The Andersons announce record ethanol income in Q1 results
The Andersons Inc. has released financial results for the first quarter, reporting the company’s Ethanol Group achieved record operating income of $19.8 million during the three-month period. During the same period of 2013, the Ethanol Group earned only $2.5 million in operating income.
Overall, The Anderson’s reported first quarter net income attributable to the company of $22.7 million, or 80 cent per diluted share, on revenues of $1 billion. In the same three month period of 2013, the company reported results of $12.6 million, or 45 cents per diluted share, on $1.3 billion of revenues.
The strong results in the Ethanol Group is attributed to improved performance of the ethanol limited liability investments, which benefited from strong ethanol margins. According to The Andersons’ quarterly results, ethanol margins during the quarter were impacted by low U.S. ethanol stocks, accompanied by improving domestic and export demand. The Ethanol Group also benefited from improved production rates, ongoing service feeds, and increased coproduct sales of corn oil, E85 and distillers dried grains. Total revenues for the quarter were $189 million, down slightly from $199 million in revenues for group during the same period of the previous year.
The company’s Grain Group reported operating income of $11.3 million, up from $8.3 million during the same period of the previous year. The Plant Nutrient Group has an operating loss of $1.4 million during the first quarter on revenues of $108 million. During the same three-month period of 2013, the group reported an operating loss of $600,000 and revenues of $112 million. The Turf & Specialty Group has an operating income of $1.4 million on $44 million of revenues, compared to $4 million of operating income on $47 million of revenues for the same period of last year. The Retail Group had an operating loss of $2.3 million during the first quarter on revenues of $28 million. In the prior year, the group’s operating loss for the same three-month period was $3.2 million and revenues were $31 million.
During a call to discuss the quarterly results, Harold Reed, chief operating officer of The Andersons, noted that the Ethanol Group has made improvements to its plants to increase efficiency. “It can be seen from the increasing gallons produced that these capital investments have been beneficial, he said, noting that some improvements have also led to increased production in corn oil.
Mike Anderson, chairman and CEO of the company, said strong ethanol margins are expected to continue. Based on the current margin environment and the fact that the Ethanol Group has locked in approximately 75 percent of the second and third quarter margins, we currently believe our Ethanol Group will have another excellent year, he said.