MAUMEE, OHIO, U.S. — Due to a slow start of the growing season, The Andersons, Inc. announced on May 5 that income for the first quarter dropped nearly 82% to $4.1 million or 14¢ per share, from $22.7 million or 80¢ per share in the same period a year earlier.
When excluding the partial redemption of the company’s investment in Lansing Trade Group last year, adjusted net income was $12.1 million, or 42¢ per diluted share.
Quarterly revenue was down 5% to $950 million, compared to revenues of $1 billion a year earlier.
"As expected we experienced a soft start to 2015, yet conditions in the markets we serve give us optimism for the full year. During the first quarter we delivered year-over-year improvements in our core grain and rail leasing businesses. Additionally, our Ethanol Group remained profitable despite reduced industry margins during the seasonally weak first quarter," said Chief Executive Officer Mike Anderson. "Also, we are successfully integrating our 2014 acquisitions which contributed more than $1 million in pre-tax income for the quarter."
The Ethanol Group achieved record first quarter ethanol production volumes and saw E-85 sales progress to a first quarter record as well.
The Rail Group's utilization rate has increased for nine consecutive quarters and averaged 91.8% during the quarter. The Rail Group's lower pre-tax income was due to gains on railcar sales being down $6.3 million this quarter versus the same time last year.
The Plant Nutrient Group experienced lower volumes than expected this quarter due to poor weather conditions at the start of the planting season.
This quarter, the company has merged the former Turf & Specialty and Plant Nutrient groups. Going forward the group will be known as the Plant Nutrient Group.
Solid fundamentals supporting the company's core businesses continue into 2015. Corn acres to be planted in 2015 are estimated to be approximately 89 million acres, which is down slightly from 2014. Bean acres to be planted are estimated to be roughly 85 million acres, which is up slightly from 2014.
The anticipated corn acres creates a good environment for all three of the company's agricultural businesses, the company said.
Lower volume experienced by the Plant Nutrient Group during the past two quarters is expected to be substantially regained in the second quarter provided the weather is cooperative.
Relative to the first quarter, ethanol margins have improved which provides optimism for the Ethanol Group's performance going forward.
The Rail Group is expected to have strong results as it continues to benefit from increased lease and utilization rates.