Balchem Corporation Q3 FY2025 earnings call

• Delivered record quarterly consolidated sales, adjusted EBITDA, adjusted net earnings, and adjusted EPS with year-over-year growth in all segments. - 25th consecutive quarter of quarterly year-over-year growth in adjusted EBITDA. - Healthy demand across end markets. - Human Nutrition and Health: Strong demand for nutrients and food ingredients/solutions due to 'Better For You' trends. - Animal Nutrition and Health: Growth in monogastric and ruminant businesses, market penetration of rumen-protected nutrients. - Specialty Products: Performance Gases and Plant Nutrition performing well, Plant Nutrition with geographic expansion. - Scientific research: NIH-funded choline biomarker study results, Real Science Exchange platform growth. - Marketing: Expanding reach via Real Science Exchange, partnerships, and expansion into new sectors.

The Human Nutrition and Health segment generated record sales of $174 million, an increase of 14.3% from the prior year. It also delivered record quarterly earnings from operations of $41 million, up 14.8% y-o-y. The Animal Nutrition and Health segment had quarterly sales of $56 million, a 6.6% increase y-o-y, and earnings from operations of $4 million, up 5.2% y-o-y. The Specialty Products segment had quarterly sales of $36 million, a 7.5% increase y-o-y, and record earnings from operations of $12 million, up 9.7% y-o-y.

• Outlook for remainder of 2025 remains positive. - Expect to offset future tariff impacts. - Confident in long-term growth outlook for Balchem Corporation.

• Global trade situation and tariffs could impact results. - Lengthy and expensive process of antidumping cases.

Q: Robert James Labick asks about Food Solutions in Human Nutrition and Health, including drivers and outlook for sub-segments.

A: Theodore Lee Harris responds on the growth in Food Solutions driven by 'Better For You' trends, such as in high-protein snacks, high-fiber beverages, etc., and that trends are likely to continue.

Q: Raghuram Selvaraju asks about European antidumping, Orange County microencapsulation facility, debt repayment, and tax rate.

A: Theodore Lee Harris talks about European antidumping duties on choline, progress on Orange County facility (completion expected early 2027, expected to boost revenue and earnings), Carl Martin Bengtsson discusses tax rate estimate around 22.5% and debt repayment depending on M&A and share repurchases.

Q: Daniel Scott Harriman asks about Specialty Products breakdown and Plant Nutrition geographic expansion.

A: Theodore Lee Harris states Specialty Products grew 7.5% with Performance Gases up 7% and Plant Nutrition up 13%, and details Plant Nutrition's geographic expansion in Latin America and Asia Pacific to balance seasonality.