Pyxus International Reports 21.4% Revenue Growth to $1.98 Billion for Nine Months Ending December 31, 2024

Pyxus International, Inc. reported a significant increase in financial performance for the nine months ending December 31, 2024, with total sales and other operating revenues reaching $1.98 billion, a 21.4% increase from $1.63 billion in the same period the previous year. The growth was primarily driven by a 17.0% rise in average sales prices, attributed to higher tobacco prices, and a 2.7% increase in kilo volumes sold, particularly from Asia and select African markets. However, gross profit as a percentage of sales decreased from 15.6% to 13.9%, largely due to adverse weather conditions in South America and a less favorable regional mix.

In terms of profitability, net income for the nine-month period was $21.1 million, compared to $12.8 million in the prior year, reflecting a notable improvement. The company also reported a gain on debt retirement of $8.2 million, resulting from the repurchase of certain loans at a discount. Operating income increased to $139.6 million from $130.5 million, despite rising selling, general, and administrative expenses, which grew by 8.2% to $126 million, driven by higher personnel costs and equity-based compensation.

Operationally, Pyxus has made strategic adjustments, including a focus on reducing long-term debt, which has decreased by $142.8 million since March 2024. The company reported a total debt of $1.06 billion as of December 31, 2024, with a net debt of $960 million, down from $977 million a year earlier. The company’s cash and cash equivalents increased to $109.7 million, bolstered by improved cash flow management and collections from securitized receivables.

The company also noted changes in its inventory levels, with processed tobacco inventory decreasing to $603.3 million from $659 million year-over-year, reflecting the impact of El Niño on crop yields. Uncommitted inventory levels also fell, indicating ongoing undersupply conditions in the market. Pyxus is slightly ahead of schedule in crop purchases for the Northern Hemisphere, resulting in an increase in unprocessed tobacco inventory to $151.9 million.

Looking ahead, Pyxus anticipates continued challenges due to market conditions, including potential regulatory impacts from proposed nicotine reduction rules by the FDA. The company remains focused on optimizing its operations and managing its debt levels while navigating the complexities of the global tobacco market.