Attached files
| file | filename |
|---|---|
| 8-K - REX AMERICAN RESOURCES Corp | c79421_8k.htm |
Exhibit 99
| News Announcement | For Immediate Release |
REX AMERICAN RESOURCES’ THIRD QUARTER
DILUTED EPS RISE 136% TO A RECORD $2.86
Diluted EPS for the Nine Months Ended October 31, 2014 Rise 250% to $8.20
Repays All Bank Debt on Consolidated Plants and
Authorizes Repurchase of Additional 500,000 Shares
Dayton, Ohio, (December 4, 2014) -- REX American Resources Corporation (NYSE: REX) today reported record financial results for its fiscal 2014 third quarter (“Q3 ’14”) ended October 31, 2014. The Company also announced that its Board of Directors approved a 500,000 share increase in the number of shares in its common stock repurchase plan. REX management will host a conference call and webcast today at 11:00 a.m. ET.
| Conference Call: | 212/231-2907 |
| Webcast / Replay URL: | www.rexamerican.com/Corp/Page4.aspx |
| The webcast will be available for replay for 30 days |
REX American Resources’ Q3 ’14 results principally reflect its alternative energy segment interests in seven ethanol production facilities. The operations of One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) are consolidated, while those of its five remaining plants are reported as equity in income of unconsolidated ethanol affiliates.
REX’s Q3 ’14 net sales and revenue were $138.5 million, compared with $166.2 million in Q3 ’13, principally reflecting reduced ethanol and distillers grains pricing. As a result of lower corn prices and strong ethanol crush spread margins in Q3 ’14, the Company’s gross profit rose to $36.5 million, from $18.0 million in the prior year period. Reflecting the continued strength of ethanol industry metrics, Q3 ’14 equity in income of unconsolidated ethanol affiliates increased to $8.8 million, compared with $3.3 million in Q3 ’13, leading to net income from continuing operations before income taxes and non-controlling interests in Q3 ’14 of $40.6 million, compared with $15.9 million in Q3 ’13.
Net income attributable to REX shareholders in Q3 ’14 rose to $23.3 million, compared with $9.9 million in Q3 ’13, while Q3 ’14 diluted net income per share attributable to REX common shareholders rose to a record $2.86 per share, compared to $1.21 per share in Q3 ’13. Per share results in Q3 ’14 and Q3 ’13 are based on 8,170,000 and 8,179,000 diluted weighted average shares outstanding, respectively.
REX CEO, Stuart Rose, commented, “REX’s consolidated ethanol plants and minority interests in ethanol production facilities continue to benefit from the positive industry environment, the efficiency of our plants, and our operating disciplines. These factors drove record third quarter net income and diluted EPS, which further strengthened our already solid financial foundation. At October 31, 2014 cash and cash equivalents rose 56% to approximately $164.3 million, compared to the fiscal 2013 year-end levels, even as we allocated approximately $8.3 million to share repurchases during the quarter.
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| REX American Resources Q3’ 14 Results, 12/4/14 | page 2 |
“During the third quarter, we also continued to allocate cash from operations to reduce consolidated plant-level debt. At the end of the fiscal third quarter, consolidated plant-level debt was $33.5 million, marking a $28.5 million, or 46% decrease, compared to 2014 Q2 consolidated plant level debt of $62.0 million. As a result, interest expense declined by 53%, compared to Q3 ’13, while our debt-to-capital ratio dropped to 9% from 16% at the end of Q2 and 21% at January 31, 2014. Subsequent to the end of fiscal third quarter, we paid off the $33.5 million debt balance on our two consolidated plants.”
Balance Sheet
At October 31, 2014, REX had cash and cash equivalents of $164.3 million, $48.5 million of which was at the parent company and $115.8 million of which was at its consolidated ethanol production facilities. This compares with cash and cash equivalents of $105.1 million at January 31, 2014, $63.3 million of which was at the parent company and $41.8 million of which was at its consolidated ethanol production facilities.
REX repurchased 121,200 common shares in Q3 ’14 at an average price of $68.58. In Q4 ’14 to date, the Company repurchased an additional 57,610 common shares at an average price of $68.19. Combining the 500,000 common share repurchase authorization announced today with the 101,096 shares remaining from the prior authorization, the Company now has the authority to repurchase up to 601,096 shares of its common stock. Reflecting all common share repurchases to date, REX has 8,003,221 shares outstanding
At October 31, 2014, REX had lease agreements, as landlord for four former retail store locations. REX also has a seasonal (temporary) lease agreement, as landlord, for one former retail store location. In addition, REX has four owned former retail stores that were vacant at October 31, 2014, which it is marketing to either lease or sell. The current net book value for the Company’s remaining real estate holdings is approximately $3.6 million. The real estate segment revenue reflects rental income derived from these sites.
Segment Income Statement Data:
| Three Months Ended | Nine Months Ended | |||||||||||||||
| ($ in thousands) | October 31, | October 31, | ||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Net sales and revenue: | ||||||||||||||||
| Alternative energy (1) | $ | 138,363 | $ | 166,039 | $ | 444,323 | $ | 519,653 | ||||||||
| Real estate (2) | 91 | 149 | 299 | 348 | ||||||||||||
| Total net sales and revenues | $ | 138,454 | $ | 166,188 | $ | 444,622 | $ | 520,001 | ||||||||
| Gross profit (loss): | ||||||||||||||||
| Alternative energy (1) | $ | 36,506 | $ | 18,002 | $ | 111,940 | $ | 37,918 | ||||||||
| Real estate (2) | (9 | ) | 26 | 17 | 6 | |||||||||||
| Total gross profit | $ | 36,497 | $ | 18,028 | $ | 111,957 | $ | 37,924 | ||||||||
| Segment profit (loss): | ||||||||||||||||
| Alternative energy segment (1) | $ | 41,412 | $ | 16,491 | $ | 121,797 | $ | 34,231 | ||||||||
| Real estate segment (2) | (34 | ) | (35 | ) | (63 | ) | (179 | ) | ||||||||
| Corporate expense, net | (801 | ) | (604 | ) | (2,319 | ) | (2,010 | ) | ||||||||
| Income from continuing operations before income taxes and non-controlling interests (2) | $ | 40,577 | $ | 15,852 | $ | 119,415 | $ | 32,042 | ||||||||
| (1) | Includes results attributable to non-controlling interests of approximately 26% for One Earth and approximately 1% for NuGen. |
| (2) | Certain amounts differ from those previously reported as a result of certain sold real estate assets being reclassified as discontinued operations. |
-more-
| REX American Resources Q3’ 14 Results, 12/4/14 | page 3 |
The following table summarizes select data related to the Company’s consolidated alternative energy interests:
| Three Months Ended | Nine Months Ended | |||||||||||||||
| October 31, | October 31, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Average selling price per gallon of ethanol | $ | 1.89 | $ | 2.25 | $ | 2.06 | $ | 2.32 | ||||||||
| Average selling price per ton of dried distillers grains | $ | 145.87 | $ | 228.00 | $ | 181.54 | $ | 244.29 | ||||||||
| Average selling price per ton of modified distillers grains | $ | 41.78 | $ | 93.50 | $ | 68.19 | $ | 117.47 | ||||||||
| Average cost per bushel of grain | $ | 3.64 | $ | 6.24 | $ | 4.14 | $ | 6.95 | ||||||||
| Average cost of natural gas (per mmbtu) | $ | 4.69 | $ | 4.02 | $ | 6.41 | $ | 4.24 | ||||||||
Segment Balance Sheet Data:
| October 31, 2014 | January 31, 2014 | |||||||
| Assets: | ||||||||
| Alternative energy | $ | 416,703 | $ | 356,589 | ||||
| Real estate | 4,145 | 4,722 | ||||||
| Corporate | 49,530 | 66,557 | ||||||
| Total assets | $ | 470,378 | $ | 427,868 | ||||
Supplemental Data Related to REX’s Alternative Energy Interests:
| REX American Resources Corporation Ethanol Ownership Interests/Effective Annual Gallons Shipped as of October 31, 2014 (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) | 112.2 | 74 | % | 83.0 | ||||||||
| NuGen Energy, LLC (Marion, SD) | 115.0 | 99 | % | 113.9 | ||||||||
| Patriot Holdings, LLC (Annawan, IL) | 122.7 | 27 | % | 33.1 | ||||||||
| Big River Resources West Burlington, LLC (West Burlington, IA) | 109.2 | 10 | % | 10.9 | ||||||||
| Big River Resources Galva, LLC (Galva, IL) | 120.1 | 10 | % | 12.0 | ||||||||
| Big River United Energy, LLC (Dyersville, IA) | 124.8 | 5 | % | 6.2 | ||||||||
| Big River Resources Boyceville,
LLC (Boyceville, WI) | 57.2 | 10 | % | 5.7 | ||||||||
| Total | 761.2 | n/a | 264.8 | |||||||||
-more-
| REX American Resources Q3’ 14 Results, 12/4/14 | page 4 |
About REX American Resources Corporation
REX American Resources has interests in seven ethanol production facilities, which in aggregate shipped approximately 761 million gallons of ethanol over the twelve month period ended October 31, 2014. REX’s effective ownership of the trailing twelve month gallons shipped (for the twelve months ended October 31, 2014) by the ethanol production facilities in which it has ownership interests was approximately 265 million gallons. Further information about REX is available at www.rexamerican.com.
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 changes, the price volatility and availability of corn, dried and modified distillers grains, ethanol, corn oil, gasoline and natural gas, ethanol plants operating efficiently and according to forecasts and projections, changes in the national or regional economies, weather, transportation delays, the effects of terrorism or acts of war, changes in real estate market conditions and the impact of Internal Revenue Service audits. The Company does not intend to update publicly any forward-looking statements except as required by law.
| Contact: | |
| Douglas Bruggeman | Joseph Jaffoni, Norberto Aja |
| Chief Financial Officer | JCIR |
| (937) 276-3931 | (212) 835-8500 |
| rex@jcir.com |
- statements of operations follow -
| REX American Resources Q3’ 14 Results, 12/4/14 | page 5 |
REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES
Consolidated Statements of Operations
(in thousands, except per share amounts)
Unaudited
| Three
Months Ended October 31, | Nine
Months Ended October 31, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Net sales and revenue | $ | 138,454 | $ | 166,188 | $ | 444,622 | $ | 520,001 | ||||||||
| Cost of sales | 101,957 | 148,160 | 332,665 | 482,077 | ||||||||||||
| Gross profit | 36,497 | 18,028 | 111,957 | 37,924 | ||||||||||||
| Selling, general and administrative expenses | (4,353 | ) | (4,589 | ) | (15,369 | ) | (12,530 | ) | ||||||||
| Equity in income of unconsolidated ethanol affiliates | 8,780 | 3,331 | 24,322 | 9,558 | ||||||||||||
| Interest and other income | 103 | 69 | 243 | 158 | ||||||||||||
| Interest expense | (454 | ) | (964 | ) | (1,737 | ) | (3,039 | ) | ||||||||
| Gains (losses) on derivative financial instruments, net | 4 | (23 | ) | (1 | ) | (29 | ) | |||||||||
| Income from continuing operations before income taxes and non-controlling interests | 40,577 | 15,852 | 119,415 | 32,042 | ||||||||||||
| Provision for income taxes | (12,126 | ) | (5,261 | ) | (40,049 | ) | (11,034 | ) | ||||||||
| Income from continuing operations including non-controlling interests | 28,451 | 10,591 | 79,366 | 21,008 | ||||||||||||
| Income from discontinued operations, net of tax | — | 287 | 5 | 556 | ||||||||||||
| Gain on disposal of discontinued operations, net of tax | 138 | 600 | 136 | 732 | ||||||||||||
| Net income including non-controlling interests | 28,589 | 11,478 | 79,507 | 22,296 | ||||||||||||
| Net income attributable to non-controlling interests | (5,249 | ) | (1,611 | ) | (12,518 | ) | (3,097 | ) | ||||||||
| Net income attributable to REX common shareholders | $ | 23,340 | $ | 9,867 | $ | 66,989 | $ | 19,199 | ||||||||
| Weighted average shares outstanding – basic | 8,170 | 8,140 | 8,157 | 8,154 | ||||||||||||
| Basic income per share from continuing operations | $ | 2.84 | $ | 1.10 | $ | 8.19 | $ | 2.19 | ||||||||
| Basic income per share from discontinued operations | — | 0.04 | — | 0.07 | ||||||||||||
| Basic income per share on disposal of discontinued operations | 0.02 | 0.07 | 0.02 | 0.09 | ||||||||||||
| Basic net income per share attributable to REX common shareholders | $ | 2.86 | $ | 1.21 | $ | 8.21 | $ | 2.35 | ||||||||
| Weighted average shares outstanding – diluted | 8,170 | 8,179 | 8,168 | 8,197 | ||||||||||||
| Diluted income per share from continuing operations | $ | 2.84 | $ | 1.10 | $ | 8.18 | $ | 2.18 | ||||||||
| Diluted income per share from discontinued operations | — | 0.04 | — | 0.07 | ||||||||||||
| Diluted income per share on disposal of discontinued operations | 0.02 | 0.07 | 0.02 | 0.09 | ||||||||||||
| Diluted net income per share attributable to REX common shareholders | $ | 2.86 | $ | 1.21 | $ | 8.20 | $ | 2.34 | ||||||||
| Amounts attributable to REX common shareholders: | ||||||||||||||||
| Income from continuing operations, net of tax | $ | 23,202 | $ | 8,980 | $ | 66,848 | $ | 17,911 | ||||||||
| Income from discontinued operations, net of tax | 138 | 887 | 141 | 1,288 | ||||||||||||
| Net income | $ | 23,340 | $ | 9,867 | $ | 66,989 | $ | 19,199 | ||||||||
Certain amounts differ from those previously reported as a result of certain real estate assets being reclassified as discontinued operations.
| REX American Resources Q3’ 14 Results, 12/4/14 | page 6 |
REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES
Consolidated Balance Sheets
(in thousands) Unaudited
| October
31, 2014 | January
31, 2014 | |||||||
| ASSETS: | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and cash equivalents | $ | 164,267 | $ | 105,149 | ||||
| Restricted cash | — | 500 | ||||||
| Accounts receivable | 10,586 | 16,486 | ||||||
| Inventory | 11,496 | 19,370 | ||||||
| Refundable income taxes | — | 268 | ||||||
| Prepaid expenses and other | 5,029 | 4,891 | ||||||
| Deferred taxes-net | — | 2,146 | ||||||
| Total current assets | 191,378 | 148,810 | ||||||
| Property and equipment-net | 197,645 | 202,258 | ||||||
| Other assets | 5,831 | 5,388 | ||||||
| Equity method investments | 75,524 | 71,189 | ||||||
| Restricted investments and deposits | — | 223 | ||||||
| TOTAL ASSETS | $ | 470,378 | $ | 427,868 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Current portion of long term debt | $ | 19,000 | $ | 12,226 | ||||
| Accounts payable – trade | 9,066 | 6,626 | ||||||
| Deferred taxes | 3,400 | — | ||||||
| Derivative financial instruments | — | 1,141 | ||||||
| Accrued expenses and other current liabilities | 19,511 | 12,147 | ||||||
| Total current liabilities | 50,977 | 32,140 | ||||||
| LONG TERM LIABILITIES: | ||||||||
| Long term debt | 14,500 | 63,500 | ||||||
| Deferred taxes | 19,597 | 19,613 | ||||||
| Other long term liabilities | 1,904 | 1,862 | ||||||
| Total long term liabilities | 36,001 | 84,975 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| EQUITY: | ||||||||
| REX shareholders’ equity: | ||||||||
| Common stock, 45,000 shares authorized, 29,853 shares issued at par | 299 | 299 | ||||||
| Paid in capital | 144,791 | 144,051 | ||||||
| Retained earnings | 424,090 | 357,101 | ||||||
| Treasury stock, 21,793 and 21,753 shares, respectively | (229,731 | ) | (222,170 | ) | ||||
| Total REX shareholders’ equity | 339,449 | 279,281 | ||||||
| Non-controlling interests | 43,951 | 31,472 | ||||||
| Total equity | 383,400 | 310,753 | ||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 470,378 | $ | 427,868 | ||||
- statements of cash flows follow -
| REX American Resources Q3’ 14 Results, 12/4/14 | page 7 |
REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands) Unaudited
| Nine Months Ended October 31, | ||||||||
| 2014 | 2013 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income | $ | 79,507 | $ | 22,296 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation, impairment charges and amortization | 12,480 | 13,178 | ||||||
| Income from equity method investments | (24,322 | ) | (9,558 | ) | ||||
| Gain on disposal of real estate and property and equipment | (209 | ) | (989 | ) | ||||
| Dividends received from equity method investments | 19,881 | 200 | ||||||
| Deferred income | — | (590 | ) | |||||
| Derivative financial instruments | (1,141 | ) | (1,249 | ) | ||||
| Deferred income tax | 5,323 | 8,241 | ||||||
| Excess tax benefit from stock option exercises | (441 | ) | — | |||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | 5,900 | 293 | ||||||
| Inventories | 7,874 | 8,613 | ||||||
| Other assets | 728 | 1,933 | ||||||
| Accounts payable-trade | 2,075 | 2,589 | ||||||
| Accrued expenses and other liabilities | 7,406 | (1,529 | ) | |||||
| Net cash provided by operating activities | 115,061 | 43,428 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Capital expenditures | (8,107 | ) | (2,159 | ) | ||||
| Restricted cash | 500 | (500 | ) | |||||
| Repayment of loan receivable | — | 681 | ||||||
| Restricted investments and deposits | 273 | 280 | ||||||
| Proceeds from sale of real estate and property and equipment | 596 | 3,406 | ||||||
| Net cash (used in) provided by investing activities | (6,738 | ) | 1,708 | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Payments of long term debt Loan | (42,226 | ) | (18,520 | ) | ||||
| Stock options exercised | 931 | 794 | ||||||
| Payments to noncontrolling interests holders | (39 | ) | (5 | ) | ||||
| Excess tax benefit from stock option exercises | 441 | — | ||||||
| Treasury stock acquired | (8,312 | ) | (3,079 | ) | ||||
| Net cash used in financing activities | (49,205 | ) | (20,810 | ) | ||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 59,118 | 24,326 | ||||||
| CASH AND CASH EQUIVALENTS-Beginning of period | 105,149 | 69,073 | ||||||
| CASH AND CASH EQUIVALENTS-End of period | $ | 164,267 | $ | 93,399 | ||||
| Non cash investing activities – Accrued capital expenditures | $ | 615 | $ | 198 | ||||
| Non cash investing activities – Loan receivable granted in connection with sale of real estate | $ | 475 | $ | — | ||||
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