Pyxus Reports Strong Results
Pyxus International reported sales and other operating revenues of $1.6 billion for the nine months that ended Dec. 31, 2023, up by 8.2 percent over the figures posted for the comparable 2022 period. The company reported positive net income in each of the first three quarters of fiscal 2024 to reach a total of $12.7 million compared to a net loss of $18.5 million in the same period of fiscal 2023. Average gross profit per kilogram increased by 28.3 percent to $0.77.
“Our teams around the world continue to demonstrate their ability to drive broad-based improvement, leveraging our business momentum and strong position in the current market to produce solid third-quarter and year-to-date results,” said Pyxus President and CEO Pieter Sikkel in a statement. “This success positions us to increase our full-year guidance as we remain focused on concluding an outstanding fiscal year.”
The company attributed its improved sales and operating revenues to consistent execution, an inventory mix well matched to specific customer demand and an increase in average pricing of 10 percent. This growth was slightly offset by a 1.9 percent reduction in volume.
Sales and other operating revenues in the third quarter of $529.8 million were lower as compared to $655.6 million in the same period of the prior year. The decrease was principally due to a 22.7 percent decrease in volume, which primarily reflects a difficult comparison to the year-ago quarter, which benefited from the inclusion of previously delayed shipments as well as acceleration of shipments from the current-year quarter into the first half of the fiscal year, according to Pyxus. The impact of the volume decline was partially offset by an average market sales price increase of 3.7 percent in this year’s third quarter.
Third quarter net income improved to $3.8 million as compared to a net loss of $2.3 million in the prior year’s third quarter despite the inclusion of a noncash expense of $12 million related to a pension termination in the United Kingdom.
“Our operational discipline, improved working capital efficiency and geographic diversification enabled us to purchase more tobacco even as we accelerated our repayment of outstanding lines of credit,” said Sikkel. “We believe these attributes enable the company to deliver significant and sustainable value to its financial stakeholders and support further potential improvements in our operational results and working capital.”