Advansix Inc. (ASIX) SEC Filing 8-K Material Event for the period ending Friday, February 17, 2023

Advansix Inc.

CIK: 1673985 Ticker: ASIX

Exhibit 99.1
News Release


Record annual sales, earnings and cash flow in 2022
4Q22 Sales of $404 million, down 5% versus prior year
4Q22 Earnings Per Share of $1.18; Adjusted Earnings Per Share of $1.27
4Q22 Cash Flow from Operations of $70 million, up 109% versus prior year
Returned $49 million of cash to shareholders through repurchases and dividends in 2022
Board of Directors authorizes additional $75 million share repurchase program
Awarded Platinum Rating for corporate social responsibility from EcoVadis

Parsippany, N.J., February 17, 2023 - AdvanSix (NYSE: ASIX) today announced its financial results for the fourth quarter and full year ending December 31, 2022. In 2022, the Company generated record annual sales, earnings and cash flow reflecting strong commercial execution. In addition, the Company enhanced its capital deployment with the acquisition of U.S. Amines and an increase in return of cash to shareholders through opportunistic share repurchases and an increased dividend, while further reducing debt.
Full Year 2022 Summary
Sales up approximately 15% versus prior year driven by 20% favorable impact of market-based pricing, 2% higher raw material pass-through pricing and 4% contribution from acquisitions, offset by 10% lower volume
Net Income of $171.9 million, an increase of $32.1 million versus the prior year
Adjusted EBITDA of $308.5 million, an increase of $41.5 million versus the prior year
Cash Flow from Operations of $273.6 million, an increase of $54.8 million versus the prior year
Capital Expenditures of $89.4 million, an increase of $32.6 million versus the prior year
Free Cash Flow of $184.2 million, an increase of $22.1 million versus the prior year
Returned $49 million of cash to shareholders through share repurchases and an increased dividend

Summary full year 2022 financial results for the Company are included below:

($ in Thousands, Except Earnings Per Share)
FY 2022FY 2021
Net Income171,886139,791
Diluted Earnings Per Share$5.92$4.81
Adjusted Diluted Earnings Per Share (1)
Adjusted EBITDA (1)
Adjusted EBITDA Margin % (1)
Cash Flow from Operations273,601218,849
Free Cash Flow (1)(2)
(1) See “Non-GAAP Measures” included in this press release for non-GAAP reconciliations
(2) Net cash provided by operating activities less capital expenditures

“In 2022, AdvanSix built upon our track record of performance with earnings growth for the third consecutive year," said Erin Kane, president and CEO of AdvanSix. "We continue to progress our core strategies and in the fourth quarter our strong commercial performance helped to offset pockets of soft end market demand, customer destocking, and operational challenges. Cash flow generation was robust in the quarter as well supporting disciplined and value-accretive capital deployment. Our additional $75 million share repurchase authorization reinforces the flexibility we've built into our capital allocation strategy. In addition, we were recently honored with our second consecutive Platinum Rating from EcoVadis in recognition of our strengthening corporate social responsibility performance and ranking us among the top 1% of all companies assessed."
Fourth Quarter 2022 Summary
Sales down approximately 5% versus prior year including a 10% favorable impact of market-based pricing and 4% contribution from acquisitions, offset by 15% lower volume and 4% lower raw material pass-through pricing
Net Income of $33.6 million, an increase of $10.0 million versus the prior year
Adjusted EBITDA of $66.6 million, an increase of $14.6 million versus the prior year
Adjusted EBITDA margin of 16.5%, up 420 bps versus the prior year
Cash Flow from Operations of $69.6 million, an increase of $36.3 million versus the prior year
Capital Expenditures of $28.4 million, an increase of $9.1 million versus the prior year
Free Cash Flow of $41.2 million, an increase of $27.2 million versus the prior year
Repurchased 284,201 shares for approximately $10 million in 4Q22

Summary fourth quarter 2022 financial results for the Company are included below:

($ in Thousands, Except Earnings Per Share)
4Q 20224Q 2021
Net Income33,62523,587
Diluted Earnings Per Share$1.18$0.80
Adjusted Diluted Earnings Per Share (1)
Adjusted EBITDA (1)
Adjusted EBITDA Margin % (1)
Cash Flow from Operations69,61433,326
Free Cash Flow (1)(2)
(1) See “Non-GAAP Measures” included in this press release for non-GAAP reconciliations
(2) Net cash provided by operating activities less capital expenditures

Sales of $404 million in the quarter decreased approximately 5% versus the prior year. Sales volume decreased approximately 15% driven primarily by soft end market demand and customer destocking. Raw material pass-through pricing was unfavorable by 4% following a net cost decrease in benzene and propylene (inputs to cumene which is a key feedstock to our products). Market-based pricing was favorable by 10% compared to the prior year primarily driven by higher ammonium sulfate pricing. The acquisition of U.S. Amines contributed approximately 4% to sales in the quarter.

Sales by product line and approximate percentage of total sales are included below:
($ in Thousands)FY 2022FY 2021
Sales % of TotalSales% of Total
Nylon$485,241 25%$422,897 25%
Caprolactam319,863 16%316,132 19%
Chemical Intermediates511,515 26%544,504 32%
Ammonium Sulfate629,021 33%401,092 24%
$1,945,640 100%$1,684,625 100%

($ in Thousands)4Q 20224Q 2021
Sales % of TotalSales% of Total
Nylon$93,510 23%$105,288 25%
Caprolactam71,871 18%73,673 17%
Chemical Intermediates101,947 25%127,862 30%
Ammonium Sulfate136,734 34%117,241 28%
$404,062 100%$424,064 100%

Adjusted EBITDA of $66.6 million in the quarter increased $14.6 million versus the prior year primarily due to higher market-based pricing and the favorable year-over-year impact of planned plant turnarounds, partially offset by lower sales volume and operational performance.


Adjusted earnings per share of $1.27 increased $0.39 versus the prior year driven primarily by the factors discussed above.

Cash flow from operations of $69.6 million in the quarter increased $36.3 million versus the prior year primarily due to higher net income. Capital expenditures of $28.4 million in the quarter increased $9.1 million versus the prior year.

The Company's Board of Directors declared a quarterly cash dividend of $0.145 per share on the Company's common stock. The dividend is payable on March 17, 2023 to stockholders of record as of the close of business on March 3, 2023.

Expect strong underlying agriculture and fertilizer industry fundamentals to continue
Expect balanced supply and demand conditions for North American acetone
Expect headwinds in consumer durables and building and construction end markets across nylon and other chemical intermediates
Expect Capital Expenditures of $110 million to $120 million in 2023, reflecting increased spend due to critical infrastructure, other maintenance, and growth and cost savings projects
Expect pre-tax income impact of planned plant turnarounds to be $28 million to $33 million in 2023 versus approximately $50 million in 2022

"With our diverse product portfolio, continued strong agricultural and fertilizer industry fundamentals and the resilience of our business model, AdvanSix is well positioned for another year of differentiated performance in 2023. While we anticipate the challenges of an uncertain environment to impact several end applications within our nylon and chemical intermediates product lines, we remain confident in our demonstrated ability to perform through various business and macroeconomic cycles. We have structurally improved the earnings power of this business and are targeting a return to higher plant production rates in 2023 to complement our strong commercial performance. Our healthy balance sheet will serve us well and continues to support our ability to deploy capital and maximize shareholder value,” concluded Kane.

Conference Call Information
AdvanSix will discuss its results during its investor conference call today starting at 9:00 a.m. ET. To participate on the conference call, dial (844) 855-9494 (domestic) or (412) 858-4602 (international) approximately 10 minutes before the 9:00 a.m. ET start, and tell the operator that you are dialing in for AdvanSix’s fourth quarter 2022 earnings call. The live webcast of the investor call as well as related presentation materials can be accessed at Investors can hear a replay of the conference call from 12 noon ET on February 17 until 12 noon ET on February 24 by dialing (877)

344-7529 (domestic) or (412) 317-0088 (international). The access code is 2764385.

About AdvanSix
AdvanSix plays a critical role in global supply chains, innovating and delivering essential products for our customers in a wide variety of end markets and applications that touch people’s lives, such as building and construction, fertilizers, agrochemicals, plastics, solvents, packaging, paints, coatings, adhesives and electronics. Our reliable and sustainable supply of quality products emerges from the integrated value chain of our five U.S.-based manufacturing facilities. AdvanSix strives to deliver best-in-class customer experiences and differentiated products in the industries of nylon solutions, chemical intermediates, and plant nutrients, guided by our core values of Safety, Integrity, Accountability and Respect. More information on AdvanSix can be found at

Forward Looking Statements
This release contains certain statements that may be deemed “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, that address activities, events or developments that our management intends, expects, projects, believes or anticipates will or may occur in the future are forward-looking statements. Forward-looking statements may be identified by words such as "expect," "anticipate," "estimate," “outlook,” "project," "strategy," "intend," "plan," "target," "goal," "may," "will," "should" and "believe" and other variations or similar terminology and expressions. Although we believe forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks, uncertainties and other factors, many of which are beyond our control and difficult to predict, which may cause the actual results or performance of the Company to be materially different from any future results or performance expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to: general economic and financial conditions in the U.S. and globally, including the impact of the coronavirus (COVID-19) pandemic and any resurgences; the potential effects of inflationary pressures, labor market shortages and supply chain issues; instability or volatility in financial markets or other unfavorable economic or business conditions caused by geopolitical concerns, including as a result of the conflict between Russia and Ukraine; the scope, shape and pace of recovery of the pandemic including the impact of social and economic restrictions and other containment measures taken to combat virus transmission; the effect on our customers’ demand for our products and our suppliers’ ability to manufacture and deliver our raw materials, including implications of reduced refinery utilization in the U.S.; our ability to sell and provide our goods and services; the ability of our customers to pay for our products; any closures of our and our customers’ offices and facilities; risks associated with increased phishing, compromised business emails and other cybersecurity attacks and disruptions to our technology infrastructure; risks associated with employees working remotely or operating with a reduced workforce; risks associated with our indebtedness including compliance with financial and restrictive covenants, and our ability to access capital on reasonable terms, at a reasonable cost, or at all, due to economic conditions or otherwise; the impact of scheduled turnarounds and significant unplanned downtime and interruptions of production or logistics operations as a result of mechanical issues or other unanticipated events such as fires, severe weather conditions, natural disasters, pandemics and geopolitical conflicts and related events; price fluctuations, cost increases and supply of raw materials; our operations and growth projects requiring substantial capital; growth rates and cyclicality of the industries we serve including global changes in supply and demand; failure to develop and commercialize new products or technologies; loss of significant customer relationships; adverse trade and tax policies; extensive environmental, health and safety laws that apply to our operations; hazards associated with chemical manufacturing, storage and transportation; litigation associated with chemical manufacturing and our business operations generally; inability to acquire and integrate businesses, assets, products or technologies; protection of our intellectual property and proprietary information; prolonged work stoppages as a result of labor difficulties or otherwise; cybersecurity, data privacy incidents and disruptions to our technology infrastructure; failure to maintain effective internal controls; our ability to declare and pay quarterly cash dividends and the amounts and timing of any future dividends; our ability to repurchase our common stock and the amount and timing of any future repurchases; disruptions in supply chain, transportation and logistics; potential for uncertainty regarding qualification for tax treatment of our spin-off; fluctuations in our stock price; and changes in laws or regulations applicable to our business. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Such forward-looking statements are not guarantees of future performance, and actual results, developments and business decisions may differ from those envisaged by such forward-looking statements. We identify the principal risks and uncertainties that affect our performance in our filings with the Securities and Exchange Commission (SEC), including the risk factors in Part 1, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021, as updated in subsequent reports filed with the SEC.

Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures intended to supplement, not to act as substitutes for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided in this press release. Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those measures provided. Non-GAAP measures in this press release may be calculated in a way that is not comparable to similarly-titled measures reported by other companies.

# # #

Janeen LawlorAdam Kressel
(973) 526-1615(973) 526-1700

AdvanSix Inc.
Consolidated Balance Sheets
(Dollars in thousands, except share and per share amounts)
December 31, 2022December 31, 2021
Current assets:
Cash and cash equivalents$30,985 $15,100 
Accounts and other receivables – net175,429 178,140 
Inventories – net215,502 149,570 
Taxes receivable9,771 947 
Other current assets9,241 6,097 
Total current assets440,928 349,854 
Property, plant and equipment – net811,065 767,964 
Operating lease right-of-use assets114,688 136,207 
Goodwill56,192 17,592 
Intangible assets49,242 17,980 
Other assets23,216 22,402 
Total assets$1,495,331 $1,311,999 
Current liabilities:
Accounts payable$272,770 $221,234 
Accrued liabilities48,820 49,712 
Operating lease liabilities – short-term37,472 36,127 
Deferred income and customer advances34,430 2,749 
Total current liabilities393,492 309,822 
Deferred income taxes160,409 133,330 
Operating lease liabilities – long-term77,571 100,580 
Line of credit – long-term115,000 135,000 
Postretirement benefit obligations— 18,243 
Other liabilities10,679 13,834 
Total liabilities757,151 710,809 
Common stock, par value $0.01; 200,000,000 shares authorized; 31,977,593 shares issued and 27,446,520 outstanding at December 31, 2022; 31,755,430 shares issued and 28,139,954 outstanding at December 31, 2021320 318 
Preferred stock, par value $0.01; 50,000,000 shares authorized; 0 shares issued and outstanding at December 31, 2022 and 2021— — 
Treasury stock at par (4,531,073 shares at December 31, 2022; 3,615,476 shares at December 31, 2021)(45)(36)
Additional paid-in capital174,585 195,931 
Retained earnings567,517 411,516 
Accumulated other comprehensive loss(4,197)(6,539)
Total stockholders' equity738,180 601,190 
Total liabilities and stockholders' equity$1,495,331 $1,311,999 

AdvanSix Inc.
Consolidated Statements of Operations
(Dollars in thousands, except share and per share amounts)

Three Months Ended
December 31,
Twelve Months Ended
December 31,
Sales$404,062 $424,064 $1,945,640 $1,684,625 
Costs, expenses and other:
Costs of goods sold335,033 369,538 1,631,161 1,410,503 
Selling, general and administrative expenses22,628 20,873 87,748 82,985 
Interest expense, net763 927 2,781 5,023 
Other non-operating (income) expense, net(16)648 (1,841)998 
Total costs, expenses and other358,408 391,986 1,719,849 1,499,509 
Income before taxes45,654 32,078 225,791 185,116 
Income tax expense12,029 8,491 53,905 45,325 
Net income$33,625 $23,587 $171,886 $139,791 
Earnings per common share
Basic$1.22 $0.84 $6.15 $4.97 
Diluted$1.18 $0.80 $5.92 $4.81 
Weighted average common shares outstanding
Basic27,572,344 28,201,439 27,969,436 28,152,876 
Diluted28,608,181 29,417,713 29,031,107 29,045,186 


AdvanSix Inc.
Consolidated Statements of Cash Flows
(Dollars in thousands)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
Cash flows from operating activities:
Net income$33,625 $23,587 $171,886 $139,791 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 17,483 16,282 69,353 65,340 
Loss on disposal of assets 218 869 1,521 1,711 
Deferred income taxes 7,532 (6,533)16,228 4,702 
Stock-based compensation2,680 2,693 10,279 11,299 
Amortization of deferred financing fees154 253 618 677 
Changes in assets and liabilities, net of business acquisitions:
Accounts and other receivables 10,496 (7,223)17,842 (53,772)
Inventories (57,070)(6,658)(57,043)31,227 
Taxes receivable5,159 (610)(8,824)11,342 
Accounts payable 12,401 (1,654)46,170 25,393 
Accrued liabilities 4,544 8,236 (3,122)14,654 
Deferred income and customer advances 31,869 (389)31,681 (23,630)
Other assets and liabilities 523 4,473 (22,988)(9,885)
Net cash provided by operating activities 69,614 33,326 273,601 218,849 
Cash flows from investing activities:
Expenditures for property, plant and equipment (28,439)(19,340)(89,449)(56,811)
Acquisition of businesses— — (97,456)(9,523)
Other investing activities(781)(253)(2,368)(1,228)
Net cash used for investing activities (29,220)(19,593)(189,273)(67,562)
Cash flows from financing activities:
Borrowings from line of credit80,500 42,500 434,500 176,000 
Payments of line of credit(100,500)(42,500)(454,500)(316,000)
Payment of line of credit facility fees— (2,442)— (2,442)
Principal payments of finance leases(214)(201)(926)(735)
Dividend payments(3,990)(3,518)(15,073)(3,518)
Purchase of treasury stock(10,157)(63)(33,748)(652)
Issuance of common stock258 352 1,304 554 
Net cash used for financing activities (34,103)(5,872)(68,443)(146,793)
Net change in cash and cash equivalents 6,291 7,861 15,885 4,494 
Cash and cash equivalents at beginning of period24,694 7,239 15,100 10,606 
Cash and cash equivalents at the end of period$30,985 $15,100 $30,985 $15,100 
Supplemental non-cash investing activities:
Capital expenditures included in accounts payable $14,879 $11,720 

AdvanSix Inc.
Non-GAAP Measures
(Dollars in thousands, except share and per share amounts)
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Three Months Ended
December 31,
Twelve Months Ended
December 31,
Net cash provided by operating activities$69,614 $33,326 $273,601 $218,849 
Expenditures for property, plant and equipment(28,439)(19,340)(89,449)(56,811)
Free cash flow (1)
$41,175 $13,986 $184,152 $162,038 
(1) Free cash flow is a non-GAAP measure defined as Net cash provided by operating activities less Expenditures for property, plant and equipment

The Company believes that this metric is useful to investors and management as a measure to evaluate our ability to generate cash flow from business operations and the impact that this cash flow has on our liquidity.

Reconciliation of Net Income to Adjusted EBITDA and Earnings Per Share to Adjusted Earnings Per Share

Three Months Ended
December 31,
Twelve Months Ended
December 31,
Net income$33,625 $23,587 $171,886 $139,791 
Non-cash stock-based compensation2,680 2,693 10,279 11,299 
Non-recurring, unusual or extraordinary expenses— — — — 
Non-cash amortization from acquisitions532 65 1,815 239 
Non-recurring M&A costs— — 277 172 
Benefit from income taxes relating to reconciling items(535)(420)(1,996)(1,798)
Adjusted Net Income36,302 25,925 182,261 149,703 
Interest expense, net763 927 2,781 5,023 
Income tax expense - adjusted12,564 8,911 55,901 47,123 
Depreciation and amortization - adjusted16,951 16,217 67,538 65,101 
Adjusted EBITDA$66,580 $51,980 $308,481 $266,950 
Sales$404,062 $424,064 $1,945,640 $1,684,625 
Adjusted EBITDA Margin (2)
(2) Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by Sales


Three Months Ended
December 31,
Twelve Months Ended
December 31,
Net Income$33,625 $23,587 $171,886 $139,791 
Adjusted Net Income36,302 25,925 182,261 149,703 
Weighted-average number of common shares outstanding - basic27,572,344 28,201,439 27,969,436 28,152,876 
Dilutive effect of equity awards and other stock-based holdings1,035,837 1,216,274 1,061,671 892,310 
Weighted-average number of common shares outstanding - diluted28,608,181 29,417,713 29,031,107 29,045,186 
EPS - Basic$1.22 $0.84 $6.15 $4.97 
EPS - Diluted$1.18 $0.80 $5.92 $4.81 
Adjusted EPS - Basic$1.32 $0.92 $6.52 $5.32 
Adjusted EPS - Diluted$1.27 $0.88 $6.28 $5.15 

The Company believes the non-GAAP financial measures presented in this release provide meaningful supplemental information as they are used by the Company’s management to evaluate the Company’s operating performance, enhance a reader’s understanding of the financial performance of the Company, and facilitate a better comparison among fiscal periods and performance relative to its competitors, as these non-GAAP measures exclude items that are not considered core to the Company’s operations.


AdvanSix Inc.
(Pre-tax income impact, Dollars in millions)
Planned Plant Turnaround Schedule (3)

(3) Primarily reflects the impact of fixed cost absorption, maintenance expense, and the purchase of feedstocks which are normally manufactured by the Company.

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Ticker: ASIX
CIK: 1673985
Form Type: 8-K Corporate News
Accession Number: 0001673985-23-000004
Submitted to the SEC: Fri Feb 17 2023 6:32:37 AM EST
Accepted by the SEC: Fri Feb 17 2023
Period: Friday, February 17, 2023
Industry: Plastic Materials Synth Resins And Nonvulcan Elastomers
  1. Earnings Release
  2. Financial Exhibit
  3. Other Events

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