REX REX American Resources Corporation

- Reports Record Full Year Net Income of $87.3 Million -

REX American Resources Corporation (NYSE: REX) today reported financial results for its fiscal 2014 fourth quarter (“Q4 ‘14”) and year ended January 31, 2015. REX management will host a conference call and webcast today at 11:00 a.m. ET.

Conference Call:

  212/271-4657  

Webcast / Replay URL:

www.rexamerican.com/Corp/Page4.aspx

The webcast will be available for replay for 30 days

REX American Resources’ Q4 ‘14 results principally reflect its interests in seven ethanol production facilities. The operations of One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) are consolidated, while those of its five remaining plants are reported as equity in income of unconsolidated ethanol affiliates.

REX’s Q4 ‘14 net sales and revenue were $127.7 million, compared with $146.1 million in Q4 ‘13. Primarily reflecting solid ethanol crush spread margins in Q4 ‘14, the Company’s gross profit rose to $30.0 million, compared to $26.3 million in the prior year period. Reflecting the ethanol industry environment during the period and strong plant operations, Q4 ‘14 equity in income of unconsolidated ethanol affiliates increased to $7.9 million, from $7.6 million in Q4 ‘13. The improved quarterly gross profit and income of unconsolidated ethanol affiliates resulted in Q4 ‘14 net income from continuing operations before income taxes and non-controlling interests of $33.4 million, compared with $27.9 million in Q4 ‘13.

Net income attributable to REX shareholders in Q4 ‘14 rose to $20.3 million, compared to $15.9 million in Q4 ‘13, while Q4 ‘14 diluted net income per share attributable to REX common shareholders was a record $2.55 per share, compared to $1.95 per share in Q4 ‘13. Per share results in Q4 ‘14 and Q4 ‘13 are based on 7,968,000 and 8,129,000 diluted weighted average shares outstanding, respectively.

Net sales and revenue for the twelve months ended January 31, 2015 declined to $572.2 million, from $666.0 million in fiscal 2013, while gross profit for fiscal 2014 more than doubled to $141.9 million, from $64.3 million in fiscal 2013. Fiscal 2014 equity in income of unconsolidated ethanol affiliates also increased substantially to $32.2 million, compared with $17.2 million in fiscal 2013. This led to fiscal 2014 income from continuing operations before income taxes and non-controlling interests more than doubling to $152.8 million, compared with $59.9 million in fiscal 2013.

For fiscal 2014, REX reported net income attributable to REX shareholders of $87.3 million, a 149% increase compared with $35.1 million in fiscal 2013, while diluted net income per share attributable to REX common shareholders rose to a record $10.76 in fiscal 2014, compared to $4.29 per share in fiscal 2013. Per share results for the fiscal year ended January 31, 2015 and January 31, 2014, are based on 8,118,000 and 8,180,000 diluted weighted average shares outstanding, respectively.

REX CEO, Stuart Rose, commented, “We are pleased to report record fourth quarter and full year earnings and earnings per share, reflecting the strength during fiscal 2014 of the ethanol industry as well as the strategic locations and operational efficiency of our plants and our talented and dedicated operating team.”

Balance Sheet and Share Repurchase Program

At January 31, 2015, REX had cash and cash equivalents of $137.7 million, $82.9 million, of which was at the parent company, and $54.8 million of which was at its consolidated ethanol production facilities. This compares with cash and cash equivalents at January 31, 2014, of $105.1 million, $63.3 million of which was at the parent company, and $41.8 million of which was at its consolidated ethanol production facilities.

REX repurchased 161,224 common shares in Q4 ‘14 at an average price per share of $60.94, bringing the total shares repurchased in fiscal 2014 to 283,979 common shares at an average price per share of $64.22. The Company is currently authorized to repurchase up to an additional 497,582 shares of common stock. Reflecting all share repurchases to date, REX has 7,899,607 shares outstanding.

At January 31, 2015, REX had lease agreements as landlord for four former retail store locations. REX has three owned former retail stores that were vacant at January 31, 2015, which it is marketing to either lease or sell. The Company sold four former retail store locations during fiscal 2014.

The following table summarizes select data related to the Company’s consolidated alternative energy interests:

      Three Months

Ended

  Twelve Months

Ended

January 31, January 31,

2015

 

2014

2015

 

2014

Average selling price per gallon of ethanol $ 1.81 $ 1.86 $ 2.00 $ 2.20 Average selling price per ton of dried distillers grains $ 117.08 $ 203.69 $ 166.00 $ 233.27 Average selling price per pound of non-food

grade corn oil

$

0.28

$

0.36

$

0.32

$

0.38

Average selling price per ton of modified distillers grains $ 57.51 $ 97.83 $ 63.47 $ 114.91 Average cost per bushel of grain $ 3.54 $ 4.50 $ 3.99 $ 6.27 Average cost of natural gas (per mmbtu) $ 5.22 $ 5.41 $ 6.10 $ 4.54  

Supplemental Data Related to REX’s Alternative Energy Interests:

REX American Resources Corporation Ethanol Ownership Interests/Effective Annual Gallons Shipped as of January 31, 2015 (gallons in millions)

Entity

     

Trailing Twelve Months Gallons Shipped

 

Current REX Ownership Interest

 

REX’s Current Effective Ownership of Trailing Twelve Month Gallons Shipped

One Earth Energy, LLC (Gibson City, IL)       110.6   74%   81.8 NuGen Energy, LLC (Marion, SD)       115.9   99%   114.7 Patriot Holdings, LLC (Annawan, IL)       126.2   27%   34.1 Big River Resources West Burlington, LLC (West Burlington, IA)       108.0   10%   10.8 Big River Resources Galva, LLC (Galva, IL)       119.0   10%   11.9 Big River United Energy, LLC (Dyersville, IA)       124.9   5%   6.2 Big River Resources Boyceville, LLC

(Boyceville, WI)

      57.8   10%   5.8 Total       762.4   n/a   265.3          

About REX American Resources Corporation

REX American Resources has interests in seven ethanol production facilities, which in aggregate shipped approximately 762 million gallons of ethanol over the twelve month period ended January 31, 2015. REX’s effective ownership of the trailing twelve month gallons shipped (for the twelve months ended January 31, 2015) by the ethanol production facilities in which it has ownership interests was approximately 265 million gallons. Further information about REX is available at www.rexamerican.com.

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 impact of legislative changes, the price volatility and availability of corn, dried and modified distillers grains, ethanol, corn oil, gasoline and natural gas, ethanol plants operating efficiently and according to forecasts and projections, changes in the national or regional economies, weather, the effects of terrorism or acts of war, changes in real estate market conditions and the impact of Internal Revenue Service audits. The Company does not intend to update publicly any forward-looking statements except as required by law.

- statements of operations follow -

        REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations (in thousands, except per share amounts)

Unaudited

  Three Months

Ended

Twelve Months

Ended

January 31, January 31,

2015

 

2014

2015

 

2014

Net sales and revenue $ 127,651 $ 146,073 $ 572,230 $ 666,045 Cost of sales

97,677

 

119,729

 

430,291

 

601,757

  Gross profit 29,974 26,344 141,939 64,288 Selling, general and administrative expenses (4,058 ) (5,318 ) (19,422 ) (17,846 ) Equity in income of unconsolidated ethanol affiliates 7,907 7,617 32,229 17,175 Interest and other income 113 76 369 234 Interest expense (338 ) (850 ) (2,074 ) (3,898 ) Loss on disposal of real estate and property and equipment, net

(230

)

-

(238

)

-

Losses on derivative financial instruments, net

-

 

(9

)

(1

)

(39

)

Income from continuing operations before income taxes and non-controlling interests

33,368

27,860

152,802

59,914

Provision for income taxes

(9,616

)

(9,726

)

(49,649

)

(20,751

)

Income from continuing operations including non-controlling interests

23,752

18,134

103,153

39,163

Income (loss) from discontinued operations, net of tax 256 (217 ) 234 325 Gain on disposal of discontinued operations, net of tax

199

 

16

    327     741   Net income including non-controlling interests 24,207 17,933 103,714 40,229 Net income attributable to non-controlling interests

(3,859

)

(2,059

)

(16,377

)

(5,156

)

Net income attributable to REX common shareholders $ 20,348   $ 15,874   $ 87,337   $ 35,073     Weighted average shares outstanding – basic   7,968     8,089     8,109     8,137     Basic income per share from continuing operations* $ 2.50 $ 1.99 $ 10.70 $ 4.18 Basic income (loss) per share from discontinued operations* 0.03 (0.03 ) 0.03 0.04 Basic income per share on disposal of discontinued operations*

0.02

 

-

 

0.04

 

0.09

  Basic net income per share attributable to REX common shareholders

$

2.55

 

$

1.96

 

$

10.77

 

$

4.31

    Weighted average shares outstanding – diluted   7,968     8,129     8,118     8,180     Diluted income per share from continuing operations* $ 2.50 $ 1.98 $ 10.69 $ 4.16 Diluted income (loss) per share from discontinued operations*

0.03

(0.03

)

0.03

0.04

Diluted income per share on disposal of discontinued operations*

0.02

 

-

 

0.04

 

0.09

  Diluted net income per share attributable to REX common shareholders

$

2.55

 

$

1.95

 

$

10.76

 

$

4.29

  Amounts attributable to REX common shareholders: Income from continuing operations, net of tax $ 19,893 $ 16,075 $ 86,776 $ 34,007 Income (loss) from discontinued operations, net of tax

455

 

(201

)

561

 

1,066

  Net income $ 20,348   $ 15,874   $ 87,337   $ 35,073    

* Certain amounts differ from those previously reported as a result of certain real estate assets being reclassified as discontinued operations.

- balance sheets follow -

      REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets (in thousands) Unaudited  

January 31,

 

2015

 

2014

CURRENT ASSETS: Cash and cash equivalents $ 137,697 $ 105,149 Restricted cash - 500 Accounts receivable 8,794 16,486 Inventory 18,062 19,370 Refundable income taxes 3,019 268 Prepaid expenses and other 5,810 4,891 Deferred taxes-net

2,363

 

2,146

  Total current assets 175,745 148,810 Property and equipment-net 194,447 202,258 Other assets 6,366 5,388 Equity method investments 80,389 71,189 Restricted investments and deposits   -     223   TOTAL ASSETS $ 456,947   $ 427,868   LIABILITIES AND EQUITY CURRENT LIABILITIES: Current portion of long term debt $ - $

12,226

Accounts payable – trade 9,210 6,626 Derivative financial instruments - 1,141 Accrued expenses and other current liabilities

10,347

 

12,147

  Total current liabilities

19,557

 

32,140

  LONG TERM LIABILITIES: Long term debt - 63,500 Deferred taxes 42,768 19,613 Other long term liabilities   1,658  

1,862

  Total long term liabilities

44,426

 

84,975

  COMMITMENTS AND CONTINGENCIES EQUITY: REX shareholders’ equity: Common stock, 45,000 shares authorized, 29,853 shares issued at par 299 299 Paid in capital 144,791 144,051 Retained earnings 444,438 357,101 Treasury stock, 21,954 and 21,753 shares, respectively   (239,557

)

  (222,170

)

Total REX shareholders’ equity 349,971 279,281 Non-controlling interests   42,993     31,472   Total equity

392,964

 

310,753

  TOTAL LIABILITIES AND EQUITY $ 456,947   $ 427,868    

- statements of cash flows follow -

        REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (in thousands) Unaudited  

Years Ended January 31,

2015

2014

CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 103,714 $ 40,229 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 16,787 17,284 Impairment charges on real estate 68 55 Income from equity method investments (32,229 ) (17,175 ) Dividends received from equity method investments 22,889 5,804 Derivative financial instruments (1,141 ) (1,648 ) Gain on disposal of real estate and property and equipment (275 ) (1,015 ) Deferred income tax 22,473 15,987 Excess tax benefit from stock option exercise (441 ) (64 ) Changes in assets and liabilities: Accounts receivable 7,692 (4,919 ) Inventory 1,308 5,549 Prepaid expenses and other assets (1,929 ) (1,490 ) Income taxes refundable (1,985 ) 1,480 Accounts payable-trade 2,030 1,721 Accrued expenses and other liabilities   (1,745 )   2,637   Net cash provided by operating activities   137,216     64,435   CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (9,927 ) (3,518 ) Repayment of note receivable 6 681 Proceeds from sale of real estate and property and equipment 1,778 8,876 Restricted cash 500 (500 ) Restricted investments and deposits   323  

1,293

  Net cash (used in) provided by investing activities   (7,320 )

6,832

  CASH FLOWS FROM FINANCING ACTIVITIES: Payments of long term debt

Loan

(75,726 ) (31,203 ) Stock options exercised 931 1,072 Payments to non-controlling interests holders (4,856 ) (1,638 ) Excess tax benefit from stock option exercises 441 64 Treasury stock acquired   (18,138 )   (3,486 ) Net cash used in financing activities   (97,348 )   (35,191 ) NET INCREASE IN CASH AND CASH EQUIVALENTS 32,548 36,076 CASH AND CASH EQUIVALENTS-Beginning of year   105,149     69,073   CASH AND CASH EQUIVALENTS-End of year $ 137,697   $ 105,149   Non cash financing activities - Cashless exercise of stock options $ 100   $ -   Non cash investing activities – Accrued capital expenditures $ 804   $ 250  

Non cash investing activities – Loan receivable granted in connection

with sale of real estate $ 475   $ -  

REX American Resources CorporationDouglas Bruggeman, (937) 276-3931Chief Financial OfficerorJCIRJoseph Jaffoni, Norberto Aja, (212) 835-8500rex@jcir.com