Advansix Inc. (ASIX) 10-K Annual Report February 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:

The following information was filed by Advansix Inc. (ASIX) on Friday, February 17, 2023 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Advansix Inc.'s 10-K Annual Report:

Financial - Earnings Highlight
The following is a reconciliation between the non-GAAP financial measures of Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA Margin to their most directly comparable U.S. GAAP financial measure: *Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by Sales The following is a reconciliation between the non-GAAP financial measures of Adjusted Earnings Per Share to its most directly comparable U.S. GAAP financial measure: Liquidity and Capital Resources Liquidity We believe that cash balances and operating cash flows, together with available capacity under our credit agreement, will provide adequate funds to support our current short-term operating objectives as well as our longer-term strategic plans, subject to the risks and uncertainties outlined below and in the risk factors as previously disclosed in in Item 1A, Risk Factors.

Financial - Earnings Highlight
Non-GAAP Measures The following tables set forth the non-GAAP financial measures of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Earnings Per Share.
Financial - Cash Flow Highlight
Cash Flow Summary for the Years Ended December 31, 2022, 2021 and 2020 Our cash flows from operating, investing and financing activities for the years ended December 31, 2022, 2021 and 2020, as reflected in the audited Consolidated Financial Statements included in this Form 10-K, are summarized as follows: 2022 compared with 2021 Net cash provided by operating activities increased by $54.8 million for the year ended December 31, 2022 versus the prior year due primarily to (i) a $59.4 million favorable impact from working capital (comprised of Accounts and other receivables, Inventories, Accounts payable and Deferred income and customer advances) year-over-year, with a $38.6 million favorable cash impact for the year ended December 31, 2022 compared to a $20.8 million unfavorable cash impact in the prior year period and (ii) a $32.1 million increase in net income.
Financial - Earnings Highlight
Differences between actual and expected results or changes in the value of defined benefit obligations and fair value of plan assets, if any, are not recognized in earnings as they occur but rather systematically over subsequent periods when net actuarial gains or losses are in excess of 10% of the greater of the fair value of plan assets or the plan's projected benefit obligation.
M & A - Other Highlight
The Credit Agreement also contains financial covenants that require the Company to maintain a Consolidated Interest Coverage Ratio (as defined in the Credit Agreement) of not less than 3.00 to 1.00 and to maintain a Consolidated Leverage Ratio of (i) 4.00 to 1.00 or less for the fiscal quarter ended December 31, 2021, through and including the fiscal quarter ending September 30, 2023 and (ii) 3.75 to 1.00 or less for each fiscal quarter thereafter (subject to the Company's option to elect a consolidated leverage ratio increase in connection with certain acquisitions).
Other - Other
While our integration, scale and...Read more
M & A - Other
The acquisition included intangible assets...Read more
Other - Other
Our ability to fund our...Read more
Financial - Cash Flow
Our cash flows are affected...Read more
Revenue - Product
The Company experienced a material...Read more
Financial - Shares
On May 4, 2018, the...Read more
Other - Other
Included within the year-over-year favorability...Read more
Financial - Expense
Interest Expense, Net 2022 compared...Read more
Financial - Shares
On February 22, 2019, the...Read more
Financial - Shares
On February 17, 2023, the...Read more
Financial - Expense
Capital Expenditures Our operations are...Read more
Other - Other
Finite-Lived Intangible Assets - Other...Read more
Revenue - Product
The pandemic and related containment...Read more
Financial - Expense
Although we have ongoing environmental...Read more
Financial - Earnings
Management applied significant judgments and...Read more
Other - Other
Non-GAAP financial measures should be...Read more
Other - Other
Effective March 9, 2017, Commerce...Read more
Other - Other
The Company's non-GAAP measures may...Read more
Other - Other
Transfer of control to the...Read more
Other - Other
We also utilize maintenance excellence...Read more
Financial - Expense
The value of the portion...Read more
Financial - Income
The Company's effective income tax...Read more
Financial - Expense
Interest costs and related penalties...Read more
Financial - Income
For additional discussion of income...Read more
Other - Other
These net favorable impacts were...Read more
Other - Other
If the Company does not...Read more
Financial - Expense
A 25 basis point increase...Read more
Other - Other
We continue to invest in...Read more
Financial - Cash Flow
Management believes that the following...Read more
Financial - Income
Income Taxes - We account...Read more
Other - Other
Additionally, we continue to execute...Read more
Other - Other
Business Overview We produce and...Read more
Other - Other
Our differentiated Nylon 6 products...Read more
Other - Other
The benefits are accrued over...Read more
Other - Other
The Company had approximately $1...Read more
Financial - Income
The Company's effective income tax...Read more
Financial - Earnings
The fair value for the...Read more
Other - Other
Substantially all tangible and intangible...Read more
M & A - Other
The acquisition provides a unique...Read more
Financial - Income
Although there are no unrecognized...Read more
Other - Other
The following tables may also...Read more
Other - Other
We believe that Nylon 6...Read more
Other - Other
Starting in the second half...Read more
Revenue - Product
These agreements typically contain formula-based...Read more
Other - Other
These covenants placed limits on...Read more
Financial - Expense
We anticipate that our estimated...Read more
Financial - Expense
Prices for acetone are influenced...Read more
Financial - Earnings
The Company made cash contributions...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Material Contracts, Statements, Certifications & more

Advansix Inc. provided additional information to their SEC Filing as exhibits

Exhibit 10.36: Material Contract

Exhibit 23.1: Consents Of Experts And Counsel

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: ASIX
CIK: 1673985
Form Type: 10-K Annual Report
Accession Number: 0001673985-23-000007
Submitted to the SEC: Fri Feb 17 2023 4:10:22 PM EST
Accepted by the SEC: Fri Feb 17 2023
Period: Saturday, December 31, 2022
Industry: Plastic Materials Synth Resins And Nonvulcan Elastomers