The Andersons, Inc. reported record renewable fuel profits with $57 million in net income for the second quarter, driven by record ethanol plant production, strong export demand, and $24 million in federal 45Z producer tax credits for low-carbon fuels.
- Record Q2 Results: The Andersons reported $57 million net income ($1.65 per diluted share) with adjusted net income of $74 million ($2.15 per diluted share)
- Renewables Division Peak: Pretax income of $65 million and adjusted pretax income of $88 million, marking the best second quarter on record
- Federal Support: $24 million in 45Z producer tax credits for low-carbon fuels boosted renewable fuel segment performance
- Strong Operations: Record second quarter ethanol production, efficient plant operations, and strong export demand drove renewable segment gains
- Financial Strength: Cash from operations reached $488 million with debt-to-EBITDA ratio below 2.5x target, providing flexibility for growth investments
The Andersons, Inc. reported second quarter net income of $57 million, or $1.65 per diluted share, driven by record performance in its renewable fuels business and improved fertilizer margins.
The diversified agriculture company announced Tuesday that adjusted net income reached $74 million, or $2.15 per diluted share, for the quarter ended June 30. That compares with adjusted net income of $8.4 million, or $0.24 per share, in the same period last year.
The Renewables division reported pretax income of $65 million and adjusted pretax income of $88 million, marking its best second quarter on record. The segment benefited from efficient ethanol plant operations, strong export demand and $24 million in federal 45Z producer tax credits for low-carbon fuels.
“Our plants achieved record second quarter production while safely completing planned spring maintenance activities,” said President and CEO Bill Krueger.
The company’s ethanol merchandising operations also improved as market volatility following the Renewable Volume Obligations announcement increased values for distillers corn oil and renewable identification numbers.
The Agribusiness division reported pretax income of $20 million, up from $17 million in adjusted pretax income last year. The fertilizer business drove the improvement with higher margins despite lower sales volumes. Grain merchandising results improved on higher commodity prices and increased market volatility early in the quarter.
Cash from operating activities totaled $488 million in the second quarter, compared with $299 million in the prior year period. The company spent $76 million on capital projects during the quarter.
CFO Brian Valentine said the company’s long-term debt to EBITDA ratio remains below its target of 2.5 times, providing financial flexibility for growth investments.
The company is preparing for a debottlenecking project at its Clymers, Indiana, ethanol facility and pursuing additional opportunities to reduce carbon intensity. The Port of Houston’s soybean meal export capabilities are expected to become operational in the fourth quarter.
The company recorded income tax expense of $13 million for an effective rate of 20%. It anticipates a full-year adjusted effective rate of 14 to 18%.
