Other and Unallocated consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation and corporate expenses that have not been allocated to a segment. Unallocated corporate expenses consist of: (i) Transaction and integration costs ...