10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED September 30, 2018.

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO _______.

Pyxus International, Inc.

(Exact name of registrant as specified in its charter)

Virginia	001-13684	54-1746567
________________	_____________________________	____________________
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

8001 Aerial Center Parkway
Morrisville, NC 27560-8417
(Address of principal executive offices)

(919) 379-4300
(Registrant’s telephone number, including area code)

Alliance One International, Inc.

(Former name, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company' in Rule 12b-2 of the Exchange Act. (Check one):           

                                                                
Large Accelerated Filer   []    Accelerated Filer   [X]    Non-Accelerated filer   []  

Smaller Reporting Company   []    Emerging Growth Company   [] 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transaction period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. []

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 Yes [ ] No [X]

As of October 31, 2018, the registrant had 9,069,034 shares outstanding of Common Stock (no par value) excluding 785,313 shares owned by a wholly owned subsidiary.

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Pyxus International, Inc. and Subsidiaries
Table of Contents
			Page No.
Part I.	Financial Information
	Item 1.	Financial Statements (Unaudited)
		Condensed Consolidated Statements of Operations
		Three and Six Months Ended September 30, 2018 and 2017	3
		Condensed Consolidated Statements of Comprehensive (Loss) Income
		Three and Six Months Ended September 30, 2018 and 2017	4
		Condensed Consolidated Balance Sheets
		September 30, 2018 and 2017 and March 31, 2018	5
		Condensed Statements of Consolidated Stockholders’ Equity
		Three and Six Months Ended September 30, 2018 and 2017	6
		Condensed Consolidated Statements of Cash Flows
		Six Months Ended September 30, 2018 and 2017	7
		Notes to Condensed Consolidated Financial Statements	8
	Item 2.	Management's Discussion and Analysis
		of Financial Condition and Results of Operations	24
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	34
	Item 4.	Controls and Procedures	34
Part II.	Other Information
	Item 1.	Legal Proceedings	35
	Item 1A.	Risk Factors	35
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
	Item 3.	Defaults Upon Senior Securities	35
	Item 4.	Mine Safety Disclosures	35
	Item 5.	Other Information	35
	Item 6.	Exhibits	36
Signature			37

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Part I. Financial Information

Item 1. Financial Statements

Pyxus International, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Six Months Ended September 30, 2018 and 2017
(Unaudited)
	Three Months Ended September 30,						Six Months Ended September 30,
(in thousands, except per share data)	2018			2017			2018			2017
Sales and other operating revenues	$	394,876		$	447,339		$	685,864		$	724,332
Cost of goods and services sold	345,672			378,008			595,266			626,366
Gross profit	49,204			69,331			90,598			97,966
Selling, general, and administrative expenses	38,995			34,463			77,079			67,965
Other income, net	2,561			4,587			5,482			8,889
Restructuring and asset impairment charges	182			—			1,723			—
Operating income	12,588			39,455			17,278			38,890
Debt retirement expense (benefit)	(388		)	—			(473		)	(2,975		)
Interest expense (includes debt amortization of $2,366 and $2,668 for the three months and $4,695 and $4,892 for the six months in 2018 and 2017, respectively)	35,324			33,099			68,235			67,540
Interest income	738			727			1,625			1,694
(Loss) income before income taxes and other items	(21,610		)	7,083			(48,859		)	(23,981		)
Income tax expense	34,816			6,403			9,546			7,049
Equity in net income (loss) of investee companies	1,584			276			2,151			(649		)
Net (loss) income	(54,842		)	956			(56,254		)	(31,679		)
Net loss attributable to noncontrolling interests	(208		)	(68		)	(862		)	(159		)
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)	$	1,024		$	(55,392	)	$	(31,520	)
(Loss) earnings per share:
Basic	$	(6.04	)	$	0.11		$	(6.13	)	$	(3.51	)
Diluted	$	(6.04	)	$	0.11		$	(6.13	)	$	(3.51	)
Weighted average number of shares outstanding:
Basic	9,051			8,982			9,038			8,973
Diluted	9,051			9,010			9,038			8,973
See "Notes to Condensed Consolidated Financial Statements"

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Pyxus International, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
Three and Six Months Ended September 30, 2018 and 2017
(Unaudited)
	Three Months Ended September 30,						Six Months Ended September 30,
(in thousands)	2018			2017			2018			2017
Net (loss) income	$	(54,842	)	$	956		$	(56,254	)	$	(31,679	)
Other comprehensive income (loss), net of tax:
Currency translation adjustment	(6		)	2,349			(5,318		)	6,091
Defined benefit pension amounts reclassified to income	202			459			568			918
Change in pension liability for settlements	771			—			771			—
Change in the fair value of derivatives designated as cash flow hedges	6			—			—			(562		)
Amounts reclassified to income for derivatives	774			71			(716		)	71
Total other comprehensive income (loss), net of tax	1,747			2,879			(4,695		)	6,518
Total comprehensive (loss) income	(53,095		)	3,835			(60,949		)	(25,161		)
Comprehensive income (loss) attributable to noncontrolling interests	43			(68		)	(786		)	(159		)
Comprehensive (loss) income attributable to Pyxus International, Inc.	$	(53,138	)	$	3,903		$	(60,163	)	$	(25,002	)
See "Notes to Condensed Consolidated Financial Statements"

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Pyxus International, Inc. and Subsidiaries CONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)
(in thousands)				September 30, 2018			September 30, 2017			March 31, 2018
ASSETS
Current assets
Cash and cash equivalents				$	116,970		$	188,936		$	264,660
Restricted cash				2,297			2,272			2,984
Trade receivables, net				210,934			215,113			285,554
Other receivables				18,313			15,654			18,845
Accounts receivable, related parties				3,587			5,325			8,188
Inventories				954,692			928,931			698,087
Advances to tobacco suppliers				65,241			65,639			30,482
Recoverable income taxes				10,628			6,102			5,994
Prepaid expenses				21,021			24,439			17,181
Other current assets				17,715			16,240			17,628
Total current assets				1,421,398			1,468,651			1,349,603
Restricted cash				389			389			389
Investments in unconsolidated affiliates				62,838			52,606			68,151
Goodwill				34,698			16,463			27,546
Other intangible assets				73,330			43,388			70,724
Deferred income taxes, net				114,696			42,113			130,520
Long-term recoverable income taxes				898			—			1,795
Other deferred charges				3,094			4,364			3,388
Other noncurrent assets				52,392			54,723			60,234
Property, plant, and equipment, net				259,318			252,506			254,281
Total assets				$	2,023,051		$	1,935,203		$	1,966,631
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Notes payable to banks				$	613,859		$	549,045		$	427,277
Accounts payable				48,095			56,352			76,506
Accounts payable, related parties				22,611			21,117			14,835
Advances from customers				11,045			15,079			24,128
Accrued expenses and other current liabilities				84,682			83,513			88,380
Income taxes payable				4,012			—			6,767
Current portion of long-term debt				165			142			164
Total current liabilities				784,469			725,248			638,057
Long-term taxes payable				9,155			—			10,027
Long-term debt				905,096			917,491			920,143
Deferred income taxes				15,692			21,549			28,937
Liability for unrecognized tax benefits				9,606			10,603			11,191
Pension, postretirement, and other long-term liabilities				70,878			78,220			75,448
Total liabilities				1,794,896			1,753,111			1,683,803
Commitments and contingencies
Stockholders’ equity	September 30, 2018	September 30, 2017	March 31, 2018
Common Stock—no par value:
Authorized shares	250,000	250,000	250,000
Issued shares	9,849	9,781	9,808	474,221			472,892			473,476
Retained deficit				(211,741		)	(240,304		)	(156,348		)
Accumulated other comprehensive loss				(50,032		)	(53,529		)	(45,262		)
Total stockholders’ equity of Pyxus International, Inc.				212,448			179,059			271,866
Noncontrolling interests				15,707			3,033			10,962
Total stockholders’ equity				228,155			182,092			282,828
Total liabilities and stockholders’ equity				$	2,023,051		$	1,935,203		$	1,966,631
See "Notes to Condensed Consolidated Financial Statements"

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Pyxus International, Inc. and Subsidiaries
CONDENSED STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY
Three and Six Months Ended September 30, 2018 and 2017
(Unaudited)
	Attributable to Pyxus International, Inc.
							Accumulated Other Comprehensive Loss
(in thousands)	Common Stock			Retained Deficit			Currency Translation Adjustment			Pensions, Net of Tax			Loss on Derivatives, Net of Tax			Noncontrolling Interests			Total Stockholders' Equity
Balance, March 31, 2017	$	472,349		$	(208,784	)	$	(22,293	)	$	(36,654	)	$	(1,100	)	$	3,192		$	206,710
Net loss	—			(32,543		)	—			—			—			(90		)	(32,633		)
Stock-based compensation	291			—			—			—			—			—			291
Other comprehensive income (loss), net of tax	—			—			3,742			459			(562		)	—			3,639
Balance, June 30, 2017	472,640			(241,327		)	(18,551		)	(36,195		)	(1,662		)	3,102			178,007
Net income (loss)	—			1,024			—			—			—			(68		)	956
Restricted stock surrender	(2		)	—			—			—			—			—			(2		)
Stock-based compensation	253			—			—			—			—			—			253
Other comprehensive income, net of tax	—			—			2,349			459			71			—			2,879
Balance, September 30, 2017*	$	472,892		$	(240,304	)	$	(16,202	)	$	(35,736	)	$	(1,591	)	$	3,033		$	182,092
Balance, March 31, 2018	$	473,476		$	(156,348	)	$	(12,682	)	$	(32,580	)	$	—		$	10,962		$	282,828
Net loss	—			(759		)	—			—			—			(654		)	(1,413		)
Stock-based compensation	295			—			—			—			—			—			295
Purchase of investment in subsidiary	—			—			—			—			—			5,531			5,531
Other comprehensive (loss) income, net of tax	—			—			(5,136		)	366			(1,496		)	(175		)	(6,441		)
Balance, June 30, 2018	473,771			(157,107		)	(17,818		)	(32,214		)	(1,496		)	15,664			280,800
Net loss	—			(54,634		)	—			—			—			(208		)	(54,842		)
Restricted stock surrender	(8		)	—			—			—			—			—			(8		)
Stock-based compensation	458			—			—			—			—			—			458
Other comprehensive (loss) income, net of tax	—			—			(257		)	973			780			251			1,747
Balance, September 30, 2018	$	474,221		$	(211,741	)	$	(18,075	)	$	(31,241	)	$	(716	)	$	15,707		$	228,155
*Amounts may not equal column totals due to rounding
See "Notes to Condensed Consolidated Financial Statements"

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Pyxus International, Inc. and Subsidiaries CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  Six Months Ended September 30, 2018 and 2017 (Unaudited)
(in thousands)	September 30, 2018			September 30, 2017
OPERATING ACTIVITIES:
Net loss	$	(56,254	)	$	(31,679	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation and amortization	18,393			16,671
Debt amortization/interest	5,832			6,235
Debt retirement benefit	(473		)	(2,975		)
(Gain) loss on foreign currency transactions	(5,129		)	4,678
Restructuring and asset impairment charges	1,723			—
Gain on sale of property, plant, and equipment	(1,627		)	—
Equity in net loss of unconsolidated affiliates, net of dividends	699			2,745
Stock-based compensation	753			598
Changes in operating assets and liabilities, net	(386,320		)	(407,403		)
Other, net	3,086			919
Net cash used by operating activities	(419,317		)	(410,211		)
INVESTING ACTIVITIES:
Purchases of property, plant, and equipment	(21,508		)	(13,318		)
Proceeds from sale of property, plant, and equipment	873			1,660
Collections on beneficial interests on securitized trade receivables	114,212			118,118
Dividend received in excess of cumulative earnings	2,846			—
Payments to acquire controlling interests, net of cash acquired	(8,692		)	—
Payments to acquire equity method investment	—			(3,000		)
Other, net	(546		)	153
Net cash provided by investing activities	87,185			103,613
FINANCING ACTIVITIES:
Net proceeds from short-term borrowings	203,100			62,287
Repayment of long-term borrowings	(17,195		)	(34,961		)
Debt issuance cost	(4,945		)	(4,910		)
Other, net	(45		)	(72		)
Net cash provided by financing activities	180,915			22,344
Effect of exchange rate changes on cash	2,840			432
Decrease in cash, cash equivalents, and restricted cash	(148,377		)	(283,822		)
Cash and cash equivalents at beginning of period	264,660			473,110
Restricted cash at beginning of period	3,373			2,309
Cash, cash equivalents, and restricted cash at end of period	$	119,656		$	191,597
Other information:
Cash paid for income taxes	$	15,906		$	10,040
Cash paid for interest	62,790			63,000
Cash received from interest	(1,200		)	(1,690		)
Non-cash amounts obtained as a beneficial interest in exchange for transferring trade receivables in a securitization transaction	90,896			110,763
See "Notes to Condensed Consolidated Financial Statements"

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Pyxus International, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands)

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company changed its name from Alliance One International, Inc. to Pyxus International, Inc. on September 12, 2018. Due to the seasonal nature of the Company’s business, the results of operations for any fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. In the opinion of management, all normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. All intercompany accounts and transactions have been eliminated.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2018.

Taxes Collected from Customers

Certain subsidiaries are subject to value-added taxes on local sales. These amounts have been included in sales and other operating revenues and cost of goods and services sold and were $5,958 and $7,244 for the three months ended September 30, 2018 and 2017, respectively, and $9,834 and $11,098 for the six months ended September 30, 2018 and 2017, respectively.

Cash and Cash Equivalents

As of September 30, 2018, the Company held $340 in the Zimbabwe Real Time Gross Settlement (“RTGS”) system. RTGS is a local currency equivalent that is exchanged 1:1 with the U.S. Dollar ("USD"). In order to convert RTGS units to USD, the Company must obtain foreign currency resources from the Reserve Bank of Zimbabwe subject to the monetary and exchange control policy in Zimbabwe.

Restricted Cash

As of September 30, 2018 and 2017, and March 31, 2018, $1,256, $2,010 and $1,261 of cash was held on deposit as a compensating balance for short-term borrowings, respectively. As of September 30, 2018 and 2017, and March 31, 2018, $850, zero, and $1,487 of cash was restricted for capital investment, respectively.

Property, Plant, and Equipment

Total property and equipment purchases for the six months endedSeptember 30, 2018 and 2017, respectively, included $1,637 and $245 that were unpaid and included in accounts payable. Additionally, sales from property and equipment for the six months endedSeptember 30, 2018 and 2017 included $1,430 and $82 that were uncollected and included in receivables, respectively.

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, Revenue Recognition (Topic 606), Revenue from Contracts with Customers. ASU 2014-09 outlines a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. The Company adopted this guidance on April 1, 2018 for all contracts using the modified retrospective approach. There was no impact on the condensed consolidated financial statements. The adoption of this guidance resulted in additional disclosures. See "Note 2. Revenue Recognition" for more information.

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1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Adopted Accounting Pronouncements (continued)

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 clarifies the classification of certain cash receipts and cash payments to reduce the diversity in practice on how these activities are presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes as of September 30, 2017 to the condensed consolidated statement cash flows: cash collections from beneficial interests of $118,118 was reclassified from operating activities to investing activities and $110,763 obtained as a beneficial interest for transferring trade receivables in a securitization transaction has been added as a non-cash disclosure.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230):Restricted Cash. ASU 2016-18 clarifies the presentation of restricted cash on the statement of cash flows to reduce diversity in practice on how restricted cash is presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes: a reclassification of $2,661 and $3,373 from other current and other long-term assets in total to separately stated line items for restricted cash in the condensed consolidated balance sheets as of September 30, 2017 and March 31, 2018, respectively; the change in restricted cash of $352 presented in investing activities in the consolidated statements of cash flows is eliminated as of September 30, 2017; and the inclusion of $2,661 of restricted cash in the calculation of cash, cash equivalents, and restricted cash at the end of the period in the condensed consolidated statements of cash flows as of September 30, 2017.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 was issued to increase the consistency, transparency, and usefulness of financial information of retirement benefits by disaggregating the service cost component from the other components of net benefit cost. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in a reclassification of $343 and $684 from selling, general, and administrative expenses to interest expense in the condensed consolidated statement of operations for the three months and six months ended September 30, 2017, respectively. See "Note 13. Pension and Other Postretirement Benefits" for more information.

In August 2017, the FASB issued ASU No. 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. ASU 2017-12 was issued to better align risk and management activities to financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The Company early adopted this guidance on April 1, 2018 using the modified retrospective approach. The adoption of this guidance did not have a material impact on the condensed consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates, adds, and modifies certain disclosure requirements for fair value measurements. The Company adopted this guidance prospectively on September 30, 2018. The adoption of this guidance resulted in the addition of the weighted average of the significant observable inputs used to develop Level 3 fair value measurements in its disclosures. See "Note 17. Fair Value Measurements" for more information.

Recent Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842),which has been amended through various updates. ASU 2016-02 requires lessees to recognize right-of-use assets and liabilities arising from leases on the balance sheet. In addition, leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance also requires disclosures about the amount, timing, and uncertainty of cash flows arising from leases. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2019. The Company has formed a project team to evaluate and implement this guidance. The Company has elected to adopt an accounting policy for all asset classes to include both the lease and non-lease components as a single component and account for it as a lease. The Company has elected to utilize the transition practical expedients, as prescribed in ASC 842-10-65-1(f). The adoption of this guidance is expected to materially increase assets and liabilities on the consolidated balance sheets. The Company does not expect the adoption of this guidance to have a material impact on its existing debt covenants.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

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1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements Not Yet Adopted (continued)

In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The guidance is effective for the Company on April 1, 2019. Early adoption is permitted. This guidance should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans. This guidance removes disclosures, clarifies specific disclosure requirements, and adds disclosure requirements. This guidance will be adopted using a retrospective approach and is effective for the Company on March 31, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

2. REVENUE RECOGNITION

The Company derives revenue from contracts with customers, primarily from the sale of processed tobacco and fees charged for processing and related services to the manufacturers of tobacco products. The Company does not disclose information related to its unsatisfied performance obligations with an expected duration of one year or less. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The Company’s performance obligations are satisfied when the transfer of control of the distinct product or service to the customer occurs. For products, control is transferred and revenue is recognized at a point in time, in accordance with the shipping terms of the contract. For services, control is transferred and revenue is recognized over time using the input method based on a kilogram of packed tobacco. The Company applied a practical expedient to account for shipping and handling costs as costs to fulfill its performance obligations, irrespective of when control transfers. A kilogram of processed tobacco (or tobacco processing services resulting in a kilogram of processed tobacco) is the only material and distinct performance obligation for each of the Company’s revenue streams; therefore, consideration is attributed to the performance of this obligation. Revenue is measured as the amount of consideration to which the Company expects to be entitled to receive in exchange for transferring goods or providing services. Contract costs primarily include labor, material, shipping and handling, and overhead expenses. Certain subsidiaries are subject to value-added taxes on local sales. These amounts have been included in sales and other operating revenues and cost of goods and services sold.

The following disaggregates sales and other operating revenues by major source:

	Three Months Ended September 30, 2018		Six Months Ended September 30, 2018
North America:
Product revenue	$	45,988	$	92,445
Processing and other revenues	7,875		11,470
Total sales and other operating revenues	53,863		103,915
Other Regions:
Product revenue	323,490		550,396
Processing and other revenues	17,523		31,553
Total sales and other operating revenues	341,013		581,949
Total sales and other operating revenues	$	394,876	$	685,864

Product revenue is primarily processed tobacco sold to the customer. Processing and other revenues are mainly contracts to process green tobacco owned and provided by the customer. During processing, ownership remains with the customer and the Company is engaged to perform processing services.

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2. REVENUE RECOGNITION (continued)

Assets Recognized from the Costs to Obtain a Contract with a Customer

The Company records product and supply contract intangible assets for the incremental costs of obtaining a contract with a customer if the Company expects the benefit of those costs to be longer than one year, and if such costs are material. The Company applied a practical expedient to expense costs as incurred for costs to obtain a contract when the amortization period would have been one year or less. Total capitalized costs to obtain a contract were immaterial during the periods presented. Capitalized costs to obtain a contract as of September 30, 2018 were $5,674 and classified as other intangible assets. See "Note 5. Goodwill and Intangibles” for more information.

Significant Judgments

The Company has identified two main forms of variable consideration in its contracts with customers: warehousing fees for storing customer-controlled tobacco until the customer requests shipment and claims resulting from tobacco that do not meet customer specifications. Warehousing fees are built into the price of tobacco based on the customers' best estimate of the date they will request shipment or separately charged using a per-day storage rate. When the Company enters into a contract with a customer, the price communicated is the amount of consideration the Company expects to receive. Price adjustments for tobacco not meeting customer specifications for shrinkage, improper blend or chemical makeup, etc. are handled through a claims allowance that is assessed quarterly. The following summarizes activity in the claims allowance:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	1,100		$	1,100
Additions	769			1,732
Payments	(509		)	(1,472		)
Balance, end of period	$	1,360		$	1,360

Contract Balances

The Company generally records a receivable when revenue is recognized. Timing of revenue recognition may differ from the timing of payment from customers. Payment terms and conditions vary by contract, although terms generally include a requirement of payment within 30 to 60 days. The Company applied a practical expedient not to adjust the transaction price for the effects of financing components as the Company expects that the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. As a result, where the timing of revenue recognition differs from the timing of payment, the Company determined its contracts do not include a significant financing component.

The allowance for doubtful accounts reflects the Company’s best estimate of probable losses inherent in the trade receivables, net balance. The Company determines the allowance based on historical experience, and other currently available information. The following summarizes activity in the allowance for doubtful accounts:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	(7,257	)	$	(7,055	)
Additions	(69		)	(362		)
Writes-offs	2			93
Balance, end of period	(7,324		)	(7,324		)
Trade receivables	218,258			218,258
Trade receivables, net	$	210,934		$	210,934

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3. INCOME TAXES

Accounting for Uncertainty in Income Taxes

As of September 30, 2018, the Company’s unrecognized tax benefits totaled $7,991, $7,754 of which would impact the Company’s effective tax rate, if recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. As of September 30, 2018, accrued interest and penalties totaled $962 and $890, respectively. The Company expects to continue accruing interest expense related to the unrecognized tax benefits described above. The Company may be subject to fluctuations in the unrecognized tax benefit due to currency exchange rate movements.

During the six months ended September 30, 2018, the Company reached an income tax settlement with the Kenyan Revenue Authority for $1,166. An uncertain tax position had previously been recorded of $2,692, which resulted in a favorable adjustment to tax expense of $1,526. The Company entered into negotiations with the Zimbabwe Revenue Authority during its amnesty program to settle asserted issues. The Company has thus far paid $2,988 and has accrued another $964 in anticipation of the settlement. These amounts have not previously been accrued as an uncertain tax position.

The Company does not currently foresee any changes in the amount of its unrecognized tax benefits in the next twelve months but acknowledges circumstances can change due to unexpected developments in the law. In certain jurisdictions, tax authorities have challenged positions that the Company has taken that resulted in recognizing benefits that are material to its financial statements. The Company believes it is more likely than not that it will prevail in these situations and accordingly has not recorded liabilities for these positions. The Company expects the challenged positions to be settled at a time greater than twelve months from its balance sheet date.

The Company and its subsidiaries file a U.S. federal consolidated income tax return as well as returns in several U.S. states and a number of foreign jurisdictions. As of September 30, 2018, the Company’s earliest open tax year for U.S. federal income tax purposes is its fiscal year ended March 31, 2015; however, the Company's net operating loss carryovers from prior periods remain subject to adjustment. Open tax years in state and foreign jurisdictions generally range from three to six years.

Enactment of Tax Cuts and Jobs Act (“Tax Act”)

In December 2017, the SEC staff issued Staff Accounting Bulletin 118 (“SAB 118”), which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC Topic 740-Income Taxes (“ASC 740”).

During the year-ended March 31, 2018, the Company recorded certain provisional impacts of the Tax Act. As noted in prior filings of the Company, the provisional tax effects may differ during the measurement period, possibly materially, due to further refinement of the calculations, changes in interpretations and assumptions made, and additional guidance that may be issued by the Department of the U.S. Treasury, the Internal Revenue Service, and other regulatory and standard setting bodies.

The Company will complete its analysis within its fiscal year 2019 consistent with the guidance provided in SAB 118, and any adjustments during this measurement period will be included in net earnings from continuing operations as an adjustment to income tax expense in the reporting period when such adjustments are determined. No such adjustments were included in income tax expense for the three months and six months ended September 30, 2018.

Provision for the Three Months and Six Months Ended September 30, 2018

The effective tax rate for the three months ended September 30, 2018 and 2017 was (161.1)% and 90.4%, respectively. The effective tax rate for the six months endedSeptember 30, 2018 and 2017 was (19.5)% and (29.4)%, respectively. The primary difference in the effective tax rates year over year is the impact of U.S. tax reform, which resulted in a change in the taxability of operations, principally due to the impact of the new section 163(j) interest addback. The impact was accentuated by the net foreign exchange effects. Similarly, the significant difference in the effective tax rate for the three months and six months ended September 30, 2018 from the U.S. federal statutory rate is primarily due to the impact of U.S. tax reform and changes resulting from net foreign exchange effects.

The Company's quarterly provision for income taxes has historically been calculated using the annual effective tax rate method (“AETR method”), which applies an estimated annual effective tax rate to pre-tax income or loss. However, the Company recorded its interim income tax provision using the discrete method as of September 30, 2018, as allowed under ASC 740-270, Accounting for Income Taxes - Interim Reporting. The Company utilized the discrete method, rather than the AETR method, due to significant variations in income tax expense, primarily driven by U.S. tax reform, relative to projected annual pre-tax income (loss) that would have resulted in a disproportionate and unreliable effective tax rate under the AETR method. Using the discrete method, the Company determined current and deferred income tax expense as if the interim period were an annual period.

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4. GUARANTEES

In certain markets, the Company guarantees bank loans to suppliers to finance their crops. Under long-term arrangements, the Company may also guarantee financing to suppliers for the construction of curing barns or other tobacco production assets. Guaranteed loans are generally repaid concurrent with the delivery of tobacco to the Company. The Company is obligated to repay any guaranteed loan should the supplier default. If default occurs, the Company has recourse against the supplier. The Company also guarantees bank loans of certain unconsolidated subsidiaries in Asia and South America. The following summarizes amounts guaranteed and the fair value of those guarantees:

	September 30, 2018		September 30, 2017		March 31, 2018
Amounts guaranteed (not to exceed)	$	168,709	$	125,060	$	150,900
Amounts outstanding under guarantee	61,904		98,748		126,835
Fair value of guarantees	1,861		2,770		5,864

Of the guarantees outstanding at September 30, 2018, most expire within one year. The fair value of guarantees is recorded in accrued expenses and other current liabilities in the condensed consolidated balance sheets and is included in crop costs, except for the joint venture in Brazil, which is included in accounts receivable, related parties.

In Brazil, certain suppliers obtain government subsidized rural credit financing from local banks that is guaranteed by the Company. The Company withholds amounts owed to suppliers related to the rural credit financing of the supplier upon delivery of tobacco to the Company. The Company remits payments to the local banks on behalf of the guaranteed suppliers. Rural credit financing repayment is due to local banks based on contractual due dates. As of September 30, 2018 and 2017, and March 31, 2018, respectively, the Company had balances of zero, zero, and $14,807 due to local banks on behalf of suppliers included in accounts payable in the condensed consolidated balance sheets.

5. GOODWILL AND INTANGIBLES

The following summarizes goodwill and other intangible assets as of September 30, 2018 and March 31, 2018:       

	September 30, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Impact of Foreign Currency Translation			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.00 years	$	58,530	$	5,450	$	(27,016	)	$	—		$	36,964
Production and supply contracts	3.31 years	14,893		—		(9,219		)	—			5,674
Internally developed software	2.79 years	18,812		199		(18,103		)	—			908
Licenses	19.36 years	30,339		—		(970		)	(54		)	29,315
Trade names	7.50 years	—		500		(31		)	—			469
Intangibles not subject to amortization:
Goodwill*		27,546		7,174		—			(22		)	34,698
Total		$	150,120	$	13,323	$	(55,339	)	$	(76	)	$	108,028

*Goodwill of $2,795 relates to the North America segment and $31,903 relates to the Other Regions segment.

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5. GOODWILL AND INTANGIBLES (continued)

	March 31, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.85 years	$	58,530	$	—	$	(25,005	)	$	33,525
Production and supply contracts	3.82 years	14,893		—		(8,774		)	6,119
Internally developed software	2.82 years	18,581		231		(17,828		)	984
Licenses	19.84 years	—		30,339		(243		)	30,096
Intangibles not subject to amortization:
Goodwill*		16,463		11,083		—			27,546
Total		$	108,467	$	41,653	$	(51,850	)	$	98,270

*Goodwill of $2,795 relates to the North America segment and $24,751 relates to the Other Regions segment.

The following summarizes the estimated future intangible asset amortization expense:

For Fiscal Years Ended	Customer Relationships		Production and Supply Contracts		Internally Developed Software*		Licenses		Trade Names		Total
October 1, 2018 through March 31, 2019	$	2,011	$	1,293	$	236	$	757	$	31	$	4,328
2020	4,022		1,741		333		1,514		63		7,673
2021	4,022		1,397		172		1,514		63		7,168
2022	4,022		1,243		99		1,514		63		6,941
2023	4,022		—		68		1,514		63		5,667
Later	18,865		—		—		22,502		186		41,553
	$	36,964	$	5,674	$	908	$	29,315	$	469	$	73,330

*Estimated amortization expense for the internally developed software is based on costs accumulated as of September 30, 2018. These estimates will change as new costs are incurred and until the software is placed into service in all locations.

6. VARIABLE INTEREST ENTITIES

The Company holds variable interests in multiple variable interest entities that primarily procure or process inventory on behalf of the Company and the other parties. These variable interests relate to equity investments, advances, and guarantees made by the Company. The Company is not the primary beneficiary of the majority of its variable interests in variable interest entities, as it does not have the power to direct the activities that most significantly impact the economic performance of the entities due to the entities’ management and board of directors’ structure. As a result, the majority of these variable interest entities are not consolidated. The Company holds a majority voting interest and is the primary beneficiary of its variable interest in Humble Juice Co., LLC ("Humble"). As a result, Humble is a consolidated entity and its intercompany accounts and transactions have been eliminated.

As of September 30, 2018 and 2017, and March 31, 2018, the Company’s investment in variable interest entities was $57,251, $51,825, and $64,208, respectively, and is classified as investments in unconsolidated affiliates in the condensed consolidated balance sheets. The Company’s advances to these variable interest entities as of September 30, 2018 and 2017, and March 31, 2018 were $994, $5,325, and $5,895, respectively, and classified as accounts receivable, related parties in the condensed consolidated balance sheets. The Company guaranteed an amount to two variable interest entities not to exceed $73,696, $75,625, and $65,487 as of September 30, 2018 and 2017, and March 31, 2018, respectively. The investments, advances, and guarantees in these variable interest entities represent the Company’s maximum exposure to loss.

7. SEGMENT INFORMATION

The Company purchases, processes, sells, and stores leaf tobacco and other specialty products. Tobacco is purchased in more than 35 countries and shipped to approximately 90 countries. The sales, logistics, and billing functions of the Company are primarily concentrated in service centers outside of the producing areas to facilitate access to its major customers. Within certain quality and grade constraints, tobacco is fungible and customers may choose to fulfill their needs from any of the areas where the Company

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7. SEGMENT INFORMATION (continued)

purchases tobacco. Sales, logistics, billing, and administrative overhead, including depreciation, which originates primarily from the Company’s corporate and sales offices, are allocated to the segments based on operating income. Intercompany transactions

are allocated to the operating segment that either purchases or processes the tobacco. Investments in new business lines as part of the Company's transformation process are in development and reported in the Other Regions segment.

The following summarizes segment information:       

	Three Months Ended September 30,					Six Months Ended September 30,
	2018			2017		2018			2017
Sales and other operating revenues:
North America	$	53,863		$	59,331	$	103,915		$	124,618
Other Regions	341,013			388,008		581,949			599,714
Total sales and other operating revenues	$	394,876		$	447,339	$	685,864		$	724,332
Operating income:
North America	$	3,353		$	7,772	$	3,795		$	6,123
Other Regions	9,235			31,683		13,483			32,767
Total operating income	12,588			39,455		17,278			38,890
Debt retirement expense (benefit)	(388		)	—		(473		)	(2,975		)
Interest expense	35,324			33,099		68,235			67,540
Interest income	738			727		1,625			1,694
(Loss) income before income taxes and other items	$	(21,610	)	$	7,083	$	(48,859	)	$	(23,981	)

	September 30, 2018		September 30, 2017		March 31, 2018
Segment assets:
North America	$	321,828	$	382,940	$	379,354
Other Regions	1,701,223		1,552,263		1,587,277
Total assets	$	2,023,051	$	1,935,203	$	1,966,631

8. (LOSS) EARNINGS PER SHARE

The weighted average number of common shares outstanding is reported as the weighted average of the total shares of common stock outstanding, net of shares of common stock held by a wholly owned subsidiary. Shares of common stock owned by the subsidiary were 785 as of September 30, 2018 and 2017. This subsidiary waives its right to receive dividends and it does not have the right to vote.

Certain potentially dilutive options were not included in the computation of earnings per diluted share because their exercise prices were greater than the average market price of the shares of common stock during the period and their effect would be antidilutive. These shares totaled 427 at a weighted average exercise price of $60.00 per share as of September 30, 2018 and 2017. Diluted net loss per share as of September 30, 2018 and 2017 was the same as basic net loss per share as the effects of potentially dilutive items were antidilutive given the Company’s net loss.

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8. (LOSS) EARNINGS PER SHARE (continued)

The following summarizes the computation of earnings per share for the three months and six months ended September 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
(in thousands, except per share data)	2018				2017		2018				2017
Basic (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Basic (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
Diluted (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price	—			*	28		—			*	—			*
Adjusted weighted average number of shares outstanding	9,051				9,010		9,038				8,973
Diluted (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
*All outstanding restricted shares and shares applicable to stock options and restricted stock units are excluded because their inclusion would have an antidilutive effect on the loss per share.

9. STOCK-BASED COMPENSATION

The Company recorded stock-based compensation expense related to stock-based awards granted under its various employee and non-employee stock incentive plans of $458 and $253 for the three months ended September 30, 2018 and 2017, respectively, of which zero and zero, respectively, were for stock-based awards payable in cash and $753 and $598 for the six months ended September 30, 2018 and 2017, respectively, of which zero and $54, respectively, were for stock-based awards payable in cash.

The Company’s shareholders approved the 2016 Incentive Plan (the "2016 Plan") at its annual meeting on August 12, 2016, which is the successor to the 2007 Incentive Plan (the “2007 Plan”) as amended on August 11, 2011 and August 6, 2009. The 2016 Plan is an omnibus plan that provides the flexibility to grant a variety of equity awards including stock options, stock appreciation rights, stock awards, stock units, performance awards, and incentive awards to officers, directors, and employees of the Company.

The following summarizes the Company's stock-based compensation awards:

	Three Months Ended September 30,				Six Months Ended September 30,
(in thousands, except grant date fair value)	2018		2017		2018		2017
Restricted stock
Number granted	6		7		13		14
Grant date fair value	$	23.00	$	10.90	$	19.63	$	12.65
Restricted stock units
Number granted	—		—		61		57
Grant date fair value	$	—	$	—	$	16.00	$	11.75
Performance-based stock units
Number granted	—		—		30		29
Grant date fair value	$	—	$	—	$	16.00	$	11.75

Restricted stock consists of shares issued to non-employee directors of the Company that are not subject to a minimum vesting period. Restricted stock units differ from restricted stock in that shares are not issued until the restrictions lapse. Restricted stock units granted during the six months endedSeptember 30, 2018 vest ratably over a three-year period. Under the terms of the performance-based stock units, shares issued will be contingent upon the achievement of specified business performance goals.

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10. CONTINGENCIES AND OTHER INFORMATION

The government in the Brazilian State of Parana (“Parana”) issued a tax assessment on October 26, 2007 with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. The assessment for intrastate trade tax credits taken is $3,290 and the total assessment including penalties and interest at September 30, 2018 is $11,285. The Company believes it has properly complied with Brazilian law and will contest any assessment through the judicial process. Should the Company lose in the judicial process, the loss of the intrastate trade tax credits would have a material impact on the financial statements of the Company.  

The Company also has local intrastate trade tax credits in the Brazilian State of Santa Catarina and the State of Rio Grande do Sul. These jurisdictions permit the sale or transfer of excess credits to third parties. However, approval must be obtained from the tax authorities. The Company has an agreement with the state governments regarding the amounts and timing of credits that can be sold. The tax credits have a carrying value of $6,867 as of September 30, 2018, which is net of impairment charges based on management’s expectations about future realization. The intrastate trade tax credits will continue to be monitored for impairment in future periods based on market conditions and the Company’s ability to use or sell the tax credits.

In 1969, the Brazilian government created a tax credit program that allowed companies to earn IPI tax credits (“IPI credits”) based on the value of their exports. The government began to phase out this program in 1979, which resulted in numerous lawsuits between taxpayers and the Brazilian government. The Company has a long legal history with respect to credits it earned while the IPI credit program was in effect. In 2001, the Company won a claim related to certain IPI credits it earned between 1983 and 1990. The Brazilian government appealed this decision and numerous rulings and appeals were rendered on behalf of both the government and the Company from 2001 through 2013. Because of this favorable ruling, the Company began to use these earned IPI credits to offset federal taxes in 2004 and 2005, until it received a Judicial Order to suspend the IPI offsetting in 2005. The value of the federal taxes offset in 2004 and 2005 was $24,142 and the Company established a reserve on these credits at the time of offsetting as they were not yet realizable due to the legal uncertainty that existed. Specifically, the Company extinguished other federal tax liabilities using IPI credits and recorded a liability in pension, postretirement and other long-term liabilities to reflect that the credits were not realizable at that time due to the prevalent legal uncertainty. On March 7, 2013, the Brazilian Supreme Court rendered a final decision in favor of the Company that recognized the validity of the IPI credits and secured the Company's right to benefit from the IPI credits earned from March 1983 to October 1990. This final decision expressly stated the Company has the right to the IPI credits. The Company estimated the total amount of the IPI credits to be approximately $94,316 at March 31, 2013. Since the March 2013 ruling definitively (without the government's ability to appeal) granted the Company the ownership of the IPI credits generated between 1983 and 1990, the Company believed the amount of IPI credits that were used to offset other federal taxes in 2004 and 2005 were realizable beyond a reasonable doubt. Accordingly, and at March 31, 2013, the Company recorded the $24,142 IPI credits it realized in the statements of consolidated operations in other income, net. No further benefit has been recognized pending the outcome of the judicial procedure to ascertain the final amount as those amounts have not yet been realized.

In addition, certain of the Company’s subsidiaries are involved in other litigation or legal matters incidental to their business activities, including tax matters. While the outcome of these matters cannot be predicted with certainty, the Company is vigorously defending them and does not currently expect that any of them will have a material adverse effect on its business or financial position. However, should one or more of these matters be resolved in a manner adverse to its current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material.

In accordance with GAAP, the Company records known asset retirement obligations (“ARO”) for which the liability can be reasonably estimated. Currently, it has identified an ARO associated with one of its facilities that requires it to restore the land to its initial condition upon vacating the facility. The Company has not recognized a liability under GAAP for this ARO because the fair value of restoring the land at this site cannot be reasonably estimated since the settlement date is unknown at this time. The settlement date is unknown because the land restoration is not required until title is returned to the government, and the Company has no current or future plans to return the title. The Company will recognize a liability in the period in which sufficient information is available to reasonably estimate its fair value.

11. DEBT ARRANGEMENTS

ABL Facility

The ABL credit agreement restricts the Company from paying any dividends during the term of this facility subject to the satisfaction of specified financial ratios. In addition, the indentures governing the Company's outstanding 8.5% senior secured first lien notes due 2021 and its outstanding 9.875% senior secured second lien notes due 2021 contain similar restrictions and also prohibit the payment of dividends and other distributions if the Company fails to satisfy a ratio of consolidated EBITDA to fixed charges of at least 2.0 to 1.0. As of September 30, 2018, the Company did not satisfy this fixed charge coverage ratio. The Company may not satisfy this ratio from time to time and failure to meet this fixed charge coverage ratio does not constitute an event of default.

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11. DEBT ARRANGEMENTS (continued)

Senior Secured Second Lien Notes

During the six months endedSeptember 30, 2018, the Company purchased $17,868 of its existing 9.875% senior secured second lien notes (the "Second Lien Notes") on the open market. The purchased securities were canceled leaving $645,078 of the Second Lien Notes outstanding at September 30, 2018. Related discounts were $837 resulting in net cash repayment of $17,031 and recorded in repayment of long-term borrowings in the condensed consolidated statements of cash flows. Associated costs paid were $45 and deferred financing costs and amortization of original issue discount of $320 were accelerated.     

12. DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses forward or option currency contracts to protect against volatility associated with certain non-U.S. dollar denominated forecasted transactions. These contracts are for green tobacco purchases, processing costs, and selling, general, and administrative costs. Derivative financial instruments are recognized on the balance sheet as assets and liabilities and are measured at fair value. Changes in the fair value of derivative instruments designated as hedging instruments are recorded each period. The changes in the fair value of derivatives designated as cash flow hedges are recorded in accumulated other comprehensive loss and subsequently reclassified into earnings in the period during which the hedged transactions are recognized in earnings.

As of September 30, 2018 and 2017, accumulated other comprehensive loss includes $716 and $1,591, net of tax of $190 and zero, for unrealized gains related to designated cash flow hedges, respectively. The Company recorded losses / (gains) of $283 and $(985) in its cost of goods and services sold for the three months and six months ended September 30, 2017, respectively. The Company recorded losses of $987 in its cost of goods and services sold for the three months and six months ended September 30, 2018 from the discontinuance of a portion of the Company’s cash flow hedges. The Company recorded a current derivative asset of zero, $64, and zero as of September 30, 2018 and 2017, and March 31, 2018, respectively, included on the condensed consolidated balance sheets.

The Company has elected not to offset fair value amounts recognized for derivative instruments with the same counterparty under a master netting agreement. See "Note 17. Fair Value Measurements” for more information.       

13. PENSION AND OTHER POSTRETIREMENT BENEFITS

The Company has multiple benefit plans at several locations. The Company has a defined benefit plan that provides retirement benefits for substantially all U.S. salaried personnel based on years of service rendered, age, and compensation. The Company also maintains various other excess benefit and supplemental plans that provide additional benefits to (1) certain individuals whose compensation, and the resulting benefits that would have actually been paid, are limited by regulations imposed by the Internal Revenue Code and (2) certain individuals in key positions. The Company funds these plans in amounts consistent with the funding requirements of federal law and regulations. The Company also provides certain health and life insurance benefits to retired employees, and their eligible dependents, who meet specified age and service requirements. Additional non-U.S. defined benefit plans cover certain full-time employees located in Germany, Turkey, and the United Kingdom.

The following summarizes the components of net periodic benefit cost:

	Pension Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	120		$	116		$	240		$	232
Interest expense:
Interest expense	1,155			1,063			2,309			2,126
Expected return on plan assets	(1,286		)	(1,264		)	(2,572		)	(2,529		)
Amortization of prior service cost	11			10			21			21
Settlement loss	518			—			518			—
Actuarial loss	422			511			845			1,022
Net periodic pension cost	$	940		$	436		$	1,361		$	872

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13. PENSION AND OTHER POSTRETIREMENT BENEFITS (continued)

	Other Postretirement Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	4		$	3		$	7		$	7
Interest expense:
Interest expense	83			85			166			169
Amortization of prior service cost	(177		)	(178		)	(355		)	(355		)
Actuarial loss	109			115			219			230
Net periodic pension cost	$	19		$	25		$	37		$	51

For the six months endedSeptember 30, 2018, contributions were made to pension plans and postretirement health and life insurance benefits of approximately $3,318 and $173, respectively. Additional contributions to pension plans and postretirement health and life insurance benefits of approximately $3,412 and $344, respectively, are expected during the remainder of fiscal 2019. During the three months and six months endedSeptember 30, 2018, the Company's cash payments activity triggered settlement accounting, which resulted in $518 of settlement loss recorded in interest expense.

14. INVENTORIES

The following summarizes the Company’s costs in inventory:

	September 30, 2018		September 30, 2017		March 31, 2018
Processed tobacco	$	725,225	$	716,384	$	468,208
Unprocessed tobacco	207,580		192,234		204,149
Other	21,887		20,313		25,730
Total inventory	$	954,692	$	928,931	$	698,087

15. OTHER COMPREHENSIVE (LOSS) INCOME

The movements in accumulated other comprehensive loss and the related tax effects that are due to current period activity and reclassifications to the income statement are shown on the condensed consolidated statements of comprehensive (loss) income. The following summarizes the components reclassified from accumulated other comprehensive loss to earnings for the three months and six months endedSeptember 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Pension and other postretirement benefits*:
Actuarial loss	$	533		$	626		$	1,066		$	1,252
Amortization of prior service cost	(167		)	(167		)	(334		)	(334		)
Amounts reclassified from accumulated other comprehensive loss to net income, gross	366			459			732			918
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income	(164		)	—			(164		)	—
Amounts reclassified from accumulated other comprehensive loss to net income, net	$	202		$	459		$	568		$	918

*Amounts are included in net periodic benefit costs for pension and other postretirement benefits. See "Note 13. Pension and Other Postretirement Benefits" for more information.

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16. SALE OF RECEIVABLES

The Company sells trade receivables to unaffiliated financial institutions under two accounts receivable securitization facilities. Under the first facility, the Company continuously sells a designated pool of trade receivables to a special purpose entity, which sells 100% of the receivables to an unaffiliated financial institution. During the six months endedSeptember 30, 2018, the investment limit of this program was decreased from $155,000 trade receivables to $125,000 trade receivables. Under the second facility, the Company offers receivables for sale to an unaffiliated financial institution, which are then subject to acceptance by the unaffiliated financial institution. As of September 30, 2018, the investment limit under the second facility was $125,000 trade receivables.

Under the facilities, the Company receives a cash payment and a deferred purchase price receivable in exchange for receivables sold. Following the sale and transfer of the receivables to the unaffiliated financial institutions, the receivables are isolated from the Company and control of the receivables is passed to the unaffiliated financial institutions. The unaffiliated financial institutions have all rights to the receivables, including the right to pledge or sell the receivables.

Under the facilities, all of the receivables sold are removed from the condensed consolidated balance sheets and the net cash proceeds received by the Company are included in net cash provided by investing activities in the condensed consolidated statements of cash flows. The deferred purchase price receivable is paid to the Company as payments on the receivables are collected from account debtors. The deferred purchase price receivables represent continuing involvement and a beneficial interest in the transferred financial assets. This beneficial interest is recognized at fair value and is included in trade and other receivables, net in the condensed consolidated balance sheets. See "Note 17. Fair Value Measurements" for more information.

The Company is the servicer of both facilities and may receive funds that are due to the unaffiliated financial institutions, which are net settled on the next settlement date. As a result of the net settlement, trade and other receivables, net in the condensed consolidated balance sheets has been reduced by $5,328, $6,433, and $10,858 as of September 30, 2018 and 2017, and March 31, 2018, respectively.

The difference between the carrying amount of the receivables sold under these facilities, the sum of the cash, and the fair value of the other assets received at the time of transfer is recognized as a loss on the sale of the related receivables and recorded in other income, net in the condensed consolidated statements of operations. The following summarizes the accounts receivable securitization information:

	September 30,				March 31,
	2018		2017		2018
Receivables outstanding in facility	$	81,171	$	123,526	$	228,621
Beneficial interest	17,512		23,668		48,715
Servicing liability	—		—		81
Cash proceeds for the six months ended:
Cash purchase price	$	243,546	$	228,930	$	694,517
Deferred purchase price	114,212		118,118		263,670
Service fees	303		225		473
Total	$	358,061	$	347,273	$	958,660

17. FAIR VALUE MEASUREMENTS

The following summarizes the items measured at fair value on a recurring basis:    

	September 30, 2018						September 30, 2017						March 31, 2018
					Total Assets /						Total Assets /						Total Assets /
					Liabilities						Liabilities						Liabilities
	Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value
Assets
Derivative financial instruments	$	—	$	—	$	—	$	64	$	—	$	64	$	—	$	—	$	—
Securitized beneficial interests	—		17,512		17,512		—		23,668		23,668		—		48,715		48,715
Total assets	$	—	$	17,512	$	17,512	$	64	$	23,668	$	23,732	$	—	$	48,715	$	48,715
Liabilities
Long-term debt	$	897,264	$	706	$	897,970	$	852,082	$	—	$	852,082	$	911,264	$	895	$	912,159
Guarantees	—		1,861		1,861		—		2,770		2,770		—		5,864		5,864
Total liabilities	$	897,264	$	2,567	$	899,831	$	852,082	$	2,770	$	854,852	$	911,264	$	6,759	$	918,023

- 20 -

17. FAIR VALUE MEASUREMENTS (continued)

Level 2 measurements

• Debt: The fair value of debt is based on the market price for similar financial instruments or model-derived valuations whose inputs are observable. The primary inputs to the valuation include market expectations, the Company's credit risk, and the contractual terms of the debt instrument.

• Derivatives: The fair value of derivatives is based on the discounted cash flow analysis of the expected future cash flows. The primary inputs to the valuation include forward yield curves, implied volatilities, LIBOR rates, and credit valuation adjustments.

Level 3 measurements

• Guarantees: The fair value of guarantees is based on the discounted cash flow analysis of the expected future cash flows or historical loss rates. The primary inputs to the discounted cash flow analysis include market interest rates of 15.0% and the Company’s historical loss rates of 2.4% to 10.0% as of September 30, 2018. The historical loss rate was weighted by the principal balance of the loans.

• Securitized beneficial interests: The fair value of securitized beneficial interests is based on the present value of future expected cash flows. The primary inputs to this valuation include payment speeds of 56 days and discount rates of 4.7% as of September 30, 2018. The discount rate was weighted by the outstanding interest. Payment speed was weighted by the average days outstanding.

The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis:

	Three Months Ended September 30, 2018						Six Months Ended September 30, 2018
	Securitized Beneficial Interests			Guarantees			Securitized Beneficial Interests			Guarantees
Beginning balance	$	17,736		$	3,544		$	48,715		$	5,864
Issuances of sales of receivables/guarantees	42,210			1,160			90,896			1,403
Settlements	(41,467		)	(2,839		)	(121,018		)	(5,540		)
(Losses) gains recognized in earnings	(967		)	(4		)	(1,081		)	134
Ending balance	$	17,512		$	1,861		$	17,512		$	1,861

	Three Months Ended September 30, 2017						Six Months Ended September 30, 2017
	Securitized Beneficial Interest			Guarantees			Securitized Beneficial Interest			Guarantees
Beginning balance	$	13,199		$	6,388		$	38,206		$	7,126
Issuances of sales of receivables/guarantees	52,206			1,428			110,763			2,066
Settlements	(40,503		)	(4,578		)	(124,171		)	(5,954		)
Losses recognized in earnings	(1,234		)	(468		)	(1,130		)	(468		)
Ending balance	$	23,668		$	2,770		$	23,668		$	2,770

The change in unrealized losses for securitized beneficial interests as of September 30, 2018 and 2017, and March 31, 2018 were $623, $747, and $2,531, respectively. Gains and losses included in earnings are reported in other income, net in the condensed consolidated statement of operations.

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18. RELATED PARTY TRANSACTIONS

The Company's operating subsidiaries have entered into transactions with affiliates of the Company for the purpose of procuring or processing inventory. The following summarizes sales and purchases with related parties:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Sales	$	6,873	$	7,814	$	13,763	$	23,056
Purchases	10,641		26,423		36,908		37,937

The Company’s accounts payable, related parties and accounts receivable, related parties' balances are disclosed in the condensed consolidated balance sheets and are primarily with its equity method investments located in Asia, Europe, North America, and South America, which purchase and process tobacco or produce consumable e-liquids.

19. INVESTEE COMPANIES

The following summarizes the Company's equity method investments as of September 30, 2018:

Investee Name	Location	Primary Purpose	The Company's Ownership Percentage		Basis Difference
Adams International Ltd.	Thailand	purchase and process tobacco	49	%	—
Alliance One Industries India Private Ltd.	India	purchase and process tobacco	49	%	—
China Brasil Tobacos Exportadora SA	Brazil	purchase and process tobacco	49	%	7,916
Criticality LLC	U.S.	extraction of cannabidiol	40	%	—
Nicotine River, LLC	U.S.	produce consumable e-liquids	40	%	2,212
Oryantal Tutun Paketleme	Turkey	process tobacco	50	%	—
Purilum, LLC	U.S.	produce consumable e-liquids	50	%	—
Siam Tobacco Export Company	Thailand	purchase and process tobacco	49	%	—

Basis differences are amortized over the respective estimated lives of the related assets and liabilities, which range from one to ten years. The Company’s earnings from the equity method investment are reduced by the amortization expense of basis differences.

20. RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

The Company continues to focus on efficiency and cost improvements. During the six months ended September 30, 2018, the Company continued to respond to changes in the business, including the decision to close one of its foreign processing facilities and process tobacco in the affected area under a third-party processing arrangement going forward. The following summarizes restructuring and impairment charges:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Employee separation charges	$	179	$	—	$	1,377	$	—
Asset impairment and other non-cash charges	3		—		346		—
Restructuring and asset impairment charges	$	182	$	—	$	1,723	$	—

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20. RESTRUCTURING AND ASSET IMPAIRMENT CHARGES (continued)

The following summarizes the liability for employee separation charges recorded in the North America and Other Regions segments:

	Three Months Ended September 30,										Six Months Ended September 30,
	2018						2017				2018						2017
	North America			Other Regions			North America		Other Regions		North America			Other Regions			North America			Other Regions
Beginning balance	$	247		$	1,058		$	—	$	129	$	—		$	107		$	60		$	129
Accruals	—			179			—		—		247			1,130			—			—
Payments	(140		)	(348		)	—		—		(140		)	(348		)	(60		)	—
Ending balance, September 30	$	107		$	889		$	—	$	129	$	107		$	889		$	—		$	129

For the three months and six months ended September 30, 2018, the non-cash charges of $3 and $346, respectively, were for the Other Regions segment.

21. SUBSEQUENT EVENTS

On November 5, 2018, the Company’s Board of Directors approved a cost-saving and restructuring initiative to consolidate the Company’s U.S. green tobacco processing operations into its Wilson, North Carolina facility and repurpose its Farmville, North Carolina facility for storage and special projects. The net impact of the initiative will result in a reduction of headcount for which the Company expects to incur severance expense. The initiative is expected to be principally implemented over the next twelve months.  An estimate of the financial effect of this initiative cannot be made as of the date of the filing of this report on Form 10-Q.

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Item 2.    Management’s Discussion and Analysis of
                Financial Condition and Results of Operations

EXECUTIVE OVERVIEW:

Our company changed its name from Alliance One International, Inc. to Pyxus International, Inc. on September 12, 2018. The following executive overview for the period ended September 30, 2018 is intended to provide highlights of the discussion and analysis that follows.

Financial Results

The second fiscal quarter is typically a seasonally lower quarter, and the second quarter this year overall was impacted by decreased volumes due to shipment timing, the larger crop in South America last year, and a stronger U.S. dollar in certain markets. The North American tobacco market in particular was impacted by new and increased foreign tariffs on U.S. tobacco imports, adverse weather conditions and the strength of the U.S. dollar. We are focused on and believe that there are offsetting opportunities in other markets although timing remains uncertain. We experienced a delay in legalization in Canada of adult-use of cannabis to October, and a slower roll-out of our industrial hemp business due to weather and its impact on completing construction of the new facility in Eastern North Carolina. Pyxus is committed to managing our working capital in order to drive efficiency, which is seen clearly in the focus on minimizing uncommitted tobacco inventory levels. Our current ending balance is down 16% from the prior-year period, the lowest second quarter balance in eight years. As a result of announced foreign tariffs and Hurricane Florence, we anticipate a combined negative impact to operating income for the full fiscal year of approximately $25 million related to the North American tobacco business and the new Argentina export tax, when compared to the prior year. Pyxus is working to offset these impacts and expects a solid back half to this fiscal year dependent on shipping and meeting shifting geographic requirements due to new tariffs. While there are challenges this year, we are continuing to execute on our full-year plan and are maintaining our previously announced guidance.

Liquidity

Our liquidity requirements are affected by various factors including crop seasonality, foreign currency and interest rates, green tobacco prices, customer mix, crop size, and quality. During the six months ended September 30, 2018, we utilized surplus cash to reduce long-term debt with the purchase and cancellation of $10.9 million of our 9.875% senior secured second lien notes in April 2018 and an additional $7 million in July 2018, leaving $645.1 million outstanding at September 30, 2018. Our liquidity at quarter end was strong with available credit lines and cash of $422.8 million including available lines for letters of credit. We will continue to monitor and adjust funding sources as needed to enhance and drive various business opportunities that maintain flexibility and meet cost expectations.

Outlook

We have made significant progress in each of our new business lines and embraced our new identity as Pyxus International. Our track-and-trace system, branded SENTRI, along with our agronomy services are proving to be key differentiators as we develop markets and partnerships across all aspects of our business. FIGR, our wholly-owned indirect Canadian subsidiary, has capitalized on the recent legalization of adult recreational cannabis in Canada with a successful launch of branded products, and is well on its way to accomplish its goal to expand to more than one million square feet of production.

As a core aspect of our transformation strategy, we have set corporate sustainability targets across business lines, with an emphasis on science-based targets related to energy and greenhouse gas reductions. At the same time, we are committed to supporting our employees, our contracted farmers and their families, while continually improving our supply-chain management. Pyxus’ mission is to pursue industry-leading sustainability targets and deliver on our purpose to transform people's lives so that together we can grow a better world. We will continue to build on our strengths and make strides in industrial hemp, e-liquids and legal cannabis, while remaining committed to the ongoing success of our tobacco business and maximize opportunities to drive enhanced shareholder value.

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Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS:

Condensed Consolidated Statement of Operations and Supplemental Information
	Three Months Ended September 30,														Six Months Ended September 30,
(in millions, except per kilo amounts)					Change													Change
(percentage change is calculated based on thousands)	2018				$				%		2017				2018				$				%		2017
Kilos sold	82.1				(9.9		)		(10.8	)	92.0				151.6				(1.6		)		(1.0	)	153.2
Tobacco sales and other operating revenues:
Sales and other operating revenues	$	369.5			$	(47.9	)		(11.5	)	$	417.4			$	642.8			$	(27.6	)		(4.1	)	$	670.4
Average price per kilo	4.50				(0.04		)		(0.9	)	4.54				4.24				(0.14		)		(3.2	)	4.38
Processing and other revenues	25.4				(4.5		)		(15.1	)	29.9				43.1				(10.8		)		(20.0	)	53.9
Total sales and other operating revenues	394.9				(52.4		)		(11.7	)	447.3				685.9				(38.4		)		(5.3	)	724.3
Tobacco cost of goods sold:
Tobacco costs	303.9				(33.8		)		(10.0	)	337.7				531.7				(21.1		)		(3.8	)	552.8
Transportation, storage, and other period costs	21.9				(0.8		)		(3.5	)	22.7				34.7				(0.7		)		(2.0	)	35.4
Derivative financial instrument and exchange (gains) losses	(1.8		)		(1.7		)		(1,700.0	)	(0.1		)		(5.5		)		(10.3		)		(214.6	)	4.8
Total tobacco cost of goods sold	324.0				(36.3		)		(10.1	)	360.3				560.9				(32.1		)		(5.4	)	593.0
Average cost per kilo	3.95				0.03				0.8		3.92				3.70				(0.17		)		(4.4	)	3.87
Processing and other revenues cost of services sold	21.7				4.0				22.6		17.7				34.4				1.1				3.3		33.3
Total cost of goods and services sold	345.7				(32.3		)		(8.5	)	378.0				595.3				(31.0		)		(4.9	)	626.3
Gross profit	49.2				(20.1		)		(29.0	)	69.3				90.6				(7.4		)		(7.5	)	98.0
Selling, general, and administrative expenses	39.0				4.5				13.0		34.5				77.1				9.1				13.4		68.0
Other income, net	2.6				(2.0		)		(43.5	)	4.6				5.5				(3.4		)		(38.2	)	8.9
Restructuring and asset impairment charges	0.2				0.2				100.0		—				1.7				1.7				100.0		—
Operating income	12.6			*	(26.9		)	*	(68.1	)	39.5			*	17.3			*	(21.6		)		(55.5	)	38.9
Debt retirement expense (income)	(0.4		)		(0.4		)		(100.0	)	—				(0.5		)		2.5				83.3		(3.0		)
Interest expense	35.3				2.2				6.6		33.1				68.2				0.7				1.0		67.5
Interest income	0.7				—				—		0.7				1.6				(0.1		)		(5.9	)	1.7
Income tax expense	34.8				28.4				443.8		6.4				9.5				2.5				35.7		7.0
Equity in net income (loss) of investee companies	1.6				1.3				433.3		0.3				2.2				2.8				466.7		(0.6		)
Loss attributable to noncontrolling interests	(0.2		)		(0.1		)		(100.0	)	(0.1		)		(0.9		)		(0.8		)		(800.0	)	(0.1		)
(Loss) income attributable to Pyxus International, Inc.	$	(54.6	)		$	(55.6	)	*	(5,560.0	)	$	1.0		*	$	(55.4	)	*	$	(23.9	)	*	(75.9	)	$	(31.5	)	*
*  Amounts do not equal column totals due to rounding

Three Months Ended September 30, 2018 Compared to Three Months Ended September 30, 2017

Summary. Total sales and other operating revenues decreased 11.7% to $394.9 million primarily due to a 10.8% decrease in volumes mainly attributable to the timing of shipments and the larger crop last year in South America. Average sales prices were 0.9% lower with the impact of a stronger U.S. dollar on sales prices including sales denominated in local currency primarily in Europe partially offset by changes in product mix in North America and Asia. While lower volumes and a stronger U.S. dollar decreased tobacco cost of goods sold by 10.1%, the change in product mix resulted in average tobacco costs per kilo increasing 0.8% from the prior

period. Third-party processing services were 15.1% lower primarily from changes in customer demand in South America and Africa. As a result, factory throughput for the processing of these 2018 crops is less resulting in higher conversion costs. Hurricane

- 25 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS (continued)

Three Months Ended September 30, 2018 Compared to Three Months Ended September 30, 2017(continued)

Florence devastated the U.S. flue-cured tobacco crop in the current period. In addition, North America was impacted by foreign tariffs on U.S. tobacco. As a result, factory throughput for the processing of the 2018 U.S. crop will be less resulting in higher conversion costs. The impact on full-service U.S. volumes will be realized in future quarters with the impact on third-party processing services beginning to be realized in the current period. Decreased throughput in South America, Africa and North America increased processing costs by 22.6%. The impact on gross profit was a 29.0% decrease to $49.2 million and gross profit as a percentage of sales declining from 15.5% to 12.5%. Selling, general and administrative expense ("SG&A") increased 13.0% primarily from the inclusion of our new business ventures in the current year and increased costs associated with developing and supporting those new business ventures. With the decreased gross profit and higher SG&A, operating income declined $26.9 million from the prior year.

During the three months ended September 30, 2018, we purchased $7.0 million of our existing 9.875% senior secured second lien notes due 2021 at a discount resulting in debt retirement income of $0.4 million. Our interest costs increased from the prior year primarily due to higher average interest rates on our seasonal lines of credit. Our effective tax rate was (161.1)% this year compared to 90.4% last year. A primary factor affecting the change in effective tax rates is the impact of tax reform in December of the prior year on current year forecasted income and discrete items compared to the prior year. Other factors that ordinarily impact the change in the effective tax rates between years include, but are not limited to, differences in forecasted income for the respective years, differences in year-to-date income for the quarters, certain losses for which no tax benefit is recorded, and differences between discrete items recognized for the quarters that include changes in valuation allowances, net exchanges losses on income tax accounts, and net exchange gains related to liabilities for unrecognized tax benefits.

North America Region Supplemental Information
	Three Months Ended September 30,
(in millions, except per kilo amounts)			Change
	2018		$			%		2017
Kilos sold	7.9		(1.4		)	(15.1	)	9.3
Tobacco sales and other operating revenues:
Sales and other operating revenues	$	46.0	$	(4.6	)	(9.1	)	$	50.6
Average price per kilo	5.82		0.38			7.0		5.44
Processing and other revenues	7.9		(0.8		)	(9.2	)	8.7
Total sales and other operating revenues	53.9		(5.4		)	(9.1	)	59.3
Tobacco cost of goods sold:
Tobacco costs	36.2		(4.3		)	(10.6	)	40.5
Transportation, storage, and other period costs	3.0		(0.5		)	(14.3	)	3.5
Derivative financial instrument and exchange losses (gains)	0.1		0.3			150.0		(0.2		)
Total tobacco cost of goods sold	39.3		(4.5		)	(10.3	)	43.8
Average cost per kilo	4.97		0.26			5.5		4.71
Processing and other revenues cost of services sold	6.8		1.2			21.4		5.6
Total cost of goods and services sold	46.1		(3.3		)	(6.7	)	49.4
Gross profit	7.8		(2.1		)	(21.2	)	9.9
Selling, general, and administrative expenses	4.8		2.3			92.0		2.5
Other income, net	0.4		—			—		0.4
Operating income	3.4		(4.4		)	(56.4	)	7.8

Total sales and other operating revenues decreased 9.1% to $53.9 million primarily due to a 15.1% decrease in volumes from prior year opportunistic sales of byproducts that did not recur and the timing of shipments in Guatemala. The impact of lower volumes

was partially offset by higher average sales prices related to product mix with lamina sales comprising 6% more of total sales in the current period compared to the prior period. Average tobacco costs per kilo also increased 5.5% from the related change in

- 26 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS (continued)

Three Months Ended September 30, 2018 Compared to Three Months Ended September 30, 2017(continued)

North America Region (continued)

product mix. Hurricane Florence devastated the U.S. flue-cured tobacco crop in the current period. In addition, North America was impacted by foreign tariffs on U.S. tobacco. As a result, factory throughput for the processing of the 2018 crop will be less resulting in higher conversion costs. The impact on full-service volumes will be realized in future quarters while the impact on third-party processing services are beginning to be realized in the current period. Processing revenues are 9.2% lower and processing costs are 21.4% higher when compared with the prior period. Lower volumes were the main reason for a 21.2% decline in gross profit and the impact of Hurricane Florence on processing and other services decreased gross profit as a percentage of sales from 16.7% last year to 14.5% this year. Higher SG&A was the result of increased allocations of general corporate services. Lower volumes and higher SG&A were the primary drivers in operating income decreasing by $4.4 million in the current period compared to the prior period.

Other Regions Supplemental Information
	Three Months Ended September 30,
(in millions, except per kilo amounts)				Change
	2018			$			%		2017
Kilos sold	74.2			(8.5		)	(10.3	)	82.7
Tobacco sales and other operating revenues:
Sales and other operating revenues	$	323.5		$	(43.3	)	(11.8	)	$	366.8
Average price per kilo	4.36			(0.08		)	(1.8	)	4.44
Processing and other revenues	17.5			(3.7		)	(17.5	)	21.2
Total sales and other operating revenues	341.0			(47.0		)	(12.1	)	388.0
Tobacco cost of goods sold:
Tobacco costs	267.7			(29.5		)	(9.9	)	297.2
Transportation, storage, and other period costs	18.9			(0.3		)	(1.6	)	19.2
Derivative financial instrument and exchange (gains) losses	(1.9		)	(2.0		)	(2,000.0	)	0.1
Total tobacco cost of goods sold	284.7			(31.8		)	(10.0	)	316.5
Average cost per kilo	3.84			0.01			0.3		3.83
Processing and other revenues cost of services sold	14.9			2.8			23.1		12.1
Total cost of goods and services sold	299.6			(29.0		)	(8.8	)	328.6
Gross profit	41.4			(18.0		)	(30.3	)	59.4
Selling, general, and administrative expenses	34.2			2.2			6.9		32.0
Other income, net	2.2			(2.0		)	(47.6	)	4.2
Restructuring and asset impairment charges	0.2			0.2			100.0		—
Operating income	$	9.2		$	(22.4	)	(70.9	)	$	31.6

Total sales and other operating revenues decreased 12.1% primarily from a 10.3% decrease in volumes mainly attributable to the timing of shipments and the larger crop last year in South America. Average sales prices were 1.8% lower driven by the impact of a stronger U.S. dollar on sales prices including sales denominated in local currency primarily in Europe. Partially offsetting the currency impact on sales prices was product mix and customer mix mainly from Asia. While lower volumes and a stronger U.S. dollar decreased tobacco cost of goods sold by 10.0%, the change in product mix resulted in average tobacco costs per kilo remaining consistent with the prior period. Third party processing services were 17.5% lower from changes in customer demand in South America and Africa. As a result, factory throughput for the processing of these 2018 crops is less resulting in higher conversion costs which increased processing costs by 23.1%. Lower volumes were the main reason for a 30.3% decline in gross profit and gross profit as a percentage of sales decreasing from 15.3% to 12.1%. Increases in SG&A were primarily associated with the inclusion of our new business ventures in the current year and increased costs associated with developing and supporting those new business ventures. Lower volumes were the primary driver of operating income declining $22.4 million from the prior year.

- 27 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS (continued)

Six Months EndedSeptember 30, 2018 Compared to Six Months EndedSeptember 30, 2017

Summary. Total sales and other operating revenues decreased 5.3% to $685.9 million primarily due to lower average sales prices as a result of product mix and the impact of a stronger U.S. dollar on sales prices including sales denominated in local currency primarily in Europe, combined with a 1.0% decline in volumes from prior year opportunistic sales in North America and the timing of shipments in Guatemala. The change in product mix and a stronger U.S. dollar decreased tobacco cost of goods sold by 5.4% and average tobacco costs per kilo by 4.4%. Third party processing services were 20.0% lower primarily from changes in customer demand in South America and Africa. As a result, factory throughput for the processing of these 2018 crops was less resulting in

higher conversion costs. Hurricane Florence devastated the U.S. flue-cured tobacco crop in the current period. As a result, factory throughput for the processing of the 2018 U.S. crop will be less resulting in higher conversion costs. The impact on full service U.S. volumes will be realized in future quarters with the impact on third-party processing services beginning to be realized in the current year. Decreased throughput in South America, Africa and North America, partially offset by the impact of a stronger U.S. dollar on costs, increased processing costs by 3.3%. The impact to gross profit was a 7.5% decrease to $90.6 million and gross profit as a percentage of sales declined from 13.5% to 13.2%. SG&A increased 13.4% primarily from the inclusion of our new business ventures in the current year and increased costs associated with developing and supporting those new business ventures. Restructuring costs are primarily related to employee costs in connection with the closure of a foreign processing facility as we continue to evaluate our global footprint. The decrease in gross profit with higher SG&A lowered operating income by $21.6 million from the prior year.

During the six months ended September 30, 2018, we purchased $17.9 million of our existing 9.875% senior secured second lien notes due 2021 at a discount resulting in debt retirement income of $0.5 million compared to $28.6 million of our existing 9.875% senior secured second lien notes due 2021 purchased during the six months ended September 30, 2017 at a discount resulting in debt retirement income of $3.0 million. Our interest costs increased slightly from the prior year primarily due to higher average interest rates on our seasonal lines of credit. Our effective tax rate was (19.5)% this year compared to (29.4)% last year. A primary factor affecting the change in effective tax rates is the impact of tax reform in December of the prior year on current year forecasted income and discrete items compared to the prior year. Other factors that ordinarily impact the change in the effective tax rates between years include, but are not limited to, differences in forecasted income for the respective years, differences in year-to-date income for the quarters, certain losses for which no tax benefit is recorded, and differences between discrete items recognized for the quarters that include changes in valuation allowances, net exchanges losses on income tax accounts, and net exchange gains related to liabilities for unrecognized tax benefits.

- 28 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS (continued)

Six Months EndedSeptember 30, 2018 Compared to Six Months EndedSeptember 30, 2017(continued)

North America Region Supplemental Information
	Six Months Ended September 30,
(in millions, except per kilo amounts)				Change
	2018			$			%		2017
Kilos sold	18.9			(1.2		)	(6.0	)	20.1
Tobacco sales and other operating revenues:
Sales and other operating revenues	$	92.4		$	(20.1	)	(17.9	)	$	112.5
Average price per kilo	4.89			(0.71		)	(12.7	)	5.60
Processing and other revenues	11.5			(0.6		)	(5.0	)	12.1
Total sales and other operating revenues	103.9			(20.7		)	(16.6	)	124.6
Tobacco cost of goods sold:
Tobacco costs	74.4			(19.0		)	(20.3	)	93.4
Transportation, storage, and other period costs	5.8			(0.2		)	(3.3	)	6.0
Total tobacco cost of goods sold	80.2			(19.2		)	(19.3	)	99.4
Average cost per kilo	4.24			(0.71		)	(14.3	)	4.95
Processing and other revenues cost of services sold	8.9			1.3			17.1		7.6
Total cost of goods and services sold	89.1			(17.9		)	(16.7	)	107.0
Gross profit	14.8			(2.8		)	(15.9	)	17.6
Selling, general, and administrative expenses	10.6			(1.0		)	(8.6	)	11.6
Other (expense) income, net	(0.2		)	(0.3		)	(300.0	)	0.1
Restructuring and asset impairment charges	0.1			0.1			100.0		—
Operating income	$	3.9		$	(2.2	)	(36.1	)	$	6.1

Total sales and other operating revenues decreased 16.6% to $103.9 million primarily due to a 6.0% decrease in volumes from prior year opportunistic sales and the timing of shipments in Guatemala. Revenues further declined as a result of lower average sales prices related to product mix with byproduct sales comprising 9.0% more of total sales in the current period compared to the prior period. Average tobacco costs per kilo also decreased 14.3% from the related change in product mix. Hurricane Florence devastated the U.S. flue-cured tobacco crop in the current period. As a result, factory throughput for the processing of the 2018 crop will be less resulting in higher conversion costs. The impact on full service volumes will be realized in future quarters while the impact on third-party processing services are beginning to be realized in the current period. As a result, processing revenues are 5.0% lower and processing costs are 17.1% higher when compared with the prior period. Lower volumes were the main reason for a 15.9% decline in gross profit although the change in product mix resulted in gross profit as a percentage of sales of 14.2% in the current year remaining consistent with the 14.1% from last year. SG&A decreased 8.6% primarily due to lower allocations of general corporate services. The decrease in volumes and change in product mix were the main drivers in operating income declining by $2.2 million.

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Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

RESULTS OF OPERATIONS (continued)

Six Months EndedSeptember 30, 2018 Compared to Six Months EndedSeptember 30, 2017(continued)

Other Regions Supplemental Information
	Six Months Ended September 30,
(in millions, except per kilo amounts)				Change
	2018			$			%		2017
Kilos sold	132.7			(0.4		)	(0.3	)	133.1
Tobacco sales and other operating revenues:
Sales and other operating revenues	$	550.4		$	(7.5	)	(1.3	)	$	557.9
Average price per kilo	4.15			(0.04		)	(1.0	)	4.19
Processing and other revenues	31.6			(10.2		)	(24.4	)	41.8
Total sales and other operating revenues	582.0			(17.7		)	(3.0	)	599.7
Tobacco cost of goods sold:
Tobacco costs	457.3			(2.1		)	(0.5	)	459.4
Transportation, storage, and other period costs	28.9			(0.5		)	(1.7	)	29.4
Derivative financial instrument and exchange (gains) losses	(5.5		)	(10.3		)	(214.6	)	4.8
Total tobacco cost of goods sold	480.7			(12.9		)	(2.6	)	493.6
Average cost per kilo	3.62			(0.09		)	(2.4	)	3.71
Processing and other revenues cost of services sold	25.5			(0.2		)	(0.8	)	25.7
Total cost of goods and services sold	506.2			(13.1		)	(2.5	)	519.3
Gross profit	75.8			(4.6		)	(5.7	)	80.4
Selling, general, and administrative expenses	66.4			10.0			17.7		56.4
Other income, net	5.7			(3.1		)	(35.2	)	8.8
Restructuring and asset impairment charges	1.6			1.6			100.0		—
Operating income	$	13.5		$	(19.3	)	(58.8	)	$	32.8

Total sales and other operating revenues decreased 3.0% primarily from a 24.4% decrease in processing and other revenues from changes in customer demand in South America and Africa. Revenues were also negatively impacted by lower average sales prices driven by the impact of a stronger U.S. dollar on sales prices, including sales denominated in local currency primarily in Europe. Partially offsetting the currency impact on sales prices was product mix and customer mix, mainly from Asia. Volumes declined slightly by 0.3% due to the timing of shipments primarily in Europe. A stronger U.S. dollar was the primary reason for tobacco cost of goods sold decreasing by 2.6% and average tobacco costs per kilo by 2.4%. As a result of lower customer demand for processing services, factory throughput for the processing of 2018 crops in South America and Africa is less resulting in higher conversion costs. However, the stronger U.S. dollar impact on costs resulted in processing costs only decreasing by 0.8%. These factors led to a decline in gross profit by 5.7% and gross profit as a percentage of sales decreasing slightly from 13.4% to 13.0%. Increases in SG&A were primarily associated with the inclusion of our new business ventures in the current year and increased costs associated with developing and supporting those new business ventures. Restructuring costs are primarily related to employee costs in connection with the closure of a foreign processing facility as we continue to evaluate our global footprint. Lower processing services and higher SG&A were the primary drivers of operating income declining $19.3 million from the prior year.

- 30 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

LIQUIDITY AND CAPITAL RESOURCES:

Overview

Our leaf tobacco business is seasonal, and purchasing, processing, and selling activities have several associated peaks where cash on hand and outstanding indebtedness may vary significantly compared to fiscal year-end. We utilize capital in excess of cash flow from operations to finance accounts receivable, inventory, and advances to tobacco suppliers in foreign countries, including Argentina, Brazil, Guatemala, Malawi, Tanzania, Turkey, and Zambia. In addition, from time to time, we may elect to purchase, redeem, repay, retire, or cancel indebtedness prior to stated maturity under our various foreign credit lines and senior secured credit agreement or indentures, as permitted therein.

As of September 30, 2018, we reached a seasonally adjusted high for our South American crop lines as we are shipping inventory and collecting receivables. In Africa, purchasing is almost complete and processing and shipping will peak in the third quarter. In Asia, the Thai crop has been processed, packed and is shipping, while Indian Mysore is being purchased, with processing and shipping scheduled to occur during the third quarter. Indonesian purchasing also began in August, and we are processing and beginning to ship. Europe has almost completed processing, and shipping will follow during the third and fourth quarters. North America has commenced flue cured purchasing and processing, with shipping scheduled to occur in full effect during the third quarter, seasonally elevating working capital requirements. Depreciation of the U.S. dollar versus many of the currencies in which we have costs may continue to have an impact on our working capital requirements and, accordingly we plan to monitor and hedge foreign currency costs prudently, and as needed on a currency-by-currency basis.

Working Capital

Our working capital decreased from $711.5 million at March 31, 2018 to $636.9 million at September 30, 2018. Our current ratio was 1.8 to 1 at September 30, 2018 and 2.1 to 1 at March 31, 2018. The decrease in working capital is primarily related to lower cash balances and accounts receivable due to the timing of collections partially offset by the seasonal buildup of African and South American inventories and advances to tobacco suppliers and the related seasonal increase of notes payable to finance the purchase and processing of these crops.

The following is a summary of items from the condensed consolidated balance sheets and condensed statements of consolidated cash flows:

	September 30,						March 31,
(in millions except for current ratio)	2018			2017			2018
Cash and cash equivalents	$	117.0		$	188.9		$	264.7
Trade and other receivables, net	229.2			230.8			304.4
Inventories and advances to tobacco suppliers	1,019.9			994.6			728.6
Total current assets	1,421.4			1,468.7			1,349.6
Notes payable to banks	613.9			549.0			427.3
Accounts payable	48.1			56.4			76.5
Advances from customers	11.0			15.1			24.1
Total current liabilities	784.5			725.2			638.1
Current ratio	1.8 to 1			2.0 to 1			2.1 to 1
Working capital	636.9			743.5			711.5
Long-term debt	905.1			917.5			920.1
Stockholders’ equity attributable to Pyxus International, Inc.	212.4			179.1			271.9
Net cash provided (used) by:
Operating activities	(419.3		)	(410.2		)
Investing activities	87.2			103.6
Financing activities	180.9			22.3

Approximately $64.2 million of our outstanding cash balance at September 30, 2018 was held in foreign jurisdictions. As a result of our cash needs abroad, it is our intention to permanently reinvest these funds in foreign jurisdictions regardless of the fact that the cost of repatriation would not have a material financial impact.

- 31 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

LIQUIDITY AND CAPITAL RESOURCES (continued)

Operating Cash Flows

Net cash used by operating activities increased $9.1 million in the six months endedSeptember 30, 2018 compared to the 2017 period. The increase in cash used was primarily due to a larger seasonal buildup of African and South American inventories and advances to tobacco suppliers due to larger crop sizes in Africa and timing of shipments. 

Investing Cash Flows

Net cash provided by investing activities decreased$16.4 million in the six months endedSeptember 30, 2018 compared to the 2017 period. The decrease in cash provided was primarily due to higher purchases for property, plant, and equipment related to expansion of new business ventures and acquisition of certain majority-owned investments during the current year.

Financing Cash Flows

Net cash provided by financing activities increased$158.6 million in the six months endedSeptember 30, 2018 compared to the 2017 period. This increase is primarily due to higher net proceeds from short-term borrowings due to the timing of shipments when compared with the prior year and increases in purchasing requirements for the current African and South American crops.

Debt Financing

We continue to finance our business with a combination of short-term and long-term seasonal credit lines, an ABL facility, long-term debt securities, customer advances, and cash from operations when available. At September 30, 2018, we had cash of $117.0 million and total debt outstanding of $1,519.2 million comprised of $613.9 million of short-term notes payable to banks, $269.9 million of 8.5% senior secured first lien notes, $634.7 million of 9.875% senior secured second lien notes, and $0.7 million of other long-term debt. The $186.6 million seasonal increase in notes payable to banks from March 31, 2018 to September 30, 2018 results from the timing of borrowings under the African and Brazilian credit lines. Aggregated peak borrowings by facility occurring at any time during the three months ended September 30, 2018 and 2017, were $711.7 million at a weighted average interest rate of 6.5% and $650.1 million at a weighted average interest rate of 5.7%, respectively. Aggregated peak borrowings by facility occurring at any time during the three months ended September 30, 2018 and 2017 were repaid with cash provided by operating activities. Available credit as of September 30, 2018 was $305.8 million comprised of $60.0 million under our ABL facility, $238.9 million of notes payable to banks, and $6.9 million of availability for letters of credit. Borrowing under the ABL facility is permitted only to the extent that, after consideration of the application of the proceeds of the borrowing, our unrestricted cash and cash equivalents would not exceed $180.0 million. At September 30, 2018, our unrestricted cash and cash equivalents was $117.0 million. In fiscal 2019, we expect to incur capital expenditures of approximately $80.0 million.  Approximately $31.0 million will be expended for routine replacement of equipment and investments intended to add value to our customers or increase efficiency in our tobacco business.  The remainder will be expended for expansion of our production capacity in Canada with anticipated funding by future Canadian structure-finance products.

No cash dividends were paid to shareholders during the three months ended September 30, 2018 and the payment of dividends is restricted under the terms of our ABL credit facility and the indentures governing the 8.5% senior secured first lien notes and the 9.875% senior secured second lien notes due 2021. We believe that our sources of liquidity will be sufficient to fund our anticipated needs for the next twelve months.

- 32 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

LIQUIDITY AND CAPITAL RESOURCES (continued)

Debt Financing (continued)

All debt agreements contain certain cross-default or cross-acceleration provisions. The following table summarizes our debt financing as of September 30, 2018:

					September 30, 2018
	Outstanding				Lines and
	March 31,		September 30,		Letters		Interest
(in millions)	2018		2018		Available		Rate
Senior secured credit facility:
ABL facility (1)	$	—	$	—	$	60.0	—	%
Senior notes:
8.5% senior secured first lien notes due 2021	268.9		269.9		—		8.5	%
9.875% senior secured second lien notes due 2021	650.5		634.7		—		9.9	%
Other long-term debt	0.9		0.7		—		5.8	%	(2)
Notes payable to banks (3)	427.3		613.9		238.9		6.3	%	(2)
Total debt	$	1,347.6	$	1,519.2	$	298.9
Short-term	$	427.3	$	613.9
Long-term:
Current portion of long-term debt	$	0.2	$	0.2
Long-term debt	920.1		905.1
	$	920.3	$	905.3
Letters of credit	$	4.8	$	2.6	6.9
Total credit available					$	305.8
(1)  As of September 30, 2018, the full amount of the ABL facility was available. Borrowing is permitted under the ABL facility only to the extent that, after consideration of the application of the proceeds of the borrowing, the Company’s unrestricted cash and cash equivalents would not exceed $180.0 million. At September 30, 2018, the Company’s unrestricted cash and cash equivalents was $117.0 million.
(2)  Weighted average rate for the trailing twelve months ended September 30, 2018.
(3)  Primarily foreign seasonal lines of credit

Foreign Seasonal Lines of Credit

We have typically financed our non-U.S. operations with uncommitted unsecured short-term seasonal lines of credit at the local level. These operating lines are seasonal in nature, normally extending for a term of 180 to 270 days, corresponding to the tobacco crop cycle in that location. These facilities are typically uncommitted in that the lenders have the right to cease making loans and demand repayment of loans at any time. These loans are typically renewed at the outset of each tobacco season. As of September 30, 2018, we had $613.9 million drawn and outstanding on foreign seasonal lines with maximum capacity totaling $862.3 million subject to limitations as provided for in the agreement governing our ABL credit facility. Additionally, against these lines there was $9.5 million available in letter of credit capacity with $2.6 million issued but unfunded.

RECENT ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED:

See "Note 1. Basis of Presentation and Significant Accounting Policies" for more information.

- 33 -

Item 2.    Management’s Discussion and Analysis of

        Financial Condition and Results of Operations (continued)

FACTORS THAT MAY AFFECT FUTURE RESULTS:

Readers are cautioned that the statements contained in this report regarding expectations of our performance or other matters that may affect our business, results of operations, or financial condition are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements, which are based on current expectations of future events, may be identified by the use of words such as “strategy,” “expects,” “continues,” “plans,” “anticipates,” “believes,” “will,” “estimates,” “intends,” “projects,” “goals,” “targets,” and other words of similar meaning. These statements also may be identified by the fact that they do not relate strictly to historical or current facts. If underlying assumptions prove inaccurate, or if known or unknown risks or uncertainties materialize, actual results could vary materially from those anticipated, estimated, or projected. Some of these risks and uncertainties include changes in the timing of anticipated shipments, changes in anticipated geographic product sourcing, political instability in sourcing locations, currency and interest rate fluctuations, shifts in the global supply and demand position for our tobacco products, and the impact of regulation and litigation on our customers. A further list and description of these risks, uncertainties, and other factors can be found in the “Risk Factors” section of our annual report on Form 10-K for the fiscal year ended March 31, 2018 in Part II, Item 1A of this report and in our other filings with the Securities and Exchange Commission. We do not undertake to update any forward-looking statements that we may make from time to time.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk.

There have been no significant changes to our market risk since March 31, 2018. For a discussion on our exposure to market risk, refer to Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk” contained in our Annual Report on Form 10-K for the year ended March 31, 2018.

Item 4.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) designed to provide reasonable assurance that the information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that this information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. Due to inherent limitations, our disclosure controls and procedures, however well designed and operated, can provide only reasonable assurance (not absolute) that the objectives of the disclosure controls and procedures are met.

In connection with the preparation of this quarterly report on Form 10-Q, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as required by Rule 13a-15(b) of the Exchange Act), as of September 30, 2018. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) were effective to provide reasonable assurance as of September 30, 2018.

Changes in Internal Control Over Financial Reporting

As required by Rule 13a-15(d) under the Exchange Act, the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, have evaluated the Company’s internal control over financial reporting to determine whether any changes occurred during the quarter covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

There were no changes that occurred during the three months ended September 30, 2018 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

- 34 -

Part II. Other Information

Item 1.    Legal Proceedings

See "Note 10. Contingencies and Other Information” for the information required by Regulation S-K Item 103 of the Exchange Act. In addition, the Company received a subpoena from the SEC, dated November 28, 2016, for documents relating to the restatement of its financial statements for the years ended March 31, 2013, 2014 and 2015 and the three months ended June 30, 2015, which restatements were filed with the SEC on May 25, 2016. The Company is cooperating fully with the SEC and providing the requested materials.

In addition to the above-mentioned matters, certain of the Company’s subsidiaries are involved in other litigation or legal matters incidental to their business activities, including tax matters. While the outcome of these matters cannot be predicted with certainty, the Company is vigorously defending them and does not currently expect that any of them will have a material adverse effect on its business or financial position. However, should one or more of these matters be resolved in a manner adverse to its current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material.

Item 1A.    Risk Factors

As of the date of this report, there are no material changes to the risk factors previously disclosed in Part I, Item 1A "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2018. Investors should carefully consider these factors, which could materially affect our business, financial condition, or operating results, in addition to the other information set forth in this report and in our other filings with the Securities and Exchange Commission.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.    Defaults Upon Senior Securities

None.

Item 4.    Mine Safety Disclosures

N/A

Item 5.    Other Information

None.

- 35 -

Item 6.    Exhibits.
3.01	Amended and Restated Articles of Incorporation, as amended, of Pyxus International, Inc. (formerly known as Alliance One International, Inc.) (filed herewith)
3.02	Amended and Restated Bylaws of Pyxus International, Inc., incorporated by reference to Exhibit 3.02 to the Current Report on Form 8-K, filed on September 12, 2018 (SEC File No. 001-13684)
4.01	Specimen of Common Stock certificate (filed herewith)
31.01	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
31.02	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
32	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)
101.INS	XBRL Instance Document (filed herewith)
101.SCH	XBRL Taxonomy Extension Schema (filed herewith)
101.CAL	XBRL Taxonomy Extension Calculation Linkbase (filed herewith)
101.DEF	XBRL Taxonomy Extension Definition Linkbase (filed herewith)
101.LAB	XBRL Taxonomy Extension Label Linkbase (filed herewith)
101.PRE	XBRL Taxonomy Extension Presentation Linkbase (filed herewith)

- 36 -

SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
	Pyxus International, Inc.
	/s/ Todd B. Compton
Date: November 7, 2018	Todd B. Compton Vice President - Controller (Principal Accounting Officer)

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EX-3.01

Exhibit 3.01

AMENDED AND RESTATED

ARTICLES OF INCORPORATION

OF

ALLIANCE ONE INTERNATIONAL, INC.

ARTICLE I

The name of the Corporation is Alliance One International, Inc.

ARTICLE II

The purpose for which the Corporation is formed is to transact any or all lawful business, not required to be specifically stated in these Articles, for which corporations may be incorporated under the Virginia Stock Corporation Act, as amended from time to time (the “VSCA”).

ARTICLE III

The Corporation shall have the authority to issue 250 million shares of Common Stock, without par value, and 10 million shares of Preferred Stock, without par value. The rights, preferences, voting powers and qualifications, limitations and restrictions of the authorized stock shall be as follows:

A. Common Stock

1. Each share of Common Stock shall be entitled to one vote on all matters submitted to a vote at any meeting of shareholders.

2. Except as otherwise required by the VSCA or the Board of Directors acting pursuant to Section 13.1-707 of the VSCA:

(a) Any corporate action, except the election of directors, an amendment or restatement of these Articles, a merger, a statutory share exchange, the sale or other disposition of all or substantially all the Corporation’s assets otherwise than in the usual and regular course of business, or dissolution shall, for each voting group entitled to vote on the matter, be approved at a meeting at which a quorum of the voting group is present if the votes cast in favor of the action exceed the votes cast against the action;

(b) Directors shall be elected by a plurality of the votes cast by the shares entitled to vote in the election at a meeting at which a quorum is present; and

(c) An amendment or restatement of these Articles, a merger, a statutory share exchange, the sale or other disposition of all or substantially all the Corporation’s assets other than in the usual and regular course of business, or dissolution shall, for each voting group entitled to vote on the matter, be approved at a meeting by a majority of the votes entitled to be cast by each voting group that is entitled to vote on the matter.

3. Subject to the rights of holders of Preferred Stock and subject to any other provisions of these Articles or any amendment hereto, holders of Common Stock shall be entitled to receive such dividends and other distributions in cash, stock or property of the Corporation as may be declared thereon by the Board of Directors from time to time.

B. Preferred Stock

The Board of Directors may determine the preferences, limitations and relative rights, to the extent permitted by the VSCA, of any class of shares of Preferred Stock before the issuance of any shares of that class, or of one or more series within a class before the issuance of any shares of that series. Each class or series shall be appropriately designated by a distinguishing designation prior to the issuance of any shares thereof. The Preferred Stock of all series shall have preferences, limitations and relative rights identical with those of other shares of the same series and, except to the extent otherwise provided in the description of the series, with those of shares of other series of the same class.

Prior to the issuance of any shares of a class or series of Preferred Stock, (1) the Board of Directors shall establish such class or series by adopting a resolution and by filing with the State Corporation Commission of Virginia articles of amendment setting forth the designation and number of shares of the class or series and the relative rights and preferences thereof, and (2) the State Corporation Commission of Virginia shall have issued a certificate of amendment.

ARTICLE IV

No holder of shares of any class of the Corporation shall have any preemptive or preferential right to purchase or to subscribe to: (A) any shares of any class of the Corporation, whether now or hereafter authorized; (B) any warrants, rights, or options to purchase any such shares; or (C) any securities or obligations convertible into any such shares or into warrants, rights or options to purchase any such shares.

ARTICLE V

Board of Directors

The number of directors shall be set forth in the bylaws of the Corporation, as may be amended from time to time (the “Bylaws”), but in the absence of such a provision in the Bylaws, the number of directors of the Corporation shall be 13. The Board of Directors of the Corporation shall be divided into three classes, Class I, Class II and Class III, as nearly equal in number as possible. At each annual meeting of shareholders, the successors to the class of directors whose terms then shall expire shall be identified as being of the same class as the directors they succeed and elected to hold office for a term expiring at the third succeeding annual meeting of shareholders. When the number of directors is changed, any newly-created directorships or any decrease in directorships shall be apportioned among the classes by the Board of Directors as to make all classes as nearly equal in number as possible. Unless otherwise provided in the Bylaws of the Corporation, if any director resigns or retires as a member of the Board of Directors of the Corporation or otherwise becomes unable or unwilling to serve as a director, the remaining directors shall fill such vacancy by appointing a director, and such newly elected director shall hold office for a term expiring at the next annual meeting of the shareholders.  

ARTICLE VI

A. Definitions

For purposes of this Article, the following terms shall have the meanings indicated:

(1) “applicant” means the person seeking indemnification pursuant to this Article;

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(2)“expenses” includes counsel fees;

(3) “liability” means the obligation to pay a judgment, settlement, penalty, fine, including any excise tax assessed with respect to an employee benefit plan, or reasonable expenses incurred with respect to a proceeding;

(4) “party” includes an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding; and

(5) “proceeding” means any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal.

B. Limitation of Liability

In any proceeding brought by a shareholder of the Corporation in the right of the Corporation or brought by or on behalf of shareholders of the Corporation, no director or officer of the Corporation shall be liable to the Corporation or its shareholders for monetary damages with respect to any transaction, occurrence or course of conduct, whether prior or subsequent to the date hereof, except for liability resulting from such person’s having engaged in willful misconduct or a knowing violation of the criminal law or any federal or state securities law.

C. Indemnification

The Corporation shall indemnify (1) any person who is, was or is threatened to be made a party to any proceeding, including a proceeding brought by a shareholder in the right of the Corporation or brought by or on behalf of shareholders of the Corporation, by reason of the fact that such person is or was a director or officer of the Corporation, and (2) any director or officer of the Corporation who is or was serving at the request of the Corporation as a director, trustee, partner or officer of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against any liability incurred by such person in connection with such proceeding except that the Corporation shall make no indemnity against the willful misconduct or knowing violation of the criminal law of any director or officer. A person is considered to be serving an employee benefit plan at the Corporation’s request if such person’s duties to the Corporation also impose duties on, or otherwise involve services by, such person to the plan or to participants in or beneficiaries of the plan. The Corporation shall promptly take all such actions, and make all such determinations, as shall be necessary or appropriate to comply with its obligations to make any indemnity under this Article and shall promptly pay or reimburse all reasonable expenses, including attorneys’ fees, incurred by any such person in connection with such actions and determinations or proceedings of any kind arising therefrom.

D. Application; Amendment

The provisions of this Article shall be applicable to all proceedings commenced after March 31, 1995 (the initial effective date of Amended and Restated Articles of Incorporation of the Corporation), arising from any act or omission, whether occurring before or after such date. No amendment or repeal of this Article shall have any effect on the rights provided under this Article with respect to any act or omission occurring prior to such amendment or repeal. Nothing in this Article shall restrict the right or obligation of the Corporation under law or under the Bylaws of the Corporation to provide such other indemnity permissible by law.

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E. Termination of Proceeding

The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not of itself create a presumption that the applicant engaged in willful misconduct or a knowing violation of the criminal law or any federal or state securities law.

F. Determination of Availability

The Corporation shall take action to indemnify a person seeking indemnification pursuant to this Article VI unless the Corporation determines, within a reasonable time following such person’s demand upon the Corporation for indemnification, that such person is not entitled to indemnification pursuant to the terms of this Article VI and applicable law. The determination shall be made:

(a) by the Board of Directors by a majority vote of a quorum consisting of directors not at the time parties to the proceeding;

(b) if a quorum cannot be obtained under clause (a) of this Article VI(F), by majority vote of a committee duly designated by the Board of Directors (in which designation directors who are parties may participate), consisting solely of two or more directors not at the time parties to the proceeding; or

(c) by special legal counsel

(i) selected by the Board of Directors or its committee in the manner prescribed in clause (a) or (b) of this Article VI(F),

(ii) if a quorum of the Board of Directors cannot be obtained under clause (a) of this Article VI(F) and a committee cannot be designated under clause (b) of this Article VI(F), selected by a majority vote of the full Board of Directors, in which selection directors who are parties may participate, or

(iii) by the holders of Common Stock, but shares owned by or voted under the control of directors who are at the time parties to the proceeding may not be voted on the determination.

Notwithstanding the foregoing, in the event there has been a change in the composition of a majority of the Board of Directors after the date of the alleged act or omission with respect to which indemnification, an advance or reimbursement is claimed, other than through successor Directors approved by the Board of Directors, any determination as to such indemnification, advance or reimbursement shall be made by special legal counsel agreed upon by the Board of Directors and the eligible person. If the Board of Directors and the eligible person are unable to agree upon such special legal counsel, the Board of Directors and the eligible person each shall select a nominee, and the nominees shall select such special legal counsel.

G. Advances

1. Unless a determination has been made pursuant to Article VI(F) that indemnification is not permissible, the Corporation (i) shall make advances and reimbursements for expenses incurred by a director

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or officer of the Corporation, in any capacity, and (ii) shall, to the extent approved by action of the Board of Directors, make advances and reimbursements for expenses incurred by any person who is or was serving at the request of the Corporation as a director, trustee, partner or officer of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, in each case in a proceeding upon receipt of:

(a) a written statement of such director’s or officer’s good faith belief that he has met the standard of conduct described in Article VI(C); and

(b) a written undertaking from such director or officer, executed personally or on his behalf, to repay such advance or reimbursement if it is ultimately determined that such director or officer did not meet such standard of conduct.

2. The undertaking required by Article VI(G)(1)(b) shall be an unlimited, unsecured general obligation of the director or officer and shall be accepted without reference to such director’s or officer’s financial ability to make repayment.

3. Authorizations of payments under this section shall be made by the persons specified in Article VI(F), except that if the determination is made by special legal counsel, such authorization and evaluations shall be made by those entitled under clause (c) of this Article VI(F) to select counsel.

H. Indemnification of Others

The Board of Directors is hereby empowered, by majority vote of a quorum consisting of disinterested directors, to cause the Corporation to indemnify or contract to indemnify any person not specified in Article VI(C) who was, is or is threatened to be made a party to any proceeding, by reason of the fact that such person is or was an employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, to the same extent as if such person was specified as one to whom indemnification is granted in Article VI(C). The provisions of Article VI(D), (E), (F) and (G) shall be applicable to any indemnification provided hereafter pursuant to this Article VI(H).

I. Insurance

The Corporation may purchase and maintain insurance to indemnify it against the whole or any portion of the liability assumed by it in accordance with this Article and may also procure insurance, in such amounts as the Board of Directors may determine, on behalf of any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against any liability asserted against or incurred by him in any such capacity or arising from his status as such, whether or not the Corporation would have power to indemnify him against such liability under the provisions of this Article.

J. Further Indemnity

Every reference herein to directors, officers, employees or agents shall include former directors, officers, employees and agents and their respective heirs, executors and administrators. The indemnification hereby provided and provided hereafter pursuant to the power hereby conferred by this Article on the Board of Directors shall not (1) be exclusive of any other rights to which any person may be entitled, including any right under policies of insurance that may be purchased and maintained by the Corporation or others, with respect to

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claims, issues or matters in relation to which the Corporation would not have the power to indemnify such person under the provisions of this Article; provided, however, that no person shall be entitled to indemnification from the Corporation to the extent that such person has otherwise been indemnified by another person or entity, including but not limited to indemnification under policies of insurance, or (2) prevent or restrict the power of the Corporation to make or to provide for any further indemnity, or provisions for determining entitlement to indemnity, pursuant to one or more indemnification agreements, bylaws, or other arrangements (including, without limitation, creation of trust funds or security interests funded by letters of credit or other means) approved by the Board of Directors (whether or not any of the directors of the Corporation shall be a party to or beneficiary of any such agreements, bylaws or arrangements); provided, however, that any provision of such agreements, bylaws or other arrangements shall not be effective if and to the extent that it is determined to be contrary to this Article or applicable laws of the Commonwealth of Virginia.

K. Severability

Each provision of this Article shall be severable, and an adverse determination as to any such provision shall in no way affect the validity of any other provisions.

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ARTICLES OF AMENDMENT OF THE

AMENDED AND RESTATED ARTICLES OF INCORPORATION OF

ALLIANCE ONE INTERNATIONAL, INC.

I.    The name of the corporation is Alliance One International, Inc. (the “Corporation”).

II.    The amendment (the “Amendment”) adopted is as follows:

The Corporation’s Amended and Restated Articles of Incorporation are amended by adding the following provision at the end of Article III(A):

4.    As of 11:59 p.m. (Eastern Time) on June 26, 2015 (the “Effective Time”), without further action of any kind on the part of the Corporation or its shareholders, every ten shares of Common Stock outstanding or held by the Corporation in its treasury shall be combined, changed and reclassified into one (1) validly issued, fully paid and non-assessable share of Common Stock, without par value, without any other change in the powers, preferences and rights or qualifications, limitations or restrictions thereof. There shall be no fractional shares issued as a result of such combination, change and reclassification, and a holder of record of Common Stock at the Effective Time who would otherwise be entitled to a fraction of a share shall, in lieu thereof, be entitled to receive one full share of Common Stock. Each certificate that immediately prior to the Effective Time represented shares of Common Stock (the “Old Certificates”) shall at and after the Effective Time confer no right upon the holders thereof other than the right to exchange them for certificates representing that number of shares of Common Stock into which the shares of Common Stock represented by the Old Certificates shall have been combined, changed and reclassified, subject to the adjustment for fractional share interests as described above, pursuant to the provisions hereof.

III.    The foregoing Amendment was proposed by the Corporation’s Board of Directors, which found adoption of the Amendment to be in the Corporation’s best interest and directed that the Amendment be submitted to a vote at a meeting of the Corporation’s shareholders on May 27, 2015.

IV.    On April 24, 2015, notice of the meeting of the Corporation’s shareholders, accompanied by a copy of this Amendment, was given in the manner provided in the Virginia Stock Corporation Act to each of the Corporation’s shareholders of record.

V.    The designation, number of outstanding shares, and number of votes entitled to be cast by each voting group entitled to vote separately on the Amendment was:

Designation	Number of Outstanding Shares	Number of Votes Entitled to be Cast
Common Stock, no par value	96,436,220	88,583,099

The total number of votes cast for and against the Amendment, and the number of abstentions, by each voting group entitled to vote separately on the Amendment was:

Voting Group	Votes “For”	Votes “Against	Abstentions
Common Stock, no par value	51,032,441	28,835,047	399,251

The total number of votes cast for the Amendment by each voting group was sufficient for approval of the Amendments by the voting group.

VI.    Pursuant to Section 13.1-606 of the Virginia Stock Corporation Act, this Amendment shall become effective at 11:59 p.m., Eastern Time, on June 26, 2015.

[Signature Page Follows]

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IN WITNESS WHEREOF, the undersigned corporation has caused these Articles of Amendment to be executed by its duly authorized President and Chief Executive Officer as of this 25th day of June, 2015.

ALLIANCE ONE INTERNATIONAL, INC.,

a Virginia corporation

By:     /s/ J. Pieter Sikkel            

Name: J. Pieter Sikkel

Title: President and Chief Executive Officer

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ARTICLES OF AMENDMENT OF THE

AMENDED AND RESTATED ARTICLES OF INCORPORATION OF

ALLIANCE ONE INTERNATIONAL, INC.

I.    The name of the corporation is Alliance One International, Inc. (the “Corporation”).

II.    The amendment (the “Amendment”) adopted is as follows:

The Corporation’s Amended and Restated Articles of Incorporation are amended by amending Article I to read as follows:

“The name of the Corporation is Pyxus International, Inc.”

III.    The foregoing Amendment was proposed by the Corporation’s Board of Directors, which found adoption of the Amendment to be in the Corporation’s best interest and directed that the Amendment be submitted to a vote at a meeting of the Corporation’s shareholders on August 16, 2018.

IV.    On July 16, 2018, notice of the meeting of the Corporation’s shareholders, accompanied by a copy of this Amendment, was given in the manner provided in the Virginia Stock Corporation Act to each of the Corporation’s shareholders of record.

V.    The designation, number of outstanding shares, and number of votes entitled to be cast by each voting group entitled to vote separately on the Amendment was:

Designation	Number of Outstanding Shares	Number of Votes Entitled to be Cast
Common Stock, no par value	9,821,535	9,036,222

The total number of votes cast for and against the Amendment, and the number of abstentions, by each voting group entitled to vote separately on the Amendment was:

Voting Group	Votes “For”	Votes “Against”	Abstentions
Common Stock, no par value	6,798,968	272,999	26,811

The total number of votes cast for the Amendment by each voting group was sufficient for approval of the Amendments by the voting group.

VI.    Pursuant to Section 13.1-606 of the Virginia Stock Corporation Act, this Amendment shall become effective at 12:01 a.m., Eastern Time, on September 12, 2018.

[Signature Page Follows]

IN WITNESS WHEREOF, the undersigned corporation has caused these Articles of Amendment to be executed by its duly authorized President and Chief Executive Officer as of this 7th day of September, 2018.

ALLIANCE ONE INTERNATIONAL, INC.,

a Virginia corporation

By:     /s/ J. Pieter Sikkel            

Name: J. Pieter Sikkel

Title: President and Chief Executive Officer

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EX-4.01

COUNTERSIGNED AND REGISTERED: AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC BROOKLYN, NY TRANSFER AGENT AND REGISTRAR BY: AUTHORIZED SIGNATURE SHARES SPECIMEN C O M M O N S T O C K CUSIP 74737V 10 6 CUSIP 74737V SEE REVERSE FOR CERTAIN DEFINITIONS PRESIDENT AND CHIEF EXECUTIVE OFFICER . nc , I Transfer Agent and Registrar. Transfer . INC L, A N E A O T I I A T N R I A O G N P R 1994 R R I E O T C V N SEAL I S U nternational X Y P I yxus P PYXUS INTERNATIONAL, INC. PYXUS INTERNATIONAL, INCORPORATED UNDER THE LAWS OF THE COMMONWEALTH OF VIRGINIA THE COMMONWEALTH OF THE LAWS UNDER INCORPORATED SPECIMEN - NOT NEGOTIABLE SECRETARY : hat FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK, NO PAR VALUE, OF VALUE, NO PAR AND NON-ASSESSABLE SHARES OF COMMON STOCK, PAID FULLY T of ertifies owner This certificate is not valid unless countersigned and registered by the This certificate is not valid unless countersigned and the facsimile signatures of its duly authorized officers. WITNESS the facsimile seal of the Corporation C : d the his NUMBER is T ate transferable on the books of the Corporation by the holder hereof in person properly endorsed. or by duly authorized attorney upon surrender of this certificate PX D SPECIMEN not negotiable

PYXUS INTERNATIONAL, INC. The Corporation will furnish to any shareholder, without charge and upon request in writing to the office of the Corporation, a full statement of the designations, relative rights, preferences and limitations of the shares of each class authorized to be issued, and the variations in the relative rights, preferences and limitations between the shares of each series of any class of shares authorized to be issued in series, so far as the same have been fixed and determined, and the authority of the board of directors to fix and determine the relative rights, preferences and limitations of subsequent series of shares of any such class. The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common UNIF GIFT MIN ACT - ....................Custodian.................... TEN ENT - as tenants by the entireties (Cust) (Minor) JT TEN - as joint tenants with right of under Uniform Gifts to Minors survivorship and not as tenants in common Act................... (State) Additional abbreviations may also be used though not in the above list. For Value Received, hereby sell, assign and transfer unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE) Shares of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises. Dated NOTICE: THE SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER. Signature(s) Guaranteed By The Signature(s) must be guaranteed by an eligible guarantor institution (Banks, Stockbrokers, Savings and Loan Associations and Credit Unions with membership in an approved Signature Guarantee Medallion Program), pursuant to SEC Rule 17Ad-15. KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, MUTILATED OR DESTROYED, THE CORPORATION MAY REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE.

EX-31.01

Exhibit 31.01

CERTIFICATION

I, J. Pieter Sikkel, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Pyxus International, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ J. Pieter Sikkel

_____________________________________________

J. Pieter Sikkel

President and Chief Executive Officer

November 7, 2018

A signed original of this written statement required by Section 302, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 302, has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-31.02

Exhibit 31.02

CERTIFICATION

I, Joel L. Thomas, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Pyxus International, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ Joel L. Thomas

_____________________________________________

Joel L. Thomas

Executive Vice President-Chief Financial Officer

November 7, 2018

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to section 906 of The Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of Pyxus International, Inc., a Virginia corporation (the "Company"), does hereby certify, to such officer's knowledge, that:

The Quarterly Report on Form 10-Q for the period ended September 30, 2018 (the "Form 10-Q") of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to Pyxus International, Inc. and will be retained by Pyxus International, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Dated: November 7, 2018

/s/ J. Pieter Sikkel

_________________________________________________________

J. Pieter Sikkel

President and Chief Executive Officer

/s/ Joel L. Thomas

_________________________________________________________

Joel L. Thomas

Executive Vice President - Chief Financial Officer

XML

Document and Entity Information - shares	6 Months Ended
	Sep. 30, 2018	Oct. 31, 2018
Document and Entity Information
Entity Registrant Name	PYXUS INTERNATIONAL, INC.
Entity Central Index Key	0000939930
Current Fiscal Year End Date	--03-31
Entity Filer Category	Accelerated Filer
Emerging Growth Company	false
Small Business	false
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		9,069,034

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Sales and other operating revenues	$ 394,876	$ 447,339	$ 685,864	$ 724,332
Cost of goods and services sold	345,672	378,008	595,266	626,366
Gross profit	49,204	69,331	90,598	97,966
Selling, general, and administrative expenses	38,995	34,463	77,079	67,965
Other income, net	2,561	4,587	5,482	8,889
Restructuring and asset impairment charges	182	0	1,723	0
Operating income	12,588	39,455	17,278	38,890
Debt retirement expense (benefit)	(388)	0	(473)	(2,975)
Interest expense (includes debt amortization of $2,366 and $2,668 for the three months and $4,695 and $4,892 for the six months in 2018 and 2017, respectively)	35,324	33,099	68,235	67,540
Interest income	738	727	1,625	1,694
(Loss) income before income taxes and other items	(21,610)	7,083	(48,859)	(23,981)
Income tax expense	34,816	6,403	9,546	7,049
Equity in net income (loss) of investee companies	1,584	276	2,151	(649)
Net (loss) income	(54,842)	956	(56,254)	(31,679)
Net loss attributable to noncontrolling interests	(208)	(68)	(862)	(159)
Net (loss) income attributable to Pyxus International, Inc.	$ (54,634)	$ 1,024	$ (55,392)	$ (31,520)
(Loss) earnings per share:
Basic (USD per share)	$ (6.04)	$ 0.11	$ (6.13)	$ (3.51)
Diluted (USD per share)	$ (6.04)	$ 0.11	$ (6.13)	$ (3.51)
Weighted average number of shares outstanding:
Basic (shares)	9,051	8,982	9,038	8,973
Diluted (shares)	9,051	9,010	9,038	8,973

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Debt amortization	$ 2,366	$ 2,668	$ 4,695	$ 4,892

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (54,842)	$ 956	$ (56,254)	$ (31,679)
Other comprehensive income (loss), net of tax:
Currency translation adjustment	(6)	2,349	(5,318)	6,091
Defined benefit pension amounts reclassified to income	202	459	568	918
Change in pension liability for settlements	771	0	771	0
Change in the fair value of derivatives designated as cash flow hedges	6	0	0	(562)
Amounts reclassified to income for derivatives	774	71	(716)	71
Total other comprehensive income (loss), net of tax	1,747	2,879	(4,695)	6,518
Total comprehensive (loss) income	(53,095)	3,835	(60,949)	(25,161)
Comprehensive income (loss) attributable to noncontrolling interests	43	(68)	(786)	(159)
Comprehensive (loss) income attributable to Pyxus International, Inc.	$ (53,138)	$ 3,903	$ (60,163)	$ (25,002)

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017
Current assets
Cash and cash equivalents	$ 116,970	$ 264,660	$ 188,936
Restricted cash	2,297	2,984	2,272
Trade receivables, net	210,934	285,554	215,113
Other receivables	18,313	18,845	15,654
Accounts receivable, related parties	3,587	8,188	5,325
Inventories	954,692	698,087	928,931
Advances to tobacco suppliers	65,241	30,482	65,639
Recoverable income taxes	10,628	5,994	6,102
Prepaid expenses	21,021	17,181	24,439
Other current assets	17,715	17,628	16,240
Total current assets	1,421,398	1,349,603	1,468,651
Restricted cash	389	389	389
Investments in unconsolidated affiliates	62,838	68,151	52,606
Goodwill	34,698	27,546	16,463
Other intangible assets	73,330	70,724	43,388
Deferred income taxes, net	114,696	130,520	42,113
Long-term recoverable income taxes	898	1,795	0
Other deferred charges	3,094	3,388	4,364
Other noncurrent assets	52,392	60,234	54,723
Property, plant, and equipment, net	259,318	254,281	252,506
Total assets	2,023,051	1,966,631	1,935,203
Current liabilities
Notes payable to banks	613,859	427,277	549,045
Accounts payable	48,095	76,506	56,352
Accounts payable, related parties	22,611	14,835	21,117
Advances from customers	11,045	24,128	15,079
Accrued expenses and other current liabilities	84,682	88,380	83,513
Income taxes payable	4,012	6,767	0
Current portion of long-term debt	165	164	142
Total current liabilities	784,469	638,057	725,248
Long-term taxes payable	9,155	10,027	0
Long-term debt	905,096	920,143	917,491
Deferred income taxes	15,692	28,937	21,549
Liability for unrecognized tax benefits	9,606	11,191	10,603
Pension, postretirement, and other long-term liabilities	70,878	75,448	78,220
Total liabilities	1,794,896	1,683,803	1,753,111
Commitments and contingencies
Common Stock—no par value:
Authorized shares (shares)	250,000,000	250,000,000	250,000,000
Issued shares (shares)	9,849,000	9,808,000	9,781,000
Issued shares	$ 474,221	$ 473,476	$ 472,892
Retained deficit	(211,741)	(156,348)	(240,304)
Accumulated other comprehensive loss	(50,032)	(45,262)	(53,529)
Total stockholders’ equity of Pyxus International, Inc.	212,448	271,866	179,059
Noncontrolling interests	15,707	10,962	3,033
Total stockholders’ equity	228,155	282,828	182,092
Total liabilities and stockholders’ equity	$ 2,023,051	$ 1,966,631	$ 1,935,203

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CONDENSED STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Retained Deficit	Currency Translation Adjustment	Pensions, Net of Tax	Loss on Derivatives, Net of Tax	Noncontrolling Interests
Beginning balance at Mar. 31, 2017	$ 206,710	$ 472,349	$ (208,784)	$ (22,293)	$ (36,654)	$ (1,100)	$ 3,192
Statement of Consolidated Stockholders' Equity
Net loss	(32,633)		(32,543)				(90)
Stock-based compensation	291	291
Other comprehensive (loss) income, net of tax	3,639			3,742	459	(562)
Ending balance at Jun. 30, 2017	178,007	472,640	(241,327)	(18,551)	(36,195)	(1,662)	3,102
Beginning balance at Mar. 31, 2017	206,710	472,349	(208,784)	(22,293)	(36,654)	(1,100)	3,192
Statement of Consolidated Stockholders' Equity
Net loss	(31,679)
Other comprehensive (loss) income, net of tax	6,518
Ending balance at Sep. 30, 2017	182,092	472,892	(240,304)	(16,202)	(35,736)	(1,591)	3,033
Beginning balance at Jun. 30, 2017	178,007	472,640	(241,327)	(18,551)	(36,195)	(1,662)	3,102
Statement of Consolidated Stockholders' Equity
Net loss	956		1,024				(68)
Restricted stock surrender	(2)	(2)
Stock-based compensation	253	253
Other comprehensive (loss) income, net of tax	2,879			2,349	459	71
Ending balance at Sep. 30, 2017	182,092	472,892	(240,304)	(16,202)	(35,736)	(1,591)	3,033
Beginning balance at Mar. 31, 2018	282,828	473,476	(156,348)	(12,682)	(32,580)	0	10,962
Statement of Consolidated Stockholders' Equity
Net loss	(1,413)		(759)				(654)
Stock-based compensation	295	295
Purchase of investment in subsidiary	5,531						5,531
Other comprehensive (loss) income, net of tax	(6,441)			(5,136)	366	(1,496)	(175)
Ending balance at Jun. 30, 2018	280,800	473,771	(157,107)	(17,818)	(32,214)	(1,496)	15,664
Beginning balance at Mar. 31, 2018	282,828	473,476	(156,348)	(12,682)	(32,580)	0	10,962
Statement of Consolidated Stockholders' Equity
Net loss	(56,254)
Other comprehensive (loss) income, net of tax	(4,695)
Ending balance at Sep. 30, 2018	228,155	474,221	(211,741)	(18,075)	(31,241)	(716)	15,707
Beginning balance at Jun. 30, 2018	280,800	473,771	(157,107)	(17,818)	(32,214)	(1,496)	15,664
Statement of Consolidated Stockholders' Equity
Net loss	(54,842)		(54,634)				(208)
Restricted stock surrender	(8)	(8)
Stock-based compensation	458	458
Other comprehensive (loss) income, net of tax	1,747			(257)	973	780	251
Ending balance at Sep. 30, 2018	$ 228,155	$ 474,221	$ (211,741)	$ (18,075)	$ (31,241)	$ (716)	$ 15,707

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
OPERATING ACTIVITIES:
Net loss	$ (56,254)	$ (31,679)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation and amortization	18,393	16,671
Debt amortization/interest	5,832	6,235
Debt retirement benefit	(473)	(2,975)
(Gain) loss on foreign currency transactions	(5,129)	4,678
Restructuring and asset impairment charges	1,723	0
Gain on sale of property, plant, and equipment	(1,627)	0
Equity in net loss of unconsolidated affiliates, net of dividends	699	2,745
Stock-based compensation	753	598
Changes in operating assets and liabilities, net	(386,320)	(407,403)
Other, net	3,086	919
Net cash used by operating activities	(419,317)	(410,211)
INVESTING ACTIVITIES:
Purchases of property, plant, and equipment	(21,508)	(13,318)
Proceeds from sale of property, plant, and equipment	873	1,660
Collections on beneficial interests on securitized trade receivables	114,212	118,118
Dividend received in excess of cumulative earnings	2,846	0
Payments to acquire controlling interests, net of cash acquired	(8,692)	0
Payments to acquire equity method investment	0	(3,000)
Other, net	(546)	153
Net cash provided by investing activities	87,185	103,613
FINANCING ACTIVITIES:
Net proceeds from short-term borrowings	203,100	62,287
Repayment of long-term borrowings	(17,195)	(34,961)
Debt issuance cost	(4,945)	(4,910)
Other, net	45	72
Net cash provided by financing activities	180,915	22,344
Effect of exchange rate changes on cash	2,840	432
Decrease in cash, cash equivalents, and restricted cash	(148,377)	(283,822)
Cash and cash equivalents at beginning of period	264,660	473,110
Restricted cash at beginning of period	3,373	2,309
Cash, cash equivalents, and restricted cash at end of period	119,656	191,597
Other information:
Cash paid for income taxes	15,906	10,040
Cash paid for interest	62,790	63,000
Cash received from interest	(1,200)	(1,690)
Non-cash amounts obtained as a beneficial interest in exchange for transferring trade receivables in a securitization transaction	$ 90,896	$ 110,763

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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company changed its name from Alliance One International, Inc. to Pyxus International, Inc. on September 12, 2018. Due to the seasonal nature of the Company’s business, the results of operations for any fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. In the opinion of management, all normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. All intercompany accounts and transactions have been eliminated.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2018.

Taxes Collected from Customers

Certain subsidiaries are subject to value-added taxes on local sales. These amounts have been included in sales and other operating revenues and cost of goods and services sold and were $5,958 and $7,244 for the three months ended September 30, 2018 and 2017, respectively, and $9,834 and $11,098 for the six months ended September 30, 2018 and 2017, respectively.

Cash and Cash Equivalents

As of September 30, 2018, the Company held $340 in the Zimbabwe Real Time Gross Settlement (“RTGS”) system. RTGS is a local currency equivalent that is exchanged 1:1 with the U.S. Dollar ("USD"). In order to convert RTGS units to USD, the Company must obtain foreign currency resources from the Reserve Bank of Zimbabwe subject to the monetary and exchange control policy in Zimbabwe.

Restricted Cash

As of September 30, 2018 and 2017, and March 31, 2018, $1,256, $2,010 and $1,261 of cash was held on deposit as a compensating balance for short-term borrowings, respectively. As of September 30, 2018 and 2017, and March 31, 2018, $850, zero, and $1,487 of cash was restricted for capital investment, respectively.

Property, Plant, and Equipment

Total property and equipment purchases for the six months endedSeptember 30, 2018 and 2017, respectively, included $1,637 and $245 that were unpaid and included in accounts payable. Additionally, sales from property and equipment for the six months endedSeptember 30, 2018 and 2017 included $1,430 and $82 that were uncollected and included in receivables, respectively.

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, Revenue Recognition (Topic 606), Revenue from Contracts with Customers. ASU 2014-09 outlines a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. The Company adopted this guidance on April 1, 2018 for all contracts using the modified retrospective approach. There was no impact on the condensed consolidated financial statements. The adoption of this guidance resulted in additional disclosures. See "Note 2. Revenue Recognition" for more information.

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Adopted Accounting Pronouncements (continued)

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 clarifies the classification of certain cash receipts and cash payments to reduce the diversity in practice on how these activities are presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes as of September 30, 2017 to the condensed consolidated statement cash flows: cash collections from beneficial interests of $118,118 was reclassified from operating activities to investing activities and $110,763 obtained as a beneficial interest for transferring trade receivables in a securitization transaction has been added as a non-cash disclosure.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230):Restricted Cash. ASU 2016-18 clarifies the presentation of restricted cash on the statement of cash flows to reduce diversity in practice on how restricted cash is presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes: a reclassification of $2,661 and $3,373 from other current and other long-term assets in total to separately stated line items for restricted cash in the condensed consolidated balance sheets as of September 30, 2017 and March 31, 2018, respectively; the change in restricted cash of $352 presented in investing activities in the consolidated statements of cash flows is eliminated as of September 30, 2017; and the inclusion of $2,661 of restricted cash in the calculation of cash, cash equivalents, and restricted cash at the end of the period in the condensed consolidated statements of cash flows as of September 30, 2017.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 was issued to increase the consistency, transparency, and usefulness of financial information of retirement benefits by disaggregating the service cost component from the other components of net benefit cost. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in a reclassification of $343 and $684 from selling, general, and administrative expenses to interest expense in the condensed consolidated statement of operations for the three months and six months ended September 30, 2017, respectively. See "Note 13. Pension and Other Postretirement Benefits" for more information.

In August 2017, the FASB issued ASU No. 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. ASU 2017-12 was issued to better align risk and management activities to financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The Company early adopted this guidance on April 1, 2018 using the modified retrospective approach. The adoption of this guidance did not have a material impact on the condensed consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates, adds, and modifies certain disclosure requirements for fair value measurements. The Company adopted this guidance prospectively on September 30, 2018. The adoption of this guidance resulted in the addition of the weighted average of the significant observable inputs used to develop Level 3 fair value measurements in its disclosures. See "Note 17. Fair Value Measurements" for more information.

Recent Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842),which has been amended through various updates. ASU 2016-02 requires lessees to recognize right-of-use assets and liabilities arising from leases on the balance sheet. In addition, leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance also requires disclosures about the amount, timing, and uncertainty of cash flows arising from leases. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2019. The Company has formed a project team to evaluate and implement this guidance. The Company has elected to adopt an accounting policy for all asset classes to include both the lease and non-lease components as a single component and account for it as a lease. The Company has elected to utilize the transition practical expedients, as prescribed in ASC 842-10-65-1(f). The adoption of this guidance is expected to materially increase assets and liabilities on the consolidated balance sheets. The Company does not expect the adoption of this guidance to have a material impact on its existing debt covenants.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements Not Yet Adopted (continued)

In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The guidance is effective for the Company on April 1, 2019. Early adoption is permitted. This guidance should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans. This guidance removes disclosures, clarifies specific disclosure requirements, and adds disclosure requirements. This guidance will be adopted using a retrospective approach and is effective for the Company on March 31, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

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REVENUE RECOGNITION

6 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

The Company derives revenue from contracts with customers, primarily from the sale of processed tobacco and fees charged for processing and related services to the manufacturers of tobacco products. The Company does not disclose information related to its unsatisfied performance obligations with an expected duration of one year or less. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The Company’s performance obligations are satisfied when the transfer of control of the distinct product or service to the customer occurs. For products, control is transferred and revenue is recognized at a point in time, in accordance with the shipping terms of the contract. For services, control is transferred and revenue is recognized over time using the input method based on a kilogram of packed tobacco. The Company applied a practical expedient to account for shipping and handling costs as costs to fulfill its performance obligations, irrespective of when control transfers. A kilogram of processed tobacco (or tobacco processing services resulting in a kilogram of processed tobacco) is the only material and distinct performance obligation for each of the Company’s revenue streams; therefore, consideration is attributed to the performance of this obligation. Revenue is measured as the amount of consideration to which the Company expects to be entitled to receive in exchange for transferring goods or providing services. Contract costs primarily include labor, material, shipping and handling, and overhead expenses. Certain subsidiaries are subject to value-added taxes on local sales. These amounts have been included in sales and other operating revenues and cost of goods and services sold.

The following disaggregates sales and other operating revenues by major source:

	Three Months Ended September 30, 2018		Six Months Ended September 30, 2018
North America:
Product revenue	$	45,988	$	92,445
Processing and other revenues	7,875		11,470
Total sales and other operating revenues	53,863		103,915
Other Regions:
Product revenue	323,490		550,396
Processing and other revenues	17,523		31,553
Total sales and other operating revenues	341,013		581,949
Total sales and other operating revenues	$	394,876	$	685,864

Product revenue is primarily processed tobacco sold to the customer. Processing and other revenues are mainly contracts to process green tobacco owned and provided by the customer. During processing, ownership remains with the customer and the Company is engaged to perform processing services.

2. REVENUE RECOGNITION (continued)

Assets Recognized from the Costs to Obtain a Contract with a Customer

The Company records product and supply contract intangible assets for the incremental costs of obtaining a contract with a customer if the Company expects the benefit of those costs to be longer than one year, and if such costs are material. The Company applied a practical expedient to expense costs as incurred for costs to obtain a contract when the amortization period would have been one year or less. Total capitalized costs to obtain a contract were immaterial during the periods presented. Capitalized costs to obtain a contract as of September 30, 2018 were $5,674 and classified as other intangible assets. See "Note 5. Goodwill and Intangibles” for more information.

Significant Judgments

The Company has identified two main forms of variable consideration in its contracts with customers: warehousing fees for storing customer-controlled tobacco until the customer requests shipment and claims resulting from tobacco that do not meet customer specifications. Warehousing fees are built into the price of tobacco based on the customers' best estimate of the date they will request shipment or separately charged using a per-day storage rate. When the Company enters into a contract with a customer, the price communicated is the amount of consideration the Company expects to receive. Price adjustments for tobacco not meeting customer specifications for shrinkage, improper blend or chemical makeup, etc. are handled through a claims allowance that is assessed quarterly. The following summarizes activity in the claims allowance:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	1,100		$	1,100
Additions	769			1,732
Payments	(509		)	(1,472		)
Balance, end of period	$	1,360		$	1,360

Contract Balances

The Company generally records a receivable when revenue is recognized. Timing of revenue recognition may differ from the timing of payment from customers. Payment terms and conditions vary by contract, although terms generally include a requirement of payment within 30 to 60 days. The Company applied a practical expedient not to adjust the transaction price for the effects of financing components as the Company expects that the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. As a result, where the timing of revenue recognition differs from the timing of payment, the Company determined its contracts do not include a significant financing component.

The allowance for doubtful accounts reflects the Company’s best estimate of probable losses inherent in the trade receivables, net balance. The Company determines the allowance based on historical experience, and other currently available information. The following summarizes activity in the allowance for doubtful accounts:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	(7,257	)	$	(7,055	)
Additions	(69		)	(362		)
Writes-offs	2			93
Balance, end of period	(7,324		)	(7,324		)
Trade receivables	218,258			218,258
Trade receivables, net	$	210,934		$	210,934

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INCOME TAXES

6 Months Ended

Sep. 30, 2018

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

Accounting for Uncertainty in Income Taxes

As of September 30, 2018, the Company’s unrecognized tax benefits totaled $7,991, $7,754 of which would impact the Company’s effective tax rate, if recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. As of September 30, 2018, accrued interest and penalties totaled $962 and $890, respectively. The Company expects to continue accruing interest expense related to the unrecognized tax benefits described above. The Company may be subject to fluctuations in the unrecognized tax benefit due to currency exchange rate movements.

During the six months ended September 30, 2018, the Company reached an income tax settlement with the Kenyan Revenue Authority for $1,166. An uncertain tax position had previously been recorded of $2,692, which resulted in a favorable adjustment to tax expense of $1,526. The Company entered into negotiations with the Zimbabwe Revenue Authority during its amnesty program to settle asserted issues. The Company has thus far paid $2,988 and has accrued another $964 in anticipation of the settlement. These amounts have not previously been accrued as an uncertain tax position.

The Company does not currently foresee any changes in the amount of its unrecognized tax benefits in the next twelve months but acknowledges circumstances can change due to unexpected developments in the law. In certain jurisdictions, tax authorities have challenged positions that the Company has taken that resulted in recognizing benefits that are material to its financial statements. The Company believes it is more likely than not that it will prevail in these situations and accordingly has not recorded liabilities for these positions. The Company expects the challenged positions to be settled at a time greater than twelve months from its balance sheet date.

The Company and its subsidiaries file a U.S. federal consolidated income tax return as well as returns in several U.S. states and a number of foreign jurisdictions. As of September 30, 2018, the Company’s earliest open tax year for U.S. federal income tax purposes is its fiscal year ended March 31, 2015; however, the Company's net operating loss carryovers from prior periods remain subject to adjustment. Open tax years in state and foreign jurisdictions generally range from three to six years.

Enactment of Tax Cuts and Jobs Act (“Tax Act”)

In December 2017, the SEC staff issued Staff Accounting Bulletin 118 (“SAB 118”), which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC Topic 740-Income Taxes (“ASC 740”).

During the year-ended March 31, 2018, the Company recorded certain provisional impacts of the Tax Act. As noted in prior filings of the Company, the provisional tax effects may differ during the measurement period, possibly materially, due to further refinement of the calculations, changes in interpretations and assumptions made, and additional guidance that may be issued by the Department of the U.S. Treasury, the Internal Revenue Service, and other regulatory and standard setting bodies.

The Company will complete its analysis within its fiscal year 2019 consistent with the guidance provided in SAB 118, and any adjustments during this measurement period will be included in net earnings from continuing operations as an adjustment to income tax expense in the reporting period when such adjustments are determined. No such adjustments were included in income tax expense for the three months and six months ended September 30, 2018.

Provision for the Three Months and Six Months Ended September 30, 2018

The effective tax rate for the three months ended September 30, 2018 and 2017 was (161.1)% and 90.4%, respectively. The effective tax rate for the six months endedSeptember 30, 2018 and 2017 was (19.5)% and (29.4)%, respectively. The primary difference in the effective tax rates year over year is the impact of U.S. tax reform, which resulted in a change in the taxability of operations, principally due to the impact of the new section 163(j) interest addback. The impact was accentuated by the net foreign exchange effects. Similarly, the significant difference in the effective tax rate for the three months and six months ended September 30, 2018 from the U.S. federal statutory rate is primarily due to the impact of U.S. tax reform and changes resulting from net foreign exchange effects.

The Company's quarterly provision for income taxes has historically been calculated using the annual effective tax rate method (“AETR method”), which applies an estimated annual effective tax rate to pre-tax income or loss. However, the Company recorded its interim income tax provision using the discrete method as of September 30, 2018, as allowed under ASC 740-270, Accounting for Income Taxes - Interim Reporting. The Company utilized the discrete method, rather than the AETR method, due to significant variations in income tax expense, primarily driven by U.S. tax reform, relative to projected annual pre-tax income (loss) that would have resulted in a disproportionate and unreliable effective tax rate under the AETR method. Using the discrete method, the Company determined current and deferred income tax expense as if the interim period were an annual period.

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GUARANTEES

6 Months Ended

Sep. 30, 2018

Guarantees [Abstract]

GUARANTEES

GUARANTEES

In certain markets, the Company guarantees bank loans to suppliers to finance their crops. Under long-term arrangements, the Company may also guarantee financing to suppliers for the construction of curing barns or other tobacco production assets. Guaranteed loans are generally repaid concurrent with the delivery of tobacco to the Company. The Company is obligated to repay any guaranteed loan should the supplier default. If default occurs, the Company has recourse against the supplier. The Company also guarantees bank loans of certain unconsolidated subsidiaries in Asia and South America. The following summarizes amounts guaranteed and the fair value of those guarantees:

	September 30, 2018		September 30, 2017		March 31, 2018
Amounts guaranteed (not to exceed)	$	168,709	$	125,060	$	150,900
Amounts outstanding under guarantee	61,904		98,748		126,835
Fair value of guarantees	1,861		2,770		5,864

Of the guarantees outstanding at September 30, 2018, most expire within one year. The fair value of guarantees is recorded in accrued expenses and other current liabilities in the condensed consolidated balance sheets and is included in crop costs, except for the joint venture in Brazil, which is included in accounts receivable, related parties.

In Brazil, certain suppliers obtain government subsidized rural credit financing from local banks that is guaranteed by the Company. The Company withholds amounts owed to suppliers related to the rural credit financing of the supplier upon delivery of tobacco to the Company. The Company remits payments to the local banks on behalf of the guaranteed suppliers. Rural credit financing repayment is due to local banks based on contractual due dates. As of September 30, 2018 and 2017, and March 31, 2018, respectively, the Company had balances of zero, zero, and $14,807 due to local banks on behalf of suppliers included in accounts payable in the condensed consolidated balance sheets.

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GOODWILL AND INTANGIBLES

6 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLES

GOODWILL AND INTANGIBLES

The following summarizes goodwill and other intangible assets as of September 30, 2018 and March 31, 2018:       

	September 30, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Impact of Foreign Currency Translation			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.00 years	$	58,530	$	5,450	$	(27,016	)	$	—		$	36,964
Production and supply contracts	3.31 years	14,893		—		(9,219		)	—			5,674
Internally developed software	2.79 years	18,812		199		(18,103		)	—			908
Licenses	19.36 years	30,339		—		(970		)	(54		)	29,315
Trade names	7.50 years	—		500		(31		)	—			469
Intangibles not subject to amortization:
Goodwill*		27,546		7,174		—			(22		)	34,698
Total		$	150,120	$	13,323	$	(55,339	)	$	(76	)	$	108,028

*Goodwill of $2,795 relates to the North America segment and $31,903 relates to the Other Regions segment.

5. GOODWILL AND INTANGIBLES (continued)

	March 31, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.85 years	$	58,530	$	—	$	(25,005	)	$	33,525
Production and supply contracts	3.82 years	14,893		—		(8,774		)	6,119
Internally developed software	2.82 years	18,581		231		(17,828		)	984
Licenses	19.84 years	—		30,339		(243		)	30,096
Intangibles not subject to amortization:
Goodwill*		16,463		11,083		—			27,546
Total		$	108,467	$	41,653	$	(51,850	)	$	98,270

*Goodwill of $2,795 relates to the North America segment and $24,751 relates to the Other Regions segment.

The following summarizes the estimated future intangible asset amortization expense:

For Fiscal Years Ended	Customer Relationships		Production and Supply Contracts		Internally Developed Software*		Licenses		Trade Names		Total
October 1, 2018 through March 31, 2019	$	2,011	$	1,293	$	236	$	757	$	31	$	4,328
2020	4,022		1,741		333		1,514		63		7,673
2021	4,022		1,397		172		1,514		63		7,168
2022	4,022		1,243		99		1,514		63		6,941
2023	4,022		—		68		1,514		63		5,667
Later	18,865		—		—		22,502		186		41,553
	$	36,964	$	5,674	$	908	$	29,315	$	469	$	73,330

*Estimated amortization expense for the internally developed software is based on costs accumulated as of September 30, 2018. These estimates will change as new costs are incurred and until the software is placed into service in all locations.

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VARIABLE INTEREST ENTITIES

6 Months Ended

Sep. 30, 2018

Variable Interest Entities [Abstract]

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

The Company holds variable interests in multiple variable interest entities that primarily procure or process inventory on behalf of the Company and the other parties. These variable interests relate to equity investments, advances, and guarantees made by the Company. The Company is not the primary beneficiary of the majority of its variable interests in variable interest entities, as it does not have the power to direct the activities that most significantly impact the economic performance of the entities due to the entities’ management and board of directors’ structure. As a result, the majority of these variable interest entities are not consolidated. The Company holds a majority voting interest and is the primary beneficiary of its variable interest in Humble Juice Co., LLC ("Humble"). As a result, Humble is a consolidated entity and its intercompany accounts and transactions have been eliminated.

As of September 30, 2018 and 2017, and March 31, 2018, the Company’s investment in variable interest entities was $57,251, $51,825, and $64,208, respectively, and is classified as investments in unconsolidated affiliates in the condensed consolidated balance sheets. The Company’s advances to these variable interest entities as of September 30, 2018 and 2017, and March 31, 2018 were $994, $5,325, and $5,895, respectively, and classified as accounts receivable, related parties in the condensed consolidated balance sheets. The Company guaranteed an amount to two variable interest entities not to exceed $73,696, $75,625, and $65,487 as of September 30, 2018 and 2017, and March 31, 2018, respectively. The investments, advances, and guarantees in these variable interest entities represent the Company’s maximum exposure to loss.

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SEGMENT INFORMATION

6 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

The Company purchases, processes, sells, and stores leaf tobacco and other specialty products. Tobacco is purchased in more than 35 countries and shipped to approximately 90 countries. The sales, logistics, and billing functions of the Company are primarily concentrated in service centers outside of the producing areas to facilitate access to its major customers. Within certain quality and grade constraints, tobacco is fungible and customers may choose to fulfill their needs from any of the areas where the Company

7. SEGMENT INFORMATION (continued)

purchases tobacco. Sales, logistics, billing, and administrative overhead, including depreciation, which originates primarily from the Company’s corporate and sales offices, are allocated to the segments based on operating income. Intercompany transactions

are allocated to the operating segment that either purchases or processes the tobacco. Investments in new business lines as part of the Company's transformation process are in development and reported in the Other Regions segment.

The following summarizes segment information:       

	Three Months Ended September 30,					Six Months Ended September 30,
	2018			2017		2018			2017
Sales and other operating revenues:
North America	$	53,863		$	59,331	$	103,915		$	124,618
Other Regions	341,013			388,008		581,949			599,714
Total sales and other operating revenues	$	394,876		$	447,339	$	685,864		$	724,332
Operating income:
North America	$	3,353		$	7,772	$	3,795		$	6,123
Other Regions	9,235			31,683		13,483			32,767
Total operating income	12,588			39,455		17,278			38,890
Debt retirement expense (benefit)	(388		)	—		(473		)	(2,975		)
Interest expense	35,324			33,099		68,235			67,540
Interest income	738			727		1,625			1,694
(Loss) income before income taxes and other items	$	(21,610	)	$	7,083	$	(48,859	)	$	(23,981	)

	September 30, 2018		September 30, 2017		March 31, 2018
Segment assets:
North America	$	321,828	$	382,940	$	379,354
Other Regions	1,701,223		1,552,263		1,587,277
Total assets	$	2,023,051	$	1,935,203	$	1,966,631

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(LOSS) EARNINGS PER SHARE

6 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

(LOSS) EARNINGS PER SHARE

EARNINGS PER SHARE

The weighted average number of common shares outstanding is reported as the weighted average of the total shares of common stock outstanding, net of shares of common stock held by a wholly owned subsidiary. Shares of common stock owned by the subsidiary were 785 as of September 30, 2018 and 2017. This subsidiary waives its right to receive dividends and it does not have the right to vote.

Certain potentially dilutive options were not included in the computation of earnings per diluted share because their exercise prices were greater than the average market price of the shares of common stock during the period and their effect would be antidilutive. These shares totaled 427 at a weighted average exercise price of $60.00 per share as of September 30, 2018 and 2017. Diluted net loss per share as of September 30, 2018 and 2017 was the same as basic net loss per share as the effects of potentially dilutive items were antidilutive given the Company’s net loss.

8. (LOSS) EARNINGS PER SHARE (continued)

The following summarizes the computation of earnings per share for the three months and six months ended September 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
(in thousands, except per share data)	2018				2017		2018				2017
Basic (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Basic (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
Diluted (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price	—			*	28		—			*	—			*
Adjusted weighted average number of shares outstanding	9,051				9,010		9,038				8,973
Diluted (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
*All outstanding restricted shares and shares applicable to stock options and restricted stock units are excluded because their inclusion would have an antidilutive effect on the loss per share.

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STOCK-BASED COMPENSATION

6 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

The Company recorded stock-based compensation expense related to stock-based awards granted under its various employee and non-employee stock incentive plans of $458 and $253 for the three months ended September 30, 2018 and 2017, respectively, of which zero and zero, respectively, were for stock-based awards payable in cash and $753 and $598 for the six months ended September 30, 2018 and 2017, respectively, of which zero and $54, respectively, were for stock-based awards payable in cash.

The Company’s shareholders approved the 2016 Incentive Plan (the "2016 Plan") at its annual meeting on August 12, 2016, which is the successor to the 2007 Incentive Plan (the “2007 Plan”) as amended on August 11, 2011 and August 6, 2009. The 2016 Plan is an omnibus plan that provides the flexibility to grant a variety of equity awards including stock options, stock appreciation rights, stock awards, stock units, performance awards, and incentive awards to officers, directors, and employees of the Company.

The following summarizes the Company's stock-based compensation awards:

	Three Months Ended September 30,				Six Months Ended September 30,
(in thousands, except grant date fair value)	2018		2017		2018		2017
Restricted stock
Number granted	6		7		13		14
Grant date fair value	$	23.00	$	10.90	$	19.63	$	12.65
Restricted stock units
Number granted	—		—		61		57
Grant date fair value	$	—	$	—	$	16.00	$	11.75
Performance-based stock units
Number granted	—		—		30		29
Grant date fair value	$	—	$	—	$	16.00	$	11.75

Restricted stock consists of shares issued to non-employee directors of the Company that are not subject to a minimum vesting period. Restricted stock units differ from restricted stock in that shares are not issued until the restrictions lapse. Restricted stock units granted during the six months endedSeptember 30, 2018 vest ratably over a three-year period. Under the terms of the performance-based stock units, shares issued will be contingent upon the achievement of specified business performance goals.

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CONTINGENCIES AND OTHER INFORMATION

6 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES AND OTHER INFORMATION

CONTINGENCIES AND OTHER INFORMATION

The government in the Brazilian State of Parana (“Parana”) issued a tax assessment on October 26, 2007 with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. The assessment for intrastate trade tax credits taken is $3,290 and the total assessment including penalties and interest at September 30, 2018 is $11,285. The Company believes it has properly complied with Brazilian law and will contest any assessment through the judicial process. Should the Company lose in the judicial process, the loss of the intrastate trade tax credits would have a material impact on the financial statements of the Company.  

The Company also has local intrastate trade tax credits in the Brazilian State of Santa Catarina and the State of Rio Grande do Sul. These jurisdictions permit the sale or transfer of excess credits to third parties. However, approval must be obtained from the tax authorities. The Company has an agreement with the state governments regarding the amounts and timing of credits that can be sold. The tax credits have a carrying value of $6,867 as of September 30, 2018, which is net of impairment charges based on management’s expectations about future realization. The intrastate trade tax credits will continue to be monitored for impairment in future periods based on market conditions and the Company’s ability to use or sell the tax credits.

In 1969, the Brazilian government created a tax credit program that allowed companies to earn IPI tax credits (“IPI credits”) based on the value of their exports. The government began to phase out this program in 1979, which resulted in numerous lawsuits between taxpayers and the Brazilian government. The Company has a long legal history with respect to credits it earned while the IPI credit program was in effect. In 2001, the Company won a claim related to certain IPI credits it earned between 1983 and 1990. The Brazilian government appealed this decision and numerous rulings and appeals were rendered on behalf of both the government and the Company from 2001 through 2013. Because of this favorable ruling, the Company began to use these earned IPI credits to offset federal taxes in 2004 and 2005, until it received a Judicial Order to suspend the IPI offsetting in 2005. The value of the federal taxes offset in 2004 and 2005 was $24,142 and the Company established a reserve on these credits at the time of offsetting as they were not yet realizable due to the legal uncertainty that existed. Specifically, the Company extinguished other federal tax liabilities using IPI credits and recorded a liability in pension, postretirement and other long-term liabilities to reflect that the credits were not realizable at that time due to the prevalent legal uncertainty. On March 7, 2013, the Brazilian Supreme Court rendered a final decision in favor of the Company that recognized the validity of the IPI credits and secured the Company's right to benefit from the IPI credits earned from March 1983 to October 1990. This final decision expressly stated the Company has the right to the IPI credits. The Company estimated the total amount of the IPI credits to be approximately $94,316 at March 31, 2013. Since the March 2013 ruling definitively (without the government's ability to appeal) granted the Company the ownership of the IPI credits generated between 1983 and 1990, the Company believed the amount of IPI credits that were used to offset other federal taxes in 2004 and 2005 were realizable beyond a reasonable doubt. Accordingly, and at March 31, 2013, the Company recorded the $24,142 IPI credits it realized in the statements of consolidated operations in other income, net. No further benefit has been recognized pending the outcome of the judicial procedure to ascertain the final amount as those amounts have not yet been realized.

In addition, certain of the Company’s subsidiaries are involved in other litigation or legal matters incidental to their business activities, including tax matters. While the outcome of these matters cannot be predicted with certainty, the Company is vigorously defending them and does not currently expect that any of them will have a material adverse effect on its business or financial position. However, should one or more of these matters be resolved in a manner adverse to its current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material.

In accordance with GAAP, the Company records known asset retirement obligations (“ARO”) for which the liability can be reasonably estimated. Currently, it has identified an ARO associated with one of its facilities that requires it to restore the land to its initial condition upon vacating the facility. The Company has not recognized a liability under GAAP for this ARO because the fair value of restoring the land at this site cannot be reasonably estimated since the settlement date is unknown at this time. The settlement date is unknown because the land restoration is not required until title is returned to the government, and the Company has no current or future plans to return the title. The Company will recognize a liability in the period in which sufficient information is available to reasonably estimate its fair value.

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DEBT ARRANGEMENTS

6 Months Ended

Sep. 30, 2018

Debt Disclosure [Abstract]

DEBT ARRANGEMENTS

DEBT ARRANGEMENTS

ABL Facility

The ABL credit agreement restricts the Company from paying any dividends during the term of this facility subject to the satisfaction of specified financial ratios. In addition, the indentures governing the Company's outstanding 8.5% senior secured first lien notes due 2021 and its outstanding 9.875% senior secured second lien notes due 2021 contain similar restrictions and also prohibit the payment of dividends and other distributions if the Company fails to satisfy a ratio of consolidated EBITDA to fixed charges of at least 2.0 to 1.0. As of September 30, 2018, the Company did not satisfy this fixed charge coverage ratio. The Company may not satisfy this ratio from time to time and failure to meet this fixed charge coverage ratio does not constitute an event of default.

11. DEBT ARRANGEMENTS (continued)

Senior Secured Second Lien Notes

During the six months endedSeptember 30, 2018, the Company purchased $17,868 of its existing 9.875% senior secured second lien notes (the "Second Lien Notes") on the open market. The purchased securities were canceled leaving $645,078 of the Second Lien Notes outstanding at September 30, 2018. Related discounts were $837 resulting in net cash repayment of $17,031 and recorded in repayment of long-term borrowings in the condensed consolidated statements of cash flows. Associated costs paid were $45 and deferred financing costs and amortization of original issue discount of $320 were accelerated.

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DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Sep. 30, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses forward or option currency contracts to protect against volatility associated with certain non-U.S. dollar denominated forecasted transactions. These contracts are for green tobacco purchases, processing costs, and selling, general, and administrative costs. Derivative financial instruments are recognized on the balance sheet as assets and liabilities and are measured at fair value. Changes in the fair value of derivative instruments designated as hedging instruments are recorded each period. The changes in the fair value of derivatives designated as cash flow hedges are recorded in accumulated other comprehensive loss and subsequently reclassified into earnings in the period during which the hedged transactions are recognized in earnings.

As of September 30, 2018 and 2017, accumulated other comprehensive loss includes $716 and $1,591, net of tax of $190 and zero, for unrealized gains related to designated cash flow hedges, respectively. The Company recorded losses / (gains) of $283 and $(985) in its cost of goods and services sold for the three months and six months ended September 30, 2017, respectively. The Company recorded losses of $987 in its cost of goods and services sold for the three months and six months ended September 30, 2018 from the discontinuance of a portion of the Company’s cash flow hedges. The Company recorded a current derivative asset of zero, $64, and zero as of September 30, 2018 and 2017, and March 31, 2018, respectively, included on the condensed consolidated balance sheets.

The Company has elected not to offset fair value amounts recognized for derivative instruments with the same counterparty under a master netting agreement. See "Note 17. Fair Value Measurements” for more information.

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PENSION AND OTHER POSTRETIREMENT BENEFITS

6 Months Ended

Sep. 30, 2018

Retirement Benefits [Abstract]

PENSION AND OTHER POSTRETIREMENT BENEFITS

PENSION AND OTHER POSTRETIREMENT BENEFITS

The Company has multiple benefit plans at several locations. The Company has a defined benefit plan that provides retirement benefits for substantially all U.S. salaried personnel based on years of service rendered, age, and compensation. The Company also maintains various other excess benefit and supplemental plans that provide additional benefits to (1) certain individuals whose compensation, and the resulting benefits that would have actually been paid, are limited by regulations imposed by the Internal Revenue Code and (2) certain individuals in key positions. The Company funds these plans in amounts consistent with the funding requirements of federal law and regulations. The Company also provides certain health and life insurance benefits to retired employees, and their eligible dependents, who meet specified age and service requirements. Additional non-U.S. defined benefit plans cover certain full-time employees located in Germany, Turkey, and the United Kingdom.

The following summarizes the components of net periodic benefit cost:

	Pension Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	120		$	116		$	240		$	232
Interest expense:
Interest expense	1,155			1,063			2,309			2,126
Expected return on plan assets	(1,286		)	(1,264		)	(2,572		)	(2,529		)
Amortization of prior service cost	11			10			21			21
Settlement loss	518			—			518			—
Actuarial loss	422			511			845			1,022
Net periodic pension cost	$	940		$	436		$	1,361		$	872

13. PENSION AND OTHER POSTRETIREMENT BENEFITS (continued)

	Other Postretirement Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	4		$	3		$	7		$	7
Interest expense:
Interest expense	83			85			166			169
Amortization of prior service cost	(177		)	(178		)	(355		)	(355		)
Actuarial loss	109			115			219			230
Net periodic pension cost	$	19		$	25		$	37		$	51

For the six months endedSeptember 30, 2018, contributions were made to pension plans and postretirement health and life insurance benefits of approximately $3,318 and $173, respectively. Additional contributions to pension plans and postretirement health and life insurance benefits of approximately $3,412 and $344, respectively, are expected during the remainder of fiscal 2019. During the three months and six months endedSeptember 30, 2018, the Company's cash payments activity triggered settlement accounting, which resulted in $518 of settlement loss recorded in interest expense.

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INVENTORIES

6 Months Ended

Sep. 30, 2018

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

The following summarizes the Company’s costs in inventory:

	September 30, 2018		September 30, 2017		March 31, 2018
Processed tobacco	$	725,225	$	716,384	$	468,208
Unprocessed tobacco	207,580		192,234		204,149
Other	21,887		20,313		25,730
Total inventory	$	954,692	$	928,931	$	698,087

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OTHER COMPREHENSIVE (LOSS) INCOME

6 Months Ended

Sep. 30, 2018

Equity [Abstract]

OTHER COMPREHENSIVE (LOSS) INCOME

OTHER COMPREHENSIVE (LOSS) INCOME

The movements in accumulated other comprehensive loss and the related tax effects that are due to current period activity and reclassifications to the income statement are shown on the condensed consolidated statements of comprehensive (loss) income. The following summarizes the components reclassified from accumulated other comprehensive loss to earnings for the three months and six months endedSeptember 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Pension and other postretirement benefits*:
Actuarial loss	$	533		$	626		$	1,066		$	1,252
Amortization of prior service cost	(167		)	(167		)	(334		)	(334		)
Amounts reclassified from accumulated other comprehensive loss to net income, gross	366			459			732			918
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income	(164		)	—			(164		)	—
Amounts reclassified from accumulated other comprehensive loss to net income, net	$	202		$	459		$	568		$	918

*Amounts are included in net periodic benefit costs for pension and other postretirement benefits. See "Note 13. Pension and Other Postretirement Benefits" for more information.

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SALE OF RECEIVABLES

6 Months Ended

Sep. 30, 2018

Transfers and Servicing [Abstract]

SALE OF RECEIVABLES

SALE OF RECEIVABLES

The Company sells trade receivables to unaffiliated financial institutions under two accounts receivable securitization facilities. Under the first facility, the Company continuously sells a designated pool of trade receivables to a special purpose entity, which sells 100% of the receivables to an unaffiliated financial institution. During the six months endedSeptember 30, 2018, the investment limit of this program was decreased from $155,000 trade receivables to $125,000 trade receivables. Under the second facility, the Company offers receivables for sale to an unaffiliated financial institution, which are then subject to acceptance by the unaffiliated financial institution. As of September 30, 2018, the investment limit under the second facility was $125,000 trade receivables.

Under the facilities, the Company receives a cash payment and a deferred purchase price receivable in exchange for receivables sold. Following the sale and transfer of the receivables to the unaffiliated financial institutions, the receivables are isolated from the Company and control of the receivables is passed to the unaffiliated financial institutions. The unaffiliated financial institutions have all rights to the receivables, including the right to pledge or sell the receivables.

Under the facilities, all of the receivables sold are removed from the condensed consolidated balance sheets and the net cash proceeds received by the Company are included in net cash provided by investing activities in the condensed consolidated statements of cash flows. The deferred purchase price receivable is paid to the Company as payments on the receivables are collected from account debtors. The deferred purchase price receivables represent continuing involvement and a beneficial interest in the transferred financial assets. This beneficial interest is recognized at fair value and is included in trade and other receivables, net in the condensed consolidated balance sheets. See "Note 17. Fair Value Measurements" for more information.

The Company is the servicer of both facilities and may receive funds that are due to the unaffiliated financial institutions, which are net settled on the next settlement date. As a result of the net settlement, trade and other receivables, net in the condensed consolidated balance sheets has been reduced by $5,328, $6,433, and $10,858 as of September 30, 2018 and 2017, and March 31, 2018, respectively.

The difference between the carrying amount of the receivables sold under these facilities, the sum of the cash, and the fair value of the other assets received at the time of transfer is recognized as a loss on the sale of the related receivables and recorded in other income, net in the condensed consolidated statements of operations. The following summarizes the accounts receivable securitization information:

	September 30,				March 31,
	2018		2017		2018
Receivables outstanding in facility	$	81,171	$	123,526	$	228,621
Beneficial interest	17,512		23,668		48,715
Servicing liability	—		—		81
Cash proceeds for the six months ended:
Cash purchase price	$	243,546	$	228,930	$	694,517
Deferred purchase price	114,212		118,118		263,670
Service fees	303		225		473
Total	$	358,061	$	347,273	$	958,660

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FAIR VALUE MEASUREMENTS

6 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

The following summarizes the items measured at fair value on a recurring basis:    

	September 30, 2018						September 30, 2017						March 31, 2018
					Total Assets /						Total Assets /						Total Assets /
					Liabilities						Liabilities						Liabilities
	Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value
Assets
Derivative financial instruments	$	—	$	—	$	—	$	64	$	—	$	64	$	—	$	—	$	—
Securitized beneficial interests	—		17,512		17,512		—		23,668		23,668		—		48,715		48,715
Total assets	$	—	$	17,512	$	17,512	$	64	$	23,668	$	23,732	$	—	$	48,715	$	48,715
Liabilities
Long-term debt	$	897,264	$	706	$	897,970	$	852,082	$	—	$	852,082	$	911,264	$	895	$	912,159
Guarantees	—		1,861		1,861		—		2,770		2,770		—		5,864		5,864
Total liabilities	$	897,264	$	2,567	$	899,831	$	852,082	$	2,770	$	854,852	$	911,264	$	6,759	$	918,023

17. FAIR VALUE MEASUREMENTS (continued)

Level 2 measurements

• Debt: The fair value of debt is based on the market price for similar financial instruments or model-derived valuations whose inputs are observable. The primary inputs to the valuation include market expectations, the Company's credit risk, and the contractual terms of the debt instrument.

• Derivatives: The fair value of derivatives is based on the discounted cash flow analysis of the expected future cash flows. The primary inputs to the valuation include forward yield curves, implied volatilities, LIBOR rates, and credit valuation adjustments.

Level 3 measurements

• Guarantees: The fair value of guarantees is based on the discounted cash flow analysis of the expected future cash flows or historical loss rates. The primary inputs to the discounted cash flow analysis include market interest rates of 15.0% and the Company’s historical loss rates of 2.4% to 10.0% as of September 30, 2018. The historical loss rate was weighted by the principal balance of the loans.

• Securitized beneficial interests: The fair value of securitized beneficial interests is based on the present value of future expected cash flows. The primary inputs to this valuation include payment speeds of 56 days and discount rates of 4.7% as of September 30, 2018. The discount rate was weighted by the outstanding interest. Payment speed was weighted by the average days outstanding.

The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis:

	Three Months Ended September 30, 2018						Six Months Ended September 30, 2018
	Securitized Beneficial Interests			Guarantees			Securitized Beneficial Interests			Guarantees
Beginning balance	$	17,736		$	3,544		$	48,715		$	5,864
Issuances of sales of receivables/guarantees	42,210			1,160			90,896			1,403
Settlements	(41,467		)	(2,839		)	(121,018		)	(5,540		)
(Losses) gains recognized in earnings	(967		)	(4		)	(1,081		)	134
Ending balance	$	17,512		$	1,861		$	17,512		$	1,861

	Three Months Ended September 30, 2017						Six Months Ended September 30, 2017
	Securitized Beneficial Interest			Guarantees			Securitized Beneficial Interest			Guarantees
Beginning balance	$	13,199		$	6,388		$	38,206		$	7,126
Issuances of sales of receivables/guarantees	52,206			1,428			110,763			2,066
Settlements	(40,503		)	(4,578		)	(124,171		)	(5,954		)
Losses recognized in earnings	(1,234		)	(468		)	(1,130		)	(468		)
Ending balance	$	23,668		$	2,770		$	23,668		$	2,770

The change in unrealized losses for securitized beneficial interests as of September 30, 2018 and 2017, and March 31, 2018 were $623, $747, and $2,531, respectively. Gains and losses included in earnings are reported in other income, net in the condensed consolidated statement of operations.

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RELATED PARTY TRANSACTIONS

6 Months Ended

Sep. 30, 2018

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

The Company's operating subsidiaries have entered into transactions with affiliates of the Company for the purpose of procuring or processing inventory. The following summarizes sales and purchases with related parties:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Sales	$	6,873	$	7,814	$	13,763	$	23,056
Purchases	10,641		26,423		36,908		37,937

The Company’s accounts payable, related parties and accounts receivable, related parties' balances are disclosed in the condensed consolidated balance sheets and are primarily with its equity method investments located in Asia, Europe, North America, and South America, which purchase and process tobacco or produce consumable e-liquids.

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INVESTEE COMPANIES

6 Months Ended

Sep. 30, 2018

Equity Method Investments and Joint Ventures [Abstract]

INVESTEE COMPANIES

INVESTEE COMPANIES

The following summarizes the Company's equity method investments as of September 30, 2018:

Investee Name	Location	Primary Purpose	The Company's Ownership Percentage		Basis Difference
Adams International Ltd.	Thailand	purchase and process tobacco	49	%	—
Alliance One Industries India Private Ltd.	India	purchase and process tobacco	49	%	—
China Brasil Tobacos Exportadora SA	Brazil	purchase and process tobacco	49	%	7,916
Criticality LLC	U.S.	extraction of cannabidiol	40	%	—
Nicotine River, LLC	U.S.	produce consumable e-liquids	40	%	2,212
Oryantal Tutun Paketleme	Turkey	process tobacco	50	%	—
Purilum, LLC	U.S.	produce consumable e-liquids	50	%	—
Siam Tobacco Export Company	Thailand	purchase and process tobacco	49	%	—

Basis differences are amortized over the respective estimated lives of the related assets and liabilities, which range from one to ten years. The Company’s earnings from the equity method investment are reduced by the amortization expense of basis differences.

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RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

6 Months Ended

Sep. 30, 2018

Restructuring and Related Activities [Abstract]

RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

RESTRUCTURING AND ASSET IMPAIRMENT CHARGES

The Company continues to focus on efficiency and cost improvements. During the six months ended September 30, 2018, the Company continued to respond to changes in the business, including the decision to close one of its foreign processing facilities and process tobacco in the affected area under a third-party processing arrangement going forward. The following summarizes restructuring and impairment charges:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Employee separation charges	$	179	$	—	$	1,377	$	—
Asset impairment and other non-cash charges	3		—		346		—
Restructuring and asset impairment charges	$	182	$	—	$	1,723	$	—

20. RESTRUCTURING AND ASSET IMPAIRMENT CHARGES (continued)

The following summarizes the liability for employee separation charges recorded in the North America and Other Regions segments:

	Three Months Ended September 30,										Six Months Ended September 30,
	2018						2017				2018						2017
	North America			Other Regions			North America		Other Regions		North America			Other Regions			North America			Other Regions
Beginning balance	$	247		$	1,058		$	—	$	129	$	—		$	107		$	60		$	129
Accruals	—			179			—		—		247			1,130			—			—
Payments	(140		)	(348		)	—		—		(140		)	(348		)	(60		)	—
Ending balance, September 30	$	107		$	889		$	—	$	129	$	107		$	889		$	—		$	129

For the three months and six months ended September 30, 2018, the non-cash charges of $3 and $346, respectively, were

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SUBSEQUENT EVENTS

6 Months Ended

Sep. 30, 2018

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

On November 5, 2018, the Company’s Board of Directors approved a cost-saving and restructuring initiative to consolidate the Company’s U.S. green tobacco processing operations into its Wilson, North Carolina facility and repurpose its Farmville, North Carolina facility for storage and special projects. The net impact of the initiative will result in a reduction of headcount for which the Company expects to incur severance expense. The initiative is expected to be principally implemented over the next twelve months.  An estimate of the financial effect of this initiative cannot be made as of the date of the filing of this report on Form 10-Q.

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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The Company changed its name from Alliance One International, Inc. to Pyxus International, Inc. on September 12, 2018. Due to the seasonal nature of the Company’s business, the results of operations for any fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. In the opinion of management, all normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. All intercompany accounts and transactions have been eliminated.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2018.

Taxes Collected from Customers

Taxes Collected from Customers

Certain subsidiaries are subject to value-added taxes on local sales. These amounts have been included in sales and other operating revenues and cost of goods and services sold and were $5,958 and $7,244 for the three months ended September 30, 2018 and 2017, respectively, and $9,834 and $11,098 for the six months ended September 30, 2018 and 2017, respectively.

Cash and Cash Equivalents

Cash and Cash Equivalents

As of September 30, 2018, the Company held $340 in the Zimbabwe Real Time Gross Settlement (“RTGS”) system. RTGS is a local currency equivalent that is exchanged 1:1 with the U.S. Dollar ("USD"). In order to convert RTGS units to USD, the Company must obtain foreign currency resources from the Reserve Bank of Zimbabwe subject to the monetary and exchange control policy in Zimbabwe.

Restricted Cash

Restricted Cash

As of September 30, 2018 and 2017, and March 31, 2018, $1,256, $2,010 and $1,261 of cash was held on deposit as a compensating balance for short-term borrowings, respectively. As of September 30, 2018 and 2017, and March 31, 2018, $850, zero, and $1,487 of cash was restricted for capital investment, respectively.

Property, Plant, and Equipment

Property, Plant, and Equipment

Total property and equipment purchases for the six months endedSeptember 30, 2018 and 2017, respectively, included $1,637 and $245 that were unpaid and included in accounts payable. Additionally, sales from property and equipment for the six months endedSeptember 30, 2018 and 2017 included $1,430 and $82 that were uncollected and included in receivables, respectively.

New Accounting Standards

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2014-09, Revenue Recognition (Topic 606), Revenue from Contracts with Customers. ASU 2014-09 outlines a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. The Company adopted this guidance on April 1, 2018 for all contracts using the modified retrospective approach. There was no impact on the condensed consolidated financial statements. The adoption of this guidance resulted in additional disclosures. See "Note 2. Revenue Recognition" for more information.

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recently Adopted Accounting Pronouncements (continued)

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 clarifies the classification of certain cash receipts and cash payments to reduce the diversity in practice on how these activities are presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes as of September 30, 2017 to the condensed consolidated statement cash flows: cash collections from beneficial interests of $118,118 was reclassified from operating activities to investing activities and $110,763 obtained as a beneficial interest for transferring trade receivables in a securitization transaction has been added as a non-cash disclosure.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230):Restricted Cash. ASU 2016-18 clarifies the presentation of restricted cash on the statement of cash flows to reduce diversity in practice on how restricted cash is presented on the statement of cash flows. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in the following changes: a reclassification of $2,661 and $3,373 from other current and other long-term assets in total to separately stated line items for restricted cash in the condensed consolidated balance sheets as of September 30, 2017 and March 31, 2018, respectively; the change in restricted cash of $352 presented in investing activities in the consolidated statements of cash flows is eliminated as of September 30, 2017; and the inclusion of $2,661 of restricted cash in the calculation of cash, cash equivalents, and restricted cash at the end of the period in the condensed consolidated statements of cash flows as of September 30, 2017.

In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 was issued to increase the consistency, transparency, and usefulness of financial information of retirement benefits by disaggregating the service cost component from the other components of net benefit cost. The Company adopted this guidance on April 1, 2018 using the retrospective approach. The adoption of this guidance resulted in a reclassification of $343 and $684 from selling, general, and administrative expenses to interest expense in the condensed consolidated statement of operations for the three months and six months ended September 30, 2017, respectively. See "Note 13. Pension and Other Postretirement Benefits" for more information.

In August 2017, the FASB issued ASU No. 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. ASU 2017-12 was issued to better align risk and management activities to financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The Company early adopted this guidance on April 1, 2018 using the modified retrospective approach. The adoption of this guidance did not have a material impact on the condensed consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 eliminates, adds, and modifies certain disclosure requirements for fair value measurements. The Company adopted this guidance prospectively on September 30, 2018. The adoption of this guidance resulted in the addition of the weighted average of the significant observable inputs used to develop Level 3 fair value measurements in its disclosures. See "Note 17. Fair Value Measurements" for more information.

Recent Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842),which has been amended through various updates. ASU 2016-02 requires lessees to recognize right-of-use assets and liabilities arising from leases on the balance sheet. In addition, leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance also requires disclosures about the amount, timing, and uncertainty of cash flows arising from leases. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2019. The Company has formed a project team to evaluate and implement this guidance. The Company has elected to adopt an accounting policy for all asset classes to include both the lease and non-lease components as a single component and account for it as a lease. The Company has elected to utilize the transition practical expedients, as prescribed in ASC 842-10-65-1(f). The adoption of this guidance is expected to materially increase assets and liabilities on the consolidated balance sheets. The Company does not expect the adoption of this guidance to have a material impact on its existing debt covenants.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements Not Yet Adopted (continued)

In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The guidance is effective for the Company on April 1, 2019. Early adoption is permitted. This guidance should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans. This guidance removes disclosures, clarifies specific disclosure requirements, and adds disclosure requirements. This guidance will be adopted using a retrospective approach and is effective for the Company on March 31, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures.

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REVENUE RECOGNITION (Tables)

6 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Abstract]

Schedule of Revenue Disaggregated by Major Source

The following disaggregates sales and other operating revenues by major source:

	Three Months Ended September 30, 2018		Six Months Ended September 30, 2018
North America:
Product revenue	$	45,988	$	92,445
Processing and other revenues	7,875		11,470
Total sales and other operating revenues	53,863		103,915
Other Regions:
Product revenue	323,490		550,396
Processing and other revenues	17,523		31,553
Total sales and other operating revenues	341,013		581,949
Total sales and other operating revenues	$	394,876	$	685,864

Schedule of Activity in the Claims Allowance

The following summarizes activity in the claims allowance:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	1,100		$	1,100
Additions	769			1,732
Payments	(509		)	(1,472		)
Balance, end of period	$	1,360		$	1,360

Schedule of Allowance for Doubtful Accounts and Activity of Claims Allowances

The allowance for doubtful accounts reflects the Company’s best estimate of probable losses inherent in the trade receivables, net balance. The Company determines the allowance based on historical experience, and other currently available information. The following summarizes activity in the allowance for doubtful accounts:

	Three Months Ended September 30, 2018			Six Months Ended September 30, 2018
Balance, beginning of period	$	(7,257	)	$	(7,055	)
Additions	(69		)	(362		)
Writes-offs	2			93
Balance, end of period	(7,324		)	(7,324		)
Trade receivables	218,258			218,258
Trade receivables, net	$	210,934		$	210,934

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GUARANTEES (Tables)

6 Months Ended

Sep. 30, 2018

Guarantees [Abstract]

Schedule of Guarantees and Associated Fair Values

The following summarizes amounts guaranteed and the fair value of those guarantees:

	September 30, 2018		September 30, 2017		March 31, 2018
Amounts guaranteed (not to exceed)	$	168,709	$	125,060	$	150,900
Amounts outstanding under guarantee	61,904		98,748		126,835
Fair value of guarantees	1,861		2,770		5,864

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GOODWILL AND INTANGIBLES (Tables)

6 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill and Intangible Asset Rollforward

The following summarizes goodwill and other intangible assets as of September 30, 2018 and March 31, 2018:       

	September 30, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Impact of Foreign Currency Translation			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.00 years	$	58,530	$	5,450	$	(27,016	)	$	—		$	36,964
Production and supply contracts	3.31 years	14,893		—		(9,219		)	—			5,674
Internally developed software	2.79 years	18,812		199		(18,103		)	—			908
Licenses	19.36 years	30,339		—		(970		)	(54		)	29,315
Trade names	7.50 years	—		500		(31		)	—			469
Intangibles not subject to amortization:
Goodwill*		27,546		7,174		—			(22		)	34,698
Total		$	150,120	$	13,323	$	(55,339	)	$	(76	)	$	108,028

*Goodwill of $2,795 relates to the North America segment and $31,903 relates to the Other Regions segment.

5. GOODWILL AND INTANGIBLES (continued)

	March 31, 2018
	Weighted Average Remaining Useful Life	Beginning Gross Carrying Amount		Additions		Accumulated Amortization			Ending Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	10.85 years	$	58,530	$	—	$	(25,005	)	$	33,525
Production and supply contracts	3.82 years	14,893		—		(8,774		)	6,119
Internally developed software	2.82 years	18,581		231		(17,828		)	984
Licenses	19.84 years	—		30,339		(243		)	30,096
Intangibles not subject to amortization:
Goodwill*		16,463		11,083		—			27,546
Total		$	108,467	$	41,653	$	(51,850	)	$	98,270

*Goodwill of $2,795 relates to the North America segment and $24,751 relates to the Other Regions segment.

Schedule of Estimated Intangible Asset Amortization Expense

The following summarizes the estimated future intangible asset amortization expense:

For Fiscal Years Ended	Customer Relationships		Production and Supply Contracts		Internally Developed Software*		Licenses		Trade Names		Total
October 1, 2018 through March 31, 2019	$	2,011	$	1,293	$	236	$	757	$	31	$	4,328
2020	4,022		1,741		333		1,514		63		7,673
2021	4,022		1,397		172		1,514		63		7,168
2022	4,022		1,243		99		1,514		63		6,941
2023	4,022		—		68		1,514		63		5,667
Later	18,865		—		—		22,502		186		41,553
	$	36,964	$	5,674	$	908	$	29,315	$	469	$	73,330

*Estimated amortization expense for the internally developed software is based on costs accumulated as of September 30, 2018. These estimates will change as new costs are incurred and until the software is placed into service in all locations.

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SEGMENT INFORMATION (Tables)

6 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Schedule of Segment Information

The following summarizes segment information:       

	Three Months Ended September 30,					Six Months Ended September 30,
	2018			2017		2018			2017
Sales and other operating revenues:
North America	$	53,863		$	59,331	$	103,915		$	124,618
Other Regions	341,013			388,008		581,949			599,714
Total sales and other operating revenues	$	394,876		$	447,339	$	685,864		$	724,332
Operating income:
North America	$	3,353		$	7,772	$	3,795		$	6,123
Other Regions	9,235			31,683		13,483			32,767
Total operating income	12,588			39,455		17,278			38,890
Debt retirement expense (benefit)	(388		)	—		(473		)	(2,975		)
Interest expense	35,324			33,099		68,235			67,540
Interest income	738			727		1,625			1,694
(Loss) income before income taxes and other items	$	(21,610	)	$	7,083	$	(48,859	)	$	(23,981	)

Schedule of Analysis of Segment Assets

	September 30, 2018		September 30, 2017		March 31, 2018
Segment assets:
North America	$	321,828	$	382,940	$	379,354
Other Regions	1,701,223		1,552,263		1,587,277
Total assets	$	2,023,051	$	1,935,203	$	1,966,631

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(LOSS) EARNINGS PER SHARE (Tables)

6 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Earnings Per Share

The following summarizes the computation of earnings per share for the three months and six months ended September 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
(in thousands, except per share data)	2018				2017		2018				2017
Basic (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Basic (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
Diluted (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$	(54,634	)		$	1,024	$	(55,392	)		$	(31,520	)
Weighted average number of shares outstanding	9,051				8,982		9,038				8,973
Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price	—			*	28		—			*	—			*
Adjusted weighted average number of shares outstanding	9,051				9,010		9,038				8,973
Diluted (loss) income per share	$	(6.04	)		$	0.11	$	(6.13	)		$	(3.51	)
*All outstanding restricted shares and shares applicable to stock options and restricted stock units are excluded because their inclusion would have an antidilutive effect on the loss per share.

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STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Compensation Awards

The Company’s shareholders approved the 2016 Incentive Plan (the "2016 Pl

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PENSION AND OTHER POSTRETIREMENT BENEFITS (Tables)

6 Months Ended

Sep. 30, 2018

Retirement Benefits [Abstract]

Schedule of Net Periodic Benefit Cost

The following summarizes the components of net periodic benefit cost:

	Pension Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	120		$	116		$	240		$	232
Interest expense:
Interest expense	1,155			1,063			2,309			2,126
Expected return on plan assets	(1,286		)	(1,264		)	(2,572		)	(2,529		)
Amortization of prior service cost	11			10			21			21
Settlement loss	518			—			518			—
Actuarial loss	422			511			845			1,022
Net periodic pension cost	$	940		$	436		$	1,361		$	872

13. PENSION AND OTHER POSTRETIREMENT BENEFITS (continued)

	Other Postretirement Benefits
	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Operating expenses:
Service cost	$	4		$	3		$	7		$	7
Interest expense:
Interest expense	83			85			166			169
Amortization of prior service cost	(177		)	(178		)	(355		)	(355		)
Actuarial loss	109			115			219			230
Net periodic pension cost	$	19		$	25		$	37		$	51

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INVENTORIES (Tables)

6 Months Ended

Sep. 30, 2018

Inventory Disclosure [Abstract]

Schedule of Costs in Inventory

The following summarizes the Company’s costs in inventory:

	September 30, 2018		September 30, 2017		March 31, 2018
Processed tobacco	$	725,225	$	716,384	$	468,208
Unprocessed tobacco	207,580		192,234		204,149
Other	21,887		20,313		25,730
Total inventory	$	954,692	$	928,931	$	698,087

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OTHER COMPREHENSIVE (LOSS) INCOME (Tables)

6 Months Ended

Sep. 30, 2018

Equity [Abstract]

Schedule of Components Reclassified from Accumulated Other Comprehensive Loss to Earnings

The following summarizes the components reclassified from accumulated other comprehensive loss to earnings for the three months and six months endedSeptember 30, 2018 and 2017:

	Three Months Ended September 30,						Six Months Ended September 30,
	2018			2017			2018			2017
Pension and other postretirement benefits*:
Actuarial loss	$	533		$	626		$	1,066		$	1,252
Amortization of prior service cost	(167		)	(167		)	(334		)	(334		)
Amounts reclassified from accumulated other comprehensive loss to net income, gross	366			459			732			918
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income	(164		)	—			(164		)	—
Amounts reclassified from accumulated other comprehensive loss to net income, net	$	202		$	459		$	568		$	918

*Amounts are included in net periodic benefit costs for pension and other postretirement benefits. See "Note 13. Pension and Other Postretirement Benefits" for more information.

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SALE OF RECEIVABLES (Tables)

6 Months Ended

Sep. 30, 2018

Transfers and Servicing [Abstract]

Schedule of Accounts Receivable Securitization Information

The following summarizes the accounts receivable securitization information:

	September 30,				March 31,
	2018		2017		2018
Receivables outstanding in facility	$	81,171	$	123,526	$	228,621
Beneficial interest	17,512		23,668		48,715
Servicing liability	—		—		81
Cash proceeds for the six months ended:
Cash purchase price	$	243,546	$	228,930	$	694,517
Deferred purchase price	114,212		118,118		263,670
Service fees	303		225		473
Total	$	358,061	$	347,273	$	958,660

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Schedule of Recurring Fair Value Measurements

The following summarizes the items measured at fair value on a recurring basis:    

	September 30, 2018						September 30, 2017						March 31, 2018
					Total Assets /						Total Assets /						Total Assets /
					Liabilities						Liabilities						Liabilities
	Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value		Level 2		Level 3		at Fair Value
Assets
Derivative financial instruments	$	—	$	—	$	—	$	64	$	—	$	64	$	—	$	—	$	—
Securitized beneficial interests	—		17,512		17,512		—		23,668		23,668		—		48,715		48,715
Total assets	$	—	$	17,512	$	17,512	$	64	$	23,668	$	23,732	$	—	$	48,715	$	48,715
Liabilities
Long-term debt	$	897,264	$	706	$	897,970	$	852,082	$	—	$	852,082	$	911,264	$	895	$	912,159
Guarantees	—		1,861		1,861		—		2,770		2,770		—		5,864		5,864
Total liabilities	$	897,264	$	2,567	$	899,831	$	852,082	$	2,770	$	854,852	$	911,264	$	6,759	$	918,023

Schedule of Assets Measured on Recurring Basis

The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis:

	Three Months Ended September 30, 2018						Six Months Ended September 30, 2018
	Securitized Beneficial Interests			Guarantees			Securitized Beneficial Interests			Guarantees
Beginning balance	$	17,736		$	3,544		$	48,715		$	5,864
Issuances of sales of receivables/guarantees	42,210			1,160			90,896			1,403
Settlements	(41,467		)	(2,839		)	(121,018		)	(5,540		)
(Losses) gains recognized in earnings	(967		)	(4		)	(1,081		)	134
Ending balance	$	17,512		$	1,861		$	17,512		$	1,861

	Three Months Ended September 30, 2017						Six Months Ended September 30, 2017
	Securitized Beneficial Interest			Guarantees			Securitized Beneficial Interest			Guarantees
Beginning balance	$	13,199		$	6,388		$	38,206		$	7,126
Issuances of sales of receivables/guarantees	52,206			1,428			110,763			2,066
Settlements	(40,503		)	(4,578		)	(124,171		)	(5,954		)
Losses recognized in earnings	(1,234		)	(468		)	(1,130		)	(468		)
Ending balance	$	23,668		$	2,770		$	23,668		$	2,770

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RELATED PARTY TRANSACTIONS (Tables)

6 Months Ended

Sep. 30, 2018

Related Party Transactions [Abstract]

Schedule of Related Party Transactions

The following summarizes sales and purchases with related parties:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Sales	$	6,873	$	7,814	$	13,763	$	23,056
Purchases	10,641		26,423		36,908		37,937

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INVESTEE COMPANIES (Tables)

6 Months Ended

Sep. 30, 2018

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investments

The following summarizes the Company's equity method investments as of September 30, 2018:

Investee Name	Location	Primary Purpose	The Company's Ownership Percentage		Basis Difference
Adams International Ltd.	Thailand	purchase and process tobacco	49	%	—
Alliance One Industries India Private Ltd.	India	purchase and process tobacco	49	%	—
China Brasil Tobacos Exportadora SA	Brazil	purchase and process tobacco	49	%	7,916
Criticality LLC	U.S.	extraction of cannabidiol	40	%	—
Nicotine River, LLC	U.S.	produce consumable e-liquids	40	%	2,212
Oryantal Tutun Paketleme	Turkey	process tobacco	50	%	—
Purilum, LLC	U.S.	produce consumable e-liquids	50	%	—
Siam Tobacco Export Company	Thailand	purchase and process tobacco	49	%	—

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RESTRUCTURING AND ASSET IMPAIRMENT CHARGES (Tables)

6 Months Ended

Sep. 30, 2018

Restructuring and Related Activities [Abstract]

Schedule of Restructuring Charges

The following summarizes the liability for employee separation charges recorded in the North America and Other Regions segments:

	Three Months Ended September 30,										Six Months Ended September 30,
	2018						2017				2018						2017
	North America			Other Regions			North America		Other Regions		North America			Other Regions			North America			Other Regions
Beginning balance	$	247		$	1,058		$	—	$	129	$	—		$	107		$	60		$	129
Accruals	—			179			—		—		247			1,130			—			—
Payments	(140		)	(348		)	—		—		(140		)	(348		)	(60		)	—
Ending balance, September 30	$	107		$	889		$	—	$	129	$	107		$	889		$	—		$	129

The following summarizes restructuring and impairment charges:

	Three Months Ended September 30,				Six Months Ended September 30,
	2018		2017		2018		2017
Employee separation charges	$	179	$	—	$	1,377	$	—
Asset impairment and other non-cash charges	3		—		346		—
Restructuring and asset impairment charges	$	182	$	—	$	1,723	$	—

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BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2018	Mar. 31, 2017
Cash and Cash Equivalents [Line Items]
Value added tax expense	$ 5,958,000	$ 7,244,000	$ 9,834,000	$ 11,098,000
Cash and cash equivalents	116,970,000	188,936,000	116,970,000	188,936,000	$ 264,660,000	$ 473,110,000
Cash held on deposit	1,256,000	2,010,000	1,256,000	2,010,000	1,261,000
Cash restricted for capital investment	850,000	0	850,000	0	1,487,000
Purchases of property, plant and equipment		245,000	1,637,000
Sales of property, plant and equipment			1,430,000	82,000
Collections on beneficial interests on securitized trade receivables			114,212,000	118,118,000
Interest expense	35,324,000	33,099,000	68,235,000	67,540,000
Accounting Standards Update 2016-15
Cash and Cash Equivalents [Line Items]
Cash collections from beneficial interests	118,118,000		118,118,000
Collections on beneficial interests on securitized trade receivables			110,763,000
Accounting Standards Update 2016-18
Cash and Cash Equivalents [Line Items]
Restricted cash		2,661,000		2,661,000	$ 3,373,000
Change in restricted cash				352,000
Interest expense		$ 343,000		$ 684,000
Zimbabwe | Cash Held in Real Time Gross Settlement System
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 340,000		$ 340,000

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REVENUE RECOGNITION - Narrative (Details) $ in Thousands	Sep. 30, 2018 USD ($)
Revenue from Contract with Customer [Abstract]
Capitalized costs to obtain a contract	$ 5,674

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REVENUE RECOGNITION - Revenue Disaggregated by Product or Service (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	$ 394,876	$ 447,339	$ 685,864	$ 724,332
North America
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	53,863	59,331	103,915	124,618
Other Regions
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	341,013	$ 388,008	581,949	$ 599,714
Product revenue | North America
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	45,988		92,445
Product revenue | Other Regions
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	323,490		550,396
Processing and other revenues | North America
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	7,875		11,470
Processing and other revenues | Other Regions
Disaggregation of Revenue [Line Items]
Total sales and other operating revenues	$ 17,523		$ 31,553

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REVENUE RECOGNITION - Claims Allowance Activity (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward]
Balance, beginning of period	$ 1,100	$ 1,100
Additions	769	1,732
Payments	(509)	(1,472)
Balance, end of period	$ 1,360	$ 1,360

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REVENUE RECOGNITION - Allowance for Doubtful Accounts (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Sep. 30, 2018 USD ($)	Sep. 30, 2018 USD ($)
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance at beginning of period	$ (7,257)	$ (7,055)
Additions	(69)	(362)
Writes-offs	2	93
Balance at end of period	(7,324)	(7,324)
Trade receivables	218,258	218,258
Trade receivables, net	$ 210,934	$ 210,934

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INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2018
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Unrecognized tax benefits	$ 7,991		$ 7,991
Unrecognized tax benefits that would impact effective tax rate	7,754		7,754
Interest on income taxes accrued	962		962
Income tax penalties accrued	$ 890		$ 890
Effective income tax rate (as a percent)	(161.10%)	90.40%	(19.50%)	(29.40%)
Non-U.S
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Income tax penalties accrued					$ 2,692
Income tax settlements	$ 1,166
Favorable adjustment to tax expense	1,526
Payments for income tax settlements	2,988
Income tax settlement accrual	$ 964		$ 964
Non-U.S | Minimum
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Income tax examination, open tax years			3 years
Non-U.S | Maximum
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Income tax examination, open tax years			6 years

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GUARANTEES - Summary (Details) - USD ($)	6 Months Ended
	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017
Guarantor Obligations [Line Items]
Amounts guaranteed (not to exceed)	$ 168,709,000	$ 150,900,000	$ 125,060,000
Amounts outstanding under guarantee	61,904,000	126,835,000	98,748,000
Fair value of guarantees	$ 1,861,000	5,864,000	2,770,000
Number of years before expiring guarantees	1 year
Financial Guarantee
Guarantor Obligations [Line Items]
Amounts outstanding under guarantee	$ 0	$ 14,807,000	$ 0

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GOODWILL AND INTANGIBLES - Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017
Schedule of Intangible Assets [Line Items]
Beginning Gross Carrying Amount	$ 150,120	$ 108,467
Additions	13,323	41,653
Accumulated Amortization	(55,339)	(51,850)
Impact of Foreign Currency Translation	(76)
Ending Intangible Assets, Net	108,028	98,270
Goodwill	34,698	27,546	$ 16,463
North America
Schedule of Intangible Assets [Line Items]
Goodwill	2,795	2,795
Other Regions
Schedule of Intangible Assets [Line Items]
Goodwill	$ 31,903	$ 24,751
Customer relationships
Schedule of Intangible Assets [Line Items]
Weighted Average Remaining Useful Life	10 years	10 years 10 months 5 days
Beginning Gross Carrying Amount	$ 58,530	$ 58,530
Additions	5,450	0
Accumulated Amortization	(27,016)	(25,005)
Impact of Foreign Currency Translation	0
Ending Intangible Assets, Net	$ 36,964	$ 33,525
Production and supply contracts
Schedule of Intangible Assets [Line Items]
Weighted Average Remaining Useful Life	3 years 3 months 22 days	3 years 9 months 25 days
Beginning Gross Carrying Amount	$ 14,893	$ 14,893
Additions	0	0
Accumulated Amortization	(9,219)	(8,774)
Impact of Foreign Currency Translation	0
Ending Intangible Assets, Net	$ 5,674	$ 6,119
Internally developed software
Schedule of Intangible Assets [Line Items]
Weighted Average Remaining Useful Life	2 years 9 months 14 days	2 years 9 months 25 days
Beginning Gross Carrying Amount	$ 18,812	$ 18,581
Additions	199	231
Accumulated Amortization	(18,103)	(17,828)
Impact of Foreign Currency Translation	0
Ending Intangible Assets, Net	$ 908	$ 984
Licenses
Schedule of Intangible Assets [Line Items]
Weighted Average Remaining Useful Life	19 years 4 months 8 days	19 years 10 months 4 days
Beginning Gross Carrying Amount	$ 30,339	$ 0
Additions	0	30,339
Accumulated Amortization	(970)	(243)
Impact of Foreign Currency Translation	(54)
Ending Intangible Assets, Net	$ 29,315	30,096
Trade names
Schedule of Intangible Assets [Line Items]
Weighted Average Remaining Useful Life	7 years 6 months
Beginning Gross Carrying Amount	$ 0
Additions	500
Accumulated Amortization	(31)
Impact of Foreign Currency Translation	0
Ending Intangible Assets, Net	469
Goodwill
Schedule of Intangible Assets [Line Items]
Beginning Gross Carrying Amount	27,546	16,463
Additions	7,174	11,083
Impact of Foreign Currency Translation	(22)
Ending Intangible Assets, Net	$ 34,698	$ 27,546

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GOODWILL AND INTANGIBLES - Estimated Intangible Asset Amortization Expense (Details) $ in Thousands	Sep. 30, 2018 USD ($)
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	$ 4,328
2020	7,673
2021	7,168
2022	6,941
2023	5,667
Later	41,553
Intangible Assets, Net	73,330
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	2,011
2020	4,022
2021	4,022
2022	4,022
2023	4,022
Later	18,865
Intangible Assets, Net	36,964
Production and Supply Contracts
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	1,293
2020	1,741
2021	1,397
2022	1,243
2023	0
Later	0
Intangible Assets, Net	5,674
Internally Developed Software Intangible
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	236
2020	333
2021	172
2022	99
2023	68
Later	0
Intangible Assets, Net	908
Licenses
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	757
2020	1,514
2021	1,514
2022	1,514
2023	1,514
Later	22,502
Intangible Assets, Net	29,315
Trade Names
Finite-Lived Intangible Assets [Line Items]
October 1, 2018 through March 31, 2019	31
2020	63
2021	63
2022	63
2023	63
Later	186
Intangible Assets, Net	$ 469

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VARIABLE INTEREST ENTITIES - Narrative (Details) $ in Thousands	6 Months Ended
	Sep. 30, 2018 USD ($) joint_venture	Mar. 31, 2018 USD ($)	Sep. 30, 2017 USD ($)
Variable Interest Entity [Line Items]
Investment in joint ventures	$ 62,838	$ 68,151	$ 52,606
Advances to joint ventures	3,587	8,188	5,325
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Investment in joint ventures	57,251	64,208	51,825
Advances to joint ventures	$ 994	5,895	5,325
Number of joint ventures, maximum loss exposure | joint_venture	2
Joint ventures, maximum loss exposure	$ 73,696	$ 65,487	$ 75,625

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SEGMENT INFORMATION - Narrative (Details)	6 Months Ended
	Sep. 30, 2018 country
Segment Reporting [Abstract]
Number of countries in which tobacco is purchased (more than)	35
Number of countries to which tobacco is shipped	90

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SEGMENT INFORMATION - Analysis of Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2018
Segment Reporting Information [Line Items]
Total sales and other operating revenues	$ 394,876	$ 447,339	$ 685,864	$ 724,332
Total operating income	12,588	39,455	17,278	38,890
Debt retirement expense (benefit)	(388)	0	(473)	(2,975)
Interest expense	35,324	33,099	68,235	67,540
Interest income	738	727	1,625	1,694
(Loss) income before income taxes and other items	(21,610)	7,083	(48,859)	(23,981)
Total assets	2,023,051	1,935,203	2,023,051	1,935,203	$ 1,966,631
North America
Segment Reporting Information [Line Items]
Total sales and other operating revenues	53,863	59,331	103,915	124,618
Total operating income	3,353	7,772	3,795	6,123
Total assets	321,828	382,940	321,828	382,940	379,354
Other Regions
Segment Reporting Information [Line Items]
Total sales and other operating revenues	341,013	388,008	581,949	599,714
Total operating income	9,235	31,683	13,483	32,767
Total assets	$ 1,701,223	$ 1,552,263	$ 1,701,223	$ 1,552,263	$ 1,587,277

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(LOSS) EARNINGS PER SHARE - Narrative (Details) - $ / shares shares in Thousands	6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Earnings Per Share [Abstract]
Shares of common stock owned by the subsidiary (in shares)	785	785
Stock Options
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	427	427
Weighted average exercise price of antidilutive shares (USD per share)	$ 60.00	$ 60.00

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(LOSS) EARNINGS PER SHARE - Summary (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Basic (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$ (54,634)	$ 1,024	$ (55,392)	$ (31,520)
Weighted average number of shares outstanding (shares)	9,051	8,982	9,038	8,973
Basic (loss) income per share (USD per share)	$ (6.04)	$ 0.11	$ (6.13)	$ (3.51)
Diluted (loss) income per share:
Net (loss) income attributable to Pyxus International, Inc.	$ (54,634)	$ 1,024	$ (55,392)	$ (31,520)
Weighted average number of shares outstanding (shares)	9,051	8,982	9,038	8,973
Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price (shares)	0	28	0	0
Adjusted weighted average number of common shares outstanding (shares)	9,051	9,010	9,038	8,973
Diluted (loss) income per share (USD per share)	$ (6.04)	$ 0.11	$ (6.13)	$ (3.51)

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STOCK-BASED COMPENSATION - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated share-based compensation expense	$ 458,000	$ 253,000	$ 753,000	$ 598,000
Stock-based Awards Payable in Cash
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated share-based compensation expense	$ 0	$ 0	$ 0	$ 54,000
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	3 years

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STOCK-BASED COMPENSATION - Summary (Details) - $ / shares shares in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number granted (shares)	6	7	13	14
Grant date fair value (USD per share)	$ 23.00	$ 10.90	$ 19.63	$ 12.65
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number granted (shares)	0	0	61	57
Grant date fair value (USD per share)	$ 0.00	$ 0.00	$ 16.00	$ 11.75
Performance-based stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number granted (shares)	0	0	30	29
Grant date fair value (USD per share)	$ 0.00	$ 0.00	$ 16.00	$ 11.75

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CONTINGENCIES AND OTHER INFORMATION - Narrative (Details) $ in Thousands	6 Months Ended	12 Months Ended	24 Months Ended
	Sep. 30, 2018 USD ($) facility	Mar. 31, 2013 USD ($)	Dec. 31, 2005 USD ($)	Oct. 26, 2007 USD ($)
Loss Contingencies [Line Items]
Amount of federal taxes offset			$ 24,142
Number of facilities with an associated asset retirement obligation | facility	1
Other Income (Expense)
Loss Contingencies [Line Items]
Benefit of excise tax		$ 24,142
IPI Credit Bonus
Loss Contingencies [Line Items]
Gain contingency, unrecorded amount		$ 94,316
Tax Assessment | Brazilian State of Parana
Loss Contingencies [Line Items]
Loss contingency, estimate of possible loss	$ 11,285			$ 3,290
Tax Assessment | Brazil State of Rio Grande do Sul and the State of Santa Catarina
Loss Contingencies [Line Items]
Loss contingency, estimate of possible loss	$ 6,867

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DEBT ARRANGEMENTS - Narrative (Details) $ in Thousands	6 Months Ended
	Sep. 30, 2018 USD ($)
Debt Instrument [Line Items]
EBITDA to fixed charges ratio requirement	2.0
Senior Notes | Senior Secured First Lien Notes Due 2021
Debt Instrument [Line Items]
Stated interest rate (as a percent)	8.50%
Senior Notes | Senior Secured Second Lien Notes Due 2021
Debt Instrument [Line Items]
Stated interest rate (as a percent)	9.875%
Extinguishment of debt	$ 17,868
Senior notes	645,078
Unamortized discount	837
Repayments of senior debt	17,031
Associated costs paid	45
Write-off of debt issuance cost and unamortized discount	$ 320

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DERIVATIVE FINANCIAL INSTRUMENTS - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2018
Derivative [Line Items]
Gain (loss) recognized in income	$ (987,000)	$ (283,000)	$ (987,000)	$ 985,000
Current derivative asset	0	64,000	0	64,000	$ 0
Loss on Derivatives
Derivative [Line Items]
Accumulated other comprehensive loss	$ 716,000	$ 1,591,000	716,000	1,591,000
Tax on accumulated other comprehensive loss			$ 190,000	$ 0

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PENSION AND OTHER POSTRETIREMENT BENEFITS - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Contributions by employer			$ 3,318
Additional contributions to the plans	$ 3,412		3,412
Settlement loss	518	$ 0	518	$ 0
Other Postretirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Contributions by employer			173
Additional contributions to the plans	$ 344		$ 344

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PENSION AND OTHER POSTRETIREMENT BENEFITS - Net Periodic Pension Costs (Details) - Pension Benefits - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 120	$ 116	$ 240	$ 232
Interest expense	1,155	1,063	2,309	2,126
Expected return on plan assets	(1,286)	(1,264)	(2,572)	(2,529)
Amortization of prior service cost	11	10	21	21
Settlement loss	518	0	518	0
Actuarial loss	422	511	845	1,022
Net periodic pension cost (benefit)	$ 940	$ 436	$ 1,361	$ 872

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PENSION AND OTHER POSTRETIREMENT BENEFITS - Postretirement Health and Life Insurance Benefits (Details) - Other Postretirement Benefits - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 4	$ 3	$ 7	$ 7
Interest expense	83	85	166	169
Amortization of prior service cost	(177)	(178)	(355)	(355)
Actuarial loss	109	115	219	230
Net periodic pension cost (benefit)	$ 19	$ 25	$ 37	$ 51

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INVENTORIES - Summary (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017
Inventory Disclosure [Abstract]
Processed tobacco	$ 725,225	$ 468,208	$ 716,384
Unprocessed tobacco	207,580	204,149	192,234
Other	21,887	25,730	20,313
Total inventory	$ 954,692	$ 698,087	$ 928,931

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OTHER COMPREHENSIVE (LOSS) INCOME - Components Reclassified from AOCI to Earnings (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Amounts reclassified from accumulated other comprehensive loss to net income, gross	$ (366)	$ (459)	$ (732)	$ (918)
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income	(164)	0	(164)	0
Amounts reclassified from accumulated other comprehensive loss to net income, net	202	459	568	918
Actuarial loss
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Amounts reclassified from accumulated other comprehensive loss to net income, gross	(533)	(626)	(1,066)	(1,252)
Amortization of prior service cost
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items]
Amounts reclassified from accumulated other comprehensive loss to net income, gross	$ 167	$ 167	$ 334	$ 334

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SALE OF RECEIVABLES - Narrative (Details)	6 Months Ended
	Sep. 30, 2018 USD ($) program	Mar. 31, 2018 USD ($)	Sep. 30, 2017 USD ($)
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items]
Number of accounts receivable securitization programs | program	2
Receivables sold, face value discounted (as a percent)	100.00%
Reductions of trade and other receivables due to settlements	$ 5,328,000	$ 10,858,000	$ 6,433,000
Accounts Receivable Securitization, Program One
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items]
Trade receivables, maximum amount	155,000,000
Accounts Receivable Securitization, Program Two
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items]
Trade receivables, maximum amount	$ 125,000,000

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SALE OF RECEIVABLES - Summary (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Mar. 31, 2018
Transfers and Servicing [Abstract]
Receivables outstanding in facility	$ 81,171	$ 123,526	$ 228,621
Beneficial interest	17,512	23,668	48,715
Servicing liability	0	0	81
Cash proceeds for the six months ended:
Cash purchase price	243,546	228,930	694,517
Deferred purchase price	114,212	118,118	263,670
Service fees	303	225	473
Total	$ 358,061	$ 347,273	$ 958,660

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FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Thousands	6 Months Ended		12 Months Ended
	Sep. 30, 2018 USD ($)	Sep. 30, 2017 USD ($)	Mar. 31, 2018 USD ($)
Guarantees of Farmers | Discounted Cash Flow Valuation Technique
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Market interest rate (as a percent)	15.00%
Securitized Beneficial Interests
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Unrealized losses for securitized beneficial interests	$ 623	$ 747	$ 2,531
Securitized Beneficial Interests | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Payment speed	56 days
Discount rate (as a percent)	4.70%
Loss Severity | Guarantees of Farmers | Historical Loss Valuation Technique | Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Historical loss (as a percent)	0.024
Loss Severity | Guarantees of Farmers | Historical Loss Valuation Technique | Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items]
Historical loss (as a percent)	0.100

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FAIR VALUE MEASUREMENTS - Input Hierarchy of Items Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017
Total Assets / Liabilities at Fair Value
Assets
Derivative financial instruments	$ 0	$ 0	$ 64
Securitized beneficial interests	17,512	48,715	23,668
Total assets	17,512	48,715	23,732
Liabilities
Long-term debt	897,970	912,159	852,082
Guarantees	1,861	5,864	2,770
Total liabilities	899,831	918,023	854,852
Level 2
Assets
Derivative financial instruments	0	0	64
Securitized beneficial interests	0	0	0
Total assets	0	0	64
Liabilities
Long-term debt	897,264	911,264	852,082
Guarantees	0	0	0
Total liabilities	897,264	911,264	852,082
Level 3
Assets
Derivative financial instruments	0	0	0
Securitized beneficial interests	17,512	48,715	23,668
Total assets	17,512	48,715	23,668
Liabilities
Long-term debt	706	895	0
Guarantees	1,861	5,864	2,770
Total liabilities	$ 2,567	$ 6,759	$ 2,770

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FAIR VALUE MEASUREMENTS - Reconciliation of Change in Recurring Level 3 Balances (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Securitized Beneficial Interests
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 17,736	$ 13,199	$ 48,715	$ 38,206
Issuances of sales of receivables/guarantees	42,210	52,206	90,896	110,763
Settlements	(41,467)	(40,503)	(121,018)	(124,171)
(Losses) gains recognized in earnings	(967)	(1,234)	(1,081)	(1,130)
Ending balance	17,512	23,668	17,512	23,668
Guarantees
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	3,544	6,388	5,864	7,126
Issuances of sales of receivables/guarantees	1,160	1,428	1,403	2,066
Settlements	(2,839)	(4,578)	(5,540)	(5,954)
(Losses) gains recognized in earnings	(4)	(468)	134	(468)
Ending balance	$ 1,861	$ 2,770	$ 1,861	$ 2,770

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RELATED PARTY TRANSACTIONS - Summary (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Related Party Transactions [Abstract]
Sales	$ 6,873	$ 7,814	$ 13,763	$ 23,056
Purchases	$ 10,641	$ 26,423	$ 36,908	$ 37,937

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INVESTEE COMPANIES - Summary (Details) $ in Thousands	6 Months Ended
	Sep. 30, 2018 USD ($)
Minimum
Schedule of Equity Method Investments [Line Items]
Estimated useful lives of assets and liabilities	1 year
Maximum
Schedule of Equity Method Investments [Line Items]
Estimated useful lives of assets and liabilities	10 years
Adams International Ltd.
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	49.00%
Basis difference	$ 0
Alliance One Industries India Private Ltd.
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	49.00%
Basis difference	$ 0
China Brasil Tobacos Exportadora SA
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	49.00%
Basis difference	$ 7,916
Criticality LLC
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	40.00%
Basis difference	$ 0
Nicotine River, LLC
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	40.00%
Basis difference	$ 2,212
Oryantal Tutun Paketleme
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	50.00%
Basis difference	$ 0
Purilum, LLC
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	50.00%
Basis difference	$ 0
Siam Tobacco Export Company
Schedule of Equity Method Investments [Line Items]
Ownership in equity method investment (as a percent)	49.00%
Basis difference	$ 0

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RESTRUCTURING AND ASSET IMPAIRMENT CHARGES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Restructuring Cost and Reserve [Line Items]
Non-cash charges	$ 3	$ 0	$ 346	$ 0
Other Regions
Restructuring Cost and Reserve [Line Items]
Non-cash charges	$ 3

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RESTRUCTURING AND ASSET IMPAIRMENT CHARGES - Restructuring Charges (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Restructuring and Related Activities [Abstract]
Employee separation charges	$ 179	$ 0	$ 1,377	$ 0
Asset impairment and other non-cash charges	3	0	346	0
Restructuring and asset impairment charges	$ 182	$ 0	$ 1,723	$ 0

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RESTRUCTURING AND ASSET IMPAIRMENT CHARGES - Employee Separation and Other Cash Charges by Segment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Restructuring Reserve [Roll Forward]
Accruals	$ 179	$ 0	$ 1,377	$ 0
North America
Restructuring Reserve [Roll Forward]
Balance at beginning of period	247	0	0	60
Accruals	0	0	247	0
Payments	(140)	0	(140)	(60)
Balance at end of period	107	0	107	0
Other Regions
Restructuring Reserve [Roll Forward]
Balance at beginning of period	1,058	129	107	129
Accruals	179	0	1,130	0
Payments	(348)	0	(348)	0
Balance at end of period	$ 889	$ 129	$ 889	$ 129