AdvanSix tops Q2 earnings expectations despite revenue decline

Investing.com -- AdvanSix Inc . (NYSE:ASIX) on Friday reported second-quarter adjusted earnings that exceeded analyst expectations, despite a 10% YoY revenue decline amid challenging market conditions.

The diversified chemistry company posted adjusted earnings per share of $1.24, beating the analyst consensus of $1.19, while revenue fell to $410 million, below the estimated $428.4 million.

The company’s revenue decreased from $453.5 million in the same quarter last year, primarily due to an 8% drop in sales volume driven by softer demand in key nylon end markets, particularly in engineering plastics applications serving the auto sector.

Raw material pass-through pricing was down 5%, while market-based pricing improved by 3% thanks to strength in the Plant Nutrients segment. AdvanSix shares edged up 1% following the earnings release.

"Our resilient second quarter results reflect our collective organization’s execution and the advantages of our business model and diverse product portfolio amid an evolving macro environment," said Erin Kane, president and CEO of AdvanSix.

The company’s adjusted EBITDA declined to $55.7 million from $78.1 million in the prior-year period, primarily due to lower Chemical Intermediates pricing and reduced Nylon Solutions sales volume. Cash flow from operations fell to $21.1 million from $50.2 million a year earlier.

A bright spot in the results was the Plant Nutrients business, which showed strong performance and helped improve earnings and cash flow sequentially from the first quarter.

The company also claimed an additional $8 million in 45Q carbon capture tax credits during the quarter, contributing approximately $0.29 per share to earnings.

Looking ahead, AdvanSix anticipates higher ammonium sulfate pricing in the third quarter YoY, reflecting a strong fall fill program, though typical seasonal patterns are expected to drive sequential domestic pricing decline.

The company continues to navigate what it describes as "an extended downturn in the nylon cycle" while maintaining its capital expenditure forecast of $135 to $145 million for 2025.

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