MAUMEE, Ohio, Aug. 6, 2014 /PRNewswire/ -- The Andersons, Inc. (Nasdaq: ANDE) today announced financial results for the second quarter ended June 30, 2014.
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Highlights
-- Record operating income of $33.9 million for the Ethanol Group -- Second quarter diluted EPS up almost 50 percent from same period last year -- Plant Nutrient Group had operating income of $25.0 million
"We're pleased with our first half performance for 2014, which is a record," said CEO Mike Anderson. "Both our Ethanol and Plant Nutrient groups had strong results this quarter. In fact, our Ethanol Group had the best quarter in its history. In addition, our Grain Group's operating income benefitted from improved space income in our grain operations, and the addition of income from the Thompsons Limited joint venture."
All financial and operating highlights below are quarterly data compared to the same period of the prior year, unless otherwise noted.
Financial Highlights
Second quarter net income attributable to the company was $44.3 million, or $1.56 per diluted share, on revenues of $1.3 billion. In the same three month period of 2013, the company reported results of $29.5 million, or $1.05 per diluted share, on revenues of $1.6 billion.
-- The Ethanol Group realized excellent margins at all plants. These margins were supported primarily by ongoing increases in export demand, lower corn prices and excellent operating metrics. The Ethanol Group had record E-85 sales and an increase in distillers dried grains and corn oil sales. -- The Plant Nutrient Group exceeded its prior year six-month earnings performance. -- The Rail Group recognized $2.5 million in pre-tax gains on sales of railcars and related leases and non-recourse transactions during the quarter, which is approximately $2.4 million less than the prior year.
Operating Highlights
The following highlights have impacted reported results, or may impact future results:
-- Crop conditions in the majority of our territories are ideal. Continued good weather provides the potential for record corn and soybean yields. -- The Ethanol Group had record ethanol production. -- At this time, we have approximately 75 percent of the third quarter and 33 percent of the fourth quarter ethanol futures risk hedged. The majority of those hedges were placed in the first quarter, consistent with our strategy to lock-in reasonable forward returns when available in the market. Other hedges were added in the second quarter, consistent with our risk management strategy. We currently are managing margins in the spot market for the rest of our production. -- Volume for the Plant Nutrient Group was up approximately six percent during the first half of the year, regaining all of the first quarter volume reduction. Further, gross profit per ton increased slightly. -- At the end of June, the Rail Group's utilization rate was 89.1 percent, up from 86.1 percent the prior year. Further, the utilization rate is expected to increase as the year progresses.
Conference Call
The company will host a webcast on Thursday, August 7, 2014 at 11:00 A.M. ET, to discuss its performance. This can be accessed under the heading "Investor" on its website at www.andersonsinc.com.
Forward Looking Statements
This release contains forward-looking statements. These statements involve risks and uncertainties that could cause actual results to differ materially. Without limitation, these risks include economic, weather and regulatory conditions, competition, and the risk factors set forth from time to time in the Company's filings with the Securities and Exchange Commission. Although the Company believes that the assumptions upon which the financial information and its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct.
Company Description
The Andersons, Inc. is a diversified company rooted in agriculture. Founded in Maumee, Ohio, in 1947, the company conducts business across North America in the grain, ethanol, and plant nutrient sectors, railcar leasing, turf and cob products, and consumer retailing. The Andersons, Inc. is located on the Internet at www.andersonsinc.com
The Andersons, Inc. Consolidated Statements of Income (Unaudited) Three months ended June 30, Six months ended June 30, (in thousands, except per share data) 2014 2013 2014 2013 ---- ---- ---- ---- Sales and merchandising revenues $1,312,082 $1,566,964 $2,315,376 $2,838,934 Cost of sales and merchandising revenues 1,190,587 1,463,735 2,117,106 2,656,432 --------- --------- --------- --------- Gross profit 121,495 103,229 198,270 182,502 Operating, administrative and general expenses 76,275 61,464 147,260 123,472 Interest expense 6,146 4,855 12,148 11,259 Other income: Equity in earnings of affiliates 32,213 10,010 52,714 17,814 Other income, net 3,797 1,292 23,409 4,018 ----- ----- ------ ----- Income before income taxes 75,084 48,212 114,985 69,603 Income tax provision 25,714 17,480 39,586 26,559 ------ ------ ------ ------ Net income 49,370 30,732 75,399 43,044 Net income attributable to the noncontrolling interests 5,069 1,193 8,390 927 ----- ----- ----- --- Net income attributable to The Andersons, Inc. $44,301 $29,539 $67,009 $42,117 ======= ======= ======= ======= Per common share: Basic earnings attributable to The Andersons, Inc. common shareholders $1.56 $1.05 $2.36 $1.50 ===== ===== ===== ===== Diluted earnings attributable to The Andersons, Inc. common shareholders $1.56 $1.05 $2.36 $1.49 ===== ===== ===== ===== Dividends paid $0.1100 $0.1067 $0.2200 $0.2133 ======= ======= ======= =======
The Andersons, Inc. Condensed Consolidated Balance Sheets (Unaudited) (In thousands) June 30, 2014 December 31, 2013 June 30, 2013 ------------- ----------------- ------------- Assets Current assets: Cash and cash equivalents $47,190 $309,085 $75,920 Restricted cash 895 408 872 Accounts receivable, net 189,646 173,930 216,432 Inventories 432,996 614,923 444,523 Commodity derivative assets - current 162,427 71,319 121,789 Deferred income taxes 7,443 4,931 2,797 Other current assets 24,596 47,188 44,936 ------ ------ ------ Total current assets 865,193 1,221,784 907,269 Other assets: Commodity derivative assets - noncurrent 312 246 87 Other assets, net 116,985 118,010 103,781 Pension asset 13,023 14,328 - Equity method investments 264,381 291,109 195,241 ------- ------- ------- 394,701 423,693 299,109 Railcar assets leased to others, net 242,147 240,621 242,887 Property, plant and equipment, net 390,587 387,458 371,716 ------- ------- ------- Total assets $1,892,628 $2,273,556 $1,820,981 ========== ========== ========== Liabilities and equity Current liabilities: Borrowings under short-term line of credit $27,000 $ - $50,000 Accounts payable for grain 164,230 592,183 178,017 Other accounts payable 143,535 154,599 183,971 Customer prepayments and deferred revenue 21,670 59,304 25,621 Commodity derivative liabilities - current 86,134 63,954 58,183 Accrued expenses and other current liabilities 81,260 70,295 57,456 Current maturities of long-term debt 89,387 51,998 45,096 ------ ------ ------ Total current liabilities 613,216 992,333 598,344 Other long-term liabilities 15,032 15,386 15,634 Commodity derivative liabilities - noncurrent 7,444 6,644 5,863 Employee benefit plan obligations 39,178 39,477 50,754 Long-term debt, less current maturities 300,220 375,213 409,020 Deferred income taxes 126,258 120,082 87,486 ------- ------- ------ Total liabilities 1,101,348 1,549,135 1,167,101 Total equity 791,280 724,421 653,880 ------- ------- ------- Total liabilities and equity $1,892,628 $2,273,556 $1,820,981 ========== ========== ==========
Segment Data Grain Ethanol Plant Nutrient Rail Turf & Specialty Retail Other Total (In thousands) Three months ended June 30, 2014 Revenues from external customers $656,004 $226,388 $311,895 $33,409 $42,913 $41,473 $ - $1,312,082 Gross profit 27,909 18,638 40,733 13,863 7,805 12,547 - 121,495 Equity in earnings of affiliates 8,467 23,746 - - - - - 32,213 Other income, net 975 356 391 787 467 190 631 3,797 Income (loss) before income taxes 10,352 38,976 25,004 6,684 1,998 1,637 (9,567) 75,084 Income (loss) attributable to the noncontrolling interests (3) 5,072 - - - - - 5,069 Operating income (loss) (a) $10,355 $33,904 $25,004 $6,684 $1,998 $1,637 $(9,567) $70,015 Three months ended June 30, 2013 Revenues from external customers $891,350 $222,240 $330,339 $38,601 $43,144 $41,290 $ - $1,566,964 Gross profit 22,092 9,649 37,201 14,557 7,321 12,409 - 103,229 Equity in earnings of affiliates 5,027 4,983 - - - - - 10,010 Other income (expense), net (349) 199 164 702 175 100 301 1,292 Income (loss) before income taxes 2,053 11,794 23,240 9,680 2,195 1,539 (2,289) 48,212 Income attributable to the noncontrolling interest - 1,193 - - - - - 1,193 Operating income (loss) (a) $2,053 $10,601 $23,240 $9,680 $2,195 $1,539 $(2,289) $47,019 Grain Ethanol Plant Nutrient Rail Turf & Specialty Retail Other Total Six months ended June 30, 2014 Revenues from external customers $1,239,163 $415,208 $419,525 $85,711 $86,638 $69,131 $ - $2,315,376 Gross profit 44,917 26,003 54,808 35,728 16,280 20,534 - 198,270 Equity in earnings of affiliates 10,351 42,363 - - - - - 52,714 Other income, net 19,321 130 576 1,497 774 302 809 23,409 Income (loss) before income taxes 21,655 62,124 23,593 21,729 3,373 (698) (16,791) 114,985 Income (loss) attributable to the noncontrolling interests (6) 8,396 - - - - - 8,390 Operating income (loss) (a) $21,661 $53,728 $23,593 $21,729 $3,373 $(698) $(16,791) $106,595 Six months ended June 30, 2013 Revenues from external customers $1,727,845 $421,549 $442,241 $84,965 $90,331 $72,003 $ - $2,838,934 Gross profit 46,942 14,454 51,150 33,536 16,339 20,081 - 182,502 Equity in earnings of affiliates 12,937 4,877 - - - - - 17,814 Other income, net 222 430 139 1,648 450 214 915 4,018 Income (loss) before income taxes 10,352 14,007 22,678 24,254 6,196 (1,630) (6,254) 69,603 Income attributable to the noncontrolling interest - 927 - - - - - 927 Operating income (loss) (a) $10,352 $13,080 $22,678 $24,254 $6,196 $(1,630) $(6,254) $68,676 (a) Operating income (loss) for each Group is defined as net sales and merchandising revenues plus identifiable other income less all identifiable operating expenses, including interest expense for carrying working capital and long-term assets and is reported net of the noncontrolling interest share of income (loss).
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SOURCE The Andersons, Inc.