REX American Resources Reports First Quarter Diluted EPS of $0.45

World News: . []

REX American Resources Corporation (NYSE: REX) (“REX” or “the Company”) today reported financial results for its fiscal 2019 first quarter (“Q1 ‘19”) ended April 30, 2019. REX management will host a conference call and webcast today at 11:00 a.m. ET.

     

Conference Call:

  212/231-2907
 

Webcast / Replay URL:

LINK 

    The webcast will be available for replay for 30 days.
 

REX American Resources’ Q1 ‘19 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 Q1 ‘19 net sales and revenue were $104.6 million compared with $120.8 million in Q1 ‘18. The decline in year-over-year net sales and revenue primarily reflects lower production due to weather-related logistical issues as well as lower average selling prices for ethanol during the current year quarter. Primarily reflecting these factors, the Company’s Q1 ‘19 gross profit for its ethanol and by-products segment was $6.1 million, compared with $13.5 million in Q1 ‘18. As a result, the ethanol and by-products segment income before income taxes was $3.2 million in Q1 ‘19, compared to $11.0 million in Q1 ‘18. The Company’s refined coal operation incurred a $2.5 million gross loss and a $2.7 million loss before income taxes in Q1 ‘19, compared to a $2.7 million gross loss and a loss before income taxes of $2.9 million in Q1 ‘18. As a result, REX reported income from continuing operations before income taxes and non-controlling interests in Q1 ‘19 of $0.2 million, compared with $7.6 million in Q1 ‘18. While the refined coal operation negatively impacted gross profit and income before income taxes, it contributed a tax benefit of $3.9 million and $4.0 million for Q1 ’19 and Q1 ‘18, respectively.

Net income attributable to REX shareholders in Q1 ‘19 was $2.8 million, compared to $9.5 million in Q1 ‘18. Q1 ‘19 basic and diluted net income per share attributable to REX common shareholders was $0.45 per share, compared to $1.45 per share in Q1 ‘18. Per share results in Q1 ‘19 and Q1 ‘18 are based on 6,315,000 and 6,571,000 diluted weighted average shares outstanding, respectively.

Segment Income Statement Data:

  Three Months Ended
($ in thousands) April 30,
2019   2018
Net sales and revenue:  
Ethanol & By-Products (1) $ 104,453 $ 120,680
Refined coal (2) (3)   122     140  
Total net sales and revenue $ 104,575   $ 120,820  
 
Gross profit (loss):
Ethanol & By-Products (1) $ 6,115 $ 13,546
Refined coal (2)   (2,469 )   (2,695 )
Total gross profit $ 3,646   $ 10,851  
 

Income (loss) before income taxes &

non-controlling interests:

Ethanol & By-Products (1) $ 3,205 $ 11,009
Refined coal (2) (2,676 ) (2,859 )
Corporate and other   (362 )   (501 )

Total income before income taxes &

non-controlling interests

$

167

 

$

7,649

 
Benefit (provision) for income taxes:
Ethanol & By-Products $ (486 ) $ (1,420 )
Refined coal 3,946 3,999
Corporate and other   88     124  
Total benefit for income taxes $ 3,548   $ 2,703  
Segment profit (loss):
Ethanol & By-Products $ 1,709 $ 8,589
Refined coal 1,386 1,271
Corporate and other   (274 )   (364 )
Net income attributable to REX common shareholders $ 2,821   $ 9,496  
 
(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, “REX generated profitable results in the fiscal 2019 first quarter despite a very challenging environment which included severe weather, including flooding, across the Midwest, rail and transportation issues, the impact of tariffs and weak ethanol margins. We remain focused on operating our plants efficiently and effectively and pursuing opportunities to leverage our operations and balance sheet to enhance shareholder value.”

Balance Sheet and Share Repurchase Program

At April 30, 2019, REX had cash and cash equivalents and short-term investments of $204.7 million, $53.7 million of which was at the parent company, and $151.0 million of which was at its consolidated ethanol production facilities. This compares with cash and cash equivalents and short-term investments at January 31, 2019, of $203.5 million, $54.8 million of which was at the parent company, and $148.7 million of which was at its consolidated ethanol production facilities.

During the first quarter of fiscal 2019, the Company did not purchase any shares and is authorized to repurchase up to 349,861 shares of its common stock.

 
The following table summarizes select data related
to REX’s consolidated alternative energy interests:
 
  Three Months Ended
April 30,

2019

 

2018

Average selling price per gallon of ethanol $ 1.27 $ 1.33
Average selling price per ton of dried distillers grains $ 142.02 $ 137.75
Average selling price per pound of non-food grade corn oil $ 0.25 $ 0.25
Average selling price per ton of modified distillers grains $ 65.75 $ 70.29
Average cost per bushel of grain $ 3.53 $ 3.50
Average cost of natural gas (per mmbtu)   $ 3.66   $ 3.46
 
 

Supplemental data related to REX’s alternative energy interests:

 

REX American Resources Corporation
Ethanol Ownership Interests/Effective Annual Gallons Shipped as of April 30, 2019

(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

  143.2   75.1 %   107.5

NuGen Energy, LLC

Marion, SD

  134.3   99.5 %   133.6

Big River Resources West Burlington, LLC
West Burlington, IA

  108.5   10.3 %   11.2

Big River Resources Galva, LLC

Galva, IL

  127.6   10.3 %   13.1

Big River United Energy, LLC

Dyersville, IA

  131.1   5.7 %   7.5

Big River Resources Boyceville, LLC

Boyceville, WI

  57.6   10.3 %   5.9

Total

  702.3   n/a     278.8
     

First 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 212/231-2907 (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 702 million gallons of ethanol over the twelve month period ended April 30, 2019. REX’s effective ownership of the trailing twelve month gallons shipped (for the twelve months ended April 30, 2019) by the ethanol production facilities in which it has ownership interests was approximately 279 million gallons. In addition, the Company acquired a refined coal operation on August 10, 2017. Further information about REX is available at LINK  .

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 Ended
April 30,

2019

 

2018

Net sales and revenue $ 104,575 $ 120,820
Cost of sales   100,929     109,969  
Gross profit 3,646 10,851
Selling, general and administrative expenses (4,732 ) (4,553 )
Equity in income of unconsolidated ethanol affiliates 126 697
Interest and other income, net   1,127     654  

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

167

7,649

Benefit for income taxes   3,548     2,703  
Net income including non-controlling interests 3,715 10,352
Net income attributable to non-controlling interests   (894 )   (856 )
Net income attributable to REX common shareholders $ 2,821   $ 9,496  
 
Weighted average shares outstanding – basic and diluted   6,315     6,571  
 

Basic and diluted net income per share attributable to REX
common shareholders

$

0.45

 

$

1.45

 
 

- balance sheets follow -

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

April 30,

 

January 31,

ASSETS:

2019

2019

CURRENT ASSETS:
Cash and cash equivalents $ 204,704 $ 188,531
Short-term investments - 14,975
Restricted cash 82 281
Accounts receivable 11,663 11,378
Inventory 20,150 18,477
Refundable income taxes 7,695 7,695
Prepaid expenses and other   9,352     9,284  
Total current assets 253,646 250,621
Property and equipment-net 177,008 182,521
Operating lease right-of-use assets 19,866 -
Other assets 9,771 6,176
Equity method investments   32,201     32,075  
TOTAL ASSETS $ 492,492   $ 471,393  
LIABILITIES AND EQUITY:
CURRENT LIABILITIES:
Accounts payable – trade $ 6,825 $ 7,463
Current operating lease liabilities 5,421 -
Accrued expenses and other current liabilities   8,078     9,546  
Total current liabilities   20,324     17,009  
LONG TERM LIABILITIES:
Deferred taxes 4,161 4,185
Long-term operating lease liabilities 13,990 -
Other long term liabilities   4,935     4,928  
Total long term liabilities   23,086     9,113  
COMMITMENTS AND CONTINGENCIES EQUITY:
REX shareholders’ equity:
Common stock, 45,000 shares authorized, 29,853 shares issued at par 299 299
Paid in capital 148,303 148,273
Retained earnings 582,379 579,558
Treasury stock, 23,580 shares   (335,186 )   (335,193 )
Total REX shareholders’ equity 395,795 392,937
Non-controlling interests   53,287     52,334  
Total equity   449,082     445,271  
TOTAL LIABILITIES AND EQUITY $ 492,492   $ 471,393  
 

- statements of cash flows follow -

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

Three Months Ended

April 30,

2019

 

2018

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 3,715 $ 10,352
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation 6,292 5,920
Amortization of operating lease right-of-use assets 1,333 -
Income from equity method investments (126 ) (697 )
Interest income from investments (25 ) (341 )
Deferred income tax (3,619 ) (2,271 )
Stock based compensation expense 128 71
Gain on disposal of property and equipment - (8 )
 
Changes in assets and liabilities:
Accounts receivable (285 ) (8,350 )
Inventory (1,673 ) (5,333 )
Other assets (75 ) (1,894 )
Accounts payable-trade (760 ) 1,011
Accrued expenses and other liabilities   (3,365 )   (1,980 )
Net cash provided by (used in) operating activities   1,540     (3,520 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (632 ) (3,061 )
Purchases of short-term investments - (111,154 )
Sales of short-term investments 15,000 -
Restricted investments and deposits - 5
Other   7     6  
Net cash provided by (used in) investing activities   14,375     (114,204 )
CASH FLOWS FROM FINANCING ACTIVITIES:

 

Treasury stock acquired - (8,586 )
Payments to non-controlling interests holders (87 ) -
Capital contributions from minority investor   146     110  
Net cash provided by (used in) financing activities   59     (8,476 )
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS
AND RESTRICTED CASH 15,974 (126,200 )
CASH, CASH EQUIVALENTS AND RESTRICTED CASH-Beginning of period   188,812     191,342  
CASH, CASH EQUIVALENTS AND RESTRICTED CASH-End of period $ 204,786   $ 65,142  
Non cash financing activities – Accrued common stock repurchases $ -   $ 542  
Non cash financing activities – Stock awards accrued $ 91   $ -  
Non cash investing activities – Accrued capital expenditures $ 147   $ 142  
 

More news and information about REX American Resources Corporation

Published By:

Business Wire: 12:00 GMT Thursday 30th May 2019

Published: .

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