Download the Complete Report Here By Brandon Hornback REX American Resources Corp. (NYSE: REX) continued its long-running winning of streak, making it 21 straight profitable quarters. Ethanol volumes edged higher and operational discipline helped offset softer pricing, reinforcing REX’s position as one of the sector’s most reliable performers. Growth investments remain firmly on track: The One Earth Energy expansion, aiming to expand capacity to 200 million gallons, is progressing well toward the targeted ...

  It is early Wednesday morning, meaning the next interest rate announcement from the US Federal Open Market Committee is a week away as its December meeting concludes on Wednesday, December 10. A look at the latest Fed fund futures forward curve (see above) shows the market has priced in another 25-basis point rate cut, with the December futures contract (ZQZ25) at 96.265 putting the expected rate at 3.735%, just below the current range of 3.75% to 4.0%. The talking heads of financial television have p ...

Raízen’s credit score was cut by one notch to junk territory by Moody’s Ratings, with the firm citing a deterioration of debt metrics at Brazil’s largest ethanol producer https://t.co/bwAUNtfLea ...

Core Insights - Green Plains Inc. (GPRE) has completed the sale of its ethanol plant in Rives, TN, to POET Biorefining for a total cash consideration of $190 million, which includes $20 million of working capital to be finalized post-closing [1][8] - The sale is part of a strategic review process initiated in February 2024, aimed at improving operational execution and capital discipline [2] - Proceeds from the sale will be used to pay off junior mezzanine debt due in 2026, thereby strengthening the company's balance sheet and enhancing liquidity [2][8] Financial Impact - The transaction enhances financial flexibility, allowing Green Plains to pursue other strategic opportunities and drive carbon reduction initiatives [3][8] - GPRE's shares have experienced a decline of 32% over the past year, contrasting with a 6.3% decline in the industry [4] Market Position - GPRE currently holds a Zacks Rank of 3 (Hold), while other companies in the Basic Materials sector, such as Agnico Eagle Mines (AEM) and Methanex Corporation (MEOH), have higher rankings [6] - AEM's current-year earnings estimate is $7.11 per share, with a significant share price increase of 116.5% over the past year [7] - MEOH's earnings estimate stands at $3.72 per share, also showing consistent earnings performance [7]

Core Insights - Frontier Infrastructure Holdings LLC has announced a strategic partnership with Gevo, Inc. to create North America's first fully integrated carbon management platform for ethanol producers [1] Group 1: Company Overview - Frontier Infrastructure Holdings LLC is a portfolio company of Tailwater Capital and is recognized as a leading developer of low-carbon infrastructure in the Mountain West and Texas [1] - Gevo, Inc. is involved in the development of sustainable alternatives to fossil fuels, focusing on ethanol production [1] Group 2: Strategic Partnership - The partnership aims to combine rail transportation, permanent sequestration, and digital carbon tracking to enhance decarbonization efforts [1] - This initiative represents a significant advancement in carbon management solutions for the ethanol industry [1]

Core Insights - Green Plains Inc. (GPRE) has agreed to sell its Rives, TN-based ethanol plant to POET for $190 million in cash, which includes $20 million of working capital to be adjusted at transaction closing, reflecting the company's commitment to enhance shareholder value and strengthen its balance sheet [1][8] - The transaction is expected to be completed in the third quarter of this year, pending closing conditions and regulatory approvals [2] - A strategic review conducted by the company concluded that continuing with its current strategy under existing leadership is the best way to deliver shareholder value [3][8] Financial Performance - GPRE's stock has experienced a decline of 21.7% over the past year, contrasting with a 2.1% decline in the industry [5] - The proceeds from the sale will be utilized to repay junior mezzanine debt due in 2026, thereby improving the company's financial position [1][8]

Financial Highlights - Adecoagro's gross revenues for Q2 2025 were $392 million, a decrease of 1% compared to the same period last year[17] - Gross revenues for 6M25 reached $716 million, an increase of 10% compared to the same period last year[17] - Adjusted EBITDA for Q2 2025 was $55 million, a decrease of 60% compared to the same period last year[17] - Adjusted EBITDA for 6M25 was $91 million, a decrease of 60% compared to the same period last year[17] Segment Performance - Sugar, Ethanol & Energy - Sugar, Ethanol & Energy accounted for 77% of gross revenues in Q2 2025[17] - Sugar production decreased by 15% from 233,881 tons in Q2 2024 to 199,175 tons in Q2 2025[30] - Ethanol production decreased by 21% from 143,401 m3 in Q2 2024 to 98,756 m3 in Q2 2025[31] - Adjusted EBITDA for Sugar, Ethanol & Energy business decreased by 36% from $68,100 thousand in Q2 2024 to $106,886 thousand in Q2 2025[42] Farming Business - 296,057 hectares of Crops + Rice were harvested[52] - Soybean harvested area is 91,802 ha[52] - Raw milk production reached 93 million liters[52] - Farming segment experienced a significant decrease in financial performance, with profits dropping by 97% from $37,792 thousand in Q2 2024 to $1,081 thousand in Q2 2025[55] Capital Allocation - Net debt stood at $699 million[62] - 75% of debt is long term debt[63] - 70% of debt is in USD and 30% in BRL[65] - $45.2 million has been committed to shareholder distribution[71]

Company Performance - A Brazilian sugar and ethanol powerhouse backed by Shell is seeking fresh capital due to increased debt [1] - The company's shares experienced a significant decline, reaching an all-time low on Thursday [1] Industry Trends - The sugar and ethanol industry in Brazil is facing challenges that may require companies to seek additional funding [1]

Financial Data and Key Metrics Changes - The company's reported and adjusted net income for Q2 2025 was $8 million, resulting in earnings per diluted share of $0.23, compared to adjusted net income of $39 million or $1.15 per share in 2024 [14] - Revenues increased slightly due to the addition of Skyland, despite overall lower commodity prices [14] - Adjusted EBITDA for Q2 was $65 million, down from $98 million in 2024 [15] Business Line Data and Key Metrics Changes - The Agribusiness segment reported adjusted pretax income of $17 million, down from $33 million in 2024, with adjusted EBITDA of $46 million compared to $56 million in 2024 [18][20] - The Renewables segment generated pretax income of $10 million, down from $23 million in 2024, with EBITDA of $30 million compared to $52 million last year [21][22] Market Data and Key Metrics Changes - The company noted improved fertilizer results due to increased volume and margin driven by high corn plantings [9] - The wheat harvest was completed, and facilities are prepared for increased corn volumes expected at harvest [9] Company Strategy and Development Direction - The company has acquired its partner's share of four ethanol plants, which is expected to be immediately accretive to EPS and align reported EPS and EBITDA [12][13] - The company is focused on pursuing additional opportunities in ethanol and renewable feedstocks, with plans to improve efficiencies and lower carbon intensity [24][27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for the second half of the year, anticipating improvements in the Agribusiness segment as the fall harvest approaches [23] - The company is evaluating additional growth projects and acquisitions aligned with its strategy, with a target of achieving a run rate EPS of approximately $4.3 per share by 2026 [27][28] Other Important Information - The company generated cash flow from operations of $43 million in Q2, down from $89 million in 2024, but continues to demonstrate positive cash flows throughout the ag cycle [16] - Capital spending for Q2 was $49 million, up from $29 million in 2024, with expectations to reach $200 million for the year [17] Q&A Session Summary Question: Did the timing of the ethanol transaction correlate with regulatory tailwinds? - Management indicated that while they have been looking at ethanol capacity for eight quarters, the recent regulatory changes did not materially affect the transaction timing [32] Question: Can you characterize the non-strategic exits in the Agribusiness segment? - Management noted a financial impact of about $7 million from minority investments and a few million dollars from the sale of underperforming facilities [34][35] Question: What is the outlook for merchandising and storage in the second half of the year? - Management expects improved opportunities for both merchandising and storage due to a large corn crop [38] Question: Why was acquiring the balance of the ethanol assets the right move now? - Management stated that acquiring the remaining 50% of the ethanol plants allows for better capital deployment and full earnings benefits without integration risk [42] Question: What is the updated outlook for ethanol margins? - Management believes the second half of 2025 will be better than the first half, with opportunities to drive more free cash flow from the plants [49] Question: How does the Port of Houston investment work with lower soybean meal prices? - Management explained that the price of soybean meal will drive it to export parity, making the investment competitive despite lower prices [53] Question: What was the revenue contribution from Skyland in the quarter? - Management reported revenue of about $200 million from Skyland in each of the first two quarters, with a revised EBITDA outlook for the full year of $25 million to $30 million [62]

Core Insights - The Andersons, Inc. reported its financial results for the second quarter ended June 30, 2025, and announced the acquisition of full ownership interest in The Andersons Marathon Holdings LLC (TAMH) [1][2][4]. Strategic Acquisition - The acquisition of TAMH, which operates four ethanol plants with a total annual production capacity of 500 million gallons, aligns with the company's strategy to grow earnings through investments in ethanol [2][4]. - This transaction doubles the company's financial ownership in the ethanol industry, a key growth area within its Renewables strategy, and is expected to provide immediate accretion in earnings per share [2][4][5]. Financial Performance - For Q2 2025, the company reported a pretax income of $24.8 million, down from $57.3 million in Q2 2024, with net income attributable to the company of $7.9 million compared to $36 million in the prior year [7][8]. - Adjusted EBITDA for Q2 2025 was $65 million, a decrease from $98.3 million in Q2 2024 [9][39]. - The company’s cash provided by operating activities was $299 million in Q2 2025, slightly down from $304 million in Q2 2024 [6]. Segment Overview - The Agribusiness segment recorded a pretax income of $19 million, down from $29 million in Q2 2024, while the Renewables segment reported a pretax income of $17 million, down from $39 million in the same period [10][13]. - The Renewables segment's adjusted EBITDA was $30 million in Q2 2025, compared to $52 million in Q2 2024 [17][39]. Cash and Debt Management - The company funded the acquisition of TAMH with cash on hand and existing credit facilities, maintaining a modest level of debt and remaining below its long-term debt to EBITDA target of less than 2.5 times [6][18]. - Cash and cash equivalents at the end of Q2 2025 were $350.97 million, down from $561.77 million at the end of 2024 [26][28]. Future Outlook - The company anticipates a large fall harvest and expects to benefit from increased support for renewable fuels, which may enhance its operational efficiency and profitability [3][12][16].