Pyxus Improves Revenues and Net Loss

Pyxus International reported sales and other operating revenues of $333.3 million for the three months ended June 30, 2021, up 26.8 percent from $262.8 million for the three months ended June 30, 2020. Gross profit as a percent of sales increased to 12.6 percent from 7.5 percent. Net loss improved 87.5 percent to $11.5 million while adjusted earnings before interest, taxes, depreciation and amortization increased 92.2 percent to $14.8 million.

“Fiscal year 2022 is progressing nicely and is in line with our expectations thus far. In the first quarter, we began to catch up from prior-period shipping delays driven by the pandemic and customer shipping instructions,” said Pieter Sikkel, president and CEO of Pyxus, in a statement.

“In the leaf business, our inventory levels are consistent with our expectations, and our uncommitted inventory decreased compared to the prior year. We continue to see customers look for ways to reduce complexity in their supply chains through partnerships with suppliers who support their environmental, social and governance objectives. British American Tobacco’s Indonesian subsidiary recently adopted a new leaf supply arrangement, which involves shifting contract volumes from its direct operations to one of our tobacco subsidiaries. Effective this crop season, we will begin processing the additional volume in our local facilities prior to its sale to BAT.

“With regards to e-liquids, we are encouraged that the Food and Drug Administration is continuing to take action against illegally marketed tobacco products, as evidenced by the most recent warning letters requesting certain companies remove their flavored disposable e-cigarettes and youth-appealing e-liquid products from the market because they do not have the required premarket tobacco product applications.

“Momentum is building across the business as we leverage the savings from fiscal 2021 restructuring initiatives. We continue to expect fiscal 2022 sales to be between $1.65 billion and $1.8 billion, SG&A expense to be between $140 million and $145 million (excluding nonrecurring items and potential changes in foreign currency exchange rates), and adjusted EBITDA to be between $150 million and $170 million. Our global team is committed to the strengthening of our business while making positive contributions to a sustainable world.”