-Company Increases Share Repurchase Plan By
500K Shares-
REX American Resources Corporation (NYSE: REX) (“REX” or “the
Company”) today reported financial results for its fiscal 2017
fourth quarter (“Q4 ‘17”) and fiscal year ended January 31, 2018.
REX management will host a conference call and webcast today at
11:00 a.m. ET.
Conference Call:
(212) 231-2908
Webcast / Replay URL:
www.rexamerican.com/Corp/Page4.aspx
The webcast will be available for replay for
30 days
REX American Resources’ Q4 ‘17 results principally reflect its
interests in six ethanol production facilities and its refined coal
operation. One Earth Energy, LLC (“One Earth”) and NuGen Energy,
LLC (“NuGen”) are consolidated, while those of its four other
ethanol plants are reported as equity in income of unconsolidated
ethanol affiliates. REX’s financial results for fiscal 2017 also
reflect the refined coal entity acquired by the Company on August
10, 2017, as well as the impact related to the 2017 Tax Cuts and
Jobs Act. The Company reports results for its two business segments
as ethanol and by-products, and refined coal.
REX’s Q4 ‘17 net sales and revenue were $109.5 million, compared
with $121.6 million in Q4 ‘16, primarily reflecting lower average
selling prices for ethanol during the quarter. The Company’s Q4 ‘17
gross profit for its ethanol and by-products segment declined to
$10.0 million, from $25.2 million in the comparable prior year
period. Equity in income of unconsolidated ethanol affiliates in Q4
‘17 decreased to $1.3 million, from $2.9 million in Q4 ‘16, leading
to income before income taxes of $6.5 million in Q4 ‘17, compared
to $22.1 million in Q4 ‘16 for the ethanol and by-product segment.
The Company also recorded a gross loss from its refined coal
operation of $4.0 million in Q4 ‘17. While gross profit was
negatively impacted, the Company recognized benefits related to its
refined coal operation in the form of a lower effective tax rate.
The Company reported income from continuing operations before
income taxes and non-controlling interests in Q4 ‘17 of $1.7
million, compared with $21.2 million in Q4 ‘16.
Net income attributable to REX shareholders in Q4 ‘17 rose to
$19.1 million, from $12.4 million in Q4 ‘16, primarily reflecting
the Company’s $14.4 million tax benefit as a result of the
revaluation of its deferred tax liabilities in connection with the
passage of the 2017 Tax Cuts and Jobs Act in December 2017. Q4 ‘17
diluted net income per share attributable to REX common
shareholders was $2.89 per share, compared to $1.88 per share in Q4
‘16.
Per share results in Q4 ‘17 and Q4 ‘16 are based on 6,604,000
and 6,591,000 diluted weighted average shares outstanding,
respectively.
Net sales and revenue for the twelve months ended January 31,
2018 were $452.6 million, compared to $453.8 million in fiscal
2016, while gross profit for fiscal 2017 was $44.2 million, which
included a $7.3 million loss from the Company’s refined coal
operation, compared to $71.0 million in fiscal 2016. Fiscal 2017
equity in income of unconsolidated ethanol affiliates was $3.2
million, compared with $6.1 million in fiscal 2016.
For fiscal 2017, REX reported net income attributable to REX
shareholders of $39.7 million, which includes the $14.4 million
benefit related to the revaluation of the Company’s deferred tax
liabilities, compared with $32.3 million in fiscal 2016. This led
to diluted net income per share attributable to REX common
shareholders of $6.02 in fiscal 2017, compared to $4.91 per share
in fiscal 2016.
Per share results for the fiscal year ended January 31, 2018 and
January 31, 2017, are based on 6,596,000 and 6,587,000 diluted
weighted average shares outstanding, respectively.
Segment Income Statement Data:
Three Months
Twelve Months
Ended
Ended
($ in thousands)
January 31,
January 31,
2018
2017
2018
2017
Net sales and revenue:
Ethanol & By-Products (1) $ 109,295 $ 121,587 $ 452,153 $
453,799 Refined coal (2) (3)
240
- 433 -
Total net sales and revenues $
109,535 $ 121,587
$ 452,586 $
453,799 Gross profit (loss): Ethanol
& By-Products (1) $ 9,981 $ 25,171 $ 51,509 $ 71,039 Refined
coal (2)
(3,957) -
(7,348) - Total gross
profit $ 6,024 $
25,171 $ 44,161
$ 71,039 Income (loss) before
income taxes: Ethanol & By-Products (1) $ 6,545 $ 22,110 $
38,352 $ 59,447 Refined coal (2) (4,336) - (10,021) - Corporate and
other
(550) (939)
(2,938) (2,536) Total income
(loss) before income taxes
$ 1,659
$ 21,171 $
25,393 $ 56,911
Benefit (provision) for income taxes: Ethanol &
By-Products $ 13,004 $ (5,913) $ 3,245 $ (18,259) Refined coal
5,250 - 15,168 - Corporate and other
222
291 1,106 866
Total benefit (provision) before income taxes
$
18,476 $ (5,622)
$ 19,519 $
(17,393) Segment profit (loss): Ethanol
& By-Products $ 18,261 $ 13,021 $ 35,880 $ 33,950 Refined coal
1,108 - 5,628 - Corporate and other
(316)
(640) (1,802)
(1,617) Net income attributable to REX common
shareholders
$ 19,053 $
12,381 $ 39,706
$ 32,333 (1) Includes
results attributable to non-controlling interests of approximately
25% for One Earth and approximately 1% for NuGen. (2) Includes
results attributable to non-controlling interests of approximately
5%. (3) Refined coal sales are reported net of the cost of coal.
REX American Resources’ Chief Executive Officer, Zafar Rizvi,
commented, “Similar to much of 2017, the fourth quarter presented a
challenging period across the ethanol sector as significant
pressure on ethanol pricing impacted our results. Despite these
challenges, we were able to leverage our ethanol and by-products
operations, as well as our refined coal operation, to post another
profitable quarter and fiscal year.
“We remain optimistic regarding our ethanol business and are
confident that our recent investment in refined coal will continue
to benefit our financial results. Finally, we ended 2017 with a
strong balance sheet and healthy liquidity position, including cash
and cash equivalents of $191 million and working capital of $212
million, which favorably positions us to execute on our operating
initiatives.”
Balance Sheet and Share Repurchase ProgramAt January 31,
2018, REX had cash and cash equivalents of $191.0 million, $74.1
million of which was at the parent company, and $116.9 million of
which was at its consolidated production facilities. This compares
with cash and cash equivalents at January 31, 2017, of $188.6
million, $79.5 million of which was at the parent company, and
$109.1 million of which was at its consolidated ethanol production
facilities.
On March 20, 2018, REX’s Board of Directors approved an increase
in the share repurchase plan providing the Company with the
authority to repurchase up to an additional 500,000 shares of its
common stock. Reflecting the balance of the Company’s prior
repurchase authorization, REX is now authorized to repurchase up to
655,334 shares of its common stock. The Company had 6,558,679
shares outstanding at January 31, 2018.
Repurchases by the Company will be subject to available
liquidity, general market and economic conditions, alternate uses
for the capital and other factors. Share repurchases may be made
from time to time in open market transactions, block trades or in
private transactions in accordance with applicable securities laws
and regulations and other legal requirements. There is no minimum
number of shares that the Company is required to repurchase and the
repurchase program may be suspended or discontinued at any time
without prior notice. All shares purchased will be held in the
Company’s treasury for possible future use.
The following table summarizes select
data related to theCompany’s consolidated alternative energy
interests:
Three Months
Ended
Twelve Months
Ended
January 31, January 31,
2018
2017
2018
2017
Average selling price per gallon of ethanol $ 1.27 $ 1.54 $ 1.40 $
1.45 Average selling price per ton of dried distillers grains $
119.20 $ 113.50 $ 105.89 $ 123.97 Average selling price per pound
of non-food
grade corn oil
$
0.28
$
0.28
$
0.29
$
0.28
Average selling price per ton of modified distillers grains $ 57.03
$ 43.85 $ 45.87 $ 50.10 Average cost per bushel of grain $ 3.18 $
3.28 $ 3.35 $ 3.45 Average cost of natural gas (per mmbtu)
$ 4.65 $ 3.69 $ 3.75
$ 3.24
Supplemental Data Related to REX’s
Alternative Energy Interests:
REX American Resources
CorporationEthanol Ownership Interests/Effective Annual
Gallons Shipped as of January 31, 2018(gallons in millions)
Entity
Trailing TwelveMonths
GallonsShipped
CurrentREXOwnershipInterest
REX’s Current EffectiveOwnership
of Trailing TwelveMonth Gallons Shipped
One Earth Energy, LLC(Gibson City,
IL)
123.1 75.1% 92.4
NuGen Energy, LLC(Marion, SD)
132.9 99.5% 132.2
Big River Resources West Burlington,
LLC(West Burlington, IA)
107.9 10.3% 11.1
Big River Resources Galva,
LLC(Galva, IL)
126.4 10.3% 13.0
Big River United Energy,
LLC(Dyersville, IA)
129.5 5.7% 7.4
Big River Resources Boyceville,
LLC(Boyceville, WI)
57.0 10.3% 5.9
Total 676.8 n/a 262.0
Fourth Quarter Conference CallREX will host a conference
call at 11:00 a.m. ET today. Senior management will discuss the
financial results and host a question and answer session. The dial
in number for the audio conference call is 212/231-2908 (domestic
and international callers).
Participants can also listen to a live webcast of the call on
the Company’s website, www.rexamerican.com/Corp/Page4.aspx. A
webcast replay will be available for 30 days following the live
event at www.rexamerican.com/Corp/Page4.aspx.
About REX American Resources CorporationREX American
Resources has interests in six ethanol production facilities, which
in aggregate shipped approximately 677 million gallons of ethanol
over the twelve month period ended January 31, 2018. REX’s
effective ownership of the trailing twelve month gallons shipped
(for the twelve months ended January 31, 2018) by the ethanol
production facilities in which it has ownership interests was
approximately 262 million gallons. In addition, the Company
acquired a refined coal operation on August 10, 2017. 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 and refined coal plants operating
efficiently and according to forecasts and projections, changes in
the international, national or regional economies, weather, results
of income tax audits, changes in income tax laws or regulations and
the effects of terrorism or acts of war. The Company does not
intend to update publicly any forward-looking statements except as
required by law.
- statements of operations follow -
REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES
Consolidated Statements of
Operations
(in thousands, except per share
amounts)
Unaudited
Three Months
Ended
Twelve Months
Ended
January 31, January 31,
2018
2017
2018
2017
Net sales and revenue $ 109,535 $ 121,587 $ 452,586 $ 453,799 Cost
of sales
103,511 96,416
408,425 382,760 Gross
profit 6,024 25,171 44,161 71,039 Selling, general and
administrative expenses (6,532) (7,073) (24,060) (21,388) Equity in
income of unconsolidated ethanol affiliates 1,301 2,887 3,232 6,144
Interest and other income 971 222 2,265 596 (Loss) gain on sale of
investment - - (13) 192 (Loss) gain on disposal of real estate and
property and equipment, net
(105)
(36)
(192)
328
Income from continuing operations before income taxes and
non-controlling interests
1,659
21,171
25,393
56,911
Benefit (provision) for income taxes
18,476
(5,622) 19,519
(17,393) Net income including non-controlling
interests 20,135 15,549 44,912 39,518 Net income attributable to
non-controlling interests
(1,082)
(3,168) (5,206)
(7,185) Net income attributable to REX common
shareholders
$ 19,053 $
12,381 $ 39,706
$ 32,333 Weighted average shares
outstanding – basic
6,604
6,591 6,596
6,587 Basic net income per share attributable
to REX common shareholders
$
2.89
$
1.88
$
6.02
$
4.91
Weighted average shares outstanding – diluted
6,604 6,591
6,596 6,587 Diluted net income per
share attributable to REX common shareholders
$
2.89
$
1.88
$
6.02
$
4.91
- balance sheets follow -
REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES
Consolidated Balance Sheets
(in thousands) Unaudited
Years Ended January 31,
ASSETS: ASSETS
2018
2017
CURRENT ASSETS: Cash and cash equivalents $ 190,988 $ 188,576
Restricted cash 354 130 Accounts receivable 12,913 11,901 Inventory
20,755 17,057 Refundable income taxes 6,612 1,070 Prepaid expenses
and other 7,412 6,959 Deferred taxes-net
-
824 Total current assets 239,034 226,517
Property and equipment-net 197,827 182,761 Other assets 7,454 6,913
Equity method investments
34,549
37,833 TOTAL ASSETS
$
478,864 $ 454,024
LIABILITIES AND EQUITY CURRENT LIABILITIES: Accounts
payable – trade $ 8,149 $ 9,171 Accrued expenses and other current
liabilities
13,716 13,348
Total current liabilities
21,865
22,519 LONG TERM LIABILITIES: Deferred taxes 21,706
41,135 Other long term liabilities
3,367
2,096 Total long term liabilities
25,073 43,231 COMMITMENTS AND
CONTINGENCIES EQUITY: REX shareholders’ equity: Common stock,
45,000 shares authorized, 29,853 shares issued at par 299 299 Paid
in capital 146,923 145,767 Retained earnings 547,913 508,207
Treasury stock, 23,287 and 23,292 shares, respectively
(313,643) (313,838) Total REX
shareholders’ equity 381,492 340,435 Non-controlling interests
50,434 47,839 Total equity
431,926 388,274 TOTAL
LIABILITIES AND EQUITY
$ 478,864
$ 454,024
- statements of cash flows follow -
REX AMERICAN RESOURCES CORPORATION AND
SUBSIDIARIES
Consolidated Statements of Cash
Flows
(in thousands) Unaudited
Years Ended January 31,
2018
2017
CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 44,912 $ 39,518
Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation 21,462 19,519 Stock based
compensation expense 1,641 1,314 Income from equity method
investments (3,232) (6,144) Dividends received from equity method
investments 6,516 7,018 Loss (gain) on sale of investment 13 (192)
Loss (gain) on disposal of real estate and property and equipment
192 (328) Deferred income tax (18,605) 3,043 Changes in assets and
liabilities: Accounts receivable (1,089) (2,535) Inventory (3,649)
121 Prepaid expenses and other assets (1,170) (1,357) Income taxes
refundable (5,542) 4,184 Accounts payable-trade (1,705) 36 Accrued
expenses and other liabilities
1,225
4,912 Net cash provided by operating activities
40,969 69,109 CASH FLOWS FROM
INVESTING ACTIVITIES: Capital expenditures (24,017) (14,208)
Acquisition of business, net of cash acquired (12,049) - Repayment
of note receivable 26 24 Proceeds from sale of investment 64 4,492
Proceeds from sale of real estate and property and equipment 104
1,511 Restricted cash (224) (76) Restricted investments and
deposits
150 510 Net cash
used in investing activities
(35,946)
(7,747) CASH FLOWS FROM FINANCING ACTIVITIES: Payments
to non-controlling interests holders (3,529) (3,842) Capital
contributions from minority investor 918 - Treasury stock acquired
- (4,709) Net cash used in
financing activities
(2,611)
(8,551) NET INCREASE IN CASH AND CASH EQUIVALENTS
2,412 52,811 CASH AND CASH EQUIVALENTS-Beginning of year
188,576 135,765 CASH AND CASH
EQUIVALENTS-End of year
$ 190,988
$ 188,576 Non cash financing activities –
Equity awards issued
$ 1,195
$ 1,095 Non cash financing activities –
Equity awards accrued
$ 1,485
$ 1,217 Non cash investing activities –
Accrued capital expenditures
$ 1,149
$ 342
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180322005276/en/
REX American ResourcesDouglas Bruggeman, 937-276-3931Chief
Financial OfficerorJCIRJoseph Jaffoni, Norberto Aja,
212-835-8500rex@jcir.com
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