Rex American Resources reports significant gross profit increase

By Erin Voegele | December 09, 2013

Rex American Resources Corp. released its financial results for the third quarter of 2013 on Dec. 3, reporting a gross profit increase of 386 percent compared to the same period of last year. The company holds ownership interest in seven ethanol plants.

According to Rex American Resources’ third quarter results, its net sales and revenue for the quarter were $166.5 million, compared to $178.8 million for the same three-month period of last year. The company’s gross profit increased 386 percent to $18.2 million, up from $3.7 million in the third quarter of 2012.

Net income attributable to Rex shareholders for the quarter increased to $9.9 million, up from $400,000 during the second quarter of 2012. Third quarter 2013 net income per share attributable to Rex common shareholders rose to $1.21 per share for the quarter, up from 5 cents per share for the same period of last year.

During a call to discuss the quarterly results, Stuart Rose, chairman and CEO of Rex, said the biggest reason why his company did so well this quarter is that gross margins increased substantially. He cited the crush spread and falling corn prices. Rose also said higher renewable identification number (RIN) prices have created an incentive for customers to buy ethanol rather than just purchasing RINs. In addition, he attributed the increase to the company’s Fagen/ICM-built plants and strong selling prices for distillers grains and corn oil coproducts.