MAUMEE, OHIO, U.S. — The Andersons, Inc. announced on Nov. 5 that net income attributable to the company for the third quarter was $16.8 million or 59¢ per share, down from $17.2 million or 61¢ per share for the same period a year ago.
The company’s Ethanol Group saw record operating income of $21.3 million.
“We’re pleased with our results through September, which set a record. Our earnings this year clearly have been led by the outstanding results of our Ethanol Group,” said Chief Executive Officer Mike Anderson. “I want to mention, however, that current ethanol market indications for 2015 show margins declining from the levels we have seen this year.
“We continue to grow, both organically and by acquisition, including the purchase of Auburn Bean and Grain in October, which added grain and agronomy locations throughout north central Michigan. This is an area of strategic significance to the company as it connects our existing locations to our Thompsons joint venture in Ontario. This acquisition increased our grain storage capacity by 13 percent, and our nutrient storage by 4 percent.”
Revenues were down in the Grain and Ethanol groups due to lower commodity prices. The majority of the decrease was within the Grain Group where the average price per bushel sold decreased by 36%, which more than offset the 11% increase in bushels sold.
The Ethanol Group realized solid margins at all plants. These margins were primarily supported by strong export demand, lower corn prices, and solid operating metrics. The Ethanol Group had record E-85 sales
Volume for the Plant Nutrient Group was up almost 25% during the third quarter; however, this was partially offset by lower gross profit per ton.
The Rail Group’s income was down this quarter due in part to the group recognizing $4.3 million in income from the settlement of two non-performing leases last year, and a significant increase in freight expense to move idle cars into service.
It should be noted that poor railroad service could impact the company in the fourth quarter, the company said. Both the Grain and Ethanol groups rely on outbound rail service to turn their inventory, which enables them to effectively serve their customers. Further, the Plant Nutrient Group relies on inbound rail to ensure nutrients are available to meet customer needs.
Integration of the Auburn Bean and Grain (AB&G), United Grain, LLC and Keller Grain, Inc. acquisitions is under way. AB&G added grain storage capacity of about 18.1 million bushels, and 16,000 tons of dry and 3.7 million gallons of liquid nutrient capacity.
All four ethanol plants had scheduled maintenance shut-downs during the third quarter. These went well, and new daily production records have been set since the maintenance was performed.