Date of Report (Date of Earliest Event Reported): | February 10, 2016 |
Ohio | 000-20557 | 34-1562374 |
_____________________ (State or other jurisdiction | _____________ (Commission | ______________ (I.R.S. Employer |
of incorporation) | File Number) | Identification No.) |
480 West Dussel Drive, Maumee, Ohio | 43537 | |
_________________________________ (Address of principal executive offices) | ___________ (Zip Code) |
Registrant’s telephone number, including area code: | 419-893-5050 |
The Andersons, Inc. | ||||
February 10, 2016 | By: | /s/ John Granato | ||
Name: John Granato | ||||
Title: Chief Financial Officer | ||||
(Principal Financial Officer) |
Exhibit No. | Description | |
99.1 | Fourth Quarter and Full Year 2015 Earnings Release |
• | Company reports adjusted net income of $41.2 million for 2015 or $1.45 per diluted share |
• | Rail Group earns record $50.7 million of pre-tax income for the year |
• | Ethanol Group delivers $28.5 million of pre-tax income in a difficult energy market |
• | Grain Group struggles as lower crop production in Eastern Corn Belt limited space income |
• | Plant Nutrient Group ended the year lower as volumes slowed on deteriorating prices |
• | Company recorded total charges of $105.6 million in the fourth quarter for the termination of a Defined Benefit Pension Plan and the impairment of goodwill |
• | Resulting GAAP reported net loss of $13.1 million or $0.46 per diluted share for 2015 |
• | The Rail Group completed a record year with utilization rates remaining strong in the quarter and renewal rates holding at good levels in most sectors. |
• | Ethanol margins were modest most of the quarter as the group finished a good year in a very challenging energy market. |
• | Adjusted pre-tax income from the Grain Group decreased by $14.3 million for the fourth quarter versus prior year driven by poor crop production in the Eastern Corn Belt, reluctance on the part of growers to sell into weak prices, and under performance of certain core grain assets and grain affiliates. |
• | Sales of plant nutrients were off to a good start in the fourth quarter then dropped off as nutrient prices continued to fall, which made farmers hesitant to buy ahead of the spring planting season. |
• | Fourth quarter pre-tax income was adjusted for non-recurring charges including a pre-tax charge of $51.4 million associated with the termination of a Defined Benefit Pension Plan and $54.2 million of goodwill impairments primarily related to the Grain Group, as well as for a gain of $23.1 million related to a partial sale and effective dilution of ownership in Lansing Trade Group. |
• | The impact of a $46.4 million impairment of goodwill recorded in the fourth quarter. |
• | Gains recognized in the first quarter of 2014 and in the fourth quarter of 2015 associated with partial redemptions, and related dilution, of the Company’s ownership stake in the Lansing Trade Group. |
$ in MM | Q4 2015 | Q4 2014 | FY 2015 | FY 2014 |
Reported Grain Group | ($13.5) | $24.0 | ($9.4) | $58.1 |
Goodwill Impairment | $46.4 | 0 | 46.4 | 0 |
Gain on LTG Redemption | ($23.1) | 0 | ($23.1) | ($17.1) |
Adjusted Grain Group | $9.8 | $24.0 | $13.9 | $41.0 |
$ in MM | Q4 2015 | Q4 2014 | FY 2015 | FY 2014 |
Adjusted Base Grain | $6.2 | $17.2 | $0.6 | $14.9 |
Grain Affiliates | $3.6 | $6.8 | $13.3 | $26.1 |
Adjusted Grain Group | $9.8 | $24.0 | $13.9 | $41.0 |
• | Excessive rains during the second quarter in the Eastern Corn Belt resulted in significantly lower crop production. This, coupled with continued grower reluctance to deliver or forward contract amidst a low price environment, reduced income from volumes put through the Company’s facilities and also limited space income opportunities. |
• | Weather conditions during the harvest were very dry, significantly reducing the historical levels of drying income recognized. |
• | Goodwill impairments of $7.8 million associated with Farm Centers in the fourth quarter and $2.0 million related to the Cob business in the third quarter. |
• | Onetime costs of $2.4 million in the fourth quarter and $4.9 million for the full year associated with the acquisition of the Nutra-Flo business. |
$ in MM | Q4 2015 | Q4 2014 | FY 2015 | FY 2014 |
Reported Plant Nutrient Group | ($8.1) | $0.5 | $0.1 | $24.5 |
One-time Acquisition Costs | $2.4 | 0 | $4.9 | 0 |
Goodwill Impairment | $7.8 | 0 | $9.8 | 0 |
Adjusted Plant Nutrient Group | $2.1 | $0.5 | $14.8 | $24.5 |
$ in MM | Q4 2015 | Q4 2014 | FY 2015 | FY 2014 |
Legacy Plant Nutrient | $3.1 | $0.5 | $20.0 | $24.5 |
Nutra-Flo | ($1.0) | 0 | ($5.2) | 0 |
Adjusted Plant Nutrient Group | $2.1 | $0.5 | $14.8 | $24.5 |
Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||
(in thousands, except per share data) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales and merchandising revenues | $ | 1,183,473 | $ | 1,271,768 | $ | 4,198,495 | $ | 4,540,071 | |||||||
Cost of sales and merchandising revenues | 1,084,309 | 1,157,817 | 3,822,657 | 4,142,932 | |||||||||||
Gross profit | 99,164 | 113,951 | 375,838 | 397,139 | |||||||||||
Operating, administrative and general expenses | 89,056 | 94,884 | 338,115 | 318,881 | |||||||||||
Pension settlement | 51,446 | — | 51,446 | — | |||||||||||
Goodwill impairment | 54,180 | — | 56,165 | — | |||||||||||
Interest expense | 3,862 | 5,359 | 20,072 | 21,760 | |||||||||||
Other income: | |||||||||||||||
Equity in earnings of affiliates | 8,629 | 19,892 | 31,924 | 96,523 | |||||||||||
Other income, net | 26,237 | 6,031 | 46,472 | 31,125 | |||||||||||
Income (loss) before income taxes | (64,514 | ) | 39,631 | (11,564 | ) | 184,146 | |||||||||
Income tax provision (benefit) | (17,797 | ) | 11,664 | (242 | ) | 61,501 | |||||||||
Net income (loss) | (46,717 | ) | 27,967 | (11,322 | ) | 122,645 | |||||||||
Net income (loss) attributable to the noncontrolling interests | 312 | 2,075 | 1,745 | 12,919 | |||||||||||
Net income (loss) attributable to The Andersons, Inc. | $ | (47,029 | ) | $ | 25,892 | $ | (13,067 | ) | $ | 109,726 | |||||
Per common share: | |||||||||||||||
Basic earnings attributable to The Andersons, Inc. common shareholders | $ | (1.68 | ) | $ | 0.89 | $ | (0.46 | ) | $ | 3.85 | |||||
Diluted earnings attributable to The Andersons, Inc. common shareholders | $ | (1.68 | ) | $ | 0.89 | $ | (0.46 | ) | $ | 3.84 | |||||
Dividends paid | $ | 0.155 | $ | 0.14 | $ | 0.575 | $ | 0.47 |
(in thousands, except per share data) | Three months ended December 31, | Twelve months ended December 31, | |||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net income attributable to The Andersons, Inc. | $ | (47,029 | ) | $ | 25,892 | $ | (13,067 | ) | $ | 109,726 | |||||
Items impacting other income, net of tax: | |||||||||||||||
Goodwill impairment | 33,592 | — | 34,822 | — | |||||||||||
Pension settlement | 31,897 | — | 31,897 | — | |||||||||||
Partial redemption of investment in Lansing Trade Group | (14,328 | ) | — | (14,328 | ) | (10,656 | ) | ||||||||
One-time acquisition costs | 901 | — | 1,863 | — | |||||||||||
Total adjusting items | 52,062 | — | 54,254 | (10,656 | ) | ||||||||||
Adjusted net income attributable to The Andersons, Inc. | $ | 5,033 | $ | 25,892 | $ | 41,187 | $ | 99,070 | |||||||
Diluted earnings attributable to The Andersons, Inc. common shareholders | $ | (1.68 | ) | $ | 0.89 | $ | (0.46 | ) | $ | 3.84 | |||||
Impact on diluted earnings per share | 1.86 | — | 1.91 | (0.38 | ) | ||||||||||
Adjusted diluted earnings per share | $ | 0.18 | $ | 0.89 | $ | 1.45 | $ | 3.46 |
(in thousands) | December 31, 2015 | December 31, 2014 | |||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 63,750 | $ | 114,704 | |||
Restricted cash | 451 | 429 | |||||
Accounts receivable, net | 170,912 | 183,059 | |||||
Inventories | 747,399 | 795,655 | |||||
Commodity derivative assets - current | 49,826 | 92,771 | |||||
Deferred income taxes | 6,772 | 7,337 | |||||
Other current assets | 90,412 | 60,492 | |||||
Total current assets | 1,129,522 | 1,254,447 | |||||
Other assets: | |||||||
Commodity derivative assets - noncurrent | 412 | 507 | |||||
Other assets, net | 142,351 | 131,527 | |||||
Equity method investments | 242,107 | 226,857 | |||||
384,870 | 358,891 | ||||||
Rail Group assets leased to others, net | 338,111 | 297,747 | |||||
Property, plant and equipment, net | 506,598 | 453,607 | |||||
Total assets | $ | 2,359,101 | $ | 2,364,692 | |||
Liabilities and equity | |||||||
Current liabilities: | |||||||
Short-term debt | $ | 16,990 | $ | 2,166 | |||
Trade and other payables | 668,788 | 706,823 | |||||
Customer prepayments and deferred revenue | 66,762 | 99,617 | |||||
Commodity derivative liabilities – current | 37,387 | 64,075 | |||||
Accrued expenses and other current liabilities | 70,324 | 78,610 | |||||
Current maturities of long-term debt | 27,786 | 76,415 | |||||
Total current liabilities | 888,037 | 1,027,706 | |||||
Other long-term liabilities | 18,176 | 15,507 | |||||
Commodity derivative liabilities – noncurrent | 1,063 | 3,318 | |||||
Employee benefit plan obligations | 45,805 | 59,308 | |||||
Long-term debt, less current maturities | 436,208 | 298,638 | |||||
Deferred income taxes | 186,073 | 136,166 | |||||
Total liabilities | 1,575,362 | 1,540,643 | |||||
Total equity | 783,739 | 824,049 | |||||
Total liabilities and equity | $ | 2,359,101 | $ | 2,364,692 |
Grain | Ethanol | Plant Nutrient | Rail | Retail | Other | Total | |||||||||||||||||||||
Three months ended December 31, 2015 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 778,251 | $ | 143,058 | $ | 187,898 | $ | 36,351 | $ | 37,916 | $ | — | $ | 1,183,474 | |||||||||||||
Gross profit | 38,989 | 5,930 | 28,556 | 14,625 | 11,064 | — | 99,164 | ||||||||||||||||||||
Equity in earnings of affiliates | 3,940 | 4,690 | — | — | — | — | 8,630 | ||||||||||||||||||||
Other income, net | 23,547 | 294 | 605 | 1,169 | 273 | 349 | 26,237 | ||||||||||||||||||||
Income (loss) before income taxes | (13,471 | ) | 7,984 | (8,062 | ) | 6,766 | 1,028 | (58,759 | ) | (64,514 | ) | ||||||||||||||||
Income (loss) attributable to the noncontrolling interests | (2 | ) | 315 | — | — | — | — | 313 | |||||||||||||||||||
Operating income (loss) (a) | $ | (13,469 | ) | $ | 7,669 | $ | (8,062 | ) | $ | 6,766 | $ | 1,028 | $ | (58,759 | ) | $ | (64,827 | ) | |||||||||
Three months ended December 31, 2014 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 867,521 | $ | 171,326 | $ | 162,730 | $ | 31,221 | $ | 38,970 | $ | — | $ | 1,271,768 | |||||||||||||
Gross profit | 53,464 | 9,284 | 26,611 | 13,193 | 11,399 | — | 113,951 | ||||||||||||||||||||
Equity in earnings of affiliates | 7,102 | 12,790 | — | — | — | — | 19,892 | ||||||||||||||||||||
Other income (expense), net | 4,483 | 22 | 161 | 805 | 235 | 325 | 6,031 | ||||||||||||||||||||
Income (loss) before income taxes | 24,024 | 19,353 | 562 | 5,556 | 1,046 | (10,910 | ) | 39,631 | |||||||||||||||||||
Income (loss) attributable to the noncontrolling interest | (2 | ) | 2,077 | — | — | — | — | 2,075 | |||||||||||||||||||
Operating income (loss) (a) | $ | 24,026 | $ | 17,276 | $ | 562 | $ | 5,556 | $ | 1,046 | $ | (10,910 | ) | $ | 37,556 | ||||||||||||
Twelve months ended December 31, 2015 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 2,483,644 | $ | 556,188 | $ | 848,338 | $ | 170,848 | $ | 139,478 | $ | — | $ | 4,198,496 | |||||||||||||
Gross profit | 123,645 | 24,324 | 119,540 | 67,687 | 40,642 | — | 375,838 | ||||||||||||||||||||
Equity in earnings of affiliates | 14,703 | 17,221 | — | — | — | — | 31,924 | ||||||||||||||||||||
Other income, net | 26,229 | 377 | 3,046 | 15,935 | 557 | 328 | 46,472 | ||||||||||||||||||||
Income (loss) before income taxes | (9,456 | ) | 30,258 | 121 | 50,681 | (455 | ) | (82,713 | ) | (11,564 | ) | ||||||||||||||||
Income (loss) attributable to the noncontrolling interests | (10 | ) | 1,755 | — | — | — | — | 1,745 | |||||||||||||||||||
Operating income (loss) (a) | $ | (9,446 | ) | $ | 28,503 | $ | 121 | $ | 50,681 | $ | (455 | ) | $ | (82,713 | ) | $ | (13,309 | ) | |||||||||
Twelve months ended December 31, 2014 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 2,682,038 | $ | 765,939 | $ | 802,333 | $ | 148,954 | $ | 140,807 | $ | — | $ | 4,540,071 | |||||||||||||
Gross profit | 131,129 | 48,057 | 116,939 | 59,762 | 41,252 | — | 397,139 | ||||||||||||||||||||
Equity in earnings of affiliates | 27,643 | 68,880 | — | — | — | — | 96,523 | ||||||||||||||||||||
Other income, net | 21,450 | 223 | 4,372 | 3,094 | 955 | 1,031 | 31,125 | ||||||||||||||||||||
Income (loss) before income taxes | 58,126 | 105,186 | 24,514 | 31,445 | (620 | ) | (34,505 | ) | 184,146 | ||||||||||||||||||
Income (loss) attributable to the noncontrolling interest | (10 | ) | 12,929 | — | — | — | — | 12,919 | |||||||||||||||||||
Operating income (loss) (a) | $ | 58,136 | $ | 92,257 | $ | 24,514 | $ | 31,445 | $ | (620 | ) | $ | (34,505 | ) | $ | 171,227 |
$"0XP&(!SE>5/%1H$0# 2 "6!G#0,8
M,2"2%)DR)8 #*BRJN+DS $N1&0&(X1B4X\JC,7X>-?HSJ5*G2Y$>-; 4*M.H
M5Z-:E8H4*@R+6*-N#$NV;-FM9M.J7 M1,^Q!FX;PD6003
M1UYW*AEC XX=W)R-Y2R93N+ANNQ*):X-L6W]QMRP3T_2&:;)L5+__)ML&&X7
M-\C*0BUM5$W&C=5F;(D CSEQ*"5$
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M:FV@U3H2?PRU&>':+9\%U65B' G5RI 0$Q7R$C=V
MUQ/5,A-V>(?UQE4%I6RW$B<' #75XD]CB&@.\6IY)A8FZ%B=$4#'U2!-H@S!
M9TS0UCG=-"5<0A'[$ADA%S\\PF0W5X,PY(7=I%X \( EL0+ZQ%CX2#G\AB6T
M0Q7Z(597$P,T*$?U%A7ZQA8[T2\I.5,KD08S<28G48TQP2X L"3'U289(CW
M!17+UWO4HW'^(DYBPD?"]QTV07$UR$1]ITT9(2_^Y$JIZ!E(""JP0@SB914A
M:$HH_Y1W]X8AGC)=%Q2/7[(R=4>0!927>)A<"C)BWC(ED%(W)94?O6(9HK,I
M?[*"[C$; =8=ZC5RPC@#L$@S??@NL' 2#!P"?D SXSLS].,SNT\Q.L #'@\Q&%,T45,T/(0?149
M@+48/TZD+74':]*5+I4AH+SH5;.'$A1LD(-Q?6F3N(R!D(X+E2#LI;J3%&!J
MRPGY(#U$22$%))
O8ANQ
MPKYN :V;>93Y4I!50;Q5\1"U,(LWC/\: ;.>?9JT^*%''HJ!!&.G/]RT79D?
M1BRXO?.[XQ$_ 'A$0T0?\A&LJZ"P>OJTN"P4 ;WQ6I5D"QZUQU>5X6@:
MM!L6LQ HE%@QBV,*0DC+5\D8\2!^R19ZDB%")V'J ]'B!-$376AS6QDW@ ;O
MH0DD'&+4VBX4EJ6CIR%I_^$C>E)2=N089Z*Q4FPO&[$,D\"3J<5V*V!_QN