REX American Resources Reports Fiscal 2021 Second Quarter Net Income Per Share Attributable to REX Common Shareholders of $1.31

Board of Directors Authorizes Repurchase of Additional 500,000 Shares Following Recent Completion of Previously Authorized Repurchase of 500,000 Common Shares

DAYTON, Ohio--()--REX American Resources Corporation (NYSE: REX) (“REX” or “the Company”) today reported financial results for its fiscal 2021 second quarter (“Q2 ‘21”) ended July 31, 2021. REX management will host a conference call and webcast today at 11:00 a.m. ET.

    Conference Call:    212/231- 2902  
    Webcast / Replay URL:   www.rexamerican.com  
 

The webcast will be available for replay for 30 days.

 

REX American Resources’ Q2 ‘21 results principally reflect its interests in six ethanol production facilities and its refined coal operation. The One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) ethanol production facilities are consolidated, as is the refined coal entity, while the four other ethanol plants are reported as equity in income of unconsolidated ethanol affiliates. The Company reports results for its two business segments as ethanol and by-products, and refined coal.

REX’s Q2 ‘21 net sales and revenue were $195.8 million, compared with $39.3 million in Q2 ‘20. The year-over-year net sales and revenue increase was primarily due to higher ethanol production levels as compared to the prior year levels, which were significantly impacted by the Covid-19 pandemic, as well as higher ethanol, distillers grains, and corn oil pricing. Primarily reflecting the revenue growth, offset in part by increased input corn pricing, Q2 ‘21 gross profit for the Company’s ethanol and by-products segment increased to $14.2 million, compared with $0.6 million in Q2 ‘20. As a result, the ethanol and by-products segment had income before income taxes of $10.7 million in Q2 ‘21, compared to a loss of $3.3 million in Q2 ‘20. The Company’s refined coal operation incurred a $3.1 million gross loss and a $3.5 million loss before income taxes in Q2 ‘21, compared to a $1.9 million gross loss and a loss before income taxes of $2.1 million in Q2 ‘20. REX reported Q2 ‘21 income before income taxes and non-controlling interests of $6.4 million, compared with a loss before income taxes and non-controlling interests of $6.1 million in the comparable year ago period. While the refined coal operation negatively impacted gross profit and income before income taxes, it contributed a tax benefit of $5.4 million and $2.9 million in Q2 ‘21 and Q2 ’20, respectively.

Net income attributable to REX shareholders in Q2 ‘21 was $7.9 million, compared to a net loss of $1.7 million in Q2 ‘20. Q2 ‘21 basic and diluted net income per share attributable to REX common shareholders was $1.31, compared to a net loss per share of $0.28 in Q2 ‘20. Per share results in Q2 ‘21 and Q2 ‘20 are based on 6,011,000 and 6,216,000 diluted weighted average shares outstanding, respectively.

Segment Income Statement Data:

 

($ in thousands)

 

Three Months
Ended July 31,

 

Six Months
Ended July 31,

 

 

2021

 

2020

 

2021

 

2020

Net sales and revenue:

 

 

 

 

 

 

 

 

Ethanol & By-Products (1)

 

$195,678

 

$ 39,242

 

$359,720

 

$122,477

Refined coal (2) (3)

 

165

 

85

 

227

 

100

Total net sales and revenue

 

$195,843

 

$ 39,327

 

$359,947

 

$122,577

 

 

 

 

 

 

 

 

 

Gross profit (loss):

 

 

 

 

 

 

 

 

Ethanol & By-Products (1)

 

$ 14,155

 

$ 553

 

$ 33,631

 

$ (7,670)

Refined coal (2)

 

(3,081)

 

(1,884)

 

(4,755)

 

(2,991)

Total gross profit (loss)

 

$ 11,074

 

$ (1,331)

 

$ 28,876

 

$(10,661)

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes:

 

 

 

 

 

 

 

 

Ethanol & By-Products (1)

 

$ 10,732

 

$ (3,259)

 

$ 21,820

 

$(15,610)

Refined coal (2)

 

(3,455)

 

(2,118)

 

(5,260)

 

(2,965)

Corporate and other

 

(902)

 

(702)

 

(1,758)

 

(1,247)

Total income (loss) before income taxes

 

$ 6,375

 

$ (6,079)

 

$ 14,802

 

$(19,822)

(Provision) benefit for income taxes:          

Ethanol & By-Products

 

$ (1,985)

 

$       893

 

$ (4,423)

 

$ 5,054

Refined coal

 

5,441

 

2,919

 

      7,639

 

   3,878

Corporate and other

 

      221

 

       234

 

       432

 

     427

Total benefit for income taxes

 

$   3,677

 

$    4,046

 

$    3,648

 

$ 9,359

Segment profit (loss):  

 

 

 

 

 

 

 

Ethanol & By-Products

 

$ 6,418

 

$ (2,178)

 

$ 14,374

 

$ (9,611)

Refined coal

 

2,139

 

898

 

2,612

 

1,048

Corporate and other

 

(681)

 

(468)

 

(1,326)

 

(820)

Net income (loss) attributable to REX common shareholders

 

$ 7,876

 

$(1,748)

 

$ 15,660

 

$ (9,383)

 

(1)

 

Includes results attributable to non-controlling interests of approximately 24.5% for One Earth and approximately 0.5% for NuGen. 

 

(2)

 

Includes results attributable to non-controlling interests of approximately 4.7%.

 

(3)

 

Refined coal sales are reported net of the cost of coal.

REX American Resources’ Chief Executive Officer, Zafar Rizvi, commented, “The resiliency of our business and effectiveness of our operations is evident in our second quarter operating results. With the return to more normalized demand compared to the prior year during the fiscal 2021 second quarter, and improved pricing, we continued to leverage our strategic locations across the corn belt and healthy liquidity position to generate second quarter net income of $7.9 million and earnings per share of $1.31.

“Subsequent to the end of the fiscal second quarter, we repurchased the remaining shares under our most recent repurchase authorization and our Board of Directors has authorized the repurchase of up to an additional 500,000 shares of our common stock. We remain focused on enhancing shareholder value through our disciplined operating approach and strategic use of our strong balance sheet and liquidity position.”

Balance Sheet

At July 31, 2021, REX had cash and cash equivalents and short-term investments of $187.6 million, $42.1 million of which was at the parent company, and $145.5 million of which was at its consolidated production facilities. This compares with cash, cash equivalents and short-term investments at January 31, 2021, of $180.7 million, $48.2 million of which was at the parent company, and $132.5 million of which was at its consolidated ethanol production facilities.

During the fiscal second quarter ended July 31, 2021 the Company repurchased 17,307 shares of its common stock at a cost of $1.4 million, and subsequent to the end of the second quarter the Company purchased an additional 16,205 shares, thus completing its previously authorized stock repurchase of 500,000 shares for $32,857,393. The Company’s Board of Directors has authorized the repurchase of up to an additional 500,000 shares of its common stock. Share repurchases will be made from time to time in open market or private transactions at prevailing market prices, and all shares purchased will be held in the Company’s treasury for possible future use. Reflecting all purchases to date, REX presently has approximately 5,970,938 shares of common stock outstanding.

The following table summarizes select data related to REX’s
consolidated alternative energy interests:

 

 

 

Three Months
Ended

 

Six Months
Ended

 
 

 

 

July 31,

 

July 31,

 
 

 

 

2021

 

2020

 

2021

 

2020

 
 

Average selling price per gallon of ethanol

 

$ 2.21

 

$ 1.23

 

$ 2.02

 

$ 1.25

 
 

Average selling price per ton of dried distillers grains

 

$ 206.78

 

$ 135.54

 

$ 207.84

 

$ 143.24

 
 

Average selling price per pound of non-food

grade corn oil

 

 

$ 0.47

 

 

$ 0.24

 

 

$ 0.41

 

 

$ 0.25

 
 

Average selling price per ton of modified distillers grains

 

$ 90.54

 

$ 31.87

 

$ 79.13

 

$ 49.32

 
 

Average cost per bushel of grain

 

$ 6.45

 

$ 3.63

 

$ 5.86

 

$ 3.86

 
 

Average cost of natural gas (per MmBtu)

 

$ 3.30

 

$ 2.92

 

$ 3.24

 

$ 3.60

 

Supplemental data related to REX’s ethanol interests:

REX American Resources Corporation
Ethanol Ownership Interests/Effective Annual Gallons Shipped as of July 31, 2021
(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

143.9

75.6%

108.8

NuGen Energy, LLC

Marion, SD

137.4

99.7%

137.0

Big River Resources West Burlington, LLC

West Burlington, IA

108.5

10.3%

11.2

Big River Resources Galva, LLC

Galva, IL

119.6

10.3%

12.3

Big River United Energy, LLC

Dyersville, IA

126.4

5.7%

7.2

Big River Resources Boyceville, LLC

Boyceville, WI

62.6

10.3%

6.5

 Total

698.4

n/a

283.0

Second Quarter Conference Call

REX will host a conference call at 11:00 a.m. ET today. Senior management will discuss the quarterly financial results and host a question and answer session. The dial in number for the audio conference call is 212/231-2902 (domestic and international callers).

Participants can also listen to a live webcast of the call on the Company’s website, www.rexamerican.com. A webcast replay will be available for 30 days following the live event at www.rexamerican.com.

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 698 million gallons of ethanol over the twelve-month period ended July 31, 2021. REX’s effective ownership of the trailing twelve-month gallons shipped (for the twelve months ended July 31, 2021) by the ethanol production facilities in which it has ownership interests was approximately 283 million gallons. In addition, the Company acquired a refined coal operation in August 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 effect of pandemics such as COVID-19 on the Company’s business operations, including impacts on supplies, demand, personnel and other factors, the impact of legislative and regulatory changes, the price volatility and availability of corn, distillers grains, ethanol, non-food grade 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, the impact of U.S. foreign trade policy, changes in foreign currency exchange rates 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

 

Six Months
Ended

 

 

July 31,

 

July 31,

 

 

2021

 

2020

 

2021

 

2020

Net sales and revenue

 

$195,843

 

$39,327

 

$359,947

 

$122,577

Cost of sales

 

184,769

 

40,658

 

331,071

 

133,238

Gross profit (loss)

 

11,074

 

(1,331)

 

28,876

 

(10,661)

Selling, general and administrative expenses

 

(6,582)

 

(4,438)

 

(16,570)

 

(9,043)

Equity in income (loss) of unconsolidated ethanol affiliates

 

1,844

 

(507)

 

2,414

 

(984)

Interest and other income, net

 

39

 

197

 

82

 

866

Income (loss) before income taxes and

non-controlling interests

 

 

6,375

 

 

(6,079)

 

 

14,802

 

 

(19,822)

Benefit for income taxes

 

3,677

 

4,046

 

3,648

 

9,359

Net income (loss) including non-controlling interests

 

10,052

 

(2,033)

 

18,450

 

(10,463)

Net (income) loss attributable to non-controlling interests

 

(2,176)

 

285

 

(2,790)

 

1,080

Net income (loss) attributable to REX common shareholders

 

$ 7,876

 

$(1,748)

 

15,660

 

($9,383)

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding – basic and diluted

 

6,011

 

6,216

 

6,010

 

6,261

 

 

 

 

 

 

 

 

 

Basic and diluted net income (loss) per share attributable to REX common shareholders

 

$1.31

 

$(0.28)

 

$2.61

 

$(1.50)

- balance sheets follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

Unaudited

   
 

July 31,

January 31,

ASSETS

 

2021

 

2021

CURRENT ASSETS:

 

 

 

 

Cash and cash equivalents

 

$ 154,312

 

$ 144,501

Short-term investments

 

33,282

 

36,194

Restricted cash

 

6,758

 

1,657

Accounts receivable

 

29,521

 

19,713

Inventory

 

41,759

 

37,880

Refundable income taxes

 

6,892

 

6,020

Prepaid expenses and other

 

12,175

 

12,785

Total current assets

 

284,699

 

258,750

Property and equipment-net

 

145,078

 

153,186

Operating lease right-of-use assets

 

13,211

 

12,678

Other assets

 

30,649

 

25,275

Equity method investment

 

31,870

 

29,456

TOTAL ASSETS

 

$ 505,507

 

$ 479,345

LIABILITIES AND EQUITY

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

Accounts payable – trade

 

$ 22,041

 

$ 16,907

Current operating lease liabilities

 

5,380

 

4,875

Accrued expenses and other current liabilities

 

11,274

 

8,955

Total current liabilities

 

38,695

 

30,737

LONG TERM LIABILITIES:

 

 

 

 

Deferred taxes

 

4,030

 

3,713

Long-term operating lease liabilities

 

7,534

 

7,439

Other long-term liabilities

 

1,951

 

273

Total long-term liabilities

 

13,515

 

11,425

COMMITMENTS AND CONTINGENCIES

 

 

 

 

EQUITY:

 

 

 

 

REX shareholders’ equity:

 

 

 

 

Common stock, 45,000 shares authorized, 29,853 shares issued at par

 

299

 

299

Paid in capital

 

149,263

 

149,110

Retained earnings

 

605,646

 

589,986

Treasury stock, 23,866 shares

 

(355,936)

 

(354,612)

Total REX shareholders’ equity

 

399,272

 

384,783

Non-controlling interests

 

54,025

 

52,400

Total equity

 

453,297

 

437,183

TOTAL LIABILITIES AND EQUITY

 

$ 505,507

 

$ 479,345

- statements of cash flows follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

   
 

Six Months Ended
July 31,

 

 

2021

 

2020

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

Net income (loss)

 

$

18,450

 

$

(10,463)

Adjustments to reconcile net income (loss) to net cash

 

 

 

 

provided by (used in) operating activities:

 

 

 

 

Depreciation

 

 

10,451

 

 

10,491

Amortization of operating lease right-of-use assets

 

 

2,734

 

 

2,691

Stock based compensation expense

 

 

567

 

 

80

(Income) loss from equity method investments

 

 

(2,414)

 

 

984

Dividends received from equity method investments

 

 

-

 

 

2,005

Interest income from investments

 

 

(27)

 

 

(179)

Deferred income tax

 

 

(4,741)

 

 

(4,784)

Gain on disposal of property and equipment

 

 

(3)

 

 

(22)

Changes in assets and liabilities:

 

 

 

 

Accounts receivable

 

 

(9,808)

 

 

3,225

Inventory

 

 

(3,879)

 

 

5,251

Refundable income taxes

 

 

(872)

 

 

(4,591)

Prepaid expenses and other assets

 

 

293

 

 

(481)

Accounts payable-trade

 

 

5,457

 

 

(10,301)

Other liabilities

 

 

949

 

 

(2,940)

Net cash provided by (used in) operating activities

 

 

17,157

 

 

(9,034)

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

Capital expenditures

 

 

(2,693)

 

 

(5,692)

Purchases of short-term investments

 

 

(49,281)

 

 

(45,450)

Sales of short-term investments

 

 

52,220

 

 

39,046

Proceeds from sale of real estate and property and equipment

 

 

30

 

 

-

Other

 

 

-

 

 

(259)

Net cash provided by (used in) investing activities

 

 

276

 

 

(12,355)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

Treasury stock acquired

 

 

(1,356)

 

 

(5,590)

Payments to noncontrolling interests holders

 

 

(1,304)

 

 

(157)

Capital contributions from minority investor

 

 

139

 

 

23

Net cash used in financing activities

 

 

(2,521)

 

 

(5,724)

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS

 

 

 

 

AND RESTRICTED CASH

 

 

14,912

 

 

(27,113)

CASH, CASH EQUIVALENTS AND RESTRICTED CASH-Beginning of period

 

 

146,158

 

 

180,771

CASH, CASH EQUIVALENTS AND RESTRICTED CASH-End of period

 

$

161,070

 

$

153,658

Non cash financing activities – Stock awards issued

 

$

100

 

$

240

Non cash financing activities – Stock awards accrued

 

$

482

 

$

-

Non cash investing activities – Accrued capital expenditures

 

$

67

 

$

22

Right-of use assets acquired and liabilities incurred upon lease execution

 

$

3,267

 

$

1,863

 

Contacts

Douglas Bruggeman
Chief Financial Officer
(937) 276‑3931

Joseph Jaffoni, Norberto Aja
JCIR
(212) 835-8500
rex@jcir.com

Contacts

Douglas Bruggeman
Chief Financial Officer
(937) 276‑3931

Joseph Jaffoni, Norberto Aja
JCIR
(212) 835-8500
rex@jcir.com