PHIBRO ANIMAL HEALTH CORP
For the period ended Mar 31, 2026. Filed May 6, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 6, 2026
PAHC$32.96-6.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-12-31; filed 2026-02-04.
0001104659-26-010317
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-06.
0001104659-26-056280
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 135 previous paragraphs and 139 current paragraphs.
90 unchanged; 40 reworded; 7 added; 4 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 58 previous and 58 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
On April 28, 2026, the 2024 Credit Agreement was amended to increase our borrowing capacity by expanding the Revolving Credit Commitments by $125.0 million, from $310.0 million to an aggregate commitment of $435.0 million. The expanded borrowing capacity provides the Company with enhanced operating flexibility. Fees of approximately $0.6 million were incurred to execute this amendment and will be amortized to interest expense through the maturity date of the Revolving Credit Commitments.
Current report
Middle East Conflicts
Current report
In February 2026, the Supreme Court of the United States ruled that tariffs previously imposed under the International Emergency Economic Powers Act (“IEEPA”) were not authorized. In response to this ruling, we are pursuing the potential recovery of IEEPA tariffs previously paid and expect to submit claims through the administrative process administered by U.S. Customs and Border Protection for the refund of tariffs previously paid by the Company. The ruling did not address potential refunds, and therefore the ultimate availability, timing, and amount of the recovery of any potential refunds of these tariffs is highly uncertain and may be subject to further legal, regulatory, and administrative developments. Accordingly, the Company has not recognized any receivable or benefit related to these potential recoveries in its financial statements as of March 31, 2026 and will continue to monitor relevant developments and evaluate the recognition of such recoveries in future periods.
Current report
Net sales of vaccines increased $5.2 million, or 16%, primarily due to an increase in international sales driven by higher demand in Israel, as well as an increase in domestic swine demand and higher sales of autogenous vaccines.
Current report
Foreign currency losses (gains), net
Current report
Comparison of nine months ended March 31, 2026 and 2025
Current report
Net sales of nutritional specialty products increased $13.3 million, or 10%, due to an increase in worldwide demand, particularly in North America, and higher companion animal sales.
Removed paragraphs (4)
Previous report
Israel and Hamas
Previous report
Comparison of six months ended December 31, 2025 and 2024
Previous report
Net sales of nutritional specialty products increased $9.8 million, or 11%, due to increased North American demand for dairy.
Previous report
Foreign currency losses, net
Reworded paragraphs (40)
Previous wording
In April 2024, the Company entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with Zoetis Inc., a Delaware corporation (“Zoetis”) to acquire Zoetis’s medicated feed additive (“MFA”) portfolio, certain water-soluble products and related assets (the “Acquisition”). On October 31, 2024, the Company completed the Acquisition at a purchase price of approximately $297.5 million ($286.5 million, as adjusted, net of cash acquired). The Acquisition was funded by term loan borrowings under the 2024 Credit Agreement. Since the Acquisition, the product portfolio acquired has contributed $382.8 million to our overall net sales, of which $94.1 million and $36.7 million were recorded in the three months ended December 31, 2025 and 2024, and $174.6 million and $36.7 million were recorded in the six months ended December 31, 2025 and 2024, respectively. Also included in the Acquisition are six manufacturing sites, comprised of four in the U.S., one in Italy and one in China. The results of operations of the Acquisition are included in our consolidated statements of operations from the date of acquisition and reported within the Animal Health segment.
Current wording
In April 2024, the Company entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with Zoetis Inc., a Delaware corporation (“Zoetis”) to acquire Zoetis’s medicated feed additive (“MFA”) portfolio, certain water-soluble products and related assets (the “Acquisition”). On October 31, 2024, the Company completed the Acquisition at a purchase price of approximately $297.5 million ($286.5 million, as adjusted, net of cash acquired). The Acquisition was funded by term loan borrowings under the 2024 Credit Agreement. Since the Acquisition, the product portfolio acquired has contributed $478.7 million to our overall net sales, of which $95.9 million and $77.0 million were recorded in the three months ended March 31, 2026 and 2025, and $270.5 million and $113.7 million were recorded in the nine months ended March 31, 2026 and 2025, respectively. Also included in the Acquisition were six manufacturing sites, comprised of four in the U.S., one in Italy and one in China. The results of operations of the Acquisition are included in our consolidated statements of operations from the date of acquisition and reported within the Animal Health segment.
Previous wording
Since the October 2023 attack on Israel by Hamas, Israel has been engaged in ongoing hostilities along its northern and southern borders, and tensions in the broader Middle East, including with Iran, remain elevated. The situation in the region is volatile, unpredictable, and subject to rapid escalation.
Current wording
Since October 2023, Israel has been engaged in ongoing hostilities along its northern and southern borders, and tensions in the broader Middle East, including with Iran, remain elevated. The situation in the region is volatile, unpredictable, and subject to rapid escalation.
Previous wording
We have three manufacturing sites in Israel. A manufacturing plant in Neot Hovav that produces active pharmaceutical ingredients for certain of our anticoccidial and antimicrobial products, a facility in Beit Shemesh that produces vaccines and a plant in Petah Tikvah that manufactures premix products and nutritional products. In addition, we have an office location near Tel Aviv in Airport City. As of December 31, 2025, we had approximately 500 employees located in Israel. We have confidence in our ability to meet our supply commitment to customers and maintain sufficient inventory to continue regional support. Our operations in Israel have navigated numerous challenging situations over the years.
Current wording
We have three manufacturing sites in Israel. A manufacturing plant in Neot Hovav that produces active pharmaceutical ingredients for certain of our anticoccidial and antimicrobial products, a facility in Beit Shemesh that produces vaccines and a plant in Petah Tikvah that manufactures premix products and nutritional products. In addition, we have an office location near Tel Aviv in Airport City. As of March 31, 2026, we had approximately 520 employees located in Israel. We have confidence in our ability to meet our supply commitment to customers and maintain sufficient inventory to continue regional support. Our operations in Israel have navigated numerous challenging situations over the years.
Previous wording
The resumption of conflicts in this region may trigger bans, economic and other sanctions, as well as broader military conflict, which could include neighboring nations and their respective allies. The potential impact of the current conflict, or escalation thereof, on our business is unclear but may include, without limitation, the possible disruption of our operations, particularly at our facilities in Israel, supply chain and logistics disruptions, personnel and raw material shortages, and other consequences, including as a result of the actions of, or disruption of the operations of, certain regulatory and governmental authorities and of certain of our suppliers, collaborative partners, licensees, manufacturing sites, distributors and customers.
Current wording
The continuation and/or escalation of conflicts in the region may trigger additional bans, economic and other sanctions, as well as broader military actions, which could include neighboring nations and their respective allies. The potential impact of the current conflicts, or escalation thereof, on our business is unclear but may include, without limitation, the possible disruption of our operations, particularly at our facilities in Israel, supply chain and logistics disruptions, personnel and raw material shortages, and other consequences, including as a result of the actions of, or disruption of the operations of, certain regulatory and governmental authorities and of certain of our suppliers, collaborative partners, licensees, manufacturing sites, distributors and customers.
Previous wording
Our Israeli manufacturing facilities and local operations account for 16% of our consolidated assets as of December 31, 2025, and 16% of our consolidated net sales for the six months ended December 31, 2025.
Current wording
Our Israeli manufacturing facilities and local operations account for 17% of our consolidated assets as of March 31, 2026, and 16% of our consolidated net sales for the nine months ended March 31, 2026.
Previous wording
In 2018, the Ministry of Agriculture in Brazil (“MAPA”), published an ordinance to ban the use of antimicrobials used at sub-therapeutic levels for growth promotion and feed efficiency in animal feed. The ordinance was in response to international pressure and scientific concerns about the potential risks of antimicrobial resistance. The Company’s virginiamycin product is currently registered and used at sub-therapeutic levels in cattle, broilers, layers and swine in Brazil. The Company and key stakeholders (trade associations) requested that MAPA allow sponsors time to shift from growth promotion claims to therapeutic claims. In 2022 and more recently in 2025, additional MAPA public consultations were held to discuss the prohibition on the use of antimicrobials as growth promoters. These discussions affect the Company’s virginiamycin product in Brazil, which is the only remaining key livestock production market where virginiamycin does not yet have therapeutic indications. The Company has been actively conducting studies to address MAPA’s requirements to obtain therapeutic indications for virginiamycin in Brazil and has submitted dossiers to MAPA for approval.
Current wording
In 2018, the Ministry of Agriculture in Brazil (“MAPA”), published an ordinance to ban the use of antimicrobials used at sub-therapeutic levels for growth promotion and feed efficiency in animal feed. The ordinance was in response to international pressure and scientific concerns about the potential risks of antimicrobial resistance. The Company’s virginiamycin product is currently registered and used for growth promotion in cattle, broilers, layers and swine in Brazil. The Company and key stakeholders (trade associations) requested that MAPA allow sponsors time to shift from growth promotion claims to therapeutic claims. In 2022 and more recently in 2025, additional MAPA public consultations were held to discuss the prohibition on the use of antimicrobials as growth promoters. These discussions affect the Company’s virginiamycin product in Brazil, which is the only remaining key livestock production market where virginiamycin does not yet have therapeutic indications.. On April 27, 2026, MAPA published its Ordinance prohibiting the importation, manufacture, marketing and use of performance enhancing feed additives containing antimicrobials classified as important in human or veterinary medicine, including virginiamycin and bacitracin. There will be a transition period of 180 days from the date of the ordinance, during which time companies and customers may continue to use and sell the products under their current labels. The Company has been actively conducting studies to address MAPA’s requirements to obtain therapeutic indications for virginiamycin. These registrations are in the final stages of review and approval by MAPA and are expected during the transition period. Phibro’s bacitracin product already carries therapeutic claims in Brazil.
Previous wording
Net sales of $373.9 million for the three months ended December 31, 2025 increased $64.6 million, or 21%, as compared to the three months ended December 31, 2024. Animal Health increased $60.6 million, Mineral Nutrition increased $5.7 million, and Performance Products decreased $1.6 million.
Current wording
Net sales of $383.5 million for the three months ended March 31, 2026 increased $35.7 million, or 10%, as compared to the three months ended March 31, 2025. Animal Health increased $32.8 million, Mineral Nutrition increased $6.6 million, and Performance Products decreased $3.8 million.
Previous wording
Net sales of $290.0 million for the three months ended December 31, 2025 increased $60.6 million, or 26%. Net sales of MFAs and other increased $51.8 million, or 34%, due to incremental revenues of $57.5 million from sales of products from the MFA portfolio acquired on October 31, 2024, partially offset by the timing of purchases by a large customer.
Current wording
Net sales of $291.2 million for the three months ended March 31, 2026 increased $32.8 million, or 13%. Net sales of MFAs and other increased $24.1 million, or 13%, due to an $18.9 million increase in the sales of products from the MFA portfolio acquired on October 31, 2024, increased demand for certain of our legacy MFAs in North America and for certain anti-microbials sold by our ethanol performance business.
Previous wording
Net sales of nutritional specialty products increased $4.3 million, or 9%, primarily due to increased North American demand for dairy.
Current wording
Net sales of nutritional specialty products increased $3.5 million, or 8%, primarily due to increased demand in North America and higher companion animal sales.
Previous wording
Net sales of $68.9 million for the three months ended December 31, 2025 increased $5.7 million, or 9%, due to an increase in demand for trace minerals and zinc.
Current wording
Net sales of $73.4 million for the three months ended March 31, 2026 increased $6.6 million, or 10%, due to an increase in demand for zinc and trace minerals.
Previous wording
Net sales of $15.0 million for the three months ended December 31, 2025 decreased $1.6 million, or 10%, as a result of lower demand for the ingredients used in personal care products.
Current wording
Net sales of $18.9 million for the three months ended March 31, 2026 decreased $3.8 million, or 17%, as a result of lower demand for the ingredients used in personal care products.
Previous wording
Gross profit of $132.7 million for the three months ended December 31, 2025 increased $30.8 million, or 30%, as compared to the three months ended December 31, 2024. Gross margin increased 260 basis points to 35.5% of net sales for the three months ended December 31, 2025, as compared to 32.9% for the three months ended December 31, 2024. The comparison of gross profit to the prior year includes a net decrease of $0.8 million for acquisition-related cost of goods sold related to the purchase accounting for the Acquisition. Excluding this purchase accounting item, gross profit increased $30.0 million, or 29%, and gross margin increased 220 basis points to 35.7% of net sales due to increased sales, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs and the unfavorable impact of changes in foreign currency exchange rates.
Current wording
Gross profit of $125.7 million for the three months ended March 31, 2026 increased $21.1 million, or 20%, as compared to the three months ended March 31, 2025. Gross margin increased 270 basis points to 32.8% of net sales for the three months ended March 31, 2026, as compared to 30.1% for the three months ended March 31, 2025. The comparison of gross profit to the prior year includes $3.8 million of prior period inventory write-offs attributable to the closure of an immaterial business, $1.7 million for prior period acquisition-related cost of goods sold related to the purchase accounting for the Acquisition, and a net increase in acquisition-related depreciation expense associated with the step-up of fair value of the acquired fixed assets and intangible asset amortization of $1.1 million. Excluding these items, gross profit increased $16.7 million, or 15%, and gross margin increased 130 basis points to 33.5% of net sales due to increased sales volume, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs.
Previous wording
Animal Health gross profit, excluding the purchase accounting item discussed above, increased $67.2 million, driven byhigher sales volume, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs and the unfavorable impact of changes in foreign currency exchange rates. Mineral Nutrition gross profit increased $1.4 million, driven by increased sales volume. Performance Products gross profit decreased $1.2 million, primarily as a result of lower demand.
Current wording
Animal Health gross profit, excluding the non-recurring items discussed above, increased $18.3 million, primarily driven by increased sales volume, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs. Mineral Nutrition gross profit decreased $0.6 million, as the impact of higher unit costs exceeded the increase in sales volume. Performance Products gross profit decreased $1.0 million, primarily as a result of lower demand.
Previous wording
SG&A of $82.3 million for the three months ended December 31, 2025 increased $6.0 million, or 8%, as compared to the three months ended December 31, 2024. SG&A for the three months ended December 31, 2025 included $3.6 million of costs associated with Phibro Forward income growth initiatives, $0.2 million for acquisition-related costs, and $0.2 million of stock-based compensation expense related to awards granted to certain named executive officers in fiscal year 2024. SG&A for the three months ended December 31, 2024 included $8.8 million of acquisition-related costs, $1.7 million of costs associated with Phibro Forward income growth initiatives, and $0.2 million of stock-based compensation expense, partially offset by $1.3 million related to an insurance settlement gain. Excluding these items, SG&A increased $11.4 million, or 17%.
Current wording
SG&A of $81.0 million for the three months ended March 31, 2026 increased $10.0 million, or 14%, as compared to the three months ended March 31, 2025. SG&A for the three months ended March 31, 2026 included $3.4 million of costs associated with Phibro Forward income growth initiatives, $0.6 million for intangible asset amortization, $0.1 million for acquisition-related costs, and $0.2 million of stock-based compensation expense related to awards granted to certain named executive officers in fiscal year 2024. SG&A for the three months ended March 31, 2025 included $4.0 million of costs associated with Phibro Forward income growth initiatives, $0.6 million for acquisition-related costs, $0.6 million for intangible asset amortization, and $0.2 million of stock-based compensation expense, partially offset by $1.5 million related to an insurance settlement gain. Excluding these items, SG&A increased $9.5 million, or 14%.
Previous wording
Animal Health SG&A, excluding the non-recurring Animal Health-related items discussed above, increased $13.9 million due to an increase in employee-related costs due in part to the incremental headcount added as part of the Acquisition. Mineral Nutrition SG&A was comparable to the prior year, and Performance Products SG&A increased $0.4 million. Corporate expenses, excluding the non-recurring Corporate-related items discussed above, increased $7.1 million due to an increase in employee-related costs.
Current wording
Animal Health SG&A, excluding the non-recurring Animal Health related items discussed above, increased $9.0 million, primarily due to an increase in employee-related costs. Mineral Nutrition and Performance Products SG&A was comparable to the prior year. Corporate costs, excluding the non-recurring Corporate related items discussed above, increased $0.4 million due to an increase in employee-related costs.
Previous wording
Interest expense, net of $11.8 million for the three months ended December 31, 2025 increased $2.8 million, as compared to the three months ended December 31, 2024, due to higher average debt levels associated with the financing of the Acquisition, as well as the expiration of a favorable interest rate swap agreement on $300.0 million of notional debt principal.
Current wording
Interest expense, net of $10.4 million for the three months ended March 31, 2026 increased $1.1 million, as compared to the three months ended March 31, 2025, due to the expiration of a favorable interest rate swap agreement on $300.0 million of notional debt principal, partially offset by lower interest rates and higher patronage income received from the lenders providing the Term A-2 Loan (see “Notes to Consolidated Financial Statements—Debt”).
Previous wording
Foreign currency losses, net for the three months ended December 31, 2025 were $2.1 million, as compared to $11.7 million of net losses for the three months ended December 31, 2024. Current period gains/losses were driven by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Argentine Peso and the Israeli New Shekel. Prior year period losses were driven in large part by fluctuations in the Brazil Real.
Current wording
Foreign currency losses, net for the three months ended March 31, 2026 were $1.9 million, as compared to $5.5 million of net gains for the three months ended March 31, 2025. Current period losses were driven by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Euro and the Brazil Real. Prior year period gains were driven in large part by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Brazil Real and in the Euro.
Previous wording
The provision for income taxes was $9.0 million and $1.7 million for the three months ended December 31, 2025 and 2024, respectively. The effective income tax rate was 24.6% and 34.2% for the three months ended December 31, 2025 and 2024, respectively.
Current wording
The provision for income taxes was $8.3 million and $8.8 million for the three months ended March 31, 2026 and 2025, respectively. The effective income tax rate was 25.7% and 29.7% for the three months ended March 31, 2026 and 2025, respectively.
Previous wording
The effective income tax rate in the current period included among other items (i) a $0.2 million expense from changes in uncertain tax positions related to prior years and (ii) certain other charges, including acquisition-related costs, foreign currency losses, and certain stock-based compensation, which had lower tax rates. The effective income tax rate in the prior year included (i) various exchange rate losses, (ii) changes in uncertain tax positions related to prior years, and (iii) certain other charges, including acquisition-related costs. Excluding these items, the effective income tax rate was 23.7% and 26.3% for the three months ended December 31, 2025 and 2024, respectively.
Current wording
The effective income tax rate in the current period included among other items (i) a $0.2 million expense from changes in uncertain tax positions related to prior years and (ii) certain other charges, including acquisition-related costs, foreign currency losses, and certain stock-based compensation, which had lower tax rates. The effective income tax rate in the prior year included (i) various exchange rate gains, (ii) changes in uncertain tax positions related to prior years and (iii) certain non-deductible write-offs in connection with the closure of an immaterial business included as part of the Phibro Forward initiatives. Excluding these items, the effective income tax rate was 24.6% and 25.8% for the three months ended March 31, 2026 and 2025, respectively.
Previous wording
Net income of $27.5 million for the three months ended December 31, 2025 increased $24.3 million, as compared to net income of $3.2 million for the three months ended December 31, 2024. Operating income increased $24.8 million, driven by favorable gross profit, partially offset by higher SG&A. Gross profit increased $30.8 million primarily as a result of higher sales in the Animal Health segment, driven in part by incremental revenues associated with sales from the MFA portfolio acquired on October 31, 2024. SG&A increased $6.0 million due to higher employee-related costs and a net increase of $1.9 million of costs associated with Phibro Forward income growth initiatives. Interest expense, net increased $2.8 million due to higher debt levels, due in part to the financing of the Acquisition and the expiration of an interest rate swap agreement. Foreign currency losses, net decreased $9.6 million. Income tax expense increased $7.3 million.
Current wording
Net income of $24.0 million for the three months ended March 31, 2026 increased $3.1 million, as compared to net income of $20.9 million for the three months ended March 31, 2025. Operating income increased $11.1 million, driven by favorable gross profit, partially offset by higher SG&A. Gross profit increased $21.1 million primarily as a result of higher sales in the Animal Health segment, primarily drivenby incremental revenues associated with sales from the MFA portfolio acquired on October 31, 2024. SG&A increased $10.0 million due to higher employee-related costs. Interest expense, net increased $1.1 million due to the expiration of an interest rate swap agreement. Foreign currency losses were $1.9 million for the three months ended March 31, 2026, as compared to gains of $5.5 million for the three months ended March 31, 2025. Income tax expense decreased $0.5 million.
Previous wording
Net sales of $737.8 million for the six months ended December 31, 2025 increased $168.1 million, or 30%, as compared to the six months ended December 31, 2024. Animal Health sales increased $161.5 million. Mineral Nutrition sales increased $9.6 million and Performance Products sales decreased $3.0 million.
Current wording
Net sales of $1,121.3 million for the nine months ended March 31, 2026 increased $203.8 million, or 22%, as compared to the nine months ended March 31, 2025. Animal Health sales increased $194.3 million. Mineral Nutrition sales increased $16.3 million and Performance Products sales decreased $6.8 million.
Previous wording
Net sales of $573.4 million for the six months ended December 31, 2025 increased $161.5 million, or 39%. Net sales of MFAs and other increased $139.1 million, or 54%, due to incremental revenues of $137.9 million from sales of products from the MFA portfolio acquired on October 31, 2024 and increased demand for certain of our MFAs in North and South America, partially offset by the timing of purchases by a large customer.
Current wording
Net sales of $864.7 million for the nine months ended March 31, 2026 increased $194.3 million, or 29%. Net sales of MFAs and other increased $163.3 million, or 37%, due to incremental revenues of $156.8 million from sales of products from the MFA portfolio acquired on October 31, 2024, increased demand for certain of our legacy MFAs in North America and for certain anti-microbials sold by our ethanol performance business.
Previous wording
Net sales of vaccines increased $12.5 million, or 19%, primarily due to continued growth of poultry products in Latin America and increase in international demand, particularly in Southeast Asia.
Current wording
Net sales of vaccines increased $17.8 million, or 18%, primarily due to continued growth of poultry products in Latin America and increase in other international demand, particularly in Israel and Southeast Asia.
Previous wording
Net sales of $131.9 million for the six months ended December 31, 2025 increased $9.6 million, or 8%, due to an increase in demand for copper, zinc and trace minerals.
Current wording
Net sales of $205.4 million for the nine months ended March 31, 2026 increased $16.3 million, or 9%, due to an increase in demand for copper, zinc and trace minerals.
Previous wording
Net sales of $32.4 million for the six months ended December 31, 2025 decreased $3.0 million, or 8%, as a result of lower demand for the ingredients used in personal care products.
Current wording
Net sales of $51.3 million for the nine months ended March 31, 2026 decreased $6.8 million, or 12%, as a result of lower demand for the ingredients used in personal care products.
Previous wording
Gross profit of $252.4 million for the six months ended December 31, 2025 increased $67.1 million, or 36%, as compared to the six months ended December 31, 2024. Gross margin increased 170 basis points to 34.2% of net sales for the six months ended December 31, 2025, as compared to 32.5% for the six months ended December 31, 2024. The comparison of gross profit to the prior year includes a net increase of $0.3 million for acquisition-related cost of goods sold related to purchase accounting adjustments for the Acquisition. Excluding this purchase accounting item, gross profit increased $67.4 million, or 36%, and gross margin increased 170 basis points to 34.5% of net sales due to increased sales, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs and the unfavorable impact of changes in foreign currency exchange rates.
Current wording
Gross profit of $378.1 million for the nine months ended March 31, 2026 increased $88.2 million, or 30%, as compared to the nine months ended March 31, 2025. Gross margin increased 210 basis points to 33.7% of net sales for the nine months ended March 31, 2026, as compared to 31.6% for the nine months ended March 31, 2025. The comparison of gross profit to the prior year includes $3.8 million of prior period inventory write-offs attributable to the closure of an immaterial business, a net decrease of $1.4 million for acquisition-related cost of goods sold related to purchase accounting adjustments for the Acquisition, and a net increase in acquisition-related depreciation expense associated with the step-up of fair value of the acquired fixed assets and intangible asset amortization of $2.9 million. Excluding these items, gross profit increased $85.9 million, or 28%, and gross margin increased 160 basis points to 34.6% of net sales due to increased sales volume, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs.
Previous wording
Animal Health gross profit, excluding the purchase accounting item discussed above, increased $29.8 million, primarily driven by increased sales, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs and the unfavorable impact of changes in foreign currency exchange rates. Mineral Nutrition gross profit increased $0.8 million, driven by increased sales volume. Performance Products gross profit decreased $0.6 million, primarily as a result of lower demand.
Current wording
Animal Health gross profit, excluding the non-recurring items discussed above, increased $87.4 million, primarily driven by sales volume, favorable product mix, and increases in average selling prices, partially offset by higher input and distribution costs. Mineral Nutrition gross profit increased $0.7 million, driven by increased sales volume and higher average selling prices. Performance Products gross profit decreased $2.2 million, primarily as a result of lower demand.
Previous wording
SG&A of $150.9 million for the six months ended December 31, 2025 increased $8.7 million, or 6%, as compared to the six months ended December 31, 2024. SG&A for the six months ended December 31, 2025, included $3.6 million of costs associated with Phibro Forward income growth initiatives, $0.5 million for acquisition-related costs, and $0.4 million of stock-based compensation expense related to awards granted to certain named executive officers in fiscal year 2024, partially offset by $3.8 million related to insurance settlement gains. SG&A for the six months ended December 31, 2024, included $12.2 million for acquisition-related costs, $2.0 million of costs associated with Phibro Forward income growth initiatives, and $0.4 million of stock-based compensation expense, partially offset by a $1.3 million insurance settlement gain. Excluding these items, SG&A increased $21.4 million.
Current wording
SG&A of $231.9 million for the nine months ended March 31, 2026 increased $18.7 million, or 9%, as compared to the nine months ended March 31, 2025. SG&A for the nine months ended March 31, 2026 included $7.0 million of costs associated with Phibro Forward income growth initiatives, $1.8 million for intangible asset amortization, $0.6 million for acquisition-related costs, and $0.5 million of stock-based compensation expense related to awards granted to certain named executive officers in fiscal year 2024, partially offset by $3.8 million related to insurance settlement gains. SG&A for the nine months ended March 31, 2025, included $12.9 million for acquisition-related costs, $6.0 million of costs associated with Phibro Forward income growth initiatives, $1.8 million for intangible asset amortization, and $0.5 million of stock-based compensation expense, partially offset by $2.8 million related to insurance settlement gains. Excluding these items, SG&A increased $31.0 million.
Previous wording
Animal Health SG&A, excluding the non-recurring Animal Health related items discussed above, increased $7.1 million, primarily due to an increase in employee-related costs due in part to the incremental headcount added as part of the Acquisition. Mineral Nutrition SG&A increased $0.2 million, and Performance Products SG&A increased $0.4 million. Corporate costs, excluding the non-recurring Corporate related items discussed above, increased $3.7 million due to an increase in employee-related costs.
Current wording
Animal Health SG&A, excluding the non-recurring Animal Health-related items discussed above, increased $23.0 million due to an increase in employee-related costs due in part to the incremental headcount added as part of the Acquisition. Mineral Nutrition SG&A was comparable to the prior year, and Performance Products SG&A increased $0.5 million. Corporate expenses,
Previous wording
Interest expense, net of $23.8 million for the six months ended December 31, 2025 increased $7.2 million, or 43%, as compared to the six months ended December 31, 2024, due to higher average debt levels associated with the financing of the Acquisition, as well as the expiration of a favorable interest rate swap agreement on $300.0 million of notional debt principal.
Current wording
Interest expense, net of $34.2 million for the nine months ended March 31, 2026 increased $8.3 million, or 32%, as compared to the nine months ended March 31, 2025, due to the expiration of a favorable interest rate swap agreement on $300.0 million of notional debt principal and higher average term loan balances associated with the financing of the Acquisition. These factors are partially offset by lower average revolving credit facility borrowings, lower interest rates, and higher patronage income received from the lenders providing the Term A-2 Loan (see “Notes to Consolidated Financial Statements—Debt”). The comparison of interest expense to the prior year is also impacted by $2.0 million in certain prior year costs and charges resulting from the refinancing of the 2024 Credit Agreement, including $1.5 million of new creditor and third-party financing costs and $0.5 million in debt extinguishment costs.
Previous wording
Foreign currency losses, net for the six months ended December 31, 2025 were $5.1 million, as compared to net losses of $12.1 million for the six months ended December 31, 2024. Current period losses were driven by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Argentine Peso and the Israeli New Shekel. Prior year period losses were driven most prominently by fluctuations in the Brazil Real.
Current wording
Foreign currency losses, net for the nine months ended March 31, 2026 were $7.0 million, as compared to net losses of $6.6 million for the nine months ended March 31, 2025. Current period losses were driven by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Argentine Peso and the Israeli New Shekel. Prior year period losses were driven by fluctuations in certain currencies related to the U.S. dollar, most prominently, in the Brazil Real, the Argentine Peso, and the Mexican Peso.
Previous wording
The provision for income taxes was $18.7 million and $4.3 million for the six months ended December 31, 2025 and 2024, respectively. The effective income tax rate was 25.7% and 29.7% for the six months ended December 31, 2025 and 2024, respectively.
Current wording
The provision for income taxes was $27.0 million and $13.1 million for the nine months ended March 31, 2026 and 2025, respectively. The effective income tax rate was 25.7% and 29.7% for the nine months ended March 31, 2026 and 2025, respectively.
Previous wording
The effective income tax rate in the current period included among other items, (i) a $0.4 million expense from changes in uncertain tax positions related to prior years, (ii) $3.8 million in insurance proceeds taxed at a lower rate, and (iii) certain other charges, including acquisition-related costs, foreign currency losses, and certain stock-based compensation, which had lower tax rates. The effective income tax rate in the prior year included (i) various exchange rate losses (ii) changes in uncertain tax positions related to prior years and (iii) certain other charges, including acquisition-related costs, which had lower tax rates. Excluding these items, the effective income tax rate was 24.7% and 25.0% for the six months ended December 31, 2025 and 2024, respectively.
Current wording
The effective income tax rate in the current period included among other items, (i) a $0.6 million expense from changes in uncertain tax positions related to prior years, (ii) $3.8 million in insurance proceeds taxed at a lower rate, and (iii) certain other charges, including acquisition-related costs, foreign currency losses, and certain stock-based compensation, which had lower tax rates. The effective income tax rate in the prior year included (i) various exchange rate losses, (ii) changes in uncertain tax positions related to prior years and (iii) certain non-deductible write-offs in connection with the closure of an immaterial business included as part of the Phibro Forward initiatives. Excluding these items, the effective income tax rate was 24.7% and 25.3% for the nine months ended March 31, 2026 and 2025, respectively.
Previous wording
Net income was $54.0 million for the six months ended December 31, 2025, as compared to net income of $10.2 million for the six months ended December 31, 2024. Operating income increased $58.4 million driven by higher gross profit, partially offset by higher SG&A of $8.7 million due to higher employee-related costs and a net increase of $1.6 million in costs associated with Phibro Forward income growth initiatives. Interest expense, net increased $7.2 million due to higher debt levels associated with the refinancing of the Company’s debt and the expiration of an interest rate swap agreement. Foreign currency losses, net decreased $7.1 million. Income tax expense increased $14.4 million.
Current wording
Net income was $78.0 million for the nine months ended March 31, 2026, as compared to net income of $31.0 million for the nine months ended March 31, 2025. Operating income increased $69.5 million driven by higher gross profit, partially offset by higher SG&A of $18.7 million due to higher employee-related costs. Interest expense, net increased $8.3 million due to the expiration of an interest rate swap agreement and higher debt levels associated with the refinancing of the Company’s debt. Foreign currency losses, net increased $0.4 million. Income tax expense increased $13.9 million.
Previous wording
Operating activities provided $28.7 million of net cash for the six months ended December 31, 2025. Cash provided by net income, adjusted for the non-cash items, including depreciation and amortization, was $87.3 million. Cash used in the ordinary course of business from changes in operating assets and liabilities was $58.6 million. Accounts receivable provided $13.7 million of cash due to the timing of collection of sales proceeds and higher sales. Inventories used $73.2 million of cash due to increased quantities on hand due to timing of inventory purchases and forecasted future demand. Accounts payable used $3.9 million of cash due to timing of purchases and payments. Accrued expenses and other liabilities used cash of $2.7 million, primarily due to timing of incurrence.
Current wording
Operating activities provided $44.9 million of net cash for the nine months ended March 31, 2026. Cash provided by net income, adjusted for the non-cash items, including depreciation and amortization, was $130.2 million. Cash used in the ordinary course of business from changes in operating assets and liabilities was $85.3 million. Accounts receivable provided $8.9 million of cash due to the timing of collection of sales proceeds and higher sales. Inventories used $92.5 million of cash due to increased quantities on hand due to timing of inventory purchases and forecasted future demand. Accounts payable used $6.8 million of cash due to timing of purchases and payments.
Previous wording
Investing activities used $38.2 million of net cash for the six months ended December 31, 2025. Capital expenditures were $24.9 million, as we continue to invest in expanding production capacity and productivity improvements. Purchases of our short-term investments used $24.0 million in cash, and maturities of our short-term investments provided $14.0 million in cash. Investing activities for the six months ended December 31, 2025 included funding of $6.5 million of investments and loans for strategic partnerships and the receipt of proceeds of $3.7 million from corporate-owned life insurance policies.
Current wording
Investing activities used $55.0 million of net cash for the nine months ended March 31, 2026. Capital expenditures were $40.2 million, as we continue to invest in expanding production capacity and productivity improvements. Purchases of our short-term investments used $37.0 million in cash, and maturities of our short-term investments provided $23.5 million in cash. Investing activities for the nine months ended March 31, 2026 included funding of $6.2 million of net investments and loans for strategic partnerships and the receipt of proceeds of $3.7 million from corporate-owned life insurance policies.
Previous wording
Financing activities used $2.6 million of net cash for the six months ended December 31, 2025. Net revolver borrowings on our credit facility provided $20.0 million in cash. We paid $9.7 million in dividends to holders of our Class A common stock and Class B common stock. We also paid $8.1 million in scheduled quarterly principal payments on long-term debt and $4.8 million in financed insurance premiums during the six months ended December 31, 2025.
Current wording
Financing activities used $4.9 million of net cash for the nine months ended March 31, 2026. Net revolver borrowings on our credit facility provided $28.0 million in cash. We paid $14.6 million in dividends to holders of our Class A common stock and Class B common stock. We also paid $12.2 million in scheduled quarterly principal payments on long-term debt and $6.2 million in financed insurance premiums during the nine months ended March 31, 2026.
Previous wording
We believe our cash on hand, operating cash flows and financing arrangements, including the availability of borrowings under the 2024 Credit Facility, will be sufficient to support our ongoing cash needs. We have considered the current and potential future effects of the macroeconomic market conditions in the financial markets. At this time, we expect adequate liquidity for at least the next twelve months. We can provide no assurance that our liquidity and capital resources will be adequate for future funding requirements. We believe we will be able to comply with the terms of the covenants under the 2024 Credit Facilities based on our operating plan. In the event of adverse operating results and/or violation of covenants under the facilities, there can be no assurance we would be able to obtain waivers or amendments. Other risks to our meeting future funding requirements include global economic conditions and macroeconomic, business and financial disruptions that could arise, including armed conflicts between Israel and Hamas (and broader military conflict in the region) and between Russia and Ukraine. There can be no assurance that a challenging economic environment or an economic downturn would not affect our liquidity or ability to obtain future financing or fund operations or investment opportunities. In addition, our debt covenants may restrict our ability to invest.
Current wording
We believe our cash on hand, operating cash flows and financing arrangements, including the availability of borrowings under the 2024 Credit Facility, will be sufficient to support our ongoing cash needs. We have considered the current and potential future effects of the macroeconomic market conditions in the financial markets. At this time, we expect adequate liquidity for at least the next twelve months. We can provide no assurance that our liquidity and capital resources will be adequate for future funding requirements. We believe we will be able to comply with the terms of the covenants under the 2024 Credit Facilities based on our operating plan. In the event of adverse operating results and/or violation of covenants under the facilities, there can be no assurance we would be able to obtain waivers or amendments. Other risks to our meeting future funding requirements include global economic conditions and macroeconomic, business and financial disruptions that could arise, including armed conflicts in the Middle East and between Russia and Ukraine. There can be no assurance that a challenging economic environment or an economic downturn would not affect our liquidity or ability to obtain future financing or fund operations or investment opportunities. In addition, our debt covenants may restrict our ability to invest.
Previous wording
As of December 31, 2025, we had $107.0 million in outstanding borrowings under the 2024 Revolver and outstanding letters of credit and other commitments of $2.9 million, leaving $200.1 million available for further borrowings and letters of credit, subject to restrictions in our 2024 Credit Facilities
Current wording
As of March 31, 2026, we had $115.0 million in outstanding borrowings under the Revolving Credit Commitments and outstanding letters of credit and other commitments of $1.8 million, leaving $193.2 million available for further borrowings and letters of credit, subject to restrictions in our 2024 Credit Facilities. On April 28, 2026, the 2024 Credit Agreement was amended to increase our borrowing capacity under the Revolving Credit Commitments by $125.0 million, from $310.0 million to $435.0 million.
Previous wording
As of December 31, 2025, our cash and cash equivalents and short-term investments included $72.2 million held by our international subsidiaries. There are no restrictions on cash distributions to PAHC from our international subsidiaries. Distributions may be subject to taxation by U.S. or non-U.S. taxing authorities.
Current wording
As of March 31, 2026, our cash and cash equivalents and short-term investments included $76.7 million held by our international subsidiaries. There are no restrictions on cash distributions to PAHC from our international subsidiaries. Distributions may be subject to taxation by U.S. or non-U.S. taxing authorities.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
excluding the non-recurring Corporate-related items discussed above, increased $7.5 million due to an increase in employee-related costs.
Current report — wording carried from elsewhere
Certain amounts and percentages may reflect rounding adjustments.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Net sales of vaccines increased $4.5 million, or 13%, primarily due to continued growth of poultry products in Latin America and an increase in international demand, particularly in Southeast Asia.