EX-99 2 c86663_ex99.htm

Exhibit 99

 

 

News Announcement For Immediate Release

 

REX AMERICAN RESOURCES REPORTS

THIRD QUARTER DILUTED EPS RISE 26% TO $1.36

 

Dayton, Ohio, (November 29, 2016) -- REX American Resources Corporation (NYSE: REX) today reported financial results for its fiscal 2016 third quarter (“Q3 ’16”) ended October 31, 2016. REX management will host a conference call and webcast today at 11:00 a.m. ET. to review the results.

 

Conference Call: (312) 429-1274
Webcast / Replay URL: www.rexamerican.com/Corp/Page4.aspx
  The webcast will be available for replay for 30 days

 

REX American Resources’ Q3 ’16 results principally reflect its interests in six ethanol production facilities. The operations of One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) are consolidated, while those of its four remaining plants are reported as equity in income of unconsolidated ethanol affiliates. During the fiscal 2015 second quarter the Company sold its interest in Patriot Holdings, LLC (“Patriot”). As such, subsequent to June 1, 2015, equity in income of unconsolidated ethanol affiliates includes contributions from four ethanol production facilities, compared with five in the comparable year-ago period.

 

REX’s Q3 ’16 net sales and revenue were $116.3 million, compared with $110.6 million in Q3 ’15, principally reflecting volume increases in both ethanol and dried distillers grains (“DDGS”), which was partially offset by a decrease in the average selling price of DDGS. Primarily due to the year-over-year decrease in grain costs and increased ethanol production, the Company’s Q3 ’16 gross profit increased to $20.2 million, from $14.3 million in the prior year period. Equity in income of unconsolidated ethanol affiliates in Q3 ’16 totaled $1.8 million, compared with $1.3 million in Q3 ’15. The above contributed to income before income taxes and non-controlling interests in Q3 ’16 of $17.2 million, compared with $11.1 million in Q3 ’15.

 

Net income attributable to REX shareholders in Q3 ’16 was $8.9 million, compared with $7.5 million in Q3 ’15, while Q3 ’16 diluted net income per share attributable to REX common shareholders was $1.36 per share, compared to $1.08 per share in Q3 ’15.

 

Per share results in Q3 ’16 and Q3 ’15 are based on 6,590,000 and 6,915,000 diluted weighted average shares outstanding, respectively.

 

-more-

 
REX American Resources Q3’ 16 Results, 11/29/16 page 2

 

REX Chief Executive Officer, Zafar Rizvi, commented, “We are pleased with our results for the third quarter, including a 26% increase in earnings per share, on the back of improved industry crush spreads and the positive impact of our capital investment projects to further expand production at our consolidated plants. Given our highly capable employees, the capital improvements at our plants and our operating disciplines, we were able to increase the number of gallons of ethanol produced by approximately 10% versus the prior year period.”

 

Balance Sheet

At October 31, 2016, REX had cash and cash equivalents of $162.8 million, $61.8 million of which was at the parent company and $101.0 million of which was at its consolidated ethanol production facilities. This compares with cash and cash equivalents of $135.8 million at January 31, 2016, $57.2 million of which was at the parent company and $78.6 million of which was at its consolidated ethanol production facilities.

 

The Company is currently authorized to repurchase up to an additional 155,334 shares of common stock and has 6,582,029 shares outstanding.

 

The following table summarizes select data related to the Company’s consolidated operations:

 

   Three Months
Ended		   Nine Months
Ended		 
   October 31,   October 31, 
   2016   2015   2016   2015 
Average selling price per gallon of ethanol  $1.44   $1.44   $1.42   $1.45 
                     
Average selling price per ton of dried distillers grains  $122.34   $146.64   $127.27   $152.69 
                     
Average selling price per pound of non-food grade corn oil  $0.29   $0.26   $0.27   $0.27 
                     
Average selling price per ton of modified distillers grains  $45.17   $56.40   $54.49   $70.99 
                     
Average cost per bushel of grain  $3.30   $3.62   $3.51   $3.64 
                     
Average cost of natural gas (per mmbtu)  $3.31   $3.21   $3.08   $3.82 

 

-more-

 
REX American Resources Q3’ 16 Results, 11/29/16 page 3

 

Supplemental Data Related to REX’s Ethanol Interests:

 

REX American Resources Corporation
Ethanol Ownership Interests/Effective Annual Gallons Shipped as of October 31, 2016
(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)		   119.1    75.0%   89.3 
NuGen Energy, LLC
(Marion, SD)		   124.5    99.5%   123.9 
Big River Resources West Burlington, LLC
(West Burlington, IA)		   107.1    9.7%   10.4 
Big River Resources Galva, LLC
(Galva, IL)		   126.1    9.7%   12.2 
Big River United Energy, LLC
(Dyersville, IA)		   126.9    5.4%   6.9 
Big River Resources Boyceville, LLC
(Boyceville, WI)		   57.6    9.7%   5.6 
Total   661.3    n/a    248.3 

 

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 661 million gallons of ethanol over the twelve month period ended October 31, 2016. REX’s effective ownership of the trailing twelve month gallons shipped (for the twelve months ended October 31, 2016) by the ethanol production facilities in which it has ownership interests was approximately 248 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 international, national or regional economies, weather, the effects of terrorism or acts of war 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’ 16 Results, 11/29/16 page 4

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Operations

(in thousands, except per share amounts)

Unaudited

 

   Three Months
Ended		   Nine Months
Ended		 
   October 31,   October 31, 
   2016   2015   2016   2015 
Net sales and revenue  $116,283   $110,584   $332,212   $329,261 
Cost of sales   96,121    96,311    286,344    287,585 
Gross profit   20,162    14,273    45,868    41,676 
Selling, general and administrative expenses   (5,082)   (4,720)   (14,315)   (15,629)
Equity in income of unconsolidated ethanol affiliates   1,838    1,314    3,257    7,857 
Gain on sale of investment   —    —    192    10,385 
Gain on disposal of property and equipment, net   179    1    364    496 
Interest and other income   117    199    374    524 
Income before income taxes   17,214    11,067    35,740    45,309 
Provision for income taxes   (5,740)   (1,634)   (11,771)   (12,726)
Net income   11,474    9,433    23,969    32,583 
Net income attributable to non-controlling interests   (2,536)   (1,977)   (4,017)   (4,833)
Net income attributable to REX common shareholders  $8,938   $7,456   $19,952   $27,750 
                     
Weighted average shares outstanding – basic and diluted   6,590    6,915    6,591    7,460 
                     
Basic and diluted net income per share attributable to REX common shareholders  $1.36   $1.08   $3.03   $3.72 
 
REX American Resources Q3’ 16 Results, 11/29/16 page 5

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Balance Sheets

(in thousands) Unaudited

 

ASSETS:  October
31, 2016		   January
31, 2016		 
CURRENT ASSETS:          
Cash and cash equivalents  $162,753   $135,765 
Restricted cash   46    54 
Accounts receivable   13,269    13,666 
Inventory   19,483    17,178 
Refundable income taxes   1,956    5,254 
Prepaid expenses and other   6,680    6,407 
Deferred taxes-net   1,537    1,036 
Total current assets   205,724    179,360 
Property and equipment-net   186,219    189,976 
Other assets   6,432    6,642 
Equity method investments   37,954    38,707 
TOTAL ASSETS  $436,329   $414,685 
LIABILITIES AND EQUITY          
CURRENT LIABILITIES:          
Accounts payable – trade  $10,999   $10,212 
Accrued expenses and other current liabilities   10,875    9,423 
Total current liabilities   21,874    19,635 
LONG TERM LIABILITIES:          
Deferred taxes   37,786    38,304 
Other long term liabilities   2,227    987 
Total long term liabilities   40,013    39,291 
COMMITMENTS AND CONTINGENCIES          
EQUITY:          
REX shareholders’ equity:          
Common stock, 45,000 shares authorized, 29,853 shares issued at par   299    299 
Paid in capital   145,744    144,844 
Retained earnings   495,826    475,874 
Treasury stock, 23,270 and 23,204 shares, respectively    (313,844)    (309,754)
Total REX shareholders’ equity   328,025    311,263 
Non-controlling interests   46,417    44,496 
Total equity   374,442    355,759 
TOTAL LIABILITIES AND EQUITY  $436,329   $414,685 

 

- statements of cash flows follow -

 
REX American Resources Q3’ 16 Results, 11/29/16 page 6

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Cash Flows

(in thousands) Unaudited

 

   Nine Months Ended
October 31,		 
   2016   2015 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net income  $23,969   $32,583 
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation, impairment charges and amortization   14,567    14,193 
Income from equity method investments   (3,257)   (7,857)
Gain on disposal of real estate and property and equipment   (364)   (496)
Dividends received from equity method investments   4,010    7,643 
Gain on sale of investment   (192)   (10,385)
Deferred income tax   (1,019)   (8,078)
Stock based compensation expense   68    23 
Changes in assets and liabilities:          
Accounts receivable   (1,686)   (2,307)
Inventories   (2,305)   (5,494)
Other assets   2,758    (51)
Accounts payable-trade   1,653    4,913 
Other liabilities   3,157    (2,849)
Net cash provided by operating activities   41,359    21,838 
CASH FLOWS FROM INVESTING ACTIVITIES:          
Capital expenditures   (11,836)   (9,852)
Restricted cash   8    (20)
Restricted investments and deposits   460    250 
Proceeds from sale of investment   2,275    45,476 
Proceeds from sale of property and equipment   1,510    1,936 
Other   17    17 
Net cash (used in) provided by investing activities   (7,566)   37,807 
CASH FLOWS FROM FINANCING ACTIVITIES:          
Dividend payments to and purchases of stock from non-controlling interests   (2,096)   (605)
Treasury stock acquired   (4,709)   (60,111)
Net cash used in financing activities   (6,805)   (60,716)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS   26,988    (1,071)
CASH AND CASH EQUIVALENTS-Beginning of period   135,765    137,697 
CASH AND CASH EQUIVALENTS-End of period  $162,753   $136,626 
Non cash investing activities – Accrued capital expenditures  $1,183   $1,216 
Non cash financing activities – Equity awards issued  $1,095   $— 

 

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