Full Year Diluted EPS of $4.91
REX American Resources Corporation (NYSE: REX) (“REX” or “the
Company”) today reported financial results for its fiscal 2018
fourth quarter (“Q4 ‘18”) ended January 31, 2019. REX management
will host a conference call and webcast today at 11:00 a.m. ET.
Conference Call:
212/271-4615
Webcast / Replay URL:
www.rexamerican.com/Corp/Page4.aspx
The webcast will be available for replay for
30 days.
REX American Resources’ Q4 ‘18 results principally reflect its
interests in six ethanol production facilities and its refined coal
operation. The One Earth Energy, LLC (“One Earth”) and NuGen
Energy, LLC (“NuGen”) ethanol production facilities are
consolidated, as is the refined coal entity, while those of its
four other ethanol plants are reported as equity in income of
unconsolidated ethanol affiliates. The Company reports results for
its two business segments as ethanol and by-products, and refined
coal.
REX’s Q4 ‘18 net sales and revenue increased 3.5% to $113.3
million, compared with $109.5 million in Q4 ‘17. The year-over-year
net sales and revenue increase was primarily due to higher average
selling prices for dried and modified distillers grains as well as
increased production in the Company’s ethanol and by-products
segment, which was partially offset by a 7.9% reduction in the
average selling price per gallon of ethanol. The Company’s Q4 ‘18
gross profit for its ethanol and by-products segment was $5.4
million, compared with $10.0 million in Q4 ‘17, primarily resulting
from lower ethanol crush spreads. As a result, the ethanol and
by-products segment income before income taxes was $1.4 million in
Q4 ‘18, compared to income of $6.5 million in Q4 ‘17. The Company’s
refined coal operation incurred a $3.2 million gross loss and a
$3.3 million loss before income taxes in Q4 ‘18, compared to a $4.0
million gross loss and a loss before income taxes of $4.3 million
in Q4 ‘17. As a result, REX reported a loss from continuing
operations before income taxes and non-controlling interests in Q4
‘18 of $1.7 million, compared with income of $1.7 million in Q4
‘17. While the refined coal operation negatively impacted gross
profit and income before income taxes, it contributed to a lower
effective tax rate.
Net income attributable to REX shareholders in Q4 ‘18 was $1.1
million, compared to $19.1 million in Q4 ‘17. Q4 ‘18 basic and
diluted net income per share attributable to REX common
shareholders was $0.17 per share, compared to $2.89 per share in Q4
‘17. The prior year results reflected a $14.4 million tax benefit
as a result of the remeasurement of the Company’s deferred tax
liabilities in connection with the passage of the 2017 Tax Cuts and
Job Act. Per share results in Q4 ‘18 and Q4 ‘17 are based on
6,341,000 and 6,604,000 diluted weighted average shares
outstanding, respectively.
Segment Income Statement Data:
Three Months Twelve Months Ended
Ended ($ in thousands)
January 31, January 31,
2019 2018
2019 2018 Net
sales and revenue: Ethanol & By-Products (1)
$ 113,168 $ 109,295 $ 485,885 $ 452,153 Refined coal (2) (3)
176 240
786 433 Total net
sales and revenue $ 113,344
$ 109,535 $
486,671 $ 452,586
Gross profit (loss): Ethanol & By-Products
(1) $ 5,381 $ 9,981 $ 43,856 $ 51,509 Refined coal (2)
(3,163 ) (3,957
) (13,641 )
(7,348 ) Total gross profit
$ 2,218 $
6,024 $ 30,215
$ 44,161 Income (loss)
before income taxes: Ethanol & By-Products (1) $ 1,354 $
6,545 $ 31,545 $ 38,352 Refined coal (2) (3,317 ) (4,336 ) (15,204
) (10,021 ) Corporate and other
288
(550 ) (1,753
) (2,938 ) Total
income (loss) before income taxes
$
(1,675 ) $
1,659 $ 14,588
$ 25,393 Benefit
(provision) for income taxes: Ethanol & By-Products $ (539
) $ 13,004 $ (2,343 ) $ 3,245 Refined coal 4,759 5,250 24,674
15,168 Corporate and other
354
222 591
1,106 Total benefit (provision) for income
taxes
$ 4,574 $
18,476 $ 22,922
$ 19,519 Segment
profit (loss): Ethanol & By-Products $ (450 ) $ 18,261 $
23,346 $ 35,880 Refined coal 1,597 1,108 10,148 5,628 Corporate and
other
(90 )
(316 ) (1,849
) (1,802 ) Net income
attributable to REX common shareholders
$
1,057 $ 19,053
$ 31,645 $
39,706
(1)
Includes results attributable to
non-controlling interests of approximately 25% for One Earth and
approximately 1% for NuGen.
(2)
Includes results attributable to
non-controlling interests of approximately 5%.
(3)
Refined coal sales are reported net of the
cost of coal.
REX American Resources’ Chief Executive Officer, Zafar Rizvi,
commented, “The fourth quarter proved to be the most challenging
period of the year, as weak ethanol pricing significantly impacted
margins. Despite these headwinds, stronger distillers grains
pricing, coupled with our ability to efficiently increase output
across our ethanol and by-products segment and the benefit of our
refined coal operation, resulted in our ability to continue to
operate profitably and generate $31.6 million of net income for the
fiscal full year 2018.
“As we enter fiscal 2019, we remain focused on near- and
long-term opportunities to enhance shareholder value as we look to
leverage our robust balance sheet, including cash, cash equivalents
and short-term investments in excess of $200 million and working
capital of $234 million. While conditions have remained challenging
so far in fiscal 2019, we remain confident in our disciplined
operating approach and the value of ethanol as a worldwide fuel
supply.”
Balance Sheet and Share Repurchase Program
At January 31, 2019, REX had cash and cash equivalents and
short-term investments of $203.5 million, $54.8 million of which
was at the parent company, and $148.7 million of which was at its
consolidated production facilities. This compares with cash and
cash equivalents at January 31, 2018, of $191.0 million, $74.1
million of which was at the parent company, and $116.9 million of
which was at its consolidated ethanol production facilities.
During the fourth quarter of fiscal 2018, the Company purchased
52,759 shares at an average cost of $65.14. REX is now authorized
to repurchase up to 349,861 shares of its common stock. The Company
had 6,274,419 shares outstanding at January 31, 2019.
Repurchases by the Company are subject to available liquidity,
general market and economic conditions, alternate uses for the
capital and other factors. Share repurchases may be made from time
to time in open market transactions, block trades or private
transactions in accordance with applicable securities laws and
regulations and other legal requirements. There is no minimum
number of shares the Company is required to repurchase and the
repurchase program may be suspended or discontinued at any time
without prior notice. All shares purchased will be held in the
Company’s treasury for possible future use.
The following table summarizes select data related to
REX’s consolidated alternative energy interests:
Three Months Twelve Months Ended
Ended January 31, January 31,
2019
2018
2019
2018
Average selling price per gallon of ethanol $ 1.17 $ 1.27 $ 1.29 $
1.40 Average selling price per ton of dried distillers grains $
143.20 $ 119.20 $ 142.20 $ 105.89
Average selling price per pound of
non-food grade corn oil
$
0.25
$
0.28
$
0.25
$
0.29
Average selling price per ton of modified distillers grains $ 58.30
$ 57.03 $ 59.42 $ 45.87 Average cost per bushel of grain $ 3.41 $
3.18 $ 3.46 $ 3.35 Average cost of natural gas (per mmbtu) $
4.07 $ 4.65 $ 3.33 $ 3.75
Supplemental data related to REX’s
alternative energy interests:
REX American Resources Corporation Ethanol
Ownership Interests/Effective Annual Gallons Shipped as of January
31, 2019 (gallons in millions)
Entity
TrailingTwelveMonthsGallonsShipped
CurrentREXOwnershipInterest
REX’s Current EffectiveOwnership
of Trailing TwelveMonth Gallons Shipped
One Earth Energy, LLC (Gibson City, IL) 141.9
75.1% 106.6
NuGen Energy, LLC (Marion, SD)
143.9 99.5% 143.2
Big River Resources West Burlington,
LLC (West Burlington, IA)
109.8 10.3% 11.3
Big River Resources Galva,
LLC (Galva, IL) 128.8 10.3% 13.3
Big
River United Energy, LLC (Dyersville, IA) 131.7
5.7% 7.5
Big River Resources Boyceville, LLC
(Boyceville, WI)
58.3 10.3% 6.0
Total
714.4 n/a 287.9
Fourth Quarter Conference Call
REX will host a conference call at 11:00 a.m. ET today. Senior
management will discuss the financial results and host a question
and answer session. The dial in number for the audio conference
call is 212/271-4615 (domestic and international callers).
Participants can also listen to a live webcast of the call on
the Company’s website, www.rexamerican.com/Corp/Page4.aspx.
A webcast replay will be available for 30 days following the live
event at www.rexamerican.com/Corp/Page4.aspx.
About REX American Resources Corporation
REX American Resources has interests in six ethanol production
facilities, which in aggregate shipped approximately 714 million
gallons of ethanol over the twelve month period ended January 31,
2019. REX’s effective ownership of the trailing twelve month
gallons shipped (for the twelve months ended January 31, 2019) by
the ethanol production facilities in which it has ownership
interests was approximately 288 million gallons. In addition, the
Company acquired a refined coal operation on August 10, 2017.
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 and regulatory changes, the price volatility and
availability of corn, distillers grains, ethanol, non-food grade
corn oil, gasoline and natural gas, ethanol and refined coal plants
operating efficiently and according to forecasts and projections,
changes in the international, national or regional economies,
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.
- statements of operations follow -
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(in thousands, except per share
amounts)
Unaudited
Three Months Twelve Months
Ended Ended January 31, January 31,
2019
2018
2019
2018
Net sales and revenue $ 113,344 $ 109,535 $ 486,671 $ 452,586 Cost
of sales
111,126
103,511 456,456
408,425 Gross profit 2,218 6,024 30,215
44,161 Selling, general and administrative expenses (4,476 ) (6,532
) (20,551 ) (24,060 ) Equity in (loss) income of unconsolidated
ethanol affiliates (646 ) 1,301 1,536 3,232 Interest and other
income, net
1,229
866 3,388
2,060 (Loss) Income from continuing operations
before income taxes and non-controlling interests
(1,675
)
1,659
14,588
25,393
Benefit for income taxes
4,574
18,476 22,922
19,519 Net income including non-controlling
interests 2,899 20,135 37,510 44,912 Net income attributable to
non-controlling interests
(1,842 )
(1,082 )
(5,865 ) (5,206
) Net income attributable to REX common shareholders
$ 1,057 $
19,053 $ 31,645
$ 39,706 Weighted
average shares outstanding – basic and diluted
6,341 6,604
6,440 6,596
Basic and diluted net income per share attributable to REX common
shareholders
$
0.17
$
2.89
$
4.91
$
6.02
- balance sheets follow -
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)
Unaudited
January 31,
January 31,
ASSETS
2019
2018
CURRENT ASSETS: Cash and cash equivalents $ 188,531 $ 190,988
Restricted cash 281 354 Short-term investments 14,975 - Accounts
receivable 11,378 12,913 Inventory 18,477 20,755 Refundable income
taxes 7,695 6,612 Prepaid expenses and other
9,284 7,412 Total
current assets 250,621 239,034 Property and equipment-net 182,521
197,827 Other assets 6,176 7,454 Equity method investments
32,075 34,549 TOTAL
ASSETS
$ 471,393 $
478,864 LIABILITIES AND EQUITY CURRENT
LIABILITIES: Accounts payable – trade $ 7,463 $ 8,149 Accrued
expenses and other current liabilities
9,546
13,716 Total current liabilities
17,009 21,865
LONG TERM LIABILITIES: Deferred taxes 4,185 21,706 Other long term
liabilities
4,928
3,367 Total long term liabilities
9,113 25,073
COMMITMENTS AND CONTINGENCIES EQUITY: REX shareholders’ equity:
Common stock, 45,000 shares authorized, 29,853 shares issued at par
299 299 Paid in capital 148,273 146,923 Retained earnings 579,558
547,913 Treasury stock, 23,580 and 23,287 shares, respectively
(335,193 )
(313,643 ) Total REX shareholders’ equity
392,937 381,492 Non-controlling interests
52,334 50,434 Total
equity
445,271
431,926 TOTAL LIABILITIES AND EQUITY
$ 471,393 $
478,864
- statements of cash flows follow -
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands)
Unaudited
Fiscal Years Ended January 31,
2019
2018
CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 37,510 $ 44,912
Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation and amortization 24,828 21,462
Stock based compensation expense 669 1,641 Income from equity
method investments (1,536 ) (3,232 ) Dividends received from equity
method investments 4,010 6,516 Interest income from investments
(1,077 ) - Loss on sale of investment - 13 Loss on disposal of real
estate and property and equipment 104 192 Deferred income tax
(23,364 ) (18,605 ) Changes in assets and liabilities: Accounts
receivable 1,535 (1,089 ) Inventory 2,278 (3,649 ) Prepaid expenses
and other assets 5,217 (1,170 ) Income taxes refundable (1,083 )
(5,542 ) Accounts payable-trade 339 (1,705 ) Accrued expenses and
other liabilities
(1,499 )
1,225 Net cash provided by operating activities
47,931 40,969
CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (10,775
) (24,017 ) Acquisition of business, net of cash acquired - (12,049
) Purchases of short-term investments (125,989 ) - Sales of
short-term investments 112,091 - Repayment of note receivable 27 26
Proceeds from sale of investment - 64 Proceeds from sale of real
estate and property and equipment - 104 Restricted investments and
deposits
5 150
Net cash used in investing activities
(24,641 ) (35,722
) CASH FLOWS FROM FINANCING ACTIVITIES: Payments to
non-controlling interests holders (4,489 ) (3,529 ) Capital
contributions from minority investor 524 918 Treasury stock
acquired
(21,855 )
- Net cash used in financing activities
(25,820 ) (2,611
) NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS
AND RESTRICTED CASH (2,530 ) 2,636 CASH, CASH EQUIVALENTS AND
RESTRICTED CASH-Beginning of year
191,342
188,706 CASH, CASH EQUIVALENTS
AND RESTRICTED CASH-End of year
$ 188,812
$ 191,342 Non cash
financing activities – Equity awards issued
$
1,473 $ 1,195
Non cash financing activities – Equity awards accrued
$ 487 $
1,485 Non cash investing activities – Accrued
capital expenditures
$ -
$ 1,149
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190321005148/en/
Douglas BruggemanChief Financial Officer(937) 276-3931
Joseph Jaffoni, Norberto AjaJCIR(212) 835-8500rex@jcir.com
REX American Resources (NYSE:REX)
Historical Stock Chart
From Aug 2024 to Sep 2024
REX American Resources (NYSE:REX)
Historical Stock Chart
From Sep 2023 to Sep 2024