The Andersons, Inc. Reports Third Quarter Results

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

MAUMEE, Ohio, Nov. 4, 2015 /CNW/ -- 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).















Logo - http://photos.prnewswire.com/prnh/20081104/CLTU081LOGO

SOURCE The Andersons, Inc.

For further information: Investor Relations - Jim Burmeister, Phone: 419-891-5848, E-mail: Jim_Burmeister@andersonsinc.com, http://www.andersonsinc.com


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