REX REX American Resources Corporation

• Reported net income attributable to REX shareholders of $24.5 million for Fiscal Q3 ’24, compared to $26.1 million for Fiscal Q3 ‘23
• Generated $1.38 of net income per share in Fiscal Q3 ‘24, the second-best quarterly result in company history
• Reported gross profit of $39.7 million for Fiscal Q3 ‘24, compared to $39.3 million for Fiscal Q3 ‘23
• Reported consolidated ethanol sales volumes of 75.5 million gallons for Fiscal Q3 ‘24, an increase of approximately 3% compared to the same period in Fiscal 2023

REX American Resources Corporation (“REX” or the “Company”) (NYSE: REX), a leading ethanol production company, today announced financial and operational results for the Company’s fiscal third quarter 2024.

REX American Resources’ fiscal third quarter 2024 results principally reflect its interests in six ethanol production facilities. The One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) ethanol production facilities are consolidated, while the four other ethanol plants are reported as equity in income of unconsolidated ethanol affiliates.

Fiscal Third Quarter 2024 Results

For fiscal third quarter 2024, REX reported net sales and revenue of $174.9 million, compared with $221.1 million for fiscal third quarter 2023. The year-over-year net sales and revenue decrease primarily reflects reduced pricing for ethanol and co-products. Fiscal third quarter 2024 gross profit for the Company was $39.7 million, compared with $39.3 million in fiscal third quarter 2023, reflecting decreased corn and natural gas prices. Interest and other income for the third fiscal quarter 2024 was $4.6 million, compared to $4.9 million for third fiscal quarter 2023. Income before income taxes and non-controlling interests for the third fiscal quarter 2024 was $39.5 million, compared with $41.3 million in the prior year period.

Net income attributable to REX shareholders in fiscal third quarter 2024 was $24.5 million, compared to $26.1 million in fiscal third quarter 2023. Fiscal third quarter 2024 diluted net income per share attributable to REX common shareholders was $1.38, compared to $1.49 per share in fiscal third quarter 2023. Per share results for fiscal third quarters 2024 and 2023 are based on 17,723,000 and 17,531,000 diluted weighted average shares outstanding, respectively.

Update on One Earth Energy Ethanol Production Expansion and Carbon Capture Projects

REX is progressing on the expansion of its ethanol production facility at the One Earth Energy facility in Gibson City, IL. REX expects to complete the expansion of the facility in the middle of 2025, which will increase production capacity from 150 million gallons per year to 175 million gallons per year. Once this is achieved, REX plans to initiate further permitting of the facility to produce 200 million gallons per year of ethanol, which the Company expects will require no additional material capital expenditures.

At this time, the necessary utility interconnection work required for the ethanol production expansion and carbon capture and compression facility remains on track. The Illinois utility carrying out the interconnection work anticipates the new interconnection will be complete by first quarter 2025.

REX has substantially completed work on the carbon capture and compression portion of the One Earth Energy carbon capture and sequestration project. Currently, REX is focused on managing further near-term costs for the project as the Company awaits the approval of its Class VI injection well applications to the EPA, approval of other state and local permits, completion of interconnection work at the site previously mentioned, and the resolution of issues around the Illinois CO2 pipeline moratorium.

Through the end of fiscal third quarter 2024, capital expenditures related to the One Earth Energy carbon capture and sequestration project totaled $52.9 million, and expenditures for expansion of ethanol production capacity totaled $50.2 million. The combined capital spending of $103.1 million remains on plan, with the Company still budgeting a total spend of $165-$175 million for these projects.

Balance Sheet

At the end of fiscal third quarter 2024 on October 31, 2024, REX had $365.1 million of cash, cash equivalents, and short-term investments available and no bank debt.

Management Commentary

“REX American continues to produce outsized positive results across market conditions thanks to our employees and management team and focused ethanol production operations,” said Zafar Rizvi, REX Chief Executive Officer. “Quarter after quarter, the REX team consistently demonstrates our ability to produce industry-leading results – and the third quarter was no exception. We delivered a year-over-year increase in gross margin by maximizing the production at our consolidated plants and carefully managing costs. As we look ahead to the future, and our planned increased production capacity coming online next year, we are excited for the anticipated step up in earnings potential from our expanded ethanol production operations.

“As we await permitting of the One Earth Energy carbon capture and sequestration facility, we remain positive about the eventual approval of our EPA Class VI injection well permit, as well as resolution of Illinois’ moratorium on CO2 pipeline construction. We are working with our government partners and other stakeholders to make sure carbon capture and sequestration operations in the state are among the safest in the country. We look forward to further updates as things progress,” concluded Mr. Rizvi.

Conference Call Information

REX will host a conference call at 11:00 a.m. ET today to discuss the Company’s quarterly results and will also host a question and answer session. To access the conference call, interested parties may dial (877) 269-7751 (US) or (201) 389-0908 (international). Participants can also view an updated presentation, as well as listen to a live webcast of the call by going to the Investors section on the REX website at www.rexamerican.com. A replay will be available shortly after the live conference call and can be accessed by dialing (844) 512-2921 (US) or (412) 317-6671 (international). The passcode for the replay is 13749929. The replay will be available for 30 days after the call.

About REX American Resources Corporation

REX American Resources Corporation has interests in six ethanol production facilities, which in aggregate have production capacity totaling approximately 730 million gallons per year. REX’s effective ownership of annual volumes is approximately 300 million gallons. Further information about REX is available at www.rexamerican.com.

Forward-Looking Statements

This news announcement contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by use of forward-looking terminology such as “may,” “expect,” “believe,” “estimate,” “anticipate” or “continue” or the negative thereof or other variations thereon or comparable terminology. Readers are cautioned that there are risks and uncertainties that could cause actual events or results to differ materially from those referred to in such forward-looking statements. These risks and uncertainties include the risk factors set forth from time to time in the Company’s filings with the Securities and Exchange Commission and include among other things: the effect of pandemics such as COVID-19 on the Company’s business operations, including impacts on supplies, demand, personnel and other factors, the impact of legislative and regulatory changes, the price volatility and availability of corn, distillers grains, ethanol, distillers corn oil, commodity market risk, gasoline and natural gas, ethanol plants operating efficiently and according to forecasts and projections, logistical interruptions, success in permitting and developing the planned carbon sequestration facility near the One Earth Energy ethanol plant, changes in the international, national or regional economies, the impact of inflation, the ability to attract employees, weather, results of income tax audits, changes in income tax laws or regulations, the impact of U.S. foreign trade policy, changes in foreign currency exchange rates and the effects of terrorism or acts of war. The Company does not intend to update publicly any forward-looking statements except as required by law.

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except per share amounts)

Unaudited

 

 

Three Months Ended

 

Nine Months Ended

 

October 31,

 

October 31,

 

2024

 

2023

 

2024

 

2023

Net sales and revenue

$

174,877

$

221,079

 

$

484,263

$

645,770

Cost of sales

 

135,196

 

181,789

 

410,358

 

577,962

Gross profit

 

39,681

 

39,290

 

 

73,905

 

67,808

Selling, general and administrative expenses

 

(8,426)

 

(7,609)

 

 

(20,977)

 

(21,996)

Equity in income of unconsolidated ethanol affiliates

 

3,621

 

4,738

 

 

7,086

 

9,275

Interest and other income, net

 

4,629

 

4,863

 

14,950

 

10,935

Income before income taxes and noncontrolling interests

 

39,505

 

41,282

 

 

74,964

 

66,022

Provision for income taxes

 

(9,402)

 

(9,640)

 

(17,581)

 

(15,396)

Net Income

 

30,103

 

31,642

 

 

57,383

 

50,626

Net Income attributable to noncontrolling interests

 

(5,603)

 

(5,566)

 

(10,314)

 

(10,259)

Net income attributable to REX common shareholders

$

24,500

$

26,076

$

47,069

$

40,367

 

 

 

 

 

 

Weighted average shares outstanding – basic

 

17,595

 

17,531

 

17,550

 

17,461

 

 

 

 

 

 

Basic net income per share attributable to REX common shareholders

$

1.39

$

1.49

$

2.68

$

2.31

 

Weighted average shares outstanding – diluted

 

17,723

 

17,531

 

17,673

 

17,461

 

Diluted net income per share attributable to REX common shareholders

$

1.38

$

1.49

$

2.66

$

2.31

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

Unaudited

 

 

October 31,

 

January 31,

 

2024

2024

ASSETS:

 

 

 

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$

298,249

 

$

223,397

Short-term investments

 

66,826

 

 

155,260

Accounts receivable

 

22,331

 

 

23,185

Inventory

 

29,127

 

 

26,984

Refundable income taxes

 

5,556

 

 

5,728

Prepaid expenses and other

 

14,408

 

17,549

Total current assets

 

436,497

 

 

452,103

Property and equipment, net

 

200,496

 

 

155,587

Operating lease right-of-use assets

 

22,580

 

 

13,038

Other assets

 

17,074

 

 

9,138

Equity method investment

 

39,015

 

34,936

TOTAL ASSETS

$

715,662

$

664,802

LIABILITIES AND EQUITY:

 

 

 

CURRENT LIABILITIES:

 

 

 

Accounts payable – trade

$

22,220

 

$

42,073

Current operating lease liabilities

 

5,857

 

 

4,469

Accrued expenses and other current liabilities

 

15,883

 

19,717

Total current liabilities

 

43,960

 

66,259

LONG-TERM LIABILITIES:

 

 

 

Deferred taxes

 

5,694

 

 

1,598

Long-term operating lease liabilities

 

16,761

 

 

8,378

Other long-term liabilities

 

2,647

 

970

Total long-term liabilities

 

25,102

 

10,946

EQUITY:

 

 

 

REX shareholders’ equity:

 

 

 

Common stock

 

299

 

 

299

Paid-in capital

 

6,254

 

 

3,769

Retained earnings

 

748,830

 

 

701,761

Treasury stock

 

(190,892)

 

(191,911)

Total REX shareholders’ equity

 

564,491

 

 

513,918

Noncontrolling interests

 

82,109

 

73,679

Total equity

 

646,600

 

587,597

TOTAL LIABILITIES AND EQUITY

$

715,662

$

664,802

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

 

 

Nine Months Ended

 

October 31,

 

October 31,

 

2024

2023

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

Net Income including noncontrolling interest

$

57,383

 

$

50,626

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation

 

12,433

 

 

13,371

Amortization of operating lease right-of-use assets

 

4,192

 

 

3,766

Income from equity method investments

 

(7,086)

 

 

(9,275)

Dividends received from equity method investments

 

3,007

 

 

5,513

Interest income from investments

 

(4,219)

 

 

(6,950)

Deferred income taxes

 

11,934

 

 

10,048

Stock based compensation expense

 

2,980

 

5,146

Loss on disposal of property and equipment – net

 

45

 

 

205

Changes in assets and liabilities:

 

 

 

Accounts receivable

 

854

 

 

(4,976)

Inventories

 

(2,143)

 

 

11,229

Refundable income taxes

 

172

 

(1,486)

Other assets

 

(12,639)

 

(1,312)

Accounts payable – trade

 

(21,629)

 

 

(5,622)

Other liabilities

 

(6,178)

 

 

(4,819)

Net cash provided by operating activities

 

39,106

 

 

65,464

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

Capital expenditures

 

(55,428)

 

 

(22,359)

Purchase of short-term investments

 

(210,328)

 

 

(378,381)

Maturity of short-term investments

 

302,981

 

 

337,490

Proceeds from sale of real estate and property and

equipment

 

210

 

 

10

Deposits

 

195

 

 

(27)

Net cash provided by (used in) investing activities

 

37,630

 

(63,267)

CASH FLOWS FROM FINANCING ACTIVITIES:

Payments to noncontrolling interests holders

 

(1,884)

 

 

(716)

Net cash used in financing activities

 

(1,884)

 

 

(716)

 

 

 

 

NET INCREASE IN CASH AND CASH EQUIVALENTS

 

74,852

 

 

1,481

CASH AND CASH EQUIVALENTS – Beginning of period

 

223,397

 

71,347

CASH AND CASH EQUIVALENTS – End of period

$

298,249

 

$

72,828

 

Non-cash investing activities – Accrued capital expenditures

$

3,275

$

722

Non-cash investing activities – Capital additions transferred from prepaid expenses

$

188

$

-

Non-cash financing activities – Stock awards accrued

$

1,648

$

1,467

Non-cash financing activities – Stock awards issued

$

2,172

$

965

Right-of-use assets acquired and liabilities incurred upon lease execution

$

13,734

$

3,210

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241203543985/en/

Investor Contacts Douglas Bruggeman Chief Financial Officer

Caldwell Bailey ICR, Inc. rexamerican@icrinc.com