Balchem Corporation (NASDAQ:BCPC) Q3 2023 Earnings Conference Call October 27, 2023 11:00 AM ET
Company Participants
Martin Bengtsson - CFO
Ted Harris - Chairman, President and CEO
Conference Call Participants
Bob Labick - CJS Securities
Anthony Polak - Aegis Capital
Kyle May - Sidoti
Operator
Greetings, and welcome to the Balchem Third Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.
It is now my pleasure to introduce you to your host, Martin Bengtsson, CFO. Thank you, Martin. You may begin.
Martin Bengtsson
Thank you. Good morning, everyone. Thank you for joining our conference call this morning to discuss the results of Balchem Corporation for the quarter ending September 30, 2023. My name is Martin Bengtsson, Chief Financial Officer; and hosting this call with me is Ted Harris, our Chairman, President and CEO. Following the advice of our counsel, auditors and the SEC, at this time, I would like to read our forward-looking statement.
Statements made in today's call that are not historical facts are considered forward-looking statements. We can give no assurance that the expectations reflected in forward-looking statements will prove correct, and various factors could cause actual results to differ materially from our expectations, including risks and factors identified in Balchem's most recent Form 10-K, 10-Q and 8-K reports. The company assumes no obligation to update these forward-looking statements. Today's call and commentary include non-GAAP financial measures. Please refer to the reconciliation in our earnings release for further details.
I will now turn the call over to Ted Harris, our Chairman, President and CEO.
Ted Harris
Thanks, Martin. Good morning, and welcome to our conference call.
This morning, we reported solid third quarter financial results with strong margins and higher profitability year-over-year despite softer sales volumes. Our revenues of $230 million were down 5.9% versus the prior year's very strong quarterly results. It is worth noting that the prior year's quarter was Balchem's strongest revenue quarter in its history, and as such, a challenging comparable from a revenue perspective.
Gross margin grew 11.9%, and we expanded our gross margin percentage by 530 basis points to 33.3%. Earnings from operations of $44 million were up 29.7% versus the prior year quarter. And we delivered a record quarterly adjusted EBITDA of $60 million, an increase of 11.4% with an adjusted EBITDA margin of 26% of sales up 400 basis points from the prior year.
Our third quarter net income of $29 million, an increase of 15.2% resulted in earnings per share of $0.90 on a GAAP basis. On an adjusted basis, our third quarter non-GAAP net earnings of $34 million, an increase of 4.3% resulted in earnings per share of $1.04 on a non-GAAP basis. Cash flows from operations were $47 million for the third quarter of 2023 with record quarterly free cash flow of $38 million.