Business Wire | Mar 25, 2021 07:00AM EDT

REX American Resources Reports Fiscal 2020 Fourth Quarter Results

Mar. 25, 2021

DAYTON, Ohio--(BUSINESS WIRE)--Mar. 25, 2021--REX American Resources Corporation (NYSE: REX) ("REX" or "the Company") today reported financial results for its fiscal 2020 fourth quarter ("Q4 '20") ended January 31, 2021. REX management will host a conference call and webcast today at 11:00 a.m. ET.

Conference Call: 212/231-2920

Webcast / Replay URL: www.rexamerican.com/Corp/Page4.aspx

The webcast will be available for replay for 30 days.

REX American Resources' Q4 '20 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 those of its 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 Q4 '20 net sales and revenue were $126.0 million, compared with $120.9 million in Q4 '19. The year-over-year net sales and revenue increase was primarily due to higher pricing of dried distillers grains and modified distillers grains, as well as higher ethanol production levels, which more than offset lower ethanol pricing. Primarily reflecting these factors, Q4 '20 gross profit for the Company's ethanol and by-products segment increased to $8.3 million, compared with $8.1 million in Q4 '19. As a result, the ethanol and by-products segment had income before income taxes of $5.3 million in Q4 '20, compared to income of $5.0 million in Q4 '19. The Company's refined coal operation incurred a $1.4 million gross loss and a $1.6 million loss before income taxes in Q4 '20, compared to a $1.5 million gross loss and a loss before income taxes of $1.4 million in Q4 '19. REX reported Q4 '20 income before income taxes and non-controlling interests of $3.2 million, compared with income before income taxes and non-controlling interests of $2.8 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 $1.7 million and $1.5 million for Q4 '20 and Q4 '19, respectively.

Net income attributable to REX shareholders in Q4 '20 was $3.5 million, compared to net income of $4.4 million in Q4 '19. Q4 '20 basic and diluted net income per share attributable to REX common shareholders was $0.59, compared to net income per share of $0.70 in Q4 '19. Per share results in Q4 '20 and Q4 '19 are based on 6,008,000 and 6,320,000 diluted weighted average shares outstanding, respectively.

Segment Income Statement Data:

Three Months Twelve Months Ended Ended

($ in thousands) January 31, January 31,

2021 2020 2021 2020

Net sales and revenue:

Ethanol & By-Products ^(1) $ 125,970 $ 120,874 $ 372,664 $ 417,700

Refined coal ^(2) (3) 48 46 182 334

Total net sales and revenue $ 126,018 $ 120,920 $ 372,846 $ 418,034



Gross profit (loss):

Ethanol & By-Products ^(1) $ 8,274 $ 8,090 $ 19,533 $ 20,402

Refined coal ^(2) (1,431 ) (1,497 ) (5,672 ) (7,917 )

Total gross profit $ 6,843 $ 6,593 $ 13,861 $ 12,485



Income (loss) before income taxes:

Ethanol & By-Products ^(1) $ 5,299 $ 4,979 $ 6,696 $ 8,469

Refined coal ^(2) (1,591 ) (1,428 ) (5,826 ) (7,778 )

Corporate and other (479 ) (714 ) (2,352 ) (1,860 )

Total income (loss) before $ 3,229 $ 2,837 $ (1,482 ) $ (1,169 )income taxes

Benefit (provision) for income taxes:

Ethanol & By-Products

$

(14

)

$

1,688

$

(31

)

$

1,528

Refined coal

1,691

1,546

6,554

10,828

Corporate and other

116

178

577

457

Total benefit for income taxes

$

1,793

$

3,412

$

7,100

$

12,813

Benefit (provision) for income taxes:

Ethanol & By-Products $ (14 ) $ 1,688 $ (31 ) $ 1,528

Refined coal 1,691 1,546 6,554 10,828

Corporate and other 116 178 577 457

Total benefit for income taxes $ 1,793 $ 3,412 $ 7,100 $ 12,813

Segment profit (loss):

Ethanol & By-Products

$

3,739

$

4,756

$

3,788

$

5,439

Refined coal

167

182

988

3,391

Corporate and other

(363

)

(536

)

(1,775

)

(1,403

)

Net income attributable to REX common shareholders

$

3,543

$

4,402

$

3,001

$

7,427

Segment profit (loss):

Ethanol & By-Products $ 3,739 $ 4,756 $ 3,788 $ 5,439

Refined coal 167 182 988 3,391

Corporate and other (363 ) (536 ) (1,775 ) (1,403 )

Net income attributable to REX common $ 3,543 $ 4,402 $ 3,001 $ 7,427 shareholders

(1)

Includes results attributable to non-controlling interests of approximately 25% for One Earth and approximately 1% for NuGen.

(2)

Includes results attributable to non-controlling interests of approximately 5%.

(3)

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

REX American Resources' Chief Executive Officer, Zafar Rizvi, commented, "Fiscal 2020 proved to be a challenging year with the impact of Covid, however we are pleased to report earnings per share of $0.59 for the fourth quarter on the back of a profitable third quarter, reflecting the resiliency of our business and the efficiency of our plants and operations."

"As we move forward into 2021 with all of our plants in operation, we remain optimistic for improved ethanol demand as we emerge from the impact of the pandemic and continue to be focused on creating additional shareholder value through our disciplined operating approach and strategic use of our strong balance sheet and liquidity position."

Balance Sheet

At January 31, 2021, REX had cash and cash equivalents and short-term investments of $180.7 million, $48.2 million of which was at the parent company, and $132.5 million of which was at its consolidated production facilities. This compares with cash, cash equivalents and short-term investments at January 31, 2020, of $205.7 million, $62.3 million of which was at the parent company, and $143.4 million of which was at its consolidated ethanol production facilities.

(1) Includes results attributable to non-controlling interests of approximately 25% for One Earth and approximately 1% for NuGen.

(2) Includes results attributable to non-controlling interests of approximately 5%.

(3) Refined coal sales are reported net of the cost of coal.

REX American Resources' Chief Executive Officer, Zafar Rizvi, commented, "Fiscal 2020 proved to be a challenging year with the impact of Covid, however we are pleased to report earnings per share of $0.59 for the fourth quarter on the back of a profitable third quarter, reflecting the resiliency of our business and the efficiency of our plants and operations."

"As we move forward into 2021 with all of our plants in operation, we remain optimistic for improved ethanol demand as we emerge from the impact of the pandemic and continue to be focused on creating additional shareholder value through our disciplined operating approach and strategic use of our strong balance sheet and liquidity position."

Balance Sheet

At January 31, 2021, REX had cash and cash equivalents and short-term investments of $180.7 million, $48.2 million of which was at the parent company, and $132.5 million of which was at its consolidated production facilities. This compares with cash, cash equivalents and short-term investments at January 31, 2020, of $205.7 million, $62.3 million of which was at the parent company, and $143.4 million of which was at its consolidated ethanol production facilities.

The following table summarizes select data related to REX's

consolidated alternative energy interests:

Three Months Twelve Months Ended Ended

January 31, January 31,

2021 2020 2021 2020

Average selling price per gallon of $ 1.36 $ 1.43 $ 1.30 $ 1.37ethanol

Average selling price per ton of dried $ 161.42 $ 138.19 $ 144.73 $ 137.68distillers grains

Average selling price per pound of non-food $ 0.27 $ 0.24 $ 0.26 $ 0.25grade corn oil

Average selling price per ton of modified $ 81.76 $ 59.62 $ 64.80 $ 59.66distillers grains

Average cost per bushel of grain $ 4.04 $ 3.90 $ 3.73 $ 3.82

Average cost of natural gas (per MmBtu) $ 3.25 $ 3.17 $ 3.00 $ 3.04

Supplemental data related to REX's ethanol interests:

REX American Resources CorporationEthanol Ownership Interests/Effective Annual Gallons Shipped as of January 31,2021

(gallons in millions)

Trailing Current REX's Current Effective Twelve REX Ownership of Trailing Months Ownership TwelveEntity Gallons Interest Month Gallons Shipped Shipped

One Earth Energy, LLC 118.6 75.4% 89.4Gibson City, IL

NuGen Energy, LLC 98.5 99.5% 98.0Marion, SD

Big River Resources WestBurlington, LLC 101.0 10.3% 10.4

West Burlington, IA

Big River Resources Galva, LLC 115.3 10.3% 11.9Galva, IL

Big River United Energy, LLC 116.1 5.7% 6.6Dyersville, IA

Big River Resources Boyceville, LLC 55.3 10.3% 5.7Boyceville, WI

Total 604.8 n/a 222.0

Fourth 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 212/231-2920 (domestic and international callers).

Participants can also listen to a live webcast of the call on the Company's website, www.rexamerican.com/Corp/Page4.aspx. A webcast replay will be available for 30 days following the live event at www.rexamerican.com/Corp/Page4.aspx.

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 605 million gallons of ethanol over the twelve-month period ended January 31, 2021. REX's effective ownership of the trailing twelve-month gallons shipped (for the twelve months ended January 31, 2021) by the ethanol production facilities in which it has ownership interests was approximately 222 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 Twelve Months Ended Ended

January 31, January 31,

2021 2020 2021 2020

Net sales and revenue $ 126,018 $ 120,920 $ 372,846 $ 418,034

Cost of sales 119,175 114,327 358,985 405,549

Gross profit 6,843 6,593 13,861 12,485

Selling, general and (4,361 ) (5,629 ) (17,661 ) (19,258 )administrative expenses

Equity in income ofunconsolidated ethanol 332 1,042 500 1,392 affiliates

Interest and other income, 415 831 1,818 4,212 net

Income (loss) before income taxes and 3,229 2,837 (1,482 ) (1,169 )non-controlling interests

Benefit for income taxes 1,793 3,412 7,100 12,813

Net income including 5,022 6,249 5,618 11,644 non-controlling interests

Net income attributable to (1,479 ) (1,847 ) (2,617 ) (4,217 )non-controlling interests

Net income attributable to $ 3,543 $ 4,402 $ 3,001 $ 7,427 REX common shareholders



Weighted average sharesoutstanding - basic and 6,008 6,320 6,167 6,318 diluted



Basic and diluted net incomeper share attributable to $ 0.59 $ 0.70 $ 0.49 $ 1.18 REX common shareholders



- balance sheets follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

Unaudited

January 31, January 31,

ASSETS 2021 2020

CURRENT ASSETS:

Cash and cash equivalents $ 144,501 $ 179,658

Short-term investments 36,194 26,073

Restricted cash 1,657 1,113

Accounts receivable 19,713 12,969

Inventory 37,880 35,634

Refundable income taxes 6,020 6,029

Prepaid expenses and other 12,785 9,659

Total current assets 258,750 271,135

Property and equipment-net 153,186 163,327

Operating lease right-of-use assets 12,678 16,173

Other assets 25,275 17,403

Equity method investment 29,456 32,464

TOTAL ASSETS $ 479,345 $ 500,502

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

Accounts payable - trade $ 16,907 $ 18,900

Current operating lease liabilities 4,875 4,935

Accrued expenses and other current liabilities 8,955 7,764

Total current liabilities 30,737 31,599

LONG TERM LIABILITIES:

Deferred taxes 3,713 4,334

Long-term operating lease liabilities 7,439 10,688

Other long-term liabilities 273 275

Total long-term liabilities 11,425 15,297

COMMITMENTS AND CONTINGENCIES

EQUITY:

REX shareholders' equity:

Common stock, 45,000 shares authorized, 29,853 299 299 shares issued at par

Paid in capital 149,110 148,789

Retained earnings 589,986 586,985

Treasury stock, 23,861 and 23,561 shares, (354,612 ) (335,066 )respectively

Total REX shareholders' equity 384,783 401,007

Non-controlling interests 52,400 52,599

Total equity 437,183 453,606

TOTAL LIABILITIES AND EQUITY $ 479,345 $ 500,502

- statements of cash flows follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

Twelve Months Ended

January 31,

2021 2020

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income $ 5,618 $ 11,644

Adjustments to reconcile net income to net cash

provided by operating activities:

Depreciation 20,906 23,007

Amortization of operating lease right-of-use assets 5,358 6,304

Stock based compensation expense 264 397

Income from equity method investments (500 ) (1,392 )

Dividends received from equity method investments 3,508 1,003

Interest income from investments (216 ) (73 )

Deferred income tax (7,949 ) (11,070 )

Gain on disposal of property and equipment (58 ) -

Changes in assets and liabilities:

Accounts receivable (6,744 ) (1,591 )

Inventory (2,246 ) (17,157 )

Prepaid expenses and other assets (3,138 ) (752 )

Income taxes refundable 9 1,666

Accounts payable-trade (2,346 ) 11,400

Other liabilities (3,843 ) (13,043 )

Net cash provided by operating activities 8,623 10,343

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures (10,412 ) (3,776 )

Purchases of short-term investments (96,233 ) (26,025 )

Sales of short-term investments 86,328 15,000

Loan receivable repayments - 369

Proceeds from sale of real estate and property and 58 - equipment

Restricted deposits (532 ) -

Net cash used in investing activities (20,791 ) (14,432 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Treasury stock acquired (19,629 ) -

Payments to noncontrolling interests holders (2,928 ) (4,264 )

Capital contributions from minority investor 112 312

Net cash used in financing activities (22,445 ) (3,952 )

NET DECREASE IN CASH, CASH EQUIVALENTS

AND RESTRICTED CASH (34,613 ) (8,041 )

CASH, CASH EQUIVALENTS AND RESTRICTED CASH-Beginning of 180,771 188,812 period

CASH, CASH EQUIVALENTS AND RESTRICTED CASH-End of $ 146,158 $ 180,771 period

Non cash financing activities - Equity awards issued $ 241 $ 487

Non cash financing activities - Equity awards accrued $ 99 $ 241

Non cash investing activities - Accrued capital $ 390 $ 37 expenditures



Initial operating lease right-of-use assets and liabilities recorded

upon adoption of ASC 842 $ - $ 20,918

Operating lease right-of-use assets acquired and liabilities assumed

upon lease execution $ 1,863 $ 432

View source version on businesswire.com: https://www.businesswire.com/news/home/20210325005174/en/

CONTACT: Douglas Bruggeman Joseph Jaffoni, Norberto Aja Chief Financial Officer JCIR (937) 276?3931 (212) 835-8500 rex@jcir.com