Business Wire | May 26, 2021 07:00AM EDT

REX American Resources Reports Fiscal 2021 First Quarter Net Income Per Share Attributable to REX Common Shareholders of $1.30 Versus a Loss of $1.21 Per Share in the Year-Ago Period

May 26, 2021

DAYTON, Ohio--(BUSINESS WIRE)--May 26, 2021--REX American Resources Corporation (NYSE: REX) ("REX" or "the Company") today reported financial results for its fiscal 2021 first quarter ("Q1 '21") ended April 30, 2021. REX management will host a conference call and webcast today at 11:00 a.m. ET.

Conference Call: 212/231-2911

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

The webcast will be available for replay for 30 days.

REX American Resources' Q1 '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 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 Q1 '21 net sales and revenue were $164.1 million, compared with $83.3 million in Q1 '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 and dried distillers grains and modified distillers grains pricing. Primarily reflecting the revenue growth, offset in part by increased input corn pricing, Q1 '21 gross profit for the Company's ethanol and by-products segment increased to $19.5 million, compared with a loss of $8.2 million in Q1 '20. As a result, the ethanol and by-products segment had income before income taxes of $11.1 million in Q1 '21, compared to a loss of $12.4 million in Q1 '20. The Company's refined coal operation incurred a $1.7 million gross loss and a $1.8 million loss before income taxes in Q1 '21, compared to a $1.1 million gross loss and a loss before income taxes of $0.8 million in Q1 '20. REX reported Q1 '21 income before income taxes and non-controlling interests of $8.4 million, compared with a loss before income taxes and non-controlling interests of $13.7 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 $2.2 million and $1.0 million for Q1 '21 and Q1 '20, respectively.

Net income attributable to REX shareholders in Q1 '21 was $7.8 million, compared to a net loss of $7.6 million in Q1 '20. Q1 '21 basic and diluted net income per share attributable to REX common shareholders was $1.30, compared to a net loss per share of $1.21 in Q1 '20. Per share results in Q1 '21 and Q1 '20 are based on 6,010,000 and 6,304,000 diluted weighted average shares outstanding, respectively.

Segment Income Statement Data:

Three Months Ended

($ in thousands) April 30,

2021 2020

Net sales and revenue:

Ethanol & By-Products ^(1) $ 164,042 $ 83,235

Refined coal ^(2) (3) 62 15

Total net sales and revenue $ 164,104 $ 83,250



Gross profit (loss):

Ethanol & By-Products ^(1) $ 19,477 $ (8,223 )

Refined coal ^(2) (1,675 ) (1,107 )

Total gross profit (loss) $ 17,802 $ (9,330 )



Income (loss) before income taxes:

Ethanol & By-Products ^(1) $ 11,082 $ (12,351 )

Refined coal ^(2) (1,795 ) (847 )

Corporate and other (860 ) (545 )

Total income (loss) before income taxes $ 8,427 $ (13,743 )

(Provision) benefit for income taxes:

Ethanol & By-Products $ (2,436 ) $ 4,161

Refined coal 2,195 959

Corporate and other 212 193

Total (provision) benefit for income taxes $ (29 ) $ 5,313

Net income (loss) attributable to REX common shareholders:

Ethanol & By-Products $ 7,952 $ (7,433 )

Refined coal 480 150

Corporate and other (648 ) (352 )

Net income (loss) attributable to REX common $ 7,784 $ (7,635 )shareholders

(1)

Includes results attributable to non-controlling interests of approximately 24.5% 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, "The operating environment in the first quarter of fiscal 2021 was markedly better than the challenging environment we experienced throughout most of fiscal 2020, with significant improvements to demand and pricing across our ethanol and by-products segments. With all of our high-quality plants in operation, we were able to leverage our strategic locations across the corn belt and healthy liquidity position to generate first quarter net income of $7.8 million and earnings per share of $1.30."

Balance Sheet

At April 30, 2021, REX had cash and cash equivalents and short-term investments of $193.0 million, $45.9 million of which was at the parent company, and $147.1 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.

The following table summarizes select data related to REX'sconsolidated alternative energy interests:

(1) Includes results attributable to non-controlling interests of approximately 24.5% 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, "The operating environment in the first quarter of fiscal 2021 was markedly better than the challenging environment we experienced throughout most of fiscal 2020, with significant improvements to demand and pricing across our ethanol and by-products segments. With all of our high-quality plants in operation, we were able to leverage our strategic locations across the corn belt and healthy liquidity position to generate first quarter net income of $7.8 million and earnings per share of $1.30."

Balance Sheet

At April 30, 2021, REX had cash and cash equivalents and short-term investments of $193.0 million, $45.9 million of which was at the parent company, and $147.1 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.

The following table summarizes select data related to REX'sconsolidated alternative energy interests:

Three Months Ended

April 30,

2021 2020

Average selling price per gallon of ethanol (net of $ 1.79 $ 1.25hedging)

Average selling price per ton of dried distillers grains $ 208.92 $ 145.64

Average selling price per pound of non-food grade corn oil $ 0.33 $ 0.25

Average selling price per ton of modified distillers grains $ 71.54 $ 65.82

Average cost per bushel of grain $ 5.16 $ 3.93

Average cost of natural gas (per MmBtu) $ 3.18 $ 3.93

Supplemental data related to REX's ethanol interests:

REX American Resources CorporationEthanol Ownership Interests/Effective Annual Gallons Shipped as of April 30,2021

(gallons in millions)

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

One Earth Energy, LLC 119.2 75.5% 90.0Gibson City, IL

NuGen Energy, LLC 119.6 99.5% 119.0Marion, SD

Big River Resources WestBurlington, LLC 97.3 10.3% 10.0

West Burlington, IA

Big River Resources Galva, LLC 111.5 10.3% 11.5Galva, IL

Big River United Energy, LLC 113.8 5.7% 6.5Dyersville, IA

Big River Resources Boyceville,LLC 55.8 10.3% 5.7

Boyceville, WI

617.2 n/a 242.7Total

REX further announced today that it had filed additional supplemental proxy materials related to its Annual Shareholder Meeting to be held on June 16, 2021. The additional information related to the voting requirements of Proposal 3, in particular the treatment of abstentions and broker non-votes. Proposal 3, which is an amendment to the Amended Certificate of Incorporation to authorize a new class of Preferred Stock, requires the affirmative vote of holders of a majority of shares entitled to vote at the Annual Meeting. Therefore, abstentions and broker non-votes will have the effect of a vote against the proposal.

First 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 212/231-2911 (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.

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 617 million gallons of ethanol over the twelve-month period ended April 30, 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 243 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

April 30,

2021 2020

Net sales and revenue $ 164,104 $ 83,250

Cost of sales 146,302 92,580

Gross profit (loss) 17,802 (9,330 )

Selling, general and administrative expenses (9,988 ) (4,605 )

Equity in income (loss) of unconsolidated ethanol 570 (477 )affiliates

Interest and other income, net 43 669

Income (loss) before income taxes and

non-controlling interests 8,427 (13,743 )

(Provision) benefit for income taxes (29 ) 5,313

Net income (loss) including non-controlling 8,398 (8,430 )interests

Net (income) loss attributable to non-controlling (614 ) 795 interests

Net income (loss) attributable to REX common $ 7,784 $ (7,635 )shareholders



Weighted average shares outstanding - basic and 6,010 6,304 diluted



Basic and diluted net income (loss) per share $ 1.30 ($ 1.21 )attributable to REX common shareholders



- balance sheets follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

Unaudited

April January 30, 31,

ASSETS 2021 2021

CURRENT ASSETS:

Cash and cash equivalents $ 157,105 $ 144,501

Short-term investments 35,864 36,194

Restricted cash 1,717 1,657

Accounts receivable 27,557 19,713

Inventory 26,687 37,880

Refundable income taxes 6,020 6,020

Prepaid expenses and other 14,831 12,785

Total current assets 269,781 258,750

Property and equipment-net 149,067 153,186

Operating lease right-of-use assets 11,289 12,678

Deferred taxes and other assets 25,977 25,275

Equity method investment 30,026 29,456

TOTAL ASSETS $ 486,140 $ 479,345

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

Accounts payable - trade $ 15,808 $ 16,907

Current operating lease liabilities 4,632 4,875

Accrued expenses and other current liabilities 9,185 8,955

Total current liabilities 29,625 30,737

LONG TERM LIABILITIES:

Deferred taxes 4,294 3,713

Long-term operating lease liabilities 6,327 7,439

Other long-term liabilities 278 273

Total long-term liabilities 10,899 11,425

COMMITMENTS AND CONTINGENCIES

EQUITY:

REX shareholders' equity:

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

Paid in capital 149,144 149,110

Retained earnings 597,770 589,986

Treasury stock, 23,861 shares (354,604 ) (354,612 )

Total REX shareholders' equity 392,609 384,783

Non-controlling interests 53,007 52,400

Total equity 445,616 437,183

TOTAL LIABILITIES AND EQUITY $ 486,140 $ 479,345

- statements of cash flows follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

Unaudited



Three Months Ended

April 30,

2021 2020

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss) $ 8,398 $ (8,430 )

Adjustments to reconcile net income (loss) to net cash

provided by (used in) operating activities:

Depreciation 5,249 5,315

Amortization of operating lease right-of-use assets 1,389 1,347

(Income) loss from equity method investments (570 ) 477

Dividends received from equity method investments - 2,005

Interest income from investments (15 ) (125 )

Deferred income tax 20 (1,748 )

Stock based compensation expense 291 39

Gain on sale of property and equipment - net (3 ) (3 )

Changes in assets and liabilities:

Accounts receivable (7,844 ) 10,197

Inventory 11,193 8,366

Other assets (2,187 ) (3,759 )

Accounts payable-trade (989 ) (11,934 )

Other liabilities (1,369 ) (2,008 )

Net cash provided by (used in) operating activities 13,563 (261 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures (1,267 ) (4,700 )

Purchases of short-term investments (25,930 ) (19,237 )

Sales of short-term investments 26,275 12,834

Other 30 (278 )

Net cash used in investing activities (892 ) (11,381 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Treasury stock acquired - (3,923 )

Payments to noncontrolling interests holders (75 ) (35 )

Capital contributions from minority investor 68 10

Net cash used in financing activities (7 ) (3,948 )

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS

AND RESTRICTED CASH 12,664 (15,590 )

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

CASH, CASH EQUIVALENTS AND RESTRICTED CASH-End of $ 158,822 $ 165,181 period

Non cash financing activities - Stock awards accrued $ 348 $ -

Non cash investing activities - Accrued capital $ 280 $ 457 expenditures

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

upon lease execution $ - $ 1,863

View source version on businesswire.com: https://www.businesswire.com/news/home/20210526005392/en/

CONTACT: Douglas Bruggeman Chief Financial Officer (937) 276?3931

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