Balchem Corp (NASDAQ:BCPC) Q3 2019 Earnings Conference Call Transcript
Nov 05, 2019 • 11:00 am ET
Greetings, and welcome to the Balchem Corporation Third Quarter Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Mr. Martin Bengtsson, CFO for Balchem Corporation. Thank you. Sir, you may begin.
Thank you. Ladies and gentlemen, thank you for joining our conference call this morning to discuss the results of Balchem Corporation for the quarter ending September 30, 2019. My name is Martin Bengtsson, Chief Financial Officer and hosting this call with me is Ted Harris, our Chairman, CEO and President.
Following the advice of our counsel, auditors and the SEC, at this time, I would like to read our forward-looking statements. This release does contain or likely will contain forward-looking statements, which reflect Balchem's expectation or beliefs concerning future events that will involve risks and uncertainties. We can give no insurance that the expectations reflected in forward-looking statements will prove correct and various factors could cause results to differ materially from our expectations, including risks and factors identified in Balchem's Form 10-K. Forward-looking statements are qualified in their entirety by this cautionary statement.
I will now turn the call over to Ted Harris, our Chairman, CEO and President.
Thanks, Martin. Good morning, ladies and gentlemen, and welcome to our conference call. This morning we reported quarterly consolidated net sales of $158.6 million, which resulted in third quarter net income of $20.7 million or $0.64 per share on a GAAP basis. Our third quarter non-GAAP net earnings of $26.3 million or $0.81 per share exclude tax adjusted non-cash amortization and other items as detailed in our earnings release this morning of $5.6 million to facilitate comparative evaluation of operating performance versus the prior year period.
These non-GAAP net earnings of $26.3 million or $0.81 per share represent an increase of $2.7 million or $0.08 per share compared with the prior year quarter of $23.7 million or $0.73 per share. We also delivered quarterly cash flows from operations of $42.7 million for the third quarter 2019 with quarterly free cash flow of $35.8 million. Our quarterly net sales of $158.6 million were 2.3% higher than the prior year comparable quarter.
We achieved sales growth in three of our four segments with record third quarter sales in our Human Nutrition & Health and Specialty Products segments and healthy year-over-year growth in our Animal Nutrition & Health segment, which were partially offset by the decline in our Industrial Products segment where volumes related to oil and gas fracking remained low compared to prior year. The impact of foreign exchange to our sales was a negative $1 million due to the weaker euro, driving a negative 64 basis point impact to our year-over-year, sales growth.
Our Q3 consolidated gross margin dollars of $54 million were up $6 million or 12.5% compared with $48 million for the same period in the prior year. Our consolidated gross margin percent was 34.1% of sales in the quarter, up 310 basis points from 31% in