Date of Report (Date of Earliest Event Reported): | August 3, 2017 |
Ohio | 000-20557 | 34-1562374 |
_____________________ (State or other jurisdiction | _____________ (Commission | ______________ (I.R.S. Employer |
of incorporation) | File Number) | Identification No.) |
1947 Briarfield Boulevard, Maumee, Ohio | 43537 | |
_________________________________ (Address of principal executive offices) | ___________ (Zip Code) |
Registrant’s telephone number, including area code: | 419-893-5050 |
The Andersons, Inc. | ||||
August 3, 2017 | By: | /s/ John Granato | ||
Name: John Granato | ||||
Title: Chief Financial Officer | ||||
(Principal Financial Officer) |
Exhibit No. | Description | |
99.1 | Second Quarter 2017 Earnings Release |
• | Grain Group records pretax income of $6.9 million, a nearly $20 million year-over-year improvement, on continued solid space income. |
• | Ethanol Group earns $4.7 million of pretax income attributable to the Company despite weaker year-over-year margins. |
• | Plant Nutrient Group reports a pretax loss of $25.8 million after a $42 million goodwill write down and earns adjusted pretax income of $16.2 million due to persistent low prices, decreased volumes and low margins. |
• | Rail Group earns $5.9 million of pretax income in a slightly improving market. |
• | Retail Group records a $6.7 million pretax loss, including the pretax exit costs, as it closed its remaining four stores. |
$ in millions | Second Quarter | Year to Date | |||||||||||
2017 | 2016 | Vs | 2017 | 2016 | Vs | ||||||||
Reported Pretax Income (Loss) | $(19.1) | $23.1 | $(42.2) | $(24.6) | $0.2 | $(24.8) | |||||||
Goodwill impairment | $42.0 | $ - | $42.0 | $42.0 | $ - | $42.0 | |||||||
Adjusted Pretax Income | $22.9 | $23.1 | $(0.2) | $17.4 | $0.2 | $17.2 |
$ in millions | Second Quarter | Year to Date | ||||||||
Pretax Income | 2017 | 2016 | Vs | 2017 | 2016 | Vs | ||||
Base Grain | $4.1 | $(9.8) | $13.9 | $0.6 | $(23.1) | $23.7 | ||||
Grain Affiliates | $2.8 | $(3.2) | $6.0 | $1.3 | $(7.3) | $8.6 | ||||
Total Grain Group | $6.9 | $(13.0) | $19.9 | $1.9 | $(30.4) | $32.3 |
$ in millions | Second Quarter | Year to Date | ||||||||
2017 | 2016 | Vs | 2017 | 2016 | Vs | |||||
Reported Pretax Income | $(25.8) | $23.5 | $(49.3) | $(19.2) | $25.2 | $(44.4) | ||||
Goodwill impairment | $42.0 | $ - | $42.0 | $42.0 | $ - | $42.0 | ||||
Adjusted Pretax Income | $16.2 | $23.5 | $(7.3) | $22.8 | $25.2 | $(2.4) |
$ in millions | Second Quarter | Year to Date | ||||
2017 | 2016 | Vs | 2017 | 2016 | Vs | |
Lease Income | $2.9 | $2.7 | $0.2 | $3.5 | $7 | (3.5) |
Utilization Rate | 84.4% | 88.6% | (4.2)% | 84.0% | 90.0% | (6.0)% |
Car Sales | $1.4 | $2.3 | $(0.9) | $5.0 | $4.7 | $0.3 |
Services and Other | $1.6 | $1.6 | $ - | $3.4 | $4.2 | (0.8) |
Total Rail Group | $5.9 | $6.6 | (0.7) | $11.9 | $15.9 | $(4.0) |
(in thousands, except per share data) | Three months ended June 30, | Six months ended June 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Sales and merchandising revenues | $ | 993,662 | $ | 1,064,244 | $ | 1,845,678 | $ | 1,952,123 | |||||||
Cost of sales and merchandising revenues | 905,828 | 967,202 | 1,681,386 | 1,787,326 | |||||||||||
Gross profit | 87,834 | 97,042 | 164,292 | 164,797 | |||||||||||
Operating, administrative and general expenses | 69,928 | 75,405 | 151,875 | 155,286 | |||||||||||
Goodwill impairment | 42,000 | — | 42,000 | — | |||||||||||
Interest expense | 5,988 | 6,554 | 12,088 | 13,605 | |||||||||||
Other income: | |||||||||||||||
Equity in earnings of affiliates, net | 6,385 | 2,344 | 4,507 | (4,633 | ) | ||||||||||
Other income, net | 4,632 | 5,682 | 12,529 | 8,928 | |||||||||||
Income before income taxes | (19,065 | ) | 23,109 | (24,635 | ) | 201 | |||||||||
Income tax provision | 7,652 | 7,668 | 5,117 | 382 | |||||||||||
Net income | (26,717 | ) | 15,441 | (29,752 | ) | (181 | ) | ||||||||
Net income attributable to the noncontrolling interests | (64 | ) | 1,018 | (10 | ) | 92 | |||||||||
Net income attributable to The Andersons, Inc. | $ | (26,653 | ) | $ | 14,423 | $ | (29,742 | ) | $ | (273 | ) | ||||
Per common share: | |||||||||||||||
Basic earnings attributable to The Andersons, Inc. common shareholders | $ | (0.94 | ) | $ | 0.51 | $ | (1.05 | ) | $ | (0.01 | ) | ||||
Diluted earnings attributable to The Andersons, Inc. common shareholders | $ | (0.94 | ) | $ | 0.51 | $ | (1.05 | ) | $ | (0.01 | ) | ||||
Dividends declared | $ | 0.160 | $ | 0.155 | $ | 0.320 | $ | 0.310 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
(in thousands, except per share data) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Net income (loss) attributable to The Andersons, Inc. | $ | (26,653 | ) | $ | 14,423 | $ | (29,742 | ) | $ | (273 | ) | ||||
Items impacting other income, net of tax: | |||||||||||||||
Goodwill impairment | 42,000 | — | 42,000 | — | |||||||||||
Total adjusting items | 42,000 | — | 42,000 | — | |||||||||||
Adjusted net income (loss) attributable to The Andersons, Inc. | $ | 15,347 | $ | 14,423 | $ | 12,258 | $ | (273 | ) | ||||||
Diluted earnings attributable to The Andersons, Inc. common shareholders | $ | (0.94 | ) | $ | 0.51 | $ | (1.05 | ) | $ | (0.01 | ) | ||||
Impact on diluted earnings per share | 1.48 | — | 1.48 | — | |||||||||||
Adjusted diluted earnings per share | $ | 0.54 | $ | 0.51 | $ | 0.43 | $ | (0.01 | ) |
(in thousands) | June 30, 2017 | December 31, 2016 | June 30, 2016 | ||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 18,934 | $ | 62,630 | $ | 31,383 | |||||
Restricted cash | 1,033 | 471 | 987 | ||||||||
Accounts receivable, net | 186,331 | 194,698 | 212,588 | ||||||||
Inventories | 463,205 | 682,747 | 486,236 | ||||||||
Commodity derivative assets - current | 11,619 | 45,447 | 115,924 | ||||||||
Other current assets | 59,873 | 72,133 | 48,754 | ||||||||
Assets held for sale | 10,028 | — | — | ||||||||
Total current assets | $ | 751,023 | $ | 1,058,126 | $ | 895,872 | |||||
Other assets: | |||||||||||
Commodity derivative assets - noncurrent | 1,191 | 100 | 1,934 | ||||||||
Other assets, net (b) | $ | 145,283 | $ | 180,445 | $ | 183,728 | |||||
Equity method investments | 215,794 | 216,931 | 238,478 | ||||||||
362,268 | 397,476 | 424,140 | |||||||||
Railcar assets leased to others, net | 375,092 | 327,195 | 340,136 | ||||||||
Property, plant and equipment, net | 423,042 | 450,052 | 447,267 | ||||||||
Total assets | $ | 1,911,425 | $ | 2,232,849 | $ | 2,107,415 | |||||
Liabilities and equity | |||||||||||
Current liabilities: | |||||||||||
Short-term debt | $ | 124,000 | $ | 29,000 | $ | 179,404 | |||||
Trade and other payables | 267,194 | 581,826 | 302,413 | ||||||||
Customer prepayments and deferred revenue | 15,113 | 48,590 | 18,252 | ||||||||
Commodity derivative liabilities – current | 18,104 | 23,167 | 43,183 | ||||||||
Accrued expenses and other current liabilities | 69,256 | 69,648 | 71,169 | ||||||||
Current maturities of long-term debt | 62,482 | 47,545 | 53,720 | ||||||||
Total current liabilities | $ | 556,149 | $ | 799,776 | $ | 668,141 | |||||
Other long-term liabilities | 34,441 | 27,833 | 30,430 | ||||||||
Commodity derivative liabilities – noncurrent | 334 | 339 | 2,182 | ||||||||
Employee benefit plan obligations | 36,837 | 35,026 | 44,902 | ||||||||
Long-term debt, less current maturities | 354,066 | 397,065 | 398,746 | ||||||||
Deferred income taxes | 181,806 | 182,113 | 179,911 | ||||||||
Total liabilities | 1,163,633 | 1,442,152 | 1,324,312 | ||||||||
Total equity | 747,792 | 790,697 | 783,103 | ||||||||
Total liabilities and equity | $ | 1,911,425 | $ | 2,232,849 | $ | 2,107,415 |
(in thousands) | Grain | Ethanol | Plant Nutrient | Rail | Retail | Other | Total | ||||||||||||||||||||
Three months ended June 30, 2017 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 488,447 | $ | 187,831 | $ | 264,736 | 38,149 | 14,499 | $ | — | $ | 993,662 | |||||||||||||||
Gross profit | 30,447 | 3,320 | 39,934 | 12,699 | 1,434 | — | 87,834 | ||||||||||||||||||||
Equity in earnings of affiliates | 2,903 | 3,482 | — | — | — | — | 6,385 | ||||||||||||||||||||
Other income, net | 1,861 | 15 | 636 | 492 | 1,303 | 325 | 4,632 | ||||||||||||||||||||
Income (loss) before income taxes | 6,929 | 4,596 | (25,825 | ) | 5,860 | (6,718 | ) | (3,907 | ) | (19,065 | ) | ||||||||||||||||
Income (loss) attributable to the noncontrolling interests | — | (64 | ) | — | — | — | — | (64 | ) | ||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | 6,929 | $ | 4,660 | $ | (25,825 | ) | $ | 5,860 | $ | (6,718 | ) | $ | (3,907 | ) | $ | (19,001 | ) | |||||||||
Three months ended June 30, 2016 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 522,989 | $ | 142,520 | $ | 320,036 | $ | 40,342 | $ | 38,357 | $ | — | $ | 1,064,244 | |||||||||||||
Gross profit | 17,551 | 4,570 | 49,577 | 13,602 | 11,742 | — | 97,042 | ||||||||||||||||||||
Equity in earnings of affiliates | (2,907 | ) | 5,251 | — | — | — | — | 2,344 | |||||||||||||||||||
Other income, net | 2,642 | 3 | 1,222 | 185 | 91 | 1,539 | 5,682 | ||||||||||||||||||||
Income (loss) before income taxes | (13,037 | ) | 7,205 | 23,535 | 6,569 | 1,010 | (2,173 | ) | 23,109 | ||||||||||||||||||
Income (loss) attributable to the noncontrolling interest | — | 1,018 | — | — | — | — | 1,018 | ||||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | (13,037 | ) | $ | 6,187 | $ | 23,535 | $ | 6,569 | $ | 1,010 | $ | (2,173 | ) | $ | 22,091 | |||||||||||
Grain | Ethanol | Plant Nutrient | Rail | Retail | Other | Total | |||||||||||||||||||||
Six months ended June 30, 2017 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 966,975 | $ | 341,984 | $ | 411,323 | $ | 78,539 | $ | 46,857 | $ | 1,845,678 | |||||||||||||||
Gross profit | 54,096 | 8,860 | 65,742 | 25,007 | 10,587 | — | 164,292 | ||||||||||||||||||||
Equity in earnings of affiliates | 1,558 | 2,949 | — | — | — | — | 4,507 | ||||||||||||||||||||
Other income, net | 2,507 | 22 | 6,200 | 1,571 | 1,433 | 796 | 12,529 | ||||||||||||||||||||
Income (loss) before income taxes | 1,856 | 6,366 | (19,154 | ) | 11,938 | (13,564 | ) | (12,077 | ) | (24,635 | ) | ||||||||||||||||
Income (loss) attributable to the noncontrolling interests | — | (10 | ) | — | — | — | — | (10 | ) | ||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | 1,856 | $ | 6,376 | $ | (19,154 | ) | $ | 11,938 | $ | (13,564 | ) | $ | (12,077 | ) | $ | (24,625 | ) | |||||||||
Six months ended June 30, 2016 | |||||||||||||||||||||||||||
Revenues from external customers | $ | 1,061,803 | $ | 257,213 | $ | 487,027 | $ | 79,951 | $ | 66,129 | $ | — | $ | 1,952,123 | |||||||||||||
Gross profit | 33,751 | 6,906 | 76,266 | 28,162 | 19,712 | — | 164,797 | ||||||||||||||||||||
Equity in earnings of affiliates | (6,674 | ) | 2,041 | — | — | — | — | (4,633 | ) | ||||||||||||||||||
Other income, net | 3,310 | 33 | 2,017 | 1,562 | 180 | 1,826 | 8,928 | ||||||||||||||||||||
Income (loss) before income taxes | (30,445 | ) | 3,602 | 25,239 | 15,944 | (1,066 | ) | (13,073 | ) | 201 | |||||||||||||||||
Income attributable to the noncontrolling interest | (3 | ) | 95 | — | — | — | — | 92 | |||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | (30,442 | ) | $ | 3,507 | $ | 25,239 | $ | 15,944 | $ | (1,066 | ) | $ | (13,073 | ) | $ | 109 |
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