Green Plains details plant upgrades in Q4 earnings call

By Erin Voegele | February 10, 2021

Todd Becker, president and CEO of Green Plains Inc., discussed the acquisition of Fluid Quip Technologies LLC and various improvements the company is making to its corn ethanol plants during a fourth quarter earnings call on Feb. 10.

Becker opened the call by noting the company’s acquisition of the majority interest in Fluid Quip is helping to secure the transformation of Green Plains. “We are continuing to execute on opportunities for expanding ultra high-protein and renewable corn-oil production through deployment of Fluid Quip’s patented MSC system,” he said, noting that the company is also beginning to install Fluid Quip’s clean sugar technology at its York, Nebraska, campus.

Construction at the Wood River, Nebraska, facility to add high-protein technology is in full swing, Becker said, with completion expected by early in the third quarter of this year. Work on adding high-protein technology to the plant in Obion, Tennessee, is also underway, with completion expected in early 2022. Work to add high-protein capability is also expected to begin at the Mouth Vernon, Indiana, plant soon, with startup at that location also scheduled for early 2022.

The high-protein technology also enables the production of higher volumes of corn oil. Becker said the company is seeking a 50 percent increase in corn oil yields at the Shenandoah, Iowa, plant where Fluid Quip’s MSC system is already operational. Similar results are expected at Green Plains other facilities as the technology is brought online.

Regarding Fluid Quip’s clean sugar technology, Becker said the company is exploring the opportunity to convert one of its dry mill plants to produce clean low carbon intensity (CI) dextrose and glucose. The technology is starting up at the company’s York innovation system now, which will enable Green Plains to deliver commercial quantities to customers for testing, validation and use in commercial products. “As we prove our ability to supply clean sugars from a dry mill process, we will quickly execute this at a larger scale by selecting one of our existing facilities to convert to clean sugar production,” Becker said.

Becker also provided a brief update of Green Plains’ project 24 initiative, which aims to reduce the company’s per gallon operating expenses to 24 cents per gallon. Project 24 upgrades are nearly complete at the company’s Mount Vernon facility, Becker said, with startup expected during the first quarter of this year. Similar upgrades at the company’s Madison, Illinois, facility are expected to be complete during the third quarter. Green Plains, however, has deferred the decision to continue Project 24 at the Atkinson and York facilities in Nebraska and pursue higher returning projects such as high-grade alcohol production at York, Becker said. The Atkinson plant is under consideration to be the company’s first clean sugar location, he added, but noted a final decision has not yet been made.

According to Becker, Green Plains’ ethanol plants produced 214 million gallons of ethanol during the fourth quarter, which equates to a 76 percent utilization rate. The company sold 214.2 million gallons of ethanol during the quarter, down from 239.1 million gallons during the same period of 2019.

Green Plains reported a net loss attributable to the company of $49.6 million, or $1.43 per diluted share, for the fourth quarter. Adjusted net loss was $18.3 million, or 53 cents per diluted share. Adjusted net loss for the fourth quarter was $18.3 million or 53 cents per diluted share, exclusive of a noncash loss on the sale of certain assets of $22.9 million and an additional valuation allowance on deferred tax assets of $8.4 million, compared with an adjusted net loss of $18.6 million, or 53 cents per diluted share, for the same period in 2019. Revenues were $478.8 million for the fourth quarter of 2020 compared with $715.7 million for the same period last year.

For the full year 2020, Green Plains reported a net loss attributable to the company of $108.8 million, or $3.14 per diluted share. Adjusted net loss attributable to the company was $53.8 million, or $1.55 per diluted share.