MAUMEE, Ohio, Nov. 5, 2014 /CNW/ -- The Andersons, Inc.
(Nasdaq: ANDE) today announces financial results for the third
quarter ended September 30, 2014.
Highlights
- Year-to-date earnings of $2.95 per diluted share set a new
record.
- Record third quarter operating income of
$21.3 million for the Ethanol
Group.
"We're pleased with our results through September, which set a
record. Our earnings this year clearly have been led by the
outstanding results of our Ethanol Group," said CEO Mike Anderson. "I want to mention, however, that
current ethanol market indications for 2015 show margins declining
from the levels we have seen this year.
"We continue to grow, both organically and by acquisition,
including the purchase of Auburn Bean and Grain in October, which
added grain and agronomy locations throughout north central
Michigan," added Mr. Anderson.
"This is an area of strategic significance to the company as it
connects our existing locations to our Thompsons joint venture in
Ontario. This acquisition increased our grain storage
capacity by 13 percent, and our nutrient storage by four
percent."
All financial and operating highlights below are quarterly data
compared to the same period of the prior year, unless otherwise
noted.
Financial Highlights
Third quarter net income attributable to the company was
$16.8 million, or $0.59 per diluted share, on revenues of
$1.0 billion. In the same three
month period of 2013, the company reported results of $17.2 million, or $0.61 per diluted share, on revenues of
$1.2 billion.
- Revenues were down in the Grain and Ethanol groups due to lower
commodity prices. The majority of the decrease was within the Grain
Group where the average price per bushel sold decreased by 36
percent, which more than offset the 11 percent increase in bushels
sold.
- The Ethanol Group realized solid margins at all plants. These
margins were primarily supported by strong export demand, lower
corn prices, and solid operating metrics. The Ethanol Group had
record E-85 sales.
- Volume for the Plant Nutrient Group was up almost 25 percent
during the third quarter; however, this was partially offset by
lower gross profit per ton.
- The Rail Group's income was down this quarter due in part to
the group recognizing $4.3 million in
income from the settlement of two non-performing leases last year,
and a significant increase in freight expense to move idle cars
into service.
Operating Highlights
The following highlights have impacted reported results, or may
impact future results:
- Crop conditions were good to excellent in the majority of the
company's territories during the growing season, which has led to
record yields. The harvest, however, had a slow start due to wet
weather conditions.
- It should be noted that poor railroad service could impact the
company in the fourth quarter. Both the Grain and Ethanol groups
rely on outbound rail service to turn their inventory, which
enables them to effectively serve their customers. Further, the
Plant Nutrient Group relies on inbound rail to ensure nutrients are
available to meet customer needs.
- Integration of the Auburn Bean and Grain (AB&G), United
Grain, LLC and Keller Grain, Inc. acquisitions is underway.
AB&G added grain storage capacity of about 18.1 million
bushels, and 16,000 tons of dry and 3.7 million gallons of liquid
nutrient capacity.
- All four ethanol plants had scheduled maintenance shut-downs
during the third quarter. These went well, and new daily production
records have been set since the maintenance was performed.
- At this time, approximately 85 percent of the fourth quarter
and almost half of the January ethanol margin risk is hedged. These
hedges were placed at different times during the year in accordance
with the group's risk management strategy.
- At the end of September, the Rail Group's utilization rate was
90.1 percent, up from 86.3 percent the prior year. The utilization
rate is expected to increase further as the year progresses.
Share Repurchase - Authorization
The Andersons also announces that its Board of Directors has
authorized the repurchase of up to an aggregate $50.0 million of the company's common
stock. The primary objective of the limited share repurchase
program is to offset dilution related to the company's recent share
issuance in connection with its acquisition of Auburn Bean and
Grain. The program will also enable the company to acquire
shares used for its employee long-term incentive plans in order to
offset dilution.
Shares will be repurchased from time to time in open market
transactions. When, and if, shares are purchased will depend
on stock price, market conditions and other factors. The
authorization for this plan will be in effect for two years.
Conference Call
The company will host a webcast on Thursday, November 6, 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.
Condensed
Consolidated Statements of Income
(Unaudited)
|
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|
|
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|
|
|
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|
|
|
|
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Three months ended
September 30,
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|
Nine months ended
September 30,
|
(in thousands, except
per share data)
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
Sales and
merchandising revenues
|
$ 952,927
|
|
$ 1,181,374
|
|
$ 3,268,303
|
|
$ 4,020,308
|
Cost of sales and
merchandising revenues
|
868,009
|
|
1,108,228
|
|
2,985,115
|
|
3,764,660
|
Gross
profit
|
84,918
|
|
73,146
|
|
283,188
|
|
255,648
|
Operating,
administrative and general expenses
|
76,737
|
|
69,193
|
|
223,997
|
|
192,665
|
Interest
expense
|
4,253
|
|
5,348
|
|
16,401
|
|
16,607
|
Other
income:
|
|
|
|
|
|
|
|
Equity in earnings of
affiliates
|
23,917
|
|
22,177
|
|
76,631
|
|
39,991
|
Other income,
net
|
1,685
|
|
7,605
|
|
25,094
|
|
11,623
|
Income before income
taxes
|
29,530
|
|
28,387
|
|
144,515
|
|
97,990
|
Income tax
provision
|
10,251
|
|
10,348
|
|
49,837
|
|
36,907
|
Net income
|
19,279
|
|
18,039
|
|
94,678
|
|
61,083
|
Net income
attributable to the noncontrolling interests
|
2,454
|
|
878
|
|
10,844
|
|
1,805
|
Net income
attributable to The Andersons, Inc.
|
$ 16,825
|
|
$ 17,161
|
|
$ 83,834
|
|
$ 59,278
|
|
|
|
|
|
|
|
|
Per common
share:
|
|
|
|
|
|
|
|
Basic earnings
attributable to The Andersons, Inc.
common
shareholders
|
$ 0.59
|
|
$ 0.61
|
|
$ 2.95
|
|
$ 2.11
|
Diluted earnings
attributable to The Andersons, Inc.
common
shareholders
|
$ 0.59
|
|
$ 0.61
|
|
$ 2.95
|
|
$ 2.10
|
Dividends
paid
|
$ 0.1100
|
|
$ 0.1067
|
|
$ 0.3300
|
|
$ 0.3200
|
|
|
|
|
|
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|
The Andersons,
Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
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(in
thousands)
|
September 30,
2014
|
|
December 31,
2013
|
|
September 30,
2013
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
326,946
|
|
$
309,085
|
|
$
134,441
|
Restricted
cash
|
173
|
|
408
|
|
164
|
Accounts receivable,
net
|
162,270
|
|
173,930
|
|
178,970
|
Inventories
|
396,464
|
|
614,923
|
|
429,017
|
Commodity derivative
assets – current
|
126,396
|
|
71,319
|
|
105,390
|
Deferred income
taxes
|
148
|
|
4,931
|
|
5,254
|
Other current
assets
|
36,518
|
|
47,188
|
|
42,278
|
Total current
assets
|
1,048,915
|
|
1,221,784
|
|
895,514
|
Other
assets:
|
|
|
|
|
|
Commodity derivative
assets – noncurrent
|
2,383
|
|
246
|
|
5
|
Other assets,
net
|
113,141
|
|
118,010
|
|
110,731
|
Pension
asset
|
13,738
|
|
14,328
|
|
-
|
Equity method
investments
|
257,166
|
|
291,109
|
|
262,643
|
|
386,428
|
|
423,693
|
|
373,379
|
Railcar assets leased
to others, net
|
245,849
|
|
240,621
|
|
233,024
|
Property, plant and
equipment, net
|
401,800
|
|
387,458
|
|
380,374
|
Total
assets
|
$
2,082,992
|
|
$
2,273,556
|
|
$
1,882,291
|
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
debt
|
$
451
|
|
$
-
|
|
$
-
|
Accounts payable for
grain
|
222,178
|
|
592,183
|
|
241,575
|
Other accounts
payable
|
165,133
|
|
154,599
|
|
200,664
|
Customer prepayments
and deferred revenue
|
27,246
|
|
59,304
|
|
23,974
|
Commodity derivative
liabilities – current
|
229,265
|
|
63,954
|
|
88,234
|
Accrued expenses and
other current liabilities
|
70,598
|
|
70,295
|
|
63,900
|
Current maturities of
long-term debt
|
76,757
|
|
51,998
|
|
44,232
|
Total current
liabilities
|
791,628
|
|
992,333
|
|
662,579
|
|
|
|
|
|
|
Other long-term
liabilities
|
13,902
|
|
15,386
|
|
17,129
|
Commodity derivative
liabilities – noncurrent
|
26,203
|
|
6,644
|
|
9,636
|
Employee benefit plan
obligations
|
39,606
|
|
39,477
|
|
49,768
|
Long-term debt, less
current maturities
|
289,448
|
|
375,213
|
|
381,018
|
Deferred income
taxes
|
120,628
|
|
120,082
|
|
91,869
|
Total
liabilities
|
1,281,415
|
|
1,549,135
|
|
1,211,999
|
Total
equity
|
801,577
|
|
724,421
|
|
670,292
|
Total liabilities and
equity
|
$
2,082,992
|
|
$
2,273,556
|
|
$
1,882,291
|
The Andersons,
Inc.
Segment
Data
(Unaudited)
|
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|
|
(in
thousands)
|
Grain
|
Ethanol
|
Plant
Nutrient
|
Rail
|
Turf &
Specialty
|
Retail
|
Other
|
Total
|
Three months ended
September 30, 2014
|
|
|
|
|
|
|
|
|
Revenues from
external customers
|
$ 575,354
|
$ 179,405
|
$ 110,809
|
$ 32,022
|
$ 22,631
|
$ 32,706
|
$
|
—
|
$ 952,927
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
32,748
|
12,770
|
13,934
|
10,841
|
5,306
|
9,319
|
—
|
84,918
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
affiliates
|
10,190
|
13,727
|
—
|
—
|
—
|
—
|
—
|
23,917
|
|
|
|
|
|
|
|
|
|
Other income
(expense), net
|
(2,354)
|
71
|
2,617
|
792
|
244
|
418
|
(103)
|
1,685
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
12,447
|
23,709
|
(129)
|
4,160
|
(2,885)
|
(968)
|
(6,804)
|
29,530
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to the noncontrolling interests
|
(2)
|
2,456
|
—
|
—
|
—
|
—
|
—
|
2,454
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) (a)
|
$ 12,449
|
$ 21,253
|
$ (129)
|
$ 4,160
|
$ (2,885)
|
$ (968)
|
$
|
(6,804)
|
$ 27,076
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30, 2013
|
|
|
|
|
|
|
|
|
Revenues from
external customers
|
$ 765,833
|
$ 213,384
|
$ 95,681
|
$ 47,523
|
$ 27,624
|
$ 31,329
|
$
|
—
|
$ 1,181,374
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
27,005
|
4,735
|
13,553
|
13,000
|
6,408
|
8,445
|
—
|
73,146
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
affiliates
|
12,003
|
10,174
|
—
|
—
|
—
|
—
|
—
|
22,177
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
1,216
|
35
|
320
|
5,031
|
135
|
102
|
766
|
7,605
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
14,315
|
11,790
|
(1,643)
|
12,360
|
(83)
|
(2,043)
|
(6,309)
|
28,387
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to the noncontrolling interest
|
(8)
|
886
|
—
|
—
|
—
|
—
|
—
|
878
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) (a)
|
$ 14,323
|
$ 10,904
|
$ (1,643)
|
$ 12,360
|
$ (83)
|
$ (2,043)
|
$
|
(6,309)
|
$ 27,509
|
|
|
|
|
|
|
|
|
|
|
Grain
|
Ethanol
|
Plant
Nutrient
|
Rail
|
Turf &
Specialty
|
Retail
|
Other
|
Total
|
Nine months ended
September 30, 2014
|
|
|
|
|
|
|
|
|
Revenues from
external customers
|
$ 1,814,517
|
$ 594,613
|
$ 530,334
|
$ 117,733
|
$ 109,269
|
$ 101,837
|
$
|
—
|
$ 3,268,303
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
77,665
|
38,773
|
68,742
|
46,569
|
21,586
|
29,853
|
—
|
283,188
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
affiliates
|
20,541
|
56,090
|
—
|
—
|
—
|
—
|
—
|
76,631
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
16,967
|
201
|
3,193
|
2,289
|
1,018
|
720
|
706
|
25,094
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
34,102
|
85,833
|
23,464
|
25,889
|
488
|
(1,666)
|
(23,595)
|
144,515
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to the noncontrolling interests
|
(8)
|
10,852
|
—
|
—
|
—
|
—
|
—
|
10,844
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) (a)
|
$ 34,110
|
$ 74,981
|
$ 23,464
|
$ 25,889
|
$ 488
|
$ (1,666)
|
$
|
(23,595)
|
$ 133,671
|
|
|
|
|
|
|
|
|
|
Nine months ended
September 30, 2013
|
|
|
|
|
|
|
|
|
Revenues from
external customers
|
$ 2,493,678
|
$ 634,933
|
$ 537,922
|
$ 132,488
|
$ 117,955
|
$ 103,332
|
$
|
—
|
$ 4,020,308
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
73,947
|
19,189
|
64,703
|
46,536
|
22,747
|
28,526
|
—
|
255,648
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
affiliates
|
24,940
|
15,051
|
—
|
—
|
—
|
—
|
—
|
39,991
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
1,438
|
465
|
459
|
6,679
|
585
|
316
|
1,681
|
11,623
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
24,667
|
25,797
|
21,035
|
36,614
|
6,113
|
(3,673)
|
(12,563)
|
97,990
|
|
|
|
|
|
|
|
|
|
Income (loss)
attributable to the noncontrolling interest
|
(8)
|
1,813
|
—
|
—
|
—
|
—
|
—
|
1,805
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) (a)
|
$ 24,675
|
$ 23,984
|
$ 21,035
|
$ 36,614
|
$ 6,113
|
$ (3,673)
|
$
|
(12,563)
|
$ 96,185
|
|
|
|
|
|
|
|
|
|
(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.