Phibro Animal Health Corporation Reports Third Quarter TEANECK, N.J.

Phibro Animal Health Corporation Reports

TEANECK, N.J., May 11, 2015 (GLOBE NEWSWIRE)

- Phibro Animal Health Corporation (NASDAQ:PAHC) today announced its financial results for its third quarter ended March

Commenting on the quarter, Jack Bendheim, Phibro's

Chairman, President and Chief Executive Officer, said, "We are pleased with the development of our Animal Health and Mineral

Nutrition segments and believe we are well positioned to take advantage of the continued global growth in animal protein and the

need to maintain the health and safety of production animals. In addition, we continue to seek reasonably sized opportunities

where we can extend the reach of our sales force into adjacent categories or line extensions, similar to the MJ Biologics agreement

we announced in January."

Net sales of $187.5 million increased

$14.2 million, or 8%, for the three months ended March 31, 2015, as compared to the three months ended March 31, 2014,

due to growth in Animal Health and Mineral Nutrition of $ 9.5 million and $7.4 million, respectively, offset by declines

in Performance Products of $2.7 million.

The consolidated statement of operations for

the three months ended March 31, 2015 included $2.0 million of revenue and gross profit related to an existing license agreement

with a global animal health company pursuant to which we share the use of our proprietary vaccine delivery technology. We recognized

the revenue and profit during the period because certain contractual and regulatory milestones were achieved by the licensee, and

we had no performance obligations under the agreement. Excluding the $2.0 million in licensing revenue, net sales growth was $12.2

Net sales of $117.3 million grew $9.5 million,

or 9%, primarily due to volume growth. Excluding the $2.0 million in licensing revenue, net sales growth was $7.5 million, or 7%.

Medicated Feed Additives ("MFAs") and other grew $2.0 million, or 2%, primarily due to volume growth in the United

States ("U.S.") and Latin America. Nutritional specialty products grew $3.7 million, or 23%, primarily due to domestic

volume growth of products for the dairy industry. Excluding the effect of the $2.0 million in licensing revenue, vaccines grew

$1.9 million, or 19%, principally from volume growth in the U.S. and certain international markets.

Vaccine revenue included the benefit of sales recognized in connection

with the Collaboration and Distribution Agreement with MJ Biologic, Inc. ("MJB") from the date of that transaction.

Net sales of $57.3 million increased $7.4 million,

or 15%. Increased volumes accounted for nearly all of the sales growth, as current market conditions improved demand for certain

trace mineral products. Partially offsetting the sales increase was lower average selling prices due to lower underlying raw material

Performance Products

Net sales of $12.8 million decreased

$2.7 million, or 18%, as a result of lower volumes of personal care ingredients and copper-based products.

Gross profit of $59.1 million increased

$6.3 million, or 12%, to 31.5% of net sales, with most of the improvement coming from Animal Health. Gross profit growth was $4.3

million, or 8%, excluding the effect of the $2.0 million in licensing revenue. Animal Health gross profit increased $3.5 million,

excluding the effect of the licensing revenue, due to volume growth and reduced production costs from favorable currency movements.

Within Animal Health, MFAs and other contributed $2.2 million of the increase due to volume growth and favorable production costs

and nutritional specialty products contributed $1.9 million of the increase primarily due to volume growth and lower unit costs

from improved operating efficiencies. Excluding the current period gross profit from the licensing revenue for the vaccine delivery

technology, vaccines gross profit decreased $0.7 million principally due to unfavorable product mix. Mineral Nutrition gross profit

increased $1.2 million due to higher volumes and lower product costs, partially offset by lower average selling prices. Performance

Products gross profit decreased $0.4 million due to lower average selling prices, higher product costs and lower volumes.

Selling, general and administrative expenses

Selling, general and administrative ("SG&A") expenses

of $37.3 million increased $1.8 million, or 5%. Animal Health accounted for $1.8 million of the increase, driven by sales

and marketing and development spending. Selling headcount and related marketing support increased to support MFA and vaccine initiatives

and the expansion of our products to the dairy industry. Development spending focused on product lifecycle extensions.

Adjusted EBITDA of $27.5 million increased

$5.1 million, or 23%. Adjusted EBITDA growth was $3.1 million, or 14%, excluding the $2.0 million in licensing revenue. Animal

Health adjusted EBITDA increased $2.1 million, or 8%, excluding the effect of the licensing revenue, due to sales growth and increased

gross profit, partially offset by increased SG&A expenses. Mineral Nutrition increased $1.0 million, or 34%, due to higher

sales volumes and improved operating margins. Performance Products decreased $0.1 million, or 10%, due to lower sales volumes.

Corporate expenses increased $0.1 million due to increases in salary and wage-related costs.

Interest expense, net

Interest expense, net, of $3.6 million

decreased $5.1 million due to the net result of issuing the revolving credit facility (the "Revolver") for short term

borrowing and a term B loan (the "Term B Loan," and together with the Revolver, the "Credit Facilities")

in April 2014, retiring the Mayflower Term Loan, the BFI Term Loan and the Domestic Senior Credit Facility in April 2014

and redeeming the 9.25% Senior Notes in May 2014.

Foreign currency (gains) losses, net

Foreign currency (gains) losses, net for the

three months ended March 31, 2015, amounted to net gains of $4.6 million, as compared to $0.3 million in net losses

for the three months ended March 31, 2014. Foreign currency gains in the current period were primarily due to the movement

of Brazil, Turkey and Belgium

currencies relative to the U.S. dollar. Foreign currency gains and

losses primarily arise from intercompany balances.

Provision for income taxes

Income tax expense was $3.4 million for the

three months ended March 31, 2015. Our effective tax rate for the current quarter was 14.8% as compared 23.3% for the same period

last year. For the three months ended March 31, 2015, our consolidated tax provision was primarily comprised of income taxes relating

to profitable foreign jurisdictions. The decrease in our effective tax rate in part resulted from positive earnings in our domestic

operations during the three months ended March 31, 2015, as compared to negative earnings during the same period last year, which

were not subject to income tax due to the utilization of our domestic net operating losses during the quarter.

Adjusted diluted EPS

Adjusted diluted EPS was $0.41 for the quarter,

compared with $0.36 last year on a pro forma adjusted basis. The pro forma adjustments to last year reflect the effects of our

April 2014 initial public offering and refinancing. The pro forma adjustments assume the additional common shares and the refinancing

occurred at the beginning of the periods.

BALANCE SHEET AND CASH FLOWS

We have updated our guidance

with the following estimates:

We will provide guidance

for our fiscal year 2016 when we report our year-end results. We want to note that our fiscal year 2015 results include the final

$8 million of milestone revenues and profits related to licensing of our proprietary vaccine delivery technology. Included in the

fiscal year 2015 total is $4 million of milestone revenues originally expected in fiscal year 2016. Future licensing revenues will

be royalty based, subject to annual minimums effective January 2016. Our preliminary fiscal year 2016 estimate is for royalty revenues

of less than $1 million, primarily in the second half of our fiscal year.

WEBCAST & CONFERENCE CALL DETAILS

Phibro Animal Health Corporation

will host a webcast and conference call at 9:00 AM (EDT) on Tuesday, May 12, 2015, during which the company will review third

quarter financial results and respond to questions.

Details for the webcast and conference call:

NOTE: In order to join this conference call,

all participants will be required to provide the Conference ID number.

A replay of the webcast will be archived and made

available on Phibro's website until approximately August 15, 2015.

Forward-Looking Statements: This

communication contains forward-looking statements, which reflect Phibro's current views with respect to business plans or

prospects, future operating or financial performance, expectations regarding future use of cash and dividend payments, and other