First Quarter Performance Review The Andersons, Inc

The Andersons, Inc. (Nasdaq: ANDE) Unveils First Quarter Financial Results”

Key Points from the First Quarter:

  • The company disclosed a net income attributable to The Andersons of $6 million, equivalent to $0.16 per diluted share, which is comparable on an adjusted basis.
  • EBITDA stood at $51 million for the quarter.
  • The Renewables sector reported pretax income of $23 million, with adjusted pretax income attributable to The Andersons reaching $13 million due to robust operating performance.
  • Trade generated adjusted pretax income of $9 million.
  • Nutrient & Industrial displayed significant improvement compared to Q1 2023.

Pat Bowe, President, and CEO of The Andersons, commented on the results, noting that the first quarter mirrored the previous year’s performance in many aspects. He highlighted the exceptional performance of Renewables, which doubled its results from 2023, driven by stellar operations in ethanol plants. Nutrient & Industrial showed notable progress in its agricultural product lines. Trade faced challenges compared to the record first quarter of the previous year but still achieved above-average results amid quiet agricultural markets.

Bowe expressed awareness of market sluggishness, attributing it to farmers’ reluctance in a lower-price environment and softer global demand for U.S. crops. He also noted the return of carry in wheat markets and anticipated an increase in wheat storage rates.

Looking ahead, Bowe emphasized the company’s proactive pursuit of growth opportunities across its businesses. In Renewables, this includes capital projects aimed at reducing the carbon intensity of ethanol plants, expected to yield positive financial results. The company is also expanding its volume merchandised by its renewable diesel feedstock team. Despite current refinery delays impacting margins, Bowe expects improvement as the industry expands. In Trade, partnerships with consumer products companies to source lower-carbon commodities from growers are underway. Nutrient & Industrial recently acquired Reed and Perrine, expanding its Turf business geographically.

Brian Valentine, Executive Vice President, and CFO, highlighted the company’s strong cash flows, maintaining a higher-than-normal cash position due to recent strong cash flows and lower commodity prices. He reassured that the company remains well below its long-term debt to EBITDA target and has ample capacity for growth.

The company’s cash from operating activities was $240 million and $334 million in Q1 2024 and 2023, respectively. Cash from operations before working capital changes was $48 million and $41 million in the same periods, respectively, with $27 million spent on capital projects in Q1 2024, a slight increase from 2023.

Segment Overview for the First Quarter:

  • Trade segment reported pretax income of $6 million and adjusted pretax income of $9 million, compared to $39 million and $24 million, respectively, in Q1 2023.
  • Renewables segment reported pretax income of $23 million and adjusted pretax income of $13 million, contrasting with a pretax loss of $83 million and adjusted pretax income of $6 million in Q1 2023.
  • Nutrient & Industrial segment reported a pretax loss of $2 million, an improvement from a $10 million loss in Q1 2023, driven by increased volumes and margins in core agricultural product lines.

Despite a seasonally slow period in the first quarter, Nutrient & Industrial anticipates strong demand in the upcoming weeks, contingent on improved planting conditions.

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