Balchem Corporation Reports Third Quarter 2026 Financial Results

Quarterly share repurchases totaled approximately $28 million, bringing trailing twelve-month repurchases to approximately $127 million.

Rhea-AI Summary

Balchem (NASDAQ: BCPC) reported third-quarter 2026 net sales of $290.7 million, with sales and operating earnings growing across all three reporting segments. Sales rose 8.6% year over year, while GAAP net earnings increased 16.0% to $46.7 million. Diluted earnings per share reached $1.46 versus $1.24 a year earlier. Adjusted EBITDA, a non-GAAP earnings measure, rose 12.4% to $80.3 million.

Human Nutrition and Health sales increased 8.1%, Animal Nutrition and Health sales rose 11.7%, and Specialty Products sales grew 4.5%. Gross margin expanded to 36.4% from 35.7%, despite certain higher manufacturing input costs. Operating expenses increased to $43.3 million from $40.9 million. Operating cash flow was $69.8 million and free cash flow was $57.9 million. Balchem made $28.0 million in net debt payments during the quarter. Nine-month sales reached $845.364 million, versus $773.544 million a year earlier.

32 points · 0 major

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0 major · 7 points

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Positive

• Moderate pointThird-quarter net sales increased 8.6% year over year to $290.7 million.
• Moderate pointThird-quarter GAAP net earnings increased 16.0% year over year to $46.7 million.
• Moderate pointThird-quarter adjusted EBITDA increased 12.4% year over year to $80.3 million.
• Moderate pointThird-quarter operating earnings increased to $62.437 million from $54.579 million a year earlier.
• Minor pointThird-quarter diluted earnings per share rose to $1.46 from $1.24 a year earlier.

27 minor points

• Minor pointThird-quarter adjusted net earnings rose to $50.350 million from $43.982 million a year earlier.
• Minor pointThird-quarter adjusted earnings per share increased to $1.57 from $1.35 a year earlier.
• Minor pointThird-quarter gross margin expanded to 36.4% from 35.7%, helped by favorable mix and manufacturing efficiencies.
• Minor pointHuman Nutrition and Health quarterly sales increased 8.1% to $188.2 million year over year.
• Minor pointHuman Nutrition and Health quarterly operating earnings increased 11.8% to $45.6 million year over year.
• Minor pointHuman Nutrition and Health quarterly adjusted operating earnings increased 10.9% to $48.9 million year over year.
• Minor pointAnimal Nutrition and Health quarterly sales increased 11.7% to $63.0 million year over year.
• Minor pointAnimal Nutrition and Health quarterly operating earnings increased 82.8% to $6.8 million year over year.
• Minor pointAnimal Nutrition and Health quarterly adjusted operating earnings increased 73.6% to $7.0 million year over year.
• Minor pointSpecialty Products quarterly sales increased 4.5% to $37.3 million year over year.
• Minor pointSpecialty Products quarterly operating earnings increased 6.6% to $12.3 million year over year.
• Minor pointSpecialty Products quarterly adjusted operating earnings increased 3.0% to $13.1 million year over year.
• Minor pointThird-quarter operating cash flow totaled $69.8 million, with free cash flow of $57.9 million.
• Minor pointQuarterly share repurchases totaled approximately $28 million; trailing twelve-month repurchases totaled approximately $127 million.
• Minor pointThird-quarter net debt payments totaled $28.0 million.
• Minor pointRevolving debt declined to $124.000 million at September 30, 2026, from $164.000 million at December 31, 2025.
• Minor pointThird-quarter net interest expense decreased to $1.9 million from $2.6 million a year earlier.
• Minor pointThird-quarter effective tax rate decreased to 22.2% from 22.6% a year earlier.
• Minor pointNine-month sales rose to $845.364 million from $773.544 million in the comparable 2025 period.
• Minor pointNine-month gross margin rose to $310.481 million from $276.734 million in the comparable 2025 period.
• Minor pointNine-month operating earnings increased to $177.284 million from $157.036 million in the comparable 2025 period.
• Minor pointNine-month net earnings increased to $131.628 million from $115.620 million in the comparable 2025 period.
• Minor pointNine-month diluted earnings per share rose to $4.09 from $3.54 in the comparable 2025 period.
• Minor pointNine-month adjusted EBITDA increased to $232.522 million from $206.961 million in the comparable 2025 period.
• Minor pointNine-month adjusted net earnings rose to $141.437 million from $125.560 million in the comparable 2025 period.
• Minor pointNine-month adjusted earnings per share increased to $4.40 from $3.84 in the comparable 2025 period.
• Minor pointNine-month operating cash flow increased to $156.544 million from $149.281 million in the comparable 2025 period.

Negative

• Minor pointThird-quarter operating expenses increased to $43.277 million from $40.874 million a year earlier, primarily on compensation costs.
• Minor pointCertain higher manufacturing input costs partially offset third-quarter gross-margin gains and Animal Nutrition and Health earnings growth.
• Minor pointCash declined to $66.264 million at September 30, 2026, from $74.570 million at December 31, 2025.
• Minor pointNine-month operating expenses increased to $133.197 million from $119.698 million in the comparable 2025 period.
• Minor pointOther and Unallocated quarterly loss widened to $2.286 million from $1.499 million a year earlier.

2 minor points

• Minor pointOther and Unallocated nine-month loss widened to $5.587 million from $4.962 million in the comparable 2025 period.
• Minor pointNine-month financing costs paid totaled $1.943 million, versus none in the comparable 2025 period.

News Explained

At September 30, 2026, $66.3 million in cash sat alongside $124.0 million of revolving debt and $57.7 million of net debt.

Balchem reports it completed $27.4 million of common-stock repurchases in the third quarter—cash used to buy shares—and about $127 million of repurchases over the trailing twelve months.

The quarter’s repurchase outlay was below the $57.9 million of free cash flow reported for the same quarter. As of September 30, 2026, Balchem reported $66.3 million in cash, $124.0 million on its revolving loan, and $57.7 million in net debt; the release defines net debt as revolving-loan debt less cash and cash equivalents.

Key Figures

Net sales: $290.7 million; +8.6% GAAP net earnings: $46.7 million; +16.0% Adjusted EBITDA: $80.3 million; +12.4% +5 more

Net sales

$290.7 million; +8.6%

Third quarter 2026 versus prior-year quarter

GAAP net earnings

$46.7 million; +16.0%

Third quarter 2026 versus prior-year quarter

Adjusted EBITDA

$80.3 million; +12.4%

Third quarter 2026 versus prior-year quarter

GAAP earnings per share

$1.46 vs. $1.24

Third quarter 2026 versus prior-year quarter

Adjusted earnings per share

$1.57 vs. $1.35

Third quarter 2026 versus prior-year quarter

Free cash flow

$57.9 million

Third quarter 2026

Gross margin as a percentage of sales

36.4% vs. 35.7% (+70 basis points)

Third quarter 2026 versus prior-year period

Net debt

$57.7 million

As of September 30, 2026

Previous Earnings Reports

5 past events · Latest: Jul 31

Same Type 5 events

1. Jul 31

   Q2 2026 earnings

   24h Move

   +3.0%

   Record quarterly sales, earnings and adjusted EBITDA; all three segments reported higher sales.

2. Apr 30

   Q1 2026 earnings

   24h Move

   -6.8%

   Quarterly sales, earnings and adjusted EBITDA increased, with growth across all three segments.

3. Feb 20

   FY2025 earnings

   24h Move

   -2.1%

   Full-year sales and adjusted EBITDA reached records; full-year free cash flow also set a record.

4. Oct 21

   Q3 2025 earnings

   24h Move

   +4.1%

   Sales, net earnings and adjusted EBITDA increased year over year; Human Nutrition sales set a record.

5. Jul 31

   Q2 2025 earnings

   24h Move

   +0.3%

   Record sales, net earnings and adjusted EBITDA increased, with growth in all three segments.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

ebitda, gaap, non-gaap

3 terms

ebitda financial

"adjusted EBITDA(a) of $80.3 million"

EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It measures a company's profitability by focusing on the money it makes from its core operations, ignoring expenses like taxes and accounting adjustments. Investors use EBITDA to compare how well different companies are performing financially, as it provides a clearer picture of operational success without the influence of financial structure or accounting choices.

View in glossary

gaap financial

"GAAP net earnings were $46.7 million"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

View in glossary

non-gaap financial

"non-GAAP financial measures"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

View in glossary

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MONTVALE, N.J., Oct. 23, 2026 (GLOBE NEWSWIRE) -- Balchem Corporation (NASDAQ: BCPC) today reported financial results for its 2026 fiscal third quarter ended September 30, 2026. For the quarter, the Company reported net sales of $290.7 million, net earnings of $46.7 million, adjusted EBITDA^(a) of $80.3 million, and free cash flow^(a) of $57.9 million.

Ted Harris, Chairman, President and CEO of Balchem, said, “Balchem delivered another excellent quarter, with healthy growth across all three of our reporting segments and record consolidated quarterly net sales, net earnings, and adjusted EBITDA.”

Third Quarter 2026 Financial Highlights:

• Net sales were $290.7 million, an increase of 8.6% from the prior year quarter.
• GAAP net earnings were $46.7 million, an increase of 16.0% from the prior year quarter.
• Adjusted EBITDA was $80.3 million, an increase of 12.4% from the prior year quarter.
• GAAP earnings per share were $1.46 compared to $1.24 in the prior year quarter and adjusted earnings per share^(a) were $1.57 compared to $1.35 in the prior year quarter.
• Cash flows from operations were $69.8 million, with free cash flow of $57.9 million.
• Sales and earnings from operations growth in all three of our reporting segments.
  
  

Recent Highlights:

• At the upcoming SupplySide Global trade show, we will showcase several of our latest Human Nutrition and Health technologies and innovations, including new science supporting VitaCholine^®, K2VITAL^™, Optifolin+^® and OptiMSM^®, as well as advances in performance nutrition and functional food and beverage applications. These innovations highlight the strength of our pipeline and our continued focus on developing differentiated, science-backed solutions that address important human health and wellness trends.
• Balchem repurchased approximately $28 million of common stock during the third quarter and approximately $127 million over the trailing twelve months, reflecting the Company's balanced capital allocation strategy and commitment to long-term shareholder value creation.
  
  

Mr. Harris added, “With strong results through the first nine months of the year and a healthy balance sheet, Balchem is well positioned to continue executing our strategic growth initiatives, and we remain excited about the future of our company.”

Results for Period EndedSeptember 30, 2026 (unaudited) (Dollars in thousands, except per share data)
		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Net sales		$	290,658			$	267,558			$	845,364			$	773,544
Gross margin			105,714				95,453				310,481				276,734
Operating expenses			43,277				40,874				133,197				119,698
Earnings from operations			62,437				54,579				177,284				157,036
Interest and other expenses			2,393				2,535				6,937				8,041
Earnings before income tax expense			60,044				52,044				170,347				148,995
Income tax expense			13,316				11,755				38,719				33,375
Net earnings		$	46,728			$	40,289			$	131,628			$	115,620
Diluted net earnings per common share		$	1.46			$	1.24			$	4.09			$	3.54
Adjusted EBITDA (a)		$	80,297			$	71,447			$	232,522			$	206,961
Adjusted net earnings (a)		$	50,350			$	43,982			$	141,437			$	125,560
Adjusted net earnings per common share (a)		$	1.57			$	1.35			$	4.40			$	3.84
Shares used in the calculations of diluted and adjusted net earnings per common share			32,032				32,595				32,181				32,702

(a)	See “Non-GAAP Financial Information” for a reconciliation of GAAP and non-GAAP financial measures.

Financial Results for the Third Quarter of 2026:

The Human Nutrition and Health segment generated record quarterly sales of $188.2 million, an increase of $14.1 million, or 8.1%, compared to the prior year quarter. The increase was driven by higher sales within both the nutrients business and the food ingredients and solutions businesses. Record earnings from operations for this segment of $45.6 million increased $4.8 million, or 11.8%, compared to $40.8 million in the prior year quarter, primarily due to the aforementioned higher sales and favorable mix, partially offset by higher operating expenses. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, record adjusted earnings from operations^(a) for this segment were $48.9 million, compared to $44.1 million in the prior year quarter, an increase of 10.9%.

The Animal Nutrition and Health segment generated quarterly sales of $63.0 million, an increase of $6.6 million, or 11.7%, compared to the prior year quarter. The increase was driven by higher sales in both the monogastric and ruminant species markets. Third quarter earnings from operations for this segment of $6.8 million increased $3.1 million, or 82.8%, compared to $3.7 million in the prior year quarter, primarily due to the aforementioned higher sales and favorable mix, partially offset by certain higher manufacturing input costs. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, adjusted earnings from operations for this segment were $7.0 million compared to $4.0 million in the prior year quarter, an increase of 73.6%.

The Specialty Products segment generated quarterly sales of $37.3 million, an increase of $1.6 million, or 4.5%, compared to the prior year quarter, due to higher sales in the performance gases business. Earnings from operations for this segment of $12.3 million increased $0.8 million, or 6.6%, compared to $11.5 million in the prior year quarter, primarily driven by the aforementioned higher sales and favorable mix, partially offset by higher operating expenses. Excluding the effect of non-cash expense associated with amortization of acquired intangible assets and other adjustments, adjusted earnings from operations for this segment were $13.1 million, compared to $12.7 million in the prior year quarter, an increase of 3.0%.

Consolidated quarterly gross margin of $105.7 million increased by $10.3 million, or 10.7%, compared to $95.5 million for the prior year comparable period. Gross margin as a percentage of sales was 36.4% compared to 35.7% in the prior year period, an increase of 70 basis points, primarily due to sales growth, favorable mix and manufacturing efficiencies, partially offset by certain higher manufacturing input costs. Operating expenses of $43.3 million for the quarter increased $2.4 million from the prior year comparable quarter, primarily due to higher compensation-related costs, partially offset by the net favorable impact of certain discrete items.

Net interest expense was $1.9 million and $2.6 million in the third quarters of 2026 and 2025, respectively. The decrease in interest expense was primarily due to lower outstanding borrowings and lower interest rates. Our effective tax rates for the three months ended September 30, 2026 and 2025 were 22.2% and 22.6%, respectively. The decrease in the effective tax rate was primarily due to higher favorable adjustments related to the filing of the prior year federal tax return and a higher foreign-derived intangible income deduction benefit, partially offset by an increase in certain state taxes.

Third quarter cash flows provided by operating activities were $69.8 million and free cash flow was $57.9 million. Net working capital of $240.8 million as of September 30, 2026 included a cash balance of $66.3 million. Significant cash payments during the quarter included net debt payments of $28.0 million, income taxes paid of $27.8 million, repurchases of common stock of $27.4 million, and capital expenditures and intangible assets acquired of $12.5 million. Outstanding debt on our revolving loan was $124.0 million as of September 30, 2026 and our net debt ^(b) was $57.7 million, with an overall leverage ratio ^(c) on a net debt basis of 0.2 times.

Mr. Harris said, “The Balchem team delivered another strong quarter in Q3 of 2026, and we remain confident in the long-term growth outlook for our company as we continue to execute our strategic growth initiatives.”

(b)	Net debt is defined as the outstanding balance on our revolving loan less cash and cash equivalents.
(c)	Leverage ratio is defined as net debt divided by trailing twelve months adjusted EBITDA.

Quarterly Conference Call

A quarterly conference call will be held on Friday, October 23, 2026, at 11:00 AM Eastern Time (ET) to review third quarter 2026 results. Ted Harris, Chairman, President and CEO and Martin Bengtsson, CFO, will host the call. Institutional investors, analysts and other members of the financial community are invited to join the live call by dialing +1-833-461-5787 (USA/Canada toll free) or +1-585-542-9983 (International Toll), and referencing Meeting ID: 831870284, five minutes prior to the scheduled start time of the conference call. Investors and the public are invited to listen to the live webcast at https://events.q4inc.com/attendee/831870284. The conference call will be available for replay shortly after the conclusion of the call at https://events.q4inc.com/attendee/831870284 for one year.

Segment Information

Balchem Corporation reports three business segments: Human Nutrition and Health, Animal Nutrition and Health, and Specialty Products. The Human Nutrition and Health segment delivers customized food and beverage ingredient systems, as well as key nutrients into a variety of applications across the food, supplement and pharmaceutical industries. The Animal Nutrition and Health segment manufactures and supplies products to numerous animal health markets. Through Specialty Products, Balchem provides specialty-packaged performance gases for use in healthcare and other industries, and also provides chelated minerals to the micronutrient agricultural market. Sales and production of products outside of our reportable segments and other minor business activities are included in "Other and Unallocated".

Forward-Looking Statements

This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect our expectation or belief concerning future events that involve risks and uncertainties. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "forecast," "outlook," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," or the negative thereof or variations thereon or similar expressions generally intended to identify forward-looking statements. Forward-looking statements may relate to such matters as projections of revenue, margins, expenses, tax provisions, earnings, cash flows, benefit obligations, dividends, share repurchases or other financial items; any statements of the plans, strategies and objectives of management for future operations, including those relating to any statements concerning expected development, performance or market share relating to our products and services; any statements regarding future economic conditions or our performance; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. These statements are based on the Company's currently available information and our current assumptions, expectations and projections about future events. They are subject to future events, risks and uncertainties - many of which are beyond the Company’s control - as well as potentially inaccurate assumptions, that could cause actual results to differ materially from those in the forward-looking statements. Important factors and other risks that may affect the Company's business or that could cause actual results to differ materially are included in filings the Company makes with the U.S. Securities and Exchange Commission from time to time, including its Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, its Current Reports on Form 8-K, and in its other SEC filings. Reference should be made to such factors and all forward-looking statements are qualified in their entirety by the above cautionary statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact: Jacqueline Yarmolowicz, Balchem Corporation (Telephone: 845-326-5600)

Selected Financial Data (unaudited)
($ in 000’s)

Business Segment Net Sales:		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Human Nutrition and Health		$	188,227			$	174,088			$	536,749			$	493,318
Animal Nutrition and Health			62,990				56,376				189,633				169,681
Specialty Products			37,294				35,683				112,532				106,143
Other (d)			2,147				1,411				6,450				4,402
Total		$	290,658			$	267,558			$	845,364			$	773,544
(d) Other consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation.

Business Segment Earnings Before Income Taxes:		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Human Nutrition and Health		$	45,633			$	40,831			$	128,034			$	117,147
Animal Nutrition and Health			6,789				3,713				17,708				12,463
Specialty Products			12,301				11,534				37,129				32,388
Other and Unallocated (e)			(2,286	)			(1,499	)			(5,587	)			(4,962	)
Interest and other expenses			(2,393	)			(2,535	)			(6,937	)			(8,041	)
Total		$	60,044			$	52,044			$	170,347			$	148,995
(e) Other and Unallocated consists of a few minor businesses which individually do not meet the quantitative thresholds for separate presentation and corporate expenses that have not been allocated to a segment. Unallocated corporate expenses consist of transaction and integration costs of $578 and $1,495 for the three and nine months ended September 30, 2026, respectively, and $333 and $1,227 for the three and nine months ended September 30, 2025, respectively.

Selected Balance Sheet Items
(Dollars in thousands)		September 30, 2026				December 31, 2025
		(unaudited)
Cash and cash equivalents		$	66,264			$	74,570
Accounts receivable, net			145,635				143,596
Inventories			177,006				131,449
Other current assets			15,972				15,999
Total current assets			404,877				365,614
Property, plant and equipment, net			306,135				306,648
Goodwill			807,487				816,375
Intangible assets with finite lives, net			147,366				163,289
Right of use assets			17,683				16,192
Other assets			20,024				18,134
Total non-current assets			1,298,695				1,320,638
Total assets		$	1,703,572			$	1,686,252
Current liabilities		$	164,115			$	176,384
Revolving loan			124,000				164,000
Deferred income taxes			52,273				54,143
Other long-term obligations			36,407				34,312
Total liabilities			376,795				428,839
Stockholders' equity			1,326,777				1,257,413
Total liabilities and stockholders' equity		$	1,703,572			$	1,686,252

Balchem Corporation Condensed Consolidated Statements of Cash Flows (Dollars in thousands)
(unaudited)
		Nine Months Ended September 30,
			2026				2025
Cash flows from operating activities:
Net earnings		$	131,628			$	115,620
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization			37,100				33,969
Stock compensation expense			16,316				14,298
Other adjustments			3,037				(1,692	)
Changes in assets and liabilities			(31,537	)			(12,914	)
Net cash provided by operating activities			156,544				149,281
Cash flows from investing activities:
Capital expenditures and intangible assets acquired			(29,605	)			(27,275	)
Cash paid for acquisitions, net of cash acquired			—				(323	)
Proceeds from the sale of assets			7				267
Investment in affiliates			(155	)			(144	)
Net cash used in investing activities			(29,753	)			(27,475	)
Cash flows from financing activities:
Proceeds from revolving loan			88,000				70,000
Principal payments on revolving loan			(128,000	)			(106,000	)
Principal payments on finance leases			(153	)			(145	)
Cash paid for financing costs			(1,943	)			—
Proceeds from stock options exercised			11,589				6,867
Dividends paid			(30,773	)			(28,276	)
Repurchases of common stock			(71,925	)			(54,008	)
Net cash used in financing activities			(133,205	)			(111,562	)
Effect of exchange rate changes on cash			(1,892	)			5,334
(Decrease) increase in cash and cash equivalents			(8,306	)			15,578
Cash and cash equivalents, beginning of period			74,570				49,515
Cash and cash equivalents, end of period		$	66,264			$	65,093

Non-GAAP Financial Information

In addition to disclosing financial results in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this earnings release contains non-GAAP financial measures that we believe are helpful in understanding and comparing our past financial performance and our future results. The non-GAAP financial measures in this press release include adjusted gross margin, adjusted earnings from operations, adjusted net earnings and the related adjusted diluted per share amounts, EBITDA, adjusted EBITDA, adjusted income tax expense, free cash flow, net debt, and leverage ratio. The non-GAAP financial measures disclosed by the Company exclude certain business combination accounting adjustments and certain other items related to acquisitions, certain equity compensation, nonqualified deferred compensation plan expense (income), and certain one-time or unusual transactions. Detailed non-GAAP adjustments are described in the reconciliation tables below and also explained in the related footnotes. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated. Investors should not consider non-GAAP measures as alternatives to the related GAAP measures.

Set forth below are reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Table 1
(unaudited)

Reconciliation of Non-GAAP Measures to GAAP (Dollars in thousands, except per share data)
		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Reconciliation of adjusted gross margin
GAAP gross margin		$	105,714			$	95,453			$	310,481			$	276,734
Amortization of intangible assets and finance leases (1)			715				739				2,162				2,156
Adjusted gross margin		$	106,429			$	96,192			$	312,643			$	278,890
Reconciliation of adjusted earnings from operations
GAAP earnings from operations		$	62,437			$	54,579			$	177,284			$	157,036
Amortization of intangible assets and finance leases (1)			4,333				4,394				13,137				12,819
Transaction and integration costs (2)			578				333				1,495				1,227
Nonqualified deferred compensation plan expense (3)			(45	)			404				572				839
Restructuring costs (4)			—				—				—				(192	)
Adjusted earnings from operations		$	67,303			$	59,710			$	192,488			$	171,729
Reconciliation of adjusted net earnings
GAAP net earnings		$	46,728			$	40,289			$	131,628			$	115,620
Amortization of intangible assets and finance leases (1)			4,433				4,467				13,381				13,035
Transaction and integration costs (2)			578				333				1,495				1,227
Restructuring costs (4)			—				—				—				(192	)
Income tax adjustment (5)			(1,389	)			(1,107	)			(5,067	)			(4,130	)
Adjusted net earnings		$	50,350			$	43,982			$	141,437			$	125,560
Adjusted net earnings per common share - diluted		$	1.57			$	1.35			$	4.40			$	3.84

Table 2 
(unaudited)

Reconciliation of GAAP Net Earnings to EBITDA and to Adjusted EBITDA (Dollars in thousands)
		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Net earnings - as reported		$	46,728			$	40,289			$	131,628			$	115,620
Add back:
Provision for income taxes			13,316				11,755				38,719				33,375
Interest and other expenses			2,393				2,535				6,937				8,041
Depreciation and amortization			12,288				11,481				36,855				33,753
EBITDA			74,725				66,060				214,139				190,789
Add back:
Non-cash compensation expense related to equity awards			5,039				4,650				16,316				14,298
Transaction and integration costs (2)			578				333				1,495				1,227
Nonqualified deferred compensation plan expense (3)			(45	)			404				572				839
Restructuring costs (4)			—				—				—				(192	)
Adjusted EBITDA		$	80,297			$	71,447			$	232,522			$	206,961

Table 3
(unaudited)

Reconciliation of GAAP Effective Income Tax Rate to Non-GAAP Effective Income Tax Rate (Dollars in thousands)
		Three Months Ended September 30,
			2026			Effective Tax Rate				2025			Effective Tax Rate
GAAP Income Tax Expense		$	13,316			22.2	%		$	11,755			22.6	%
Impact of ASU 2016-09 (6)			260							21
Adjusted Income Tax Expense		$	13,576			22.6	%		$	11,776			22.6	%

		Nine Months Ended September 30,
			2026			Effective Tax Rate				2025			Effective Tax Rate
GAAP Income Tax Expense		$	38,719			22.7	%		$	33,375			22.4	%
Impact of ASU 2016-09 (6)			1,550							894
Adjusted Income Tax Expense		$	40,269			23.6	%		$	34,269			23.0	%

Table 4
(unaudited)

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Dollars in thousands)
		Three Months Ended September 30,								Nine Months Ended September 30,
			2026				2025				2026				2025
Net cash provided by operating activities		$	69,772			$	65,572			$	156,544			$	149,281
Capital expenditures and proceeds from the sale of assets			(11,863	)			(14,891	)			(28,559	)			(26,866	)
Free cash flow		$	57,909			$	50,681			$	127,985			$	122,415

(1) Amortization of intangible assets and finance leases: Amortization of intangible assets and finance leases consists of amortization of customer relationships, trademarks and trade names, developed technology, regulatory registration costs, patents and trade secrets, capitalized loan issuance costs, other intangibles acquired primarily in connection with business combinations, and finance leases. We record expense relating to the amortization of these intangibles and finance leases in our GAAP financial statements. Amortization expenses for our intangible assets and finance leases are inconsistent in amount and are significantly impacted by the timing and valuation of acquisitions. Consequently, our non-GAAP adjustments exclude these expenses to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.

(2) Transaction and integration costs: Transaction and integration costs related to acquisitions and divestitures are expensed in our GAAP financial statements. Management excludes these items for the purposes of calculating adjusted EBITDA and other non-GAAP financial measures. We believe that excluding these items from our non-GAAP financial measures is useful to investors because these are items associated with transactions that are inconsistent in amount and frequency causing comparison of current and historical financial results to be difficult.

(3) Nonqualified deferred compensation plan (income) expense: Gains and losses on rabbi trust assets related to our nonqualified deferred compensation plan are recorded in other (income) expense while the offsetting increases or decreases to the deferred compensation liability are recorded within earnings from operations. The increases and decreases in the deferred compensation liability are driven by market volatility and are not a true reflection of company performance. We believe excluding these amounts from our non-GAAP financial measures is useful to investors because these items are inconsistent in amount based on market conditions causing comparison of current and historical financial results to be difficult.

(4) Restructuring costs: Restructuring costs related to a reorganization of the business are recorded in our GAAP financial statements. Management excludes these items for the purposes of calculating adjusted EBITDA and other non-GAAP financial measures. We believe that excluding these items from our non-GAAP financial measures is useful to investors because these items are inconsistent in amount and frequency causing comparison of current and historical financial results to be difficult.

(5) Income tax adjustment: For purposes of calculating adjusted net earnings and adjusted diluted earnings per share, we adjust the provision for (benefit from) income taxes to tax effect the taxable and deductible non-GAAP adjustments described above as they have a significant impact on our income tax (benefit) provision. Additionally, the income tax adjustment is adjusted for the impact of adopting ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting” and uses our non-GAAP effective rate applied to both our GAAP earnings before income tax expense and non-GAAP adjustments described above. See Table 3 for the calculation of our non-GAAP effective tax rate.

(6) Impact of ASU 2016-09: The primary impact of ASU No. 2016-09, "Improvements to Employee Share-Based Payment Accounting" ("ASU 2016-09"), was the recognition during the three and nine months ended September 30, 2026 and 2025, of excess tax benefits as a reduction to the provision for income taxes and the classification of these excess tax benefits in operating activities in the consolidated statement of cash flows instead of financing activities. Management excludes this item for the purpose of calculating adjusted Income Tax Expense. We believe that excluding the item in our non-GAAP financial measures is useful to investors because it is inconsistent in amount and frequency causing comparison of current and historical financial results to be difficult.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Balchem's third-quarter 2026 earnings and sales?

Balchem reported $290.7 million in net sales and $46.7 million in GAAP net earnings for the quarter ended September 30, 2026. Sales increased 8.6% and net earnings increased 16.0% year over year. Diluted earnings per share were $1.46, compared with $1.24 a year earlier.

How much debt did Balchem have at September 30, 2026?

Balchem had $124.0 million outstanding on its revolving loan and net debt of $57.7 million at September 30, 2026. Net debt is revolving borrowings less cash and cash equivalents. Its net-debt leverage ratio, measured against trailing twelve-month adjusted EBITDA, was 0.2 times.

Why did Balchem's third-quarter 2026 effective tax rate decrease?

Balchem attributed the lower effective tax rate to higher favorable adjustments related to its prior-year federal tax return and a higher foreign-derived intangible income deduction benefit. An increase in certain state taxes partially offset those benefits.