The Andersons, Inc. Reports Third Quarter Results

04 Nov, 2015, 16:01 ET from The Andersons, Inc.

Third Quarter Loss of $0.04 per Diluted Share; Dividend increased for First Quarter 2016

MAUMEE, Ohio, Nov. 4, 2015 /PRNewswire/ -- The Andersons, Inc. (NASDAQ: ANDE) announces financial results for the third quarter ended September 30, 2015.

Highlights

  • Rail Group has continued strong performance
  • Quarterly dividend to be increased 11 percent
  • Grain Group performance down due to significant decline in equity earnings and lower core grain business results
  • Plant Nutrient Group results adversely impacted by ongoing and one-time costs associated with recent acquisitions, lower demand, and a cob business impairment

"The Rail Group had a great quarter as they continued to benefit from their focus on asset management, which has led to higher lease and utilization rates. The Ethanol Group also had good results, despite margins being down, as they continued to increase throughput due to various process improvements they have made," said Chairman Mike Anderson.  "Overall, however, this was a disappointing quarter primarily due to the results of our Grain and Plant Nutrient groups.    

"We are confident in our future earning potential and we have again raised our dividend.  It has increased from 14 cents to 15 1/2 cents per share; this will be effective with the next planned dividend to be paid on January 25, 2016 to holders of record as of January 4, 2016," concluded Anderson.

Key Highlights The loss during the third quarter of 2015 attributable to the Company was $1.2 million, or $0.04 per diluted share.  Last year, third quarter net income was $16.8 million, or $0.59 per diluted share.  Net income through September this year was $34.0 million, or $1.19 per diluted share.  Adjusted net income through September of 2014 was $73.2 million, or $2.57 per diluted share.  (See the Reconciliation to Adjusted Net Income Table attached for further explanation.)  Third quarter 2015 revenues were $936 million compared to $953 million in the prior year.

  • The Rail Group achieved pre-tax income of $11.9 million this quarter led by strong base leasing business results and continuing improvement in the railcar repair business.  The utilization rate ended the third quarter at 92.2 percent.   
  • Despite ethanol margins being down significantly, the Ethanol Group had a good quarter due to strong operational execution.  The group achieved record third quarter ethanol production volumes.
  • The Grain Group's performance was down year over year by $12.3 million due to a significant decrease in equity earnings from affiliates and lower results in the core grain business.
  • The Plant Nutrient Group's performance included a $4.5 million negative impact related to recent acquisitions, which were not expected to be accretive this quarter.  The legacy portion of the business continued to see a reduction of nutrient purchasing this quarter.   The group's results were further impacted by a $2.0 million goodwill impairment charge in the Cob business.   

Conference Call The Company will host a webcast on Thursday, November 5, 2015 at 11:00 A.M. ET, to discuss its performance.  To dial-in to the call, the number is 866-439-8514 (participant passcode is 60752097).  It is recommended that you call 10 minutes before the conference call begins. 

To access the webcast: Click on the link: http://edge.media-server.com/m/p/dybuefmq/lan/en  Log on.  Click on the phone icon at the bottom of the "webcast window" on the left side of the screen.  Then, you will be provided with the conference call number and passcode.  Click the gear set icon (left of the telephone icon) and select 'Live Phone' to synchronize the presentation with the audio on your phone.  A replay of the call can also be accessed under the heading "Investor" on the Company website at www.andersonsinc.com.  

Forward Looking Statements 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.

Company Description Founded in Maumee, Ohio, in 1947, The Andersons is a diversified Company rooted in agriculture conducting business across North America in the grain, ethanol, plant nutrient and rail sectors. The Company also has a consumer retailing presence. For more information, visit The Andersons online at www.andersonsinc.com.

The Andersons, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

Three months ended  September 30,

Nine months ended  September 30,

(in thousands, except per share data)

2015

2014

2015

2014

Sales and merchandising revenues

$   935,774

$   952,927

$  3,094,355

$  3,268,303

Cost of sales and merchandising revenues

850,584

868,009

2,817,681

2,985,115

Gross profit

85,190

84,918

276,674

283,188

Operating, administrative and general expenses

88,698

76,737

251,044

223,997

Interest expense

6,147

4,253

16,210

16,401

Other income:

Equity in earnings of affiliates

3,845

23,917

23,295

76,631

Other income, net

3,355

1,685

20,235

25,094

Income before income taxes

(2,455)

29,530

52,950

144,515

Income tax provision

(1,505)

10,251

17,556

49,837

Net income

(950)

19,279

35,394

94,678

Net income attributable to the noncontrolling interests

277

2,454

1,433

10,844

Net income attributable to The Andersons, Inc.

$      (1,227)

$     16,825

$        33,961

$       83,834

Per common share:

Basic earnings attributable to The Andersons, Inc. common shareholders

$         (0.04)

$         0.59

$            1.19

$           2.95

Diluted earnings attributable to The Andersons, Inc. common shareholders

$         (0.04)

$         0.59

$            1.19

$           2.95

Dividends declared

$           0.14

$         0.11

$            0.42

$           0.33

 

 

The Andersons, Inc.

Reconciliation to Adjusted Net Income

(Unaudited)

Three months ended  September 30,

Nine months ended  September 30,

(in thousands, except per share data)

2015

2014

2015

2014

Net income attributable to The Andersons, Inc.

$    (1,227)

$  16,825

$  33,961

$      83,834

Items impacting other income, net:

Partial redemption of investment in Lansing Trade Group

-

-

-

(10,656)

Total adjusting items

-

-

-

(10,656)

Adjusted net income attributable to The Andersons, Inc.

$    (1,227)

$  16,825

$  33,961

$      73,178

Diluted earnings attributable to The Andersons, Inc. common shareholders

$       (0.04)

$      0.59

$      1.19

$          2.95

Impact on diluted earnings per share

-

-

-

(0.38)

Adjusted diluted earnings per share

$       (0.04)

$      0.59

$      1.19

$          2.57

 

 

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

(in thousands)

September 30, 2015

December 31, 2014

September 30, 2014

Assets

Current assets:

Cash and cash equivalents

$                  40,658

$                 114,704

$                  326,946

Restricted cash

181

429

173

Accounts receivable, net

201,664

183,059

162,270

Inventories

527,789

795,655

396,464

Commodity derivative assets – current

60,965

92,771

126,396

Deferred income taxes

6,735

7,337

148

Other current assets

66,411

60,492

36,518

Total current assets

904,403

1,254,447

1,048,915

Other assets:

Commodity derivative assets – noncurrent

1,584

507

2,383

Other assets, net

220,355

131,527

113,141

Pension asset

-

-

13,738

Equity method investments

223,207

226,857

257,166

445,146

358,891

386,428

Rail Group assets leased to others, net

347,100

297,747

245,849

Property, plant and equipment, net

495,045

453,607

401,800

Total assets

$            2,191,694

$              2,364,692

$               2,082,992

Liabilities and equity

Current liabilities:

Short-term debt

$                  82,801

$                     2,166

$                         451

Trade and other payables

466,428

706,823

387,311

Customer prepayments and deferred revenue

23,581

99,617

27,246

Commodity derivative liabilities – current

49,911

64,075

229,265

Accrued expenses and other current liabilities

71,593

78,610

70,598

Current maturities of long-term debt

26,989

76,415

76,757

Total current liabilities

721,303

1,027,706

791,628

Other long-term liabilities

16,510

15,507

13,902

Commodity derivative liabilities – noncurrent

2,912

3,318

26,203

Employee benefit plan obligations

58,123

59,308

39,606

Long-term debt, less current maturities

413,561

298,638

289,448

Deferred income taxes

179,591

136,166

120,628

Total liabilities

1,392,000

1,540,643

1,281,415

Total equity

799,694

824,049

801,577

Total liabilities and equity

$            2,191,694

$              2,364,692

$               2,082,992

 

The Andersons, Inc.

Segment Data

(Unaudited)

(in thousands)

Grain

Ethanol

Plant Nutrient

Rail

Retail

Other

Total

Three months ended September 30, 2015

Revenues from external customers

$     570,626

$  139,140

$  149,303

$  44,758

$  31,947

$         —

$     935,774

Gross profit

29,926

6,265

22,320

17,491

9,188

85,190

Equity in earnings of affiliates

1,340

2,505

3,845

Other income, net

618

36

947

2,093

92

(431)

3,355

Income (loss) before income taxes

129

6,167

(11,114)

11,913

(769)

(8,781)

(2,455)

Income (loss) attributable to the noncontrolling interests

(2)

279

277

Income (loss) before income taxes attributable to The Andersons, Inc. (a)

$            131

$      5,888

$  (11,114)

$  11,913

$     (769)

$ (8,781)

$       (2,732)

-

Three months ended September 30, 2014

-

Revenues from external customers

$     575,354

$  179,405

$  133,440

$  32,022

$  32,706

$       —

$     952,927

Gross profit

32,748

12,770

19,240

10,841

9,319

84,918

Equity in earnings of affiliates

10,190

13,727

23,917

Other income (expense), net

(2,354)

71

2,861

792

418

(103)

1,685

Income (loss) before income taxes

12,447

23,709

(3,014)

4,160

(968)

(6,804)

29,530

Income (loss) attributable to the noncontrolling interest

(2)

2,456

2,454

Income (loss) before income taxes attributable to The Andersons, Inc. (a)

$       12,449

$    21,253

$    (3,014)

$    4,160

$     (968)

$  (6,804)

$       27,076

Grain

Ethanol

Plant Nutrient

Rail

Retail

Other

Total

Nine months ended September 30, 2015

Revenues from external customers

$ 1,781,104

$  416,752

$  660,440

$ 134,497

$ 101,562

$        —

$ 3,094,355

Gross profit

84,656

18,394

90,984

53,062

29,578

276,674

Equity in earnings of affiliates

10,764

12,531

23,295

Other income, net

2,682

83

2,441

14,766

284

(21)

20,235

Income (loss) before income taxes

4,016

22,274

8,183

43,915

(1,483)

(23,955)

52,950

Income (loss) attributable to the noncontrolling interests

(8)

1,441

1,433

Income (loss) before income taxes attributable to The Andersons, Inc. (a)

$         4,024

$    20,833

$      8,183

$  43,915

$   (1,483)

$ (23,955)

$       51,517

-

Nine months ended September 30, 2014

-

Revenues from external customers

$  1,814,517

$  594,613

$  639,603

$ 117,733

$ 101,837

$          —

$  3,268,303

Gross profit

77,665

38,773

90,328

46,569

29,853

283,188

Equity in earnings of affiliates

20,541

56,090

76,631

Other income, net

16,967

201

4,211

2,289

720

706

25,094

Income (loss) before income taxes

34,102

85,833

23,952

25,889

(1,666)

(23,595)

144,515

Income (loss) attributable to the noncontrolling interest

(8)

10,852

10,844

Income (loss) before income taxes attributable to The Andersons, Inc. (a)

34,110

74,981

23,952

25,889

(1,666)

(23,595)

133,671

(a) Income (loss) before income taxes attributable to The Andersons, Inc. 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).

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SOURCE The Andersons, Inc.



RELATED LINKS

http://www.andersonsinc.com