Net sales were up 9.4 percent to $1.29 billion for Advanced Drainage Systems, the world's largest manufacturer of thermoplastic corrugated pipe, during its 2016 fiscal year thanks to increased demand for plastic pipes.
The Hilliard, Ohio-based company saw an uptick in sales of its high density polyethylene pipe for storm sewers and infrastructure as well as its polypropylene products for storm and sanitary sewers, according to its annual report of financial results through March 31.
The report was filed with the U.S. Securities Exchange Commission on Sept. 15, which is three months late and out of compliance with New York Stock Exchange listing requirements. However, the business has been granted filing extensions in the past.
Soon after ADS started trading publicly under the ticker symbol WMS (for water management solutions) in July 2014, accounting errors prompted an SEC inquiry that led to an investigation and a costly process of restating previous financial statements going back to 2011. The majority of errors were related to inventory adjustments, leases and a subsidiary in Mexico. The company incurred $28 million of audit and legal expenses in its 2016 fiscal year related to this.
ADS posted net profit of $15 million with sales up $110.6 million over the prior year as contractors, civil design engineers and cities continue to switch from more traditional materials, such as concrete, steel and PVC pipe. Thermoplastic corrugated pipe, which is generally lighter, more durable and easier to install than competing products, continues to gain market share and now represents about 27 percent of the total storm sewer market compared to about 10 percent 10 years ago, ADS says in its SEC filing.
ADS, which operates a global network of 61 manufacturing plants and 31 distribution centers, is scheduled to release its unaudited financial results for the first quarter of 2017 on Oct. 6.