How are energy investors positioned?
Introduction & Market Context
Pyxus International Inc (OTC:PYYX) presented its fourth quarter and full fiscal year 2025 results on June 10, 2025, showcasing strong financial performance despite industry supply constraints. The company’s stock closed at $5.00 on June 9, within its 52-week range of $1.44 to $5.44, ahead of the earnings presentation.
The agricultural products company demonstrated its ability to navigate market-wide supply challenges through strategic planning and operational efficiency, resulting in substantial revenue growth and improved profitability metrics across both quarterly and annual timeframes.
Full Year Performance Highlights
Pyxus reported impressive full-year results, with revenue growing 22.1% to $2.48 billion compared to $2.03 billion in fiscal 2024. The company’s adjusted EBITDA reached $208.4 million, reflecting a three-year compound annual growth rate of 18%.
"We successfully managed market-wide supply constraints through a well-designed strategy and consistent financial performance," noted Pieter Sikkel, President and CEO, during the presentation.
The company’s operating income increased 11.7% to $153.3 million, while net income attributable to Pyxus surged 463% to $15.2 million compared to $2.7 million in the previous fiscal year.
A significant achievement for the fiscal year was the generation of $152 million in adjusted free cash flow, enabling substantial debt reduction. The company also reported a 38-day improvement in its average operating cycle, dropping from 186 days in FY24 to 148 days in FY25, indicating enhanced operational efficiency.
Fourth Quarter Results
The fourth quarter continued the company’s strong momentum, with revenue increasing 25% to $502 million compared to $401 million in Q4 FY24. This growth was attributed to both price escalation and volume gains across key markets.
Gross profit for the quarter rose to $67.2 million, up 15.9% from $58 million in the same period last year. Operating income more than doubled to $13.7 million compared to $6.7 million in Q4 FY24, representing a 104.5% increase.
Net interest expense improved by $4 million due to debt reduction efforts and improved shipment timing. Despite these improvements, the company still recorded a quarterly net loss of $5.1 million, though this represents a significant improvement from the $10.1 million loss in the same quarter last year.
Debt Reduction and Financial Health
Pyxus made substantial progress in strengthening its balance sheet during fiscal 2025. The company retired $143 million of long-term debt since March 1, 2024, representing approximately 25% of its total long-term obligations.
This debt reduction strategy has significantly improved the company’s credit profile. The net debt to adjusted EBITDA ratio decreased to 3.7x, down from 4.8x in FY24 and 5.4x in FY23, marking the lowest level in over a decade. Similarly, interest coverage improved to 1.6x from 1.5x in the previous year.
The balance sheet shows total assets of $1.5 billion as of March 31, 2025, a 9.3% decrease from the previous year, primarily due to more efficient inventory management. Total (EPA:TTEF) stockholders’ equity increased 12.9% to $165.8 million, reflecting the company’s improved profitability and financial position.
Forward Guidance and Outlook
Looking ahead to fiscal year 2026, Pyxus provided guidance for revenue between $2.3 billion and $2.5 billion, with adjusted EBITDA expected to range between $205 million and $235 million. This outlook suggests potential continued growth in profitability despite a possible slight contraction in revenue.
The company noted that larger crops are expected following a period of undersupply conditions, which should create volume-driven growth opportunities with improved profitability. However, management acknowledged that the guidance reflects a range of known and unknown variables, including potential changes in trade policy.
"We anticipate volume-driven growth opportunities to come with improved profitability," said Dustin Styons, Interim CFO and Executive Vice President. "Our guidance reflects careful consideration of both market opportunities and potential challenges in the coming fiscal year."
This outlook aligns with the company’s previous statements during its Q3 earnings call, where it anticipated a 30% larger South American crop in fiscal 2026 and promising crop conditions in African markets.
Pyxus appears well-positioned to capitalize on improving supply conditions while maintaining the financial discipline that has enabled its recent performance improvements. Investors will be watching closely to see if the company can maintain its momentum in the face of changing market dynamics and potential trade policy shifts in the coming fiscal year.
Full presentation:
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.