Ascent Industries Co. Files Q3 2024 Report

Ticker: ACNT · Form: 10-Q · Filed: Nov 12, 2024 · CIK: 95953

Ascent Industries CO. 10-Q Filing Summary
FieldDetail
CompanyAscent Industries CO. (ACNT)
Form Type10-Q
Filed DateNov 12, 2024
Risk Levellow
Pages16
Reading Time19 min
Key Dollar Amounts$1.00
Sentimentneutral

Sentiment: neutral

Topics: quarterly-report, sec-filing, compliance

Related Tickers: ACNT

TL;DR

**ACNT filed its 10-Q for Q3 2024, all good on filings.**

AI Summary

Ascent Industries Co. filed its quarterly report for the period ending September 30, 2024. The company is incorporated in Delaware and its common stock trades on the NASDAQ Global Market under the symbol ACNT. Ascent Industries Co. has confirmed it has filed all required reports for the preceding 12 months and has submitted all Interactive Data Files electronically.

Why It Matters

This filing provides an update on Ascent Industries Co.'s financial and operational status for the third quarter of 2024, which is crucial for investors to assess the company's performance and outlook.

Risk Assessment

Risk Level: low — This filing is a routine quarterly report and does not contain any immediate red flags or significant negative developments.

Key Players & Entities

FAQ

What is the trading symbol for Ascent Industries Co.'s common stock?

The trading symbol for Ascent Industries Co.'s common stock is ACNT.

On which exchange is Ascent Industries Co.'s common stock traded?

Ascent Industries Co.'s common stock is traded on the NASDAQ Global Market.

In which state was Ascent Industries Co. incorporated?

Ascent Industries Co. was incorporated in Delaware.

Has Ascent Industries Co. filed all required reports for the preceding 12 months?

Yes, Ascent Industries Co. has filed all required reports for the preceding 12 months.

Has Ascent Industries Co. submitted all Interactive Data Files electronically for the preceding 12 months?

Yes, Ascent Industries Co. has submitted electronically every Interactive Data File required for the preceding 12 months.

Filing Stats: 4,679 words · 19 min read · ~16 pages · Grade level 16.8 · Accepted 2024-11-12 17:08:52

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Disclosure Regarding Forward Looking Statements 2 Item 1.

Financial Statements

Financial Statements Condensed Consolidated Balance Sheets as of September 30, 2024 (unaudited) and December 31, 2023 3 Condensed Consolidated Statements of Income (Loss) for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited) 4 Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 (unaudited) 5 Condensed Consolidated Statements of Shareholders' Equity for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited) 6 Notes to Condensed Consolidated Financial Statements (unaudited) Note 1: Basis of Presentation 8 Note 2: Discontinued Operations 9 Note 3: Revenue Recognition 10 Note 4: Fair Value of Financial Instruments 11 Note 5: Inventories 12 Note 6: Property, Plant and Equipment 13 Note 7: Intangible Assets and Deferred Charges 13 Note 8: Debt 14 Note 9: Leases 15 Note 10: Shareholders' Equity 17 Note 11: Earnings Per Share 18 Note 12: Income Taxes 18 Note 13: Commitments and Contingencies 19 Note 14: Industry Segments 19 Note 15: Subsequent Events 20

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 29

Controls and Procedures

Item 4. Controls and Procedures 29

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 30 Item 1A.

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 30

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 30

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 30

Other Information

Item 5. Other Information 30

Exhibits

Item 6. Exhibits 31

Signatures

Signatures 32 1 Table of Contents

Forward-Looking Statements

Forward-Looking Statements This Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and other applicable federal securities laws. All statements that are not historical facts are forward-looking statements. Forward looking statements can be identified through the use of words such as "estimate," "project," "intend," "expect," "believe," "should," "anticipate," "hope," "optimistic," "plan," "outlook," "should," "could," "may" and similar expressions. The forward-looking statements are subject to certain risks and uncertainties, including without limitation those identified below, which could cause actual results to differ materially from historical results or those anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements. The following factors could cause actual results to differ materially from historical results or those anticipated: adverse economic conditions, including risks relating to the impact and spread of and the government's response to COVID-19; inability to weather an economic downturn; the impact of competitive products and pricing; product demand and acceptance risks; raw material and other increased costs; raw material availability; financial stability of the Company's customers; customer delays or difficulties in the production of products; loss of consumer or investor confidence; employee relations; ability to maintain workforce by hiring trained employees; labor efficiencies; risks associated with acquisitions; environmental issues; negative or unexpected results from tax law changes; inability to comply with covenants and ratios required by the Company's debt financing arrangements; and other risks detailed from time-to-time in Ascent Industries Co.'s Securities and Exchange Commission filings, including our Annual Report on Form 10-K, which filings are available from the SEC. Ascent Industries Co. assumes no oblig

- Financial Information

Part I - Financial Information

Financial Statements

Item 1. Financial Statements Ascent Industries Co. Condensed Consolidated Balance Sheets (in thousands, except par value and share data) (Unaudited) September 30, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 8,547 $ 1,851 Accounts receivable, net of allowance for credit losses of $ 583 and $ 463 , respectively 27,768 26,604 Inventories 42,968 52,306 Prepaid expenses and other current assets 3,483 4,879 Assets held for sale — 2,912 Current assets of discontinued operations 56 861 Total current assets 82,822 89,413 Property, plant and equipment, net 26,654 29,755 Right-of-use assets, operating leases, net 28,623 27,784 Intangible assets, net 7,380 8,496 Deferred income taxes — 5,808 Deferred charges, net 29 104 Other non-current assets, net 3,108 1,935 Total assets $ 148,616 $ 163,295 Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 12,286 $ 16,416 Accrued expenses and other current liabilities 7,081 5,108 Current portion of note payable 641 360 Current portion of operating lease liabilities 1,448 1,140 Current portion of finance lease liabilities 288 292 Current liabilities of discontinued operations 222 1,473 Total current liabilities 21,966 24,789 Long-term portion of operating lease liabilities 30,433 29,729 Long-term portion of finance lease liabilities 1,089 1,307 Deferred income taxes 369 — Other long-term liabilities 54 60 Total non-current liabilities 31,945 31,096 Total liabilities $ 53,911 $ 55,885 Commitments and contingencies – See Note 13 Shareholders' equity: Common stock, par value $ 1 per share; 24,000,000 shares authorized; 11,085,103 and 10,092,966 shares issued and outstanding, respectively $ 11,085 $ 11,085 Capital in excess of par value 47,238 47,333 Retained earnings 45,946 58,517 104,269 116,935 Less: cost of common stock in treasury - 992,137 and 990,282 shares, respectively ( 9,564 ) ( 9,525 ) Total shareholders' equity 94,705 107

Notes to Consolidated Financial Statements (Unaudited )

Notes to Consolidated Financial Statements (Unaudited ) Unless indicated otherwise, the terms "Company," "we," "us," and "our" refer to Ascent Industries Co. and its consolidated subsidiaries. Note 1: Basis of Presentation Basis of Financial Statement Presentation The accompanying unaudited condensed consolidated financial statements and notes to the unaudited condensed consolidated financial statements are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The unaudited condensed consolidated financial statements, in the opinion of management, contain all normal recurring adjustments necessary to present a fair statement of the condensed consolidated balance sheets as of September 30, 2024, the statements of income (loss) and shareholders' equity for the three and nine months ended September 30, 2024 and 2023, and the statements of cash flows for the nine months ended September 30, 2024 and 2023. The December 31, 2023 condensed consolidated balance sheet was derived from the audited financial statements. These interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 (the "Annual Report"). The financial results for the interim periods may not be indicative of the financial results for the entire year as our future assessment of our current expectations could result in material impacts to our consolidated financial statements in future reporting periods. Use of Estimates The preparation of the Company's financial statements in accordance with accounting principles generally accepted in the United States of America requires

Notes to Consolidated Financial Statements (Unaudited )

Notes to Consolidated Financial Statements (Unaudited ) adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and footnote disclosures. In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures. The ASU requires updated disclosures, in the notes to the financial statements, of specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity disclose the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion, and amortization recognized as part of oil and gas producing activities included in relevant expense captions. The amendments also require disclosure of qualitative descriptions of amounts remaining in relevant expense captions that are not separately disaggregated and to disclose the total amount of selling expenses as well as the entity's definition of selling expenses. The ASU is effective for the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2027, and subsequent interim periods, with early adoption permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and footnote disclosures Recent accounting pronouncements pending adoption not discussed in this Form 10-Q are either not applicable to the Company or are not expected to have a material impact on the Company. Note 2: Discontinued Operations Munhall Closure During the second quarter of 2023, the Board of Directors of the Company made the decision to permanently cease operations at Munhall effective on or around August 31, 2023. The strategic decision to cease manufacturing operations at Munhall is part of the Company's ongoing efforts to consolidate manuf

Notes to Consolidated Financial Statements (Unaudited )

Notes to Consolidated Financial Statements (Unaudited ) (in thousands) September 30, 2024 December 31, 2023 Carrying amounts of assets included as part of discontinued operations: Accounts receivable, net $ — $ 778 Prepaid expenses and other current assets 56 83 Current assets classified as discontinued operations 56 861 Carrying amounts of current liabilities included as part of discontinued operations: Accounts payable 9 107 Accrued expenses and other current liabilities 213 1,366 Total current liabilities classified as discontinued operations $ 222 $ 1,473 The financial results are presented as loss from discontinued operations, net of tax on the unaudited condensed consolidated statements of income (loss). The following table summarizes the results of the Company's discontinued operations: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2024 2023 2024 2023 Net sales $ 29 $ 12,016 $ 290 $ 57,547 Cost of sales 466 12,974 2,064 56,393 Gross profit ( 437 ) ( 958 ) ( 1,774 ) 1,154 Selling, general and administrative expense ( 1,899 ) 742 ( 1,758 ) 6,326 Acquisition costs and other 5 135 124 213 Asset impairments — 2,416 1,115 8,803 Income (loss) from discontinued operations before income taxes 1,457 ( 4,251 ) ( 1,255 ) ( 14,188 ) Income tax expense (benefit) 593 ( 997 ) 7 ( 3,036 ) Net income (loss) from discontinued operations $ 864 $ ( 3,254 ) $ ( 1,262 ) $ ( 11,152 ) Note 3: Revenue Recognition Revenue is generated primarily from contracts to produce, ship and deliver stainless steel and specialty chemical products. Revenues are recognized when control of the promised goods or services is transferred to our customers upon shipment, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The Company's revenues are derived from contracts with customers where performance obligations are satisfied at a point-in-time or over-time. For certain cont

Notes to Consolidated Financial Statements (Unaudited )

Notes to Consolidated Financial Statements (Unaudited ) The following table presents the Company's revenues, disaggregated by product group from continuing operations: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2024 2023 2024 2023 Fiberglass and steel liquid storage tanks and separation equipment $ — $ — $ —

View Full Filing

View this 10-Q filing on SEC EDGAR

View on Read The Filing