Pyxus International Q4 2025 Earnings Report

Pyxus International EPS Results

• Actual EPS: -$0.20
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Pyxus International Revenue Results

• Actual Revenue: $501.71 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Pyxus International Announcement Details

• Quarter: Q4 2025
• Date: 6/10/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, June 10, 2025
• Conference Call Time: 9:00AM ET

Pyxus International (OTCMKTS:PYYX), an agricultural company, offers value-added products and services to businesses and customers. It also involved in the purchasing, processing, packing, storing, and shipping tobacco to manufacturers of cigarettes and other consumer tobacco products. The company offers its products in China, the United States, the United Arab Emirates, Indonesia, Russia, Northern Africa, and internationally. The company was formerly known as Old Holdco, Inc. Pyxus International, Inc. was founded in 1873 and is headquartered in Morrisville, North Carolina.

Pyxus International Q4 2025 Earnings Call Transcript

Key Takeaways

• Pyxis delivered 22% sales growth to $2.5 billion in FY 2025, with net income rising to $15 million and adjusted EBITDA increasing to $208 million.
• Volume rose 3% by sourcing additional inventory from Africa and Asia, offsetting South America weather impacts and accelerating shipment timing.
• Strong working capital management shortened the operating cycle by 38 days and generated $152 million in adjusted free cash flow, while reducing long-term debt by roughly 25%.
• Leverage fell to 3.7× from 4.8× with interest coverage improving to 1.6×, representing the company’s strongest credit profile in over a decade.
• FY 2026 guidance forecasts $2.3–2.5 billion in sales and $205–235 million in adjusted EBITDA, with results expected to be weighted to the second half amid tariff uncertainties.

Presentation

[Operator]

morning, ladies and gentlemen, and welcome to today's Pyxis International Fiscal Year twenty twenty five Fourth Quarter and Year End Conference Call. As a reminder, this call is being recorded. I would now like to introduce your host for today's call, Mr. Tomas Gregaria. Mr. Gregaria, you may begin.

[Tomas Grigera, VP & Corporate Treasurer at Pyxus International Inc]

Thank you, operator. With me today is Peter Sickle, our President and CEO and Dustin Stines, our Interim CFO and Executive Vice President of Business Strategy and Sales. Before we begin discussing our financial results, I would like to cover a few points. You may hear statements during the course of this call that express a belief, expectation or intention as well as those that are not historical fact. These statements are forward looking and involve a number of risks and uncertainties that may cause actual events and results to differ materially from these forward looking statements.

[Tomas Grigera, VP & Corporate Treasurer at Pyxus International Inc]

These risks and uncertainties are described in detail along with other risks and uncertainties in our filings with the SEC, including our most recent Form 10 ks. We do not undertake to update any forward looking statements made on this conference call to reflect any change in management's expectations or any change in assumptions or circumstances on which these statements are based. Included in our call today may be a discussion of non GAAP financial measurements, including earnings before interest, taxes, depreciation and amortization, commonly referred to as EBITDA, as well as adjusted EBITDA and adjusted free cash flow, that are not measures of results of operations under generally accepted accounting principles in The United States and should not be considered as an alternative to U. S. GAAP measurements.

[Tomas Grigera, VP & Corporate Treasurer at Pyxus International Inc]

A table including a reconciliation of and other disclosures regarding these historical non GAAP financial measures is available on our website at www.pixis.com. Any replay, rebroadcast, transcript or other reproduction of this conference call other than the replay as provided by Pixis International has not been authorized and is strictly prohibited. Investors should be aware that any unauthorized reproduction of this conference call may not be an accurate reflection of its contents. Now I'll hand the call over to Peter.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Good morning, everyone, and thank you for joining our call today. Fiscal year 2025 was an exemplary year for Pyxis, evidenced by our consistent delivery of strong financial and operational performance. At this time last year, many global agricultural companies, including Pyxis, were facing the potential risks associated with an El Nino weather event. In this highly dynamic market, we continue to build on the growth and improvement of the prior two fiscal years. I am pleased to say we successfully navigated one of the more complex market environments in recent history.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Our disciplined execution and sustained customer demand enabled our delivery of solid results across the board, outperforming the guidance we announced at the beginning of the fiscal year and successfully managing market wide supply constraints to deliver significant growth, a clear signal of our strength and differentiation globally. Our experienced and dedicated teams around the world leveraged our geographic footprint to procure additional volume from Africa and Asia to offset the weather related crop reductions in South America. By sourcing from these markets and shifting our customer mix, we seized opportunities for additional growth and profits and reinforced our competitive position. We delivered a strong fiscal twenty twenty five during which our overall volume increased by 3% by sourcing additional inventory from Africa and Asia, growing our market share in certain geographies and accelerating the timing of shipments. We grew full year sales by 22% to $2,500,000,000 We increased our annual gross profit by 10% to $343,000,000 for fiscal twenty twenty five compared to $312,000,000 in fiscal twenty twenty four.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

We increased our operating income for the year by 12% to $153,000,000 and achieved net income of $15,000,000 compared to $3,000,000 in the prior year. And our full year adjusted EBITDA reached $208,000,000 showing continued growth compared to a $194,000,000 in the prior year at an 18% compounded annual growth rate over the last three years. Our disciplined approach to managing working capital and strong demand positioned the business to accelerate our operating cycle by thirty eight days compared to fiscal twenty twenty four. This strong efficiency gain combined with our growth in profits and a more normalized purchasing cadence in the fourth quarter supported the generation of $152,000,000 in adjusted free cash flow during the fiscal year. We continue to improve our capital structure through the repayment of long term debt and the elimination of the associated interest expense.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

As we will detail later in the call, since the March 2024, we've reduced our long term debt by approximately 25%. Beyond financial progress, fiscal twenty twenty five was a milestone year with respect to our commitment to sustainability. Following an in-depth review and approval process, the science based target initiative validated our company's near term emission reduction targets. This validation reflects the consistency of our targets with the goals established by the Paris Agreement and drives further alignment with our global customer base and other key stakeholders. In the third quarter, we released our annual sustainability report, sharing our 16% reduction of indirect emissions since fiscal year twenty twenty one.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

This is a testament to our engagement efforts with our contracted farmers to promote the adoption of climate smart best practices. With approximately 1 of our employees focused on the agronomic side of our business, we have the unique ability to work hand in hand with our contracted farmers throughout the crop season. This approach allows for ongoing farmer training and supports crop quality and yield, which enhances our capability to manage risks, meet customer requirements, and provide consistent product delivery. I'll reserve some additional comments for closing. But it's my pleasure to introduce Dustin Saenz, Pyxus' interim chief financial officer.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Dustin has been with the company for twenty years in a variety of leadership positions in finance, sales, and business strategy. His deep institutional knowledge combined with our shared strategic vision for the company's future has allowed for a seamless transition as we prepare for a strong fiscal twenty twenty six. Dustin?

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

Good morning, everyone. And Peter, thank you for that introduction. Before I cover our financial performance for the year, I'd like to briefly share the success we had in the fourth quarter. We ended the fourth quarter with revenues up 25% to $5.00 $2,000,000 Consistent with the full year, pricing was the key driver and was assisted by increased volume, which was driven by accelerating the timing of shipments. Fourth quarter gross profit grew to $67,000,000 compared to $58,000,000 in the prior year, and operating income more than doubled to $14,000,000 compared to last year's $7,000,000 Net interest expense in the fourth quarter improved to $26,000,000 compared to $30,000,000 last year and was driven by the long term debt reduction, acceleration of shipments and a more normalized purchasing cadence in South America.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

Turning to the full year, I'll briefly add some detail to Peter's comments. Our full year sales growth of 22% reflects a 3% gain in volume and an 18% increase in sales price. The volume gains came from our strategic sourcing from Africa and Asia and the timing of shipments, which more than offset reduced volume from South America and enabled us to outperform market constraints to meet customer demand. For the full year, average gross profit per kilo increased to $0.84 from $0.78 in the prior year as we strategically shifted to a more favorable customer mix and improved our product mix by capturing opportunities to expand certain value added businesses that generally produce higher than average gross profit per kilo. SG and A increased to $171,000,000 compared to $161,000,000 in the prior year.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

This was driven by higher personnel costs, including a $4,000,000 non cash equity based compensation expense and increased variable bonus compensation. Excluding the non cash equity based compensation, SG and A increased 4% compared to the prior year. Net income increased to $15,000,000 for the year ended 03/31/2025 compared to $3,000,000 for the prior year. We improved our adjusted EBITDA to $2.00 $8,000,000 compared to $194,000,000 in fiscal year twenty twenty four. And as Peter mentioned, we're pleased to deliver adjusted EBITDA that exceeded our initial guidance and is well within the increased guidance range we announced in February.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

We continued to focus on leverage reduction throughout the fiscal year, successfully retiring $65,000,000 of senior debt, which was a continuation of our strategies in fiscal year twenty twenty four when we retired $78,000,000. In total, we've retired 143,000,000 of our senior debt since 03/01/2024. This reduction, combined with our disciplined working capital management and our improved profitability, reduced leverage from 4.8 times to 3.7 times, the lowest it's been in over ten years. The long term debt reduction also drove a $9,000,000 decrease in interest expense related to our senior debt. But this was offset in fiscal year twenty twenty five by an increase in the average and peak borrowings from our seasonal lines of credit, which were used to purchase more expensive inventory during the fiscal year to support our $449,000,000 increase in sales.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

As a result, interest expense in fiscal year twenty five was consistent with the prior year. Our interest coverage over the last twelve months improved to 1.6 times, up from 1.5 times in fiscal year twenty twenty four. Our credit profile and key metrics, including year end leverage and interest coverage ratios, strengthened significantly in fiscal twenty twenty five. We remain focused on driving further improvements to these metrics over time and reducing our overall borrowing cost. Before I turn the call over to Peter for his closing remarks, I'll provide our guidance for fiscal year twenty twenty six.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

For the full year, our guidance for sales is in the range of $2,300,000,000 to $2,500,000,000 Our guidance for adjusted EBITDA is in the range of $2.00 $5,000,000 to $235,000,000 reflecting our continued focus to expand margin as we capture volume driven growth on higher crop sizes expected next year. We believe the company is well positioned to deliver these results, but we do anticipate sales during fiscal year twenty twenty six to be weighted to the half of the year. Given the dynamic trade environment, particularly related to tariffs, our guidance range reflects varying assumptions with respect to the extent that recently announced tariffs are implemented.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Thank you, Dustin.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Fiscal year twenty twenty five was another year of significant progress and success for our company. We navigated tremendously complex market dynamics with discipline, consistency, and proactive execution. Most importantly, we've strengthened our credit profile, laying a solid foundation to build upon. As of 03/31/2025, we have only $8,000,000 of uncommitted inventory, which is approximately 1% of our total inventory. Total inventory at year end was $762,000,000 compared to $932,000,000 last year.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

This change shows our ability to meet customer demand by accelerating shipments as well as the impact of a more normalized purchasing cadence, particularly in South America. For fiscal twenty twenty six, we believe ongoing undersupply conditions will shift to a more normalized level compared to the prior year and market demand should remain strong and ready to absorb the emerging larger crops. Already, we are pleased to see larger crop sizes with reduced cost and improved quality in South America and parts of Africa, which we plan to use to replenish our inventory to build on our exceptional fiscal twenty five and drive another year of volume, gross margin and EBITDA growth in fiscal twenty twenty six. Thank you again for joining today's call. Operator, I believe we're now ready to take questions.

[Operator]

Thank We'll take our question from Patrick Fitzgerald with Baird.

[Patrick Fitzgerald, Managing Director at Baird]

Hi. Thanks a lot for taking the question. Could you provide a little bit more color on why you'd expect sales to be weighted towards the half of the year? Like, what are you seeing that that makes you think that that's how it's gonna play out? And also, do you expect EBITDA to be weighted to the half of the year as well?

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Hello, Patrick. And thanks very much for the question. Yeah. As you can see from the results in the in the past fiscal year, we ended the year with very low inventories and with the larger crops. We are replenishing those in the half of the year.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

And as we purchase, commit, process, and then ship, we see those shipments more weighted to the half of the year. So that's really what's driving both volume growth for the year, but the half weighting of of of this coming fiscal year. So, volume and EBITDA, are both driven with the same characteristics.

[Patrick Fitzgerald, Managing Director at Baird]

Okay. Thanks. So your guidance is for revenue down a little bit year over year, you know, at the midpoint and EBITDA up up, mid single digits year over year at again, at the midpoint. What is that what does that assume for, you know, full year volumes and kind of the pricing environment?

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Well, it's it's kind of exactly as we, anticipated for this year. We saw very elevated costs last year that were passed on to customers, and we anticipated with larger crop sizes that pricing would start to reduce this year on on the larger crop. So we're really well positioned this year and that we're able to purchase, tobacco is better according to its quality and and transfer those prices, to customers. So what we're seeing out of that, and it's really reflective of what's going on in Brazil right now, and and we hope to see in in crops around the rest of the world, is that volumes will increase, gross margins will will increase, and that's really what's creating the the difference between if you look at the guidance, that's really reflective of increased volumes, lower selling prices, and higher margins. So that's coming together to create that guidance.

[Patrick Fitzgerald, Managing Director at Baird]

Okay. Thanks a lot. So, you know, given your kind of lower than normal inventory balance at the end of the year, the fact that you'll have to invest in inventory this year, what's the what's your view on kind of free cash flow? Do you think you know, you ended the year with a really, you know, nice lower net debt balance. Do you think you can sustain that or or just kind of given your inventory purchases, probably could expect higher maybe higher EBITDA, but also higher net debt at the end of next year. How are you thinking about that?

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

Hi, Patrick. This is Dustin. I think when we look at the end of this fiscal year, particularly related to the inventory cycles, what we see is a more normalized, purchasing pattern out of Brazil. Last year, we saw elevated purchases, at very high cost because of El Nino. This year, we've really seen that reverse.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

So as we look for the remainder of the fiscal year, we would we will continue our disciplined working capital approach. And also, as Peter mentioned, and it's reflected in our guidance and guidance ranges, improved profitability. And so I think especially when we look at cash flow, working capital, you know, is is seasonal, and we have had some benefits this year related to the reversal of some of the the major events at the end of last year. We would expect that to continue to normalize. But what I would really focus on from the free cash flow, perspective is that for this fiscal year end, we were cash generative before working capital changes.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

And I think that highlights our focus not only on the disciplined working capital management, but also the improved operating performance for the company.

[Patrick Fitzgerald, Managing Director at Baird]

Alright. Thanks a lot. Appreciate it.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Thank you.

[Operator]

Next to Joseph Von Mester with Intermarket.

[Joseph Von Meister, Credit Analyst at Intermarket Group]

Hi, guys. Hello, Joseph. I have a couple of quick questions. one is, maybe you could update us on what's happening with the Philip Morris International heat not burn product in The United States. And then the question I had was, I noticed in your cash flow statement, there was no was no entry for the share repurchase that happened last August, and I'm wondering why that is.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

Well, let me take the one. I'll let Dustin take the the part. I mean, obviously, we're not, entirely privy to, filamorest's plans for commercialization of of IQOS in The United States. What I what I can say is we are obviously heavily involved in the supply chain for those products, which is an exciting business stream for us and really falls well within the strategies and tactics that we've had for a long time to make sure that the products that we supply can meet the reduced risk product requirements of next generation products. So we're pleased with, how that is is going, and we see that as positive, for our, for our business.

[J. Pieter Sikkel, President & CEO at Pyxus International Inc]

And, obviously, we look forward to the the full launch in The United States, but, I don't have a date for you at this point in time.

[Joseph Von Meister, Credit Analyst at Intermarket Group]

Great. Thanks. Hi, Joe.

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

Hi, Joe. I think where you would, see more clearly the repurchase of the, stock is actually in the, statement of stockholders' equity. As it relates to being in the cash flow, that is captured in the cash flow, but it's captured in some of the other segments, that's not highlighted. So but it is very clear on the statement of shareholders' equity, statement.

[Joseph Von Meister, Credit Analyst at Intermarket Group]

Thank you very much. Maybe maybe as a follow-up with your improved credit metrics, what's your thinking on improving your capital structure or at least refinancing some of your high cost debt?

[Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales at Pyxus International Inc]

Joe, great question. I I think that we're continuing to evaluate our strategic options. So no no key updates related to any refinancing efforts at this time.

[Joseph Von Meister, Credit Analyst at Intermarket Group]

Great. Thank you, guys. Thank you.

[Operator]

And at this time, there are no further questions. This does conclude the Q and A portion of today's call. I will now hand the call back to Mr. Gregaria for closing remarks.

[Tomas Grigera, VP & Corporate Treasurer at Pyxus International Inc]

Again for joining our fiscal year twenty twenty five fourth quarter and year end call. We look forward to sharing future updates with you following the first quarter of fiscal year twenty twenty six.

[Operator]

This does conclude today's conference. We thank you for your participation.

Participants

Executives

• Tomas Grigera, VP & Corporate Treasurer
• J. Pieter Sikkel, President & CEO
• Dustin Styons, Interim CFO - Executive Vice President, Business Strategy & Sales

Analysts

• Patrick Fitzgerald, Managing Director at Baird
• Joseph Von Meister, Credit Analyst at Intermarket Group