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Press release from PR Newswire

The Andersons, Inc. Reports Second Quarter Results

Tuesday, August 06, 2013

The Andersons, Inc. Reports Second Quarter Results

16:01 EDT Tuesday, August 06, 2013

Second Quarter Earnings of $1.57 per Diluted Share
The Plant Nutrient, Ethanol and Rail Groups Lead Earning Results

MAUMEE, Ohio, Aug. 6, 2013 /PRNewswire/ -- The Andersons, Inc. (Nasdaq: ANDE), today announced second quarter net income attributable to the company of $29.5 million, or $1.57 per diluted share, on revenues of $1.6 billion.  In the same three month period of 2012, the company reported similar results of $29.2 million, or $1.56 per diluted share on revenues of $1.3 billion.  During the first six months of 2013, the company earned $42.1 million, or $2.24 per diluted share.  In the first half of 2012, The Andersons reported results of $47.6 million, or $2.54 per diluted share.  The revenue for the first six months of 2013 and 2012 were $2.8 billion and $2.5 billion, respectively.   

(Logo: http://photos.prnewswire.com/prnh/20081104/CLTU081LOGO )

The Plant Nutrient Group had operating income of $23.2 million during the second quarter on revenues of $330 million.  In the same three month period of 2012, the group had operating income of $28.0 million on revenues of $309 million.  This quarter the group regained much of the volume lost in the first quarter; however, margins were down year over year.  The group's first half 2013 operating income was $22.7 million on $442 million of revenues.  Last year, the operating income through the first six months was $33.8 million on revenues of $484 million.  Margins from year to year were down due to a slow start to the season and limited inventory price appreciation.

The Ethanol Group achieved record operating income of $10.6 million in the second quarter on revenues of $222 million.  This compares to an operating loss of $2.1 million during the same period last year on revenues of $168 million.  This income increase was due primarily to significant ethanol margin improvement, which includes the positive impact of co-products such as corn-oil, distillers dried grains, E-85, and CO2.  Also, the group had a full quarter of income from its Denison, Iowa production facility compared to the prior year as the acquisition occurred in May of 2012.  The group's operating income through June was $13.1 million on revenues of $422 million.  Last year, its first half operating loss was $2.0 million on revenues of $318 million.  The revenue increase was due to added volume from the Denison plant and an increase in the average price per gallon of ethanol. 

The Rail Group achieved record operating income of $9.7 million in the second quarter on revenues of $39 million.  In the same three month period of 2012, the group earned $7.2 million and revenues were $32 million.  The group's revenue and operating income benefited from higher lease rates and increased income from railcar financings.  The group recognized $4.4 million in pre-tax gains on sales of railcars and related leases and non-recourse transactions during the second quarter this year.  In the same period of 2012, the company recognized gains of $2.4 million on similar transactions.  The average utilization rate for the quarter was 85.7 percent in comparison to 84.7 percent for the same period last year.  The group's first half operating income was a record $24.3 million on $85 million of revenues.  In 2012, operating income through June was $15.2 million and revenues were $68 million.  The rail fleet has increased to 23,245 cars from 23,107 last year.    

The Grain Group reported operating income of $2.1 million in the second quarter of 2013, compared to $15.3 million in the same three month period last year, as it continued to be impacted by the 2012 drought, which led to significantly reduced space income.  The group benefited from good second quarter earnings from its investment in Lansing Trade Group.  Revenues for the Grain Group were $891 million and $719 million for the quarter in 2013 and 2012, respectively.  The group's operating income for the first six months was $10.4 million on revenues of $1.7 billion.  Last year, its first half operating income was $34.7 million and revenues were $1.4 billion.  Revenues increased due to higher grain prices and greater sales volume, which resulted primarily from the addition of the former Green Plains Grain facilities.  

The Turf & Specialty Group's operating income was $2.2 million in the second quarter on $43 million of revenues.  Last year, the group reported operating income of $2.8 million on $44 million of revenues for the same period.  Through the first half of 2013, the group's operating income was $6.2 million on $90 million of revenues.  Comparatively, in 2012 the group earned $5.0 million through June on revenues of $89 million.

The Retail Group had operating income of $1.5 million during the second quarter of 2013 on revenues of $41 million.  During the same period of the prior year, the group had operating income of $1.4 million and revenues were $44 million.  Through the first six months, the group lost $1.6 million and revenues were $72 million.  Last year through June, the group lost $1.3 million on revenues of $75 million.  

It was announced last week that the company and Lansing Trade Group finalized the acquisition of Thompsons Limited, a grain and food-grade bean handler and agronomy input provider, headquartered in Blenheim, Ontario, and operating 12 locations across Ontario and Minnesota.  Then, yesterday the company announced it has entered into an agreement to acquire Mile Rail, LLC, a railcar repair and cleaning provider headquartered in Kansas City, Missouri, with three satellite locations in Nebraska, Kansas and Indiana, and mobile units in the Central Midwest. 

"We had record quarterly results in both our Rail and Ethanol groups, and strong results in our Plant Nutrient Group.  The Rail Group continues to manage its railcar portfolio in a skillful manner.  It is satisfying to see significantly improved margins in the ethanol business; however, we are very aware the ethanol market will continue to be volatile," CEO Mike Anderson stated.  "The 2012 drought continues to have a strong impact on our Grain Group, as was expected, and the largest impact may be seen in the third quarter.  A projected record corn crop, however, should positively impact the group the last three or four months of 2013," added Mr. Anderson.

The company will host a webcast on Wednesday, August 7, 2013 at 11:00 A.M. ET, to discuss its performance.  This can be accessed under the heading "Investor" on its website at www.andersonsinc.com.

The Andersons, Inc. is a diversified company rooted in agriculture.  Founded in Maumee, Ohio, in 1947, the company conducts business across North America in the grain, ethanol, and plant nutrient sectors, railcar leasing, turf and cob products, and consumer retailing.

This release contains forward-looking statements.  These statements involve risks and uncertainties that could cause actual results to differ materially.  Without limitation, these risks include economic, weather and regulatory conditions, competition, and the risk factors set forth from time to time in the Company's filings with the Securities and Exchange Commission.  Although the Company believes that the assumptions upon which the financial information and its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct.

The Andersons, Inc. is located on the Internet at www.andersonsinc.com

FINANCIAL TABLES FOLLOW . . .

 

The Andersons, Inc.

Consolidated Statements of Income

(Unaudited)

Three months ended June 30,

Six months ended June 30,

(in thousands, except per share data)

2013

2012

2013

2012

Sales and merchandising revenues

$ 1,566,964

$ 1,315,834

$ 2,838,934

$ 2,452,967

Cost of sales and merchandising revenues

1,463,735

1,213,184

2,656,432

2,264,447

Gross profit

103,229

102,650

182,502

188,520

Operating, administrative and general expenses

61,464

59,210

123,472

119,310

Interest expense

4,855

5,380

11,259

10,710

Other income:

Equity in earnings of affiliates

10,010

5,096

17,814

9,379

Other income, net

1,292

2,671

4,018

5,917

Income before income taxes

48,212

45,827

69,603

73,796

Income tax provision

17,480

17,356

26,559

27,597

Net income

30,732

28,471

43,044

46,199

Net income (loss) attributable to the noncontrolling interests

1,193

(728)

927

(1,407)

Net income attributable to The Andersons, Inc.

$      29,539

$      29,199

$      42,117

$      47,606

Per common share:

Basic earnings attributable to The Andersons, Inc. common shareholders

$          1.58

$          1.57

$          2.25

$          2.56

Diluted earnings attributable to The Andersons, Inc. common shareholders

$          1.57

$          1.56

$          2.24

$          2.54

Dividends paid

$          0.16

$          0.15

$          0.32

$          0.30

 

The Andersons, Inc.Condensed Consolidated Balance Sheets(Unaudited)(In thousands)

June 30, 2013

December 31, 2012

June 30, 2012

Assets

Current assets:

Cash and cash equivalents

$      75,920

$    138,218

$      23,930

Restricted cash

872

398

5,644

Accounts receivable, net

216,432

208,877

205,046

Inventories

444,523

776,677

597,091

Commodity derivative assets ? current

121,789

103,105

122,010

Deferred income taxes

2,797

15,862

18,784

Other current assets

44,936

54,016

38,535

Total current assets

907,269

1,297,153

1,011,040

Other assets:

Commodity derivative assets ? noncurrent

87

1,906

4,844

Other assets, net

103,781

105,129

70,040

Equity method investments

195,241

190,908

189,610

299,109

297,943

264,494

Railcar assets leased to others, net

242,887

228,330

252,965

Property, plant and equipment, net

371,716

358,878

266,275

Total assets

$ 1,820,981

$ 2,182,304

$ 1,794,774

Liabilities and equity

Current liabilities:

Borrowings under short-term line of credit

$      50,000

$      24,219

$    309,608

Accounts payable for grain

178,017

582,653

129,979

Other accounts payable

183,971

165,201

148,497

Customer prepayments and deferred revenue

25,621

105,410

55,912

Commodity derivative liabilities ? current

58,183

33,277

29,764

Accrued expenses and other current liabilities

57,456

66,902

51,283

Current maturities of long-term debt

45,096

15,145

29,647

Total current liabilities

598,344

992,807

754,690

Other long-term liabilities

15,634

18,406

11,546

Commodity derivative liabilities ? noncurrent

5,863

1,134

454

Employee benefit plan obligations

50,754

53,131

50,437

Long-term debt, less current maturities

409,020

427,243

317,648

Deferred income taxes

87,486

78,138

70,806

Total liabilities

1,167,101

1,570,859

1,205,581

Total equity

653,880

611,445

589,193

Total liabilities and equity

$ 1,820,981

$ 2,182,304

$ 1,794,774

 

Segment Data

Grain

Ethanol

Plant Nutrient

Rail

Turf & Specialty

Retail

Other

Total

Three months ended June 30, 2013

Revenues from external customers

$    891,350

$ 222,240

$ 330,339

$ 38,601

$ 43,144

$ 41,290

$            -

$ 1,566,964

Gross profit

22,092

9,649

37,201

14,557

7,321

12,409

-

103,229

Equity in earnings of affiliates

5,027

4,983

-

-

-

-

-

10,010

Other income (expense), net

(349)

199

164

702

175

100

301

1,292

Income (loss) before income taxes

2,053

11,794

23,240

9,680

2,195

1,539

(2,289)

48,212

Income attributable to the noncontrolling interests

-

1,193

-

-

-

-

-

1,193

Operating income (loss) (a)

$        2,053

$   10,601

$   23,240

$   9,680

$   2,195

$   1,539

$   (2,289)

$      47,019

Three months ended June 30, 2012

Revenues from external customers

$    718,911

$ 167,758

$ 308,797

$ 32,046

$ 43,845

$ 44,477

$            -

$ 1,315,834

Gross profit

26,440

1,925

41,657

11,563

7,490

13,575

-

102,650

-

Equity in earnings (loss) of affiliates

7,505

(2,410)

1

-

-

-

-

5,096

Other income (expense), net

489

20

1,010

824

289

155

(116)

2,671

Income (loss) before income taxes

15,277

(2,833)

27,953

7,199

2,753

1,428

(5,950)

45,827

Loss attributable to the noncontrolling interest

-

(728)

-

-

-

-

-

(728)

Operating income (loss) (a)

$      15,277

$   (2,105)

$   27,953

$   7,199

$   2,753

$   1,428

$   (5,950)

$      46,555

Grain

Ethanol

Plant Nutrient

Rail

Turf & Specialty

Retail

Other

Total

Six months ended June 30, 2013

Revenues from external customers

$ 1,727,845

$ 421,549

$ 442,241

$ 84,965

$ 90,331

$ 72,003

$            -

$ 2,838,934

Gross profit

46,942

14,454

51,150

33,536

16,339

20,081

-

182,502

Equity in earnings of affiliates

12,937

4,877

-

-

-

-

-

17,814

Other income, net

222

430

139

1,648

450

214

915

4,018

Income (loss) before income taxes

10,352

14,007

22,678

24,254

6,196

(1,630)

(6,254)

69,603

Income attributable to the noncontrolling interests

-

927

-

-

-

-

-

927

Operating income (loss) (a)

$      10,352

$ 13,080

$   22,678

$ 24,254

$   6,196

$ (1,630)

$   (6,254)

$      68,676

Six months ended June 30, 2012

Revenues from external customers

$ 1,418,772

$ 318,428

$ 484,157

$ 67,905

$ 88,972

$ 74,733

$            -

$ 2,452,967

Gross profit

59,041

4,698

62,975

24,128

15,489

22,189

-

188,520

Equity in earnings (loss) of affiliates

13,457

(4,081)

3

-

-

-

-

9,379

Other income, net

1,316

36

1,128

1,600

490

279

1,068

5,917

Income (loss) before income taxes

34,712

(3,391)

33,781

15,217

4,955

(1,321)

(10,157)

73,796

Loss attributable to the noncontrolling interest

-

(1,407)

-

-

-

-

-

(1,407)

Operating income (loss) (a)

$      34,712

$   (1,984)

$   33,781

$ 15,217

$   4,955

$  (1,321)

$ (10,157)

$      75,203

(a) Operating income (loss) for each Group is defined as net sales and merchandising revenues plus identifiable other income less all identifiable operating expenses, including interest expense for carrying working capital and long-term assets and is reported net of the noncontrolling interest share of (income) loss.

 

 

SOURCE The Andersons, Inc.

For further information: Investor Relations, Nick Conrad, Phone: 419-891-6415, E-mail: nick_conrad@andersonsinc.com

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