REX American Resources (US:REX)2025-03-26 20:31Financial Data and Key Metrics Changes - Fiscal year 2024 saw ethanol sales volume increase to 289.7 million gallons from 285.9 million gallons in 2023, with Q4 volumes at 74.7 million gallons compared to 72.1 million gallons in Q4 2023 [15][5] - Gross profit for fiscal year 2024 was $91.5 million, down from $98.2 million in 2023, with Q4 gross profit at $17.6 million compared to $30.4 million in Q4 2023 [18][19] - Net income attributable to REX shareholders for the year was $58.2 million, down from $60.9 million in fiscal year 2023, with Q4 net income at $11.1 million compared to $20.6 million in Q4 2023 [20][21] - Selling, general and administrative expenses decreased to $27.1 million for fiscal year 2024 from $29.4 million in 2023, with Q4 expenses at approximately $6.2 million compared to $7.4 million in Q4 2023 [19] Business Line Data and Key Metrics Changes - Dry distillers grain sales volumes decreased by 3% to 632,000 tons in fiscal year 2024 from 652,000 tons in 2023, with Q4 volumes down by approximately 2% [16] - Modified distillers grain sales volumes increased to 70,000 tons in fiscal year 2024 from 54,000 tons in 2023, with Q4 volumes up by approximately 11% [16] - Corn oil sales volume increased by approximately 1% to 88.1 million pounds in fiscal year 2024 compared to 87.5 million pounds in 2023, with Q4 volumes up by 7% [17] Market Data and Key Metrics Changes - U.S. ethanol exports reached a record high of 1.9 billion gallons in 2024, supporting pricing throughout the year [24] - Canada accounted for approximately 36% of U.S. ethanol exports, while Mexico represented about 21% of U.S. DDG exports in 2024 [25] Company Strategy and Development Direction - The company is focused on efficient and profitable operations while pursuing growth projects, including carbon capture and ethanol facility expansion [6][10] - A share repurchase program is in place, with 373,000 shares repurchased in Q4 and an additional 282,000 shares in Q1 of fiscal year 2025 [7][21] - The company is monitoring policy changes that could impact the ethanol market, including potential tariffs on exports and the debate around year-round E15 blending [24][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for a profitable Q1 2025, which would mark the nineteenth consecutive profitable quarter [23] - The company is closely watching regulatory developments and market conditions to make informed decisions [23][24] Other Important Information - The total cash, cash equivalents, and short-term investments at the end of the fiscal year were $359.1 million, down from $378.7 million in 2023, primarily due to capital expenditures and share repurchases [21][22] - The company ended the year without any bank debt [22] Q&A Session Summary Question: Details on higher capital budget for expansion project - Management explained that the increase in budget is due to the need for energy-efficient equipment capable of handling future production increases, which has also extended the project timeline [29][31] Question: Update on regulatory and permitting side - Management discussed the new FSMA rules and the current review process under the new administration, indicating that previous regulations are under review and may be invalid for implementation [33] Question: Dialogue with EPA on Class VI well permitting - Management confirmed that communication with the EPA has resumed and they are optimistic about moving forward with the permitting process [37][38]