Date of Report (Date of Earliest Event Reported): | November 5, 2018 |
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 |
Exhibit No. | Description | |
99.1 |
The Andersons, Inc. | ||||
November 5, 2018 | By: | /s/ Brian A. Valentine | ||
Name: Brian A. Valentine | ||||
Title: Senior Vice President and Chief Financial Officer | ||||
(Principal Financial Officer) |
Exhibit No. | Description | |
99.1 |
• | Grain Group records a pretax loss of $8.6 million significantly impacted by mark-to-market basis adjustments to grain inventories that are expected to rebound in the near term. |
• | Ethanol Group earns $9.1 million of pretax income on strong capacity utilization and timely forward hedging in a worsening margin environment. |
• | Plant Nutrient Group reports a pretax loss of $8.0 million as low margins persist in its specialty nutrients product lines. |
• | Rail Group earns $5.7 million of pretax income in a gradually improving market. |
• | Results include a benefit of $0.14 per share from its venture capital arm, primarily related to the sale of an investment, and expenses of $0.09 per share associated with the pending Lansing Trade Group acquisition. |
$ in millions | Third Quarter | Year to Date | ||||
2018 | 2017 | Vs | 2018 | 2017 | Vs | |
Reported Pretax Income (Loss) | $(3.6) | $5.0 | $(8.6) | $23.2 | $(19.6) | $42.8 |
Goodwill Impairment 1 | — | — | — | — | 42.0 | (42.0) |
Adjusted Pretax Income | $(3.6) | $5.0 | $(8.6) | $23.2 | $22.4 | $0.8 |
EBITDA | $24.0 | $32.0 | $(8.0) | $111.4 | $62.3 | $49.1 |
Adjusted EBITDA | $24.0 | $32.0 | $(8.0) | $111.4 | $104.3 | $7.1 |
$ in millions | Third Quarter | Year to Date | ||||
Adjusted Pretax Income | 2018 | 2017 | Vs | 2018 | 2017 | Vs |
Base Grain | $(10.9) | $3.4 | $(14.3) | $(8.1) | $4.0 | $(12.1) |
Grain Affiliates | 2.3 | (0.8) | 3.1 | 9.3 | 0.5 | 8.8 |
Total Grain Group | $(8.6) | $2.6 | $(11.2) | $1.2 | $4.5 | $(3.3) |
EBITDA | $(2.4) | $9.2 | $(11.6) | $22.5 | $25.5 | $(3.0) |
$ in millions | Third Quarter | Year to Date | ||||
2018 | 2017 | Vs | 2018 | 2017 | Vs | |
Equity in Earnings of Affiliates | $4.8 | $4.4 | $0.4 | $10.7 | $7.3 | $3.4 |
Consolidated Operations and Service Fees | 4.5 | 1.8 | 2.7 | 6.1 | 5.3 | 0.8 |
Pretax Income | 9.3 | 6.2 | 3.1 | 16.8 | 12.6 | 4.2 |
Attributable to Noncontrolling Interests | 0.2 | 0.1 | 0.1 | (0.2) | 0.1 | (0.3) |
Ethanol Group Pretax Income Attributable to The Andersons | $9.1 | $6.1 | $3.0 | $17.0 | $12.5 | $4.5 |
$ in millions | Third Quarter | Year to Date | ||||
2018 | 2017 | Vs | 2018 | 2017 | Vs | |
Reported Pretax Income | $(8.0) | $(7.9) | $(0.1) | $8.2 | $(27.1) | $35.3 |
Goodwill Impairment | — | — | — | — | 42.0 | (42.0) |
Adjusted Pretax Income | $(8.0) | $(7.9) | $(0.1) | $8.2 | $14.9 | $(6.7) |
EBITDA | $0.1 | $0.2 | $(0.1) | $32.9 | $(1.9) | $34.8 |
Adjusted EBITDA | $0.1 | $0.2 | $(0.1) | $32.9 | $40.1 | $(7.2) |
$ in millions | Third Quarter | Year to Date | ||||
Pretax Income | 2018 | 2017 | Vs | 2018 | 2017 | Vs |
Lease Income | 2.5 | 3.5 | (1.0) | 6.7 | 7.1 | (0.4) |
Car Sales | 1.9 | 2.6 | (0.7) | 1.2 | 7.6 | (6.4) |
Services and Other | 1.3 | — | 1.3 | 2.7 | 3.4 | (0.7) |
Total Rail Group | 5.7 | 6.1 | (0.4) | 10.6 | 18.1 | (7.5) |
EBITDA | 15.7 | 13.9 | 1.8 | 40.0 | 40.6 | (0.6) |
Utilization Rate | 92.0% | 85.8% | 6.2% | 89.8% | 84.6% | 5.2% |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
(in thousands, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Sales and merchandising revenues | $ | 685,579 | $ | 836,595 | $ | 2,232,720 | $ | 2,682,273 | |||||||
Cost of sales and merchandising revenues | 631,715 | 766,924 | 2,024,677 | 2,448,310 | |||||||||||
Gross profit | 53,864 | 69,671 | 208,043 | 233,963 | |||||||||||
Operating, administrative and general expenses | 65,986 | 68,153 | 190,096 | 219,242 | |||||||||||
Asset impairment | — | — | 6,272 | — | |||||||||||
Goodwill impairment | — | — | — | 42,000 | |||||||||||
Interest expense | 5,176 | 5,384 | 20,000 | 17,472 | |||||||||||
Other income: | |||||||||||||||
Equity in earnings of affiliates | 7,225 | 3,586 | 20,601 | 8,093 | |||||||||||
Other income, net | 6,434 | 5,285 | 10,949 | 17,028 | |||||||||||
Income (loss) before income taxes | (3,639 | ) | 5,005 | 23,225 | (19,630 | ) | |||||||||
Income tax provision (benefit) | (1,764 | ) | 2,389 | 5,668 | 7,505 | ||||||||||
Net income (loss) | (1,875 | ) | 2,616 | 17,557 | (27,135 | ) | |||||||||
Net income (loss) attributable to the noncontrolling interests | 223 | 83 | (175 | ) | 73 | ||||||||||
Net income (loss) attributable to The Andersons, Inc. | $ | (2,098 | ) | $ | 2,533 | $ | 17,732 | $ | (27,208 | ) | |||||
Per common share: | |||||||||||||||
Basic earnings (loss) attributable to The Andersons, Inc. common shareholders | $ | (0.07 | ) | $ | 0.09 | $ | 0.63 | $ | (0.96 | ) | |||||
Diluted earnings (loss) attributable to The Andersons, Inc. common shareholders | $ | (0.07 | ) | $ | 0.09 | $ | 0.62 | $ | (0.96 | ) | |||||
Dividends paid | $ | 0.165 | $ | 0.160 | $ | 0.495 | $ | 0.480 |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
(in thousands, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Net income (loss) attributable to The Andersons, Inc. | $ | (2,098 | ) | $ | 2,533 | $ | 17,732 | $ | (27,208 | ) | |||||
Items impacting other income, net of tax: | |||||||||||||||
Goodwill impairment | — | — | — | 42,000 | |||||||||||
Total adjusting items | — | — | — | 42,000 | |||||||||||
Adjusted net income (loss) attributable to The Andersons, Inc. | $ | (2,098 | ) | $ | 2,533 | $ | 17,732 | $ | 14,792 | ||||||
Diluted earnings (loss) attributable to The Andersons, Inc. common shareholders | $ | (0.07 | ) | $ | 0.09 | $ | 0.62 | $ | (0.96 | ) | |||||
Impact on diluted earnings per share | — | — | — | 1.48 | |||||||||||
Adjusted diluted earnings (loss) per share | $ | (0.07 | ) | $ | 0.09 | $ | 0.62 | $ | 0.52 |
(in thousands) | September 30, 2018 | December 31, 2017 | September 30, 2017 | ||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 16,820 | $ | 34,919 | $ | 24,478 | |||||
Restricted cash | — | — | — | ||||||||
Accounts receivable, net | 206,380 | 183,238 | 196,192 | ||||||||
Inventories | 490,331 | 648,703 | 475,602 | ||||||||
Commodity derivative assets – current | 76,861 | 30,702 | 45,202 | ||||||||
Other current assets | 58,374 | 63,790 | 53,958 | ||||||||
Assets held for sale | 29,527 | 37,859 | 8,383 | ||||||||
Total current assets | 878,293 | 999,211 | 803,815 | ||||||||
Other assets: | |||||||||||
Commodity derivative assets – noncurrent | 766 | 310 | 245 | ||||||||
Other assets, net | 132,928 | 131,474 | 148,328 | ||||||||
Equity method investments | 240,350 | 223,239 | 215,031 | ||||||||
374,044 | 355,023 | 363,604 | |||||||||
Rail Group assets leased to others, net | 464,776 | 423,443 | 377,393 | ||||||||
Property, plant and equipment, net | 434,505 | 384,677 | 419,348 | ||||||||
Total assets | $ | 2,151,618 | $ | 2,162,354 | $ | 1,964,160 | |||||
Liabilities and equity | |||||||||||
Current liabilities: | |||||||||||
Short-term debt | $ | 132,000 | $ | 22,000 | $ | 19,000 | |||||
Trade and other payables | 344,406 | 503,571 | 381,359 | ||||||||
Customer prepayments and deferred revenue | 38,242 | 59,710 | 29,520 | ||||||||
Commodity derivative liabilities – current | 91,403 | 29,651 | 38,578 | ||||||||
Accrued expenses and other current liabilities | 68,925 | 69,579 | 67,064 | ||||||||
Current maturities of long-term debt | 15,677 | 54,205 | 53,972 | ||||||||
Total current liabilities | 690,653 | 738,716 | 589,493 | ||||||||
Other long-term liabilities | 30,615 | 33,129 | 34,407 | ||||||||
Commodity derivative liabilities – noncurrent | 2,548 | 825 | 902 | ||||||||
Employee benefit plan obligations | 25,356 | 26,716 | 36,356 | ||||||||
Long-term debt, less current maturities | 437,280 | 418,339 | 371,315 | ||||||||
Deferred income taxes | 122,523 | 121,730 | 181,876 | ||||||||
Total liabilities | 1,308,975 | 1,339,455 | 1,214,349 | ||||||||
Total equity | 842,643 | 822,899 | 749,811 | ||||||||
Total liabilities and equity | $ | 2,151,618 | $ | 2,162,354 | $ | 1,964,160 |
(in thousands) | Grain | Ethanol | Plant Nutrient | Rail | Other | Total | |||||||||||||||||
Three months ended September 30, 2018 | |||||||||||||||||||||||
Revenues from external customers | $ | 343,430 | $ | 194,849 | $ | 104,188 | $ | 43,112 | $ | — | $ | 685,579 | |||||||||||
Gross profit | 16,612 | 6,960 | 15,542 | 14,750 | — | 53,864 | |||||||||||||||||
Equity in earnings of affiliates | 2,412 | 4,813 | — | — | — | 7,225 | |||||||||||||||||
Other income, net | 625 | 20 | 626 | 220 | 4,943 | 6,434 | |||||||||||||||||
Income (loss) before income taxes | (8,619 | ) | 9,281 | (7,976 | ) | 5,732 | (2,057 | ) | (3,639 | ) | |||||||||||||
Income (loss) attributable to the noncontrolling interests | — | 223 | — | — | — | 223 | |||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | (8,619 | ) | $ | 9,058 | $ | (7,976 | ) | $ | 5,732 | $ | (2,057 | ) | $ | (3,862 | ) | |||||||
Three months ended September 30, 2017 | |||||||||||||||||||||||
Revenues from external customers | $ | 497,613 | $ | 191,531 | $ | 103,620 | $ | 43,093 | $ | 738 | $ | 836,595 | |||||||||||
Gross profit | 32,316 | 6,388 | 17,349 | 13,422 | 196 | 69,671 | |||||||||||||||||
Equity in earnings of affiliates | (694 | ) | 4,280 | — | — | — | 3,586 | ||||||||||||||||
Other income, net | 539 | 12 | (1,622 | ) | 693 | 5,663 | 5,285 | ||||||||||||||||
Income (loss) before income taxes | 2,641 | 6,181 | (7,920 | ) | 6,127 | (2,024 | ) | 5,005 | |||||||||||||||
Income (loss) attributable to the noncontrolling interest | — | 83 | — | — | — | 83 | |||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | 2,641 | $ | 6,098 | $ | (7,920 | ) | $ | 6,127 | $ | (2,024 | ) | $ | 4,922 | |||||||||
Nine months ended September 30, 2018 | |||||||||||||||||||||||
Revenues from external customers | $ | 986,202 | $ | 568,625 | $ | 542,911 | $ | 134,982 | $ | — | $ | 2,232,720 | |||||||||||
Gross profit | 77,369 | 14,868 | 74,946 | 40,860 | — | $ | 208,043 | ||||||||||||||||
Equity in earnings of affiliates | 9,909 | 10,692 | — | — | — | $ | 20,601 | ||||||||||||||||
Other income, net | 2,198 | 158 | 1,900 | 911 | 5,782 | $ | 10,949 | ||||||||||||||||
Income (loss) before income taxes | 1,228 | 16,847 | 8,239 | 10,645 | (13,734 | ) | $ | 23,225 | |||||||||||||||
Income (loss) attributable to the noncontrolling interests | — | (175 | ) | — | — | — | $ | (175 | ) | ||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | 1,228 | $ | 17,022 | $ | 8,239 | $ | 10,645 | $ | (13,734 | ) | $ | 23,400 | ||||||||||
Nine months ended September 30, 2017 | |||||||||||||||||||||||
Revenues from external customers | $ | 1,464,588 | $ | 533,515 | $ | 514,943 | $ | 121,632 | $ | 47,595 | $ | 2,682,273 | |||||||||||
Gross profit | 86,412 | 15,248 | 83,091 | 38,429 | 10,783 | 233,963 | |||||||||||||||||
Equity in earnings of affiliates | 864 | 7,229 | — | — | — | 8,093 | |||||||||||||||||
Other income, net | 3,046 | 34 | 4,578 | 2,264 | 7,106 | 17,028 | |||||||||||||||||
Income (loss) before income taxes | 4,497 | 12,547 | (27,074 | ) | 18,065 | (27,665 | ) | (19,630 | ) | ||||||||||||||
Income (loss) attributable to the noncontrolling interest | — | 73 | — | — | — | 73 | |||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. (a) | $ | 4,497 | $ | 12,474 | $ | (27,074 | ) | $ | 18,065 | $ | (27,665 | ) | $ | (19,703 | ) |
(in thousands) | Grain | Ethanol | Plant Nutrient | Rail | Other | Total | ||||||||||||||||||
Three months ended September 30, 2018 | ||||||||||||||||||||||||
Income (loss) before income taxes | $ | (8,619 | ) | $ | 9,281 | $ | (7,976 | ) | $ | 5,732 | $ | (2,057 | ) | $ | (3,639 | ) | ||||||||
Income (loss) attributable to the noncontrolling interest | — | 223 | — | — | — | 223 | ||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. | (8,619 | ) | — | 9,058 | (7,976 | ) | 5,732 | (2,057 | ) | (3,862 | ) | |||||||||||||
Interest expense | 2,126 | (784 | ) | 1,314 | 2,602 | (82 | ) | 5,176 | ||||||||||||||||
Depreciation and amortization | 4,118 | 1,533 | 6,761 | 7,385 | 2,931 | 22,728 | ||||||||||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) | $ | (2,375 | ) | $ | 9,807 | $ | 99 | $ | 15,719 | $ | 792 | $ | 24,042 | |||||||||||
Three months ended September 30, 2017 | ||||||||||||||||||||||||
Income (loss) before income taxes | $ | 2,641 | $ | 6,181 | $ | (7,920 | ) | $ | 6,127 | $ | (2,024 | ) | $ | 5,005 | ||||||||||
Income (loss) attributable to the noncontrolling interests | — | 83 | — | — | — | 83 | ||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. | 2,641 | 6,098 | (7,920 | ) | 6,127 | (2,024 | ) | 4,922 | ||||||||||||||||
Interest expense | 1,898 | (27 | ) | 1,561 | 1,742 | 210 | 5,384 | |||||||||||||||||
Depreciation and amortization | 4,659 | 1,479 | 6,526 | 6,069 | 2,935 | 21,668 | ||||||||||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) | $ | 9,198 | $ | 7,550 | $ | 167 | $ | 13,938 | $ | 1,121 | $ | 31,974 | ||||||||||||
Nine months ended September 30, 2018 | ||||||||||||||||||||||||
Income (loss) before income taxes | $ | 1,228 | $ | 16,847 | $ | 8,239 | $ | 10,645 | $ | (13,734 | ) | $ | 23,225 | |||||||||||
Income (loss) attributable to the noncontrolling interests | — | (175 | ) | — | — | — | (175 | ) | ||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. | 1,228 | 17,022 | 8,239 | 10,645 | (13,734 | ) | 23,400 | |||||||||||||||||
Interest expense | 9,015 | (1,096 | ) | 4,397 | 7,688 | (4 | ) | 20,000 | ||||||||||||||||
Depreciation and amortization | 12,261 | 4,559 | 20,257 | 21,673 | 9,210 | 67,960 | ||||||||||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) | $ | 22,504 | $ | 20,485 | $ | 32,893 | $ | 40,006 | $ | (4,528 | ) | $ | 111,360 | |||||||||||
Nine months ended September 30, 2017 | ||||||||||||||||||||||||
Income (loss) before income taxes | $ | 4,497 | $ | 12,547 | $ | (27,074 | ) | $ | 18,065 | $ | (27,665 | ) | $ | (19,630 | ) | |||||||||
Income (loss) attributable to the noncontrolling interests | — | 73 | — | — | — | 73 | ||||||||||||||||||
Income (loss) before income taxes attributable to The Andersons, Inc. | 4,497 | 12,474 | (27,074 | ) | 18,065 | (27,665 | ) | (19,703 | ) | |||||||||||||||
Interest expense | 6,921 | (52 | ) | 5,016 | 5,487 | 100 | 17,472 | |||||||||||||||||
Depreciation and amortization | 14,061 | 4,464 | 20,149 | 17,057 | 8,815 | 64,546 | ||||||||||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) | $ | 25,479 | $ | 16,886 | $ | (1,909 | ) | $ | 40,609 | $ | (18,750 | ) | $ | 62,315 | ||||||||||
Adjusting items impacting EBITDA: | ||||||||||||||||||||||||
Goodwill impairment | — | — | 42,000 | — | — | 42,000 | ||||||||||||||||||
Total adjusting items | — | — | 42,000 | — | — | 42,000 | ||||||||||||||||||
Adjusted EBITDA | $ | 25,479 | $ | 16,886 | $ | 40,091 | $ | 40,609 | $ | (18,750 | ) | $ | 104,315 |
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