Green Plains(GPRE) - 2025 Q1 - Quarterly Results

Green Plains First Quarter 2025 Financial Results Green Plains reported a wider net loss and Adjusted EBITDA loss in Q1 2025, while advancing strategic carbon reduction projects, achieving significant cost savings, and enhancing liquidity Q1 2025 Financial Highlights Green Plains reported a net loss of $72.9 million, or ($1.14) per diluted share, for the first quarter of 2025, an increase from the $51.4 million net loss in Q1 2024, with revenues seeing a slight increase to $601.5 million, while Adjusted EBITDA showed a larger loss of ($24.2) million compared to ($21.5) million in the prior-year period Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $601.5 million | $597.2 million | | Net Loss Attributable to Company | $72.9 million | $51.4 million | | Diluted Loss Per Share | ($1.14) | ($0.81) | | Adjusted EBITDA | ($24.2) million | ($21.5) million | Management Commentary Management emphasized progress on strategic initiatives, including the 'Advantage Nebraska' carbon reduction project, which is on track for a Q4 2025 startup, having achieved $45 million in annualized cost savings, nearing its $50 million target, and positioning the company to deliver positive EBITDA for the remainder of the year under current market conditions, with steps also taken to enhance liquidity and monetize non-core assets - The 'Advantage Nebraska' carbon reduction project is under construction and on track for a Q4 2025 startup[5] - The company has achieved approximately $45 million of its $50 million annualized cost savings target, with corporate and trade SG&A expected to have a run rate in the low $40 million range by year-end[5] - Management expects to deliver positive EBITDA for the remainder of the year, based on current market conditions, due to cost reductions and a disciplined hedging program[5] - The company is focused on enhancing liquidity and monetizing non-core assets to strengthen its balance sheet and reduce its cost structure[5] Operational and Strategic Developments The company initiated carbon capture construction, secured new marketing and credit agreements, and underwent corporate reorganization, while experiencing decreased ethanol production volumes and wider operating losses across key segments Highlights and Recent Developments The company highlighted several key developments, including the commencement of construction for its Nebraska carbon capture project, a new marketing agreement with Eco-Energy, LLC, and significant corporate reorganization to reduce costs, additionally refreshing its Board of Directors, extending the maturity of its Mezzanine Notes, and securing a new revolving credit facility - Commenced construction on its carbon capture and storage initiative in Nebraska, targeting a Q4 2025 start-up[8] - Selected Eco-Energy, LLC as its exclusive ethanol marketer in April 2025 to optimize value and supply chain efficiency[8][9] - Entered into a Cooperation Agreement with Ancora Holdings Group, LLC, appointing three new independent board members[9] - Extended the maturity of its $125 million Mezzanine Note facility to May 15, 2026, and entered into a new $30 million secured revolving credit facility with Ancora[9] Results of Operations In Q1 2025, ethanol production volumes decreased to 195.3 million gallons from 207.9 million gallons year-over-year, with the consolidated ethanol crush margin worsening to a loss of ($14.7) million compared to a loss of ($9.3) million in Q1 2024, and the overall net loss increasing by $21.5 million, primarily due to lower margins in the ethanol production and agribusiness segments, along with $16.6 million in restructuring costs Ethanol Production & Crush Margin | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Ethanol Gallons Sold | 195.3 million | 207.9 million | | Consolidated Ethanol Crush Margin | ($14.7) million | ($9.3) million | - Consolidated revenues increased slightly by $4.3 million due to higher ethanol and natural gas prices, which was offset by lower sales volumes of ethanol, distillers grains, and renewable corn oil[7] - The net loss increase of $21.5 million was driven by weaker segment margins and $16.6 million in restructuring costs incurred during the quarter[10] Segment Performance The Ethanol Production segment's operating loss widened to ($39.6) million from ($33.7) million year-over-year, with revenues slightly decreasing, while the Agribusiness and Energy Services segment saw a significant drop in operating income to $1.5 million from $6.0 million, despite a 10.9% increase in revenue, and Corporate activities' operating loss increased, partly due to $10.3 million in restructuring costs Segment Operations (Three Months Ended March 31) | Segment | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Ethanol Production | Revenues | $497,772 | $505,659 | (1.6)% | | | Operating Loss | $(39,550) | $(33,653) | 17.5% | | | Adjusted EBITDA | $(19,416) | $(13,621) | 42.5% | | Agribusiness & Energy | Revenues | $109,829 | $98,996 | 10.9% | | | Operating Income | $1,533 | $6,004 | (74.5)% | | | Adjusted EBITDA | $3,156 | $7,056 | (55.3)% | - Corporate activities included $10.3 million of restructuring costs related to the company's cost reduction initiative and the departure of its CEO[14] Selected Operating Data (Three Months Ended March 31) | Product | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Ethanol (million gallons) | 195.3 | 207.9 | (6.0)% | | Distillers grains (thousand tons) | 417 | 469 | (11.1)% | | Ultra-High Protein (thousand tons) | 68 | 60 | 13.3% | - The consolidated ethanol crush margin deteriorated to ($14.7) million in Q1 2025 from ($9.3) million in Q1 2024[18] Financial Position and Outlook Green Plains maintained substantial cash and credit availability, with improved corporate liquidity, while acknowledging that forward-looking statements are subject to significant risks and uncertainties Liquidity and Capital Resources As of March 31, 2025, Green Plains had $126.6 million in total cash and restricted cash, with $204.5 million available under a revolving credit facility, and total corporate liquidity was $48.6 million at quarter-end but improved to $89.2 million by May 7, 2025, with total debt outstanding at $571.8 million Liquidity Position | Metric | As of March 31, 2025 | | :--- | :--- | | Total Cash & Restricted Cash | $126.6 million | | Available Revolving Credit | $204.5 million | | Total Debt Outstanding | $571.8 million | | Total Corporate Liquidity | $48.6 million | - Total corporate liquidity increased significantly from $48.6 million on March 31, 2025, to $89.2 million as of May 7, 2025[21] Forward-Looking Statements The report contains forward-looking statements regarding future growth, profitability, and strategic plans, which are subject to numerous risks and uncertainties, including industry conditions, commodity market risks, and economic factors, that could cause actual results to differ materially, and the company directs investors to its SEC filings for a more complete discussion of these risks - Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from projections, and investors should not place undue reliance on them[25] - Key risks include failure to realize benefits from new products, sustained adverse conditions in the ethanol industry, commodity market volatility, and changes in government policy[25][26] - The company does not intend to update forward-looking statements except as required by law and refers to the 'Risk Factors' in its Form 10-K for more details[27] Consolidated Financial Statements The company's Q1 2025 financial statements show a decrease in total assets and liabilities, a wider net loss despite slightly increased revenues, and increased cash usage in operating activities Condensed Consolidated Balance Sheets As of March 31, 2025, total assets were $1.67 billion, down from $1.78 billion at year-end 2024, with the decrease primarily driven by a reduction in cash and inventories, and total liabilities also decreased to $859.4 million from $907.6 million, mainly due to lower accounts payable, while total stockholders' equity stood at $807.2 million Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $98,610 | $173,041 | | Total current assets | $450,310 | $569,032 | | Total assets | $1,666,572 | $1,782,174 | | Liabilities & Equity | | | | Total current liabilities | $325,735 | $385,687 | | Total liabilities | $859,384 | $907,637 | | Total stockholders' equity | $807,188 | $874,537 | Consolidated Statements of Operations For the first quarter of 2025, Green Plains reported revenues of $601.5 million, a slight increase from $597.2 million in Q1 2024, however, a rise in cost of goods sold and SG&A expenses led to a wider operating loss of ($62.3) million, compared to ($44.9) million in the prior-year period, with the net loss attributable to the company being ($72.9) million, or ($1.14) per share Statement of Operations Highlights (Three Months Ended March 31, in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Revenues | $601,515 | $597,214 | | Cost of goods sold | $598,476 | $588,847 | | Selling, general and administrative expenses | $42,912 | $31,769 | | Operating loss | $(62,260) | $(44,889) | | Net loss attributable to Green Plains | $(72,906) | $(51,412) | | Diluted loss per share | $(1.14) | $(0.81) | Condensed Consolidated Statements of Cash Flows For the three months ended March 31, 2025, net cash used in operating activities was ($55.0) million, a larger outflow than the ($50.6) million used in the same period of 2024, with net cash used in investing activities at ($20.7) million, primarily for property and equipment purchases, and financing activities using ($7.0) million, resulting in a net decrease in cash, cash equivalents, and restricted cash of ($82.8) million for the quarter Cash Flow Summary (Three Months Ended March 31, in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(55,041) | $(50,599) | | Net cash used in investing activities | $(20,710) | $(30,203) | | Net cash used in financing activities | $(7,041) | $(20,578) | | Net change in cash | $(82,792) | $(101,380) | Non-GAAP Financial Measures The company reconciled its Q1 2025 net loss to Adjusted EBITDA, highlighting the impact of restructuring costs on its non-GAAP financial performance Reconciliation of Net Loss to Adjusted EBITDA The company provides a reconciliation from its GAAP Net Loss to the non-GAAP measure of Adjusted EBITDA, where for Q1 2025, the net loss of ($72.6) million was adjusted for interest, taxes, D&A, and $16.6 million in restructuring costs, resulting in an Adjusted EBITDA of ($24.2) million, which compares to an Adjusted EBITDA of ($21.5) million in Q1 2024 - Management uses non-GAAP measures like EBITDA and Adjusted EBITDA to measure financial performance, with Adjusted EBITDA including adjustments for items like restructuring costs[23] Reconciliation of Net Loss to Adjusted EBITDA (Three Months Ended March 31, in thousands) | Line Item | 2025 | 2024 | | :--- | :--- | :--- | | Net loss | $(72,641) | $(51,122) | | Interest expense | 8,913 | 7,786 | | Income tax expense | (165) | 329 | | Depreciation and amortization | 22,387 | 21,487 | | EBITDA | (41,506) | (21,520) | | Restructuring costs | 16,587 | — | | Other adjustments | 735 | 45 | | Adjusted EBITDA | $(24,184) | $(21,475) |