REX American Resources Reports All Time Record Net Income Per Share Attributable to REX Common Shareholders of $1.49 for Its Fiscal 2023 Third Quarter

DAYTON, Ohio--(BUSINESS WIRE)--REX American Resources Corporation (NYSE: REX) ("REX" or "the Company") today reported financial results for its fiscal 2023 third quarter ("Q3 '23") ended October 31, 2023. REX management will host a conference call and webcast today at 11:00 a.m. ET.

Conference Call:				212/231-2938
Webcast / Replay URL:				www.rexamerican.com
				The webcast will be available for replay for 30 days.

REX American Resources' Q3 '23 results principally reflect its interests in six ethanol production facilities. The One Earth Energy, LLC ("One Earth") and NuGen Energy, LLC ("NuGen") ethanol production facilities are consolidated, while the four other ethanol plants are reported as equity in income of unconsolidated ethanol affiliates.

REX's Q3 '23 net sales and revenue were $221.1 million, compared with $220.3 million in Q3 '22. The year-over-year net sales and revenue increase primarily reflects a 10.4% increase in the quantities of ethanol sold, partially offset by lower prices for ethanol, dried and modified distillers grains, and corn oil. Q3 '23 gross profit increased 323.7% to $39.3 million, from $9.3 million in Q3 '22, primarily reflecting decreased input costs, including lower corn and natural gas pricing. As a result, income before income taxes and non-controlling interests was $41.3 million, compared with $6.1 million in the comparable year-ago period.

Net income attributable to REX common shareholders was $26.1 million in Q3 '23 compared with $3.2 million in Q3 '22. This led to Q3 '23 basic and diluted net income per share attributable to REX common shareholders of $1.49, an all time quarterly record, compared to $0.18 per share in Q3 '22. Per share results for the Q3 '23 and Q3 '22 periods are based on 17,531,000 and 17,591,000 diluted weighted average shares outstanding, respectively.

REX American Resources' Chief Executive Officer, Zafar Rizvi, commented, "Our fiscal third quarter results mark the best quarterly net income and earnings per share results in our 39 year history as a public company and highlights the strength of our ethanol operations. The substantial increase in income before taxes to $41.3 million underscores the efficiency of our operations and our ability to capitalize on favorable industry conditions.

"REX remains committed to a sustainable future by fully embracing the power of ethanol. We continue to make progress on our cutting-edge carbon sequestration initiatives including beginning construction on a carbon capture facility, implementing carbon intensity (CI) score reduction projects and expanding capacity from 150 to 175 million gallons, with the ultimate goal being annual production capacity of 200 million gallons all at the One Earth plant location.

"As we look ahead, we are confident in our ability to extend our long track record of leading ethanol industry operating results, and advancing our carbon capture and sequestration initiatives, while growing our capacity. With a disciplined operating approach and focus on profitability, we expect these initiatives will lead to incremental cash generation and added shareholder value creation."

Balance Sheet

As of October 31, 2023, REX had cash and cash equivalents and short-term investments of $332.0 million, $34.1 million of which was at the parent company and $297.9 million of which was at its consolidated production facilities. This compares with cash, cash equivalents and short-term investments at January 31, 2023, of $280.9 million, $42.1 million of which was at the parent company and $238.8 million of which was at its consolidated production facilities.

The following table summarizes select data related to REX's consolidated alternative energy interests:
		Three Months Ended								Nine Months Ended
		October 31,								October 31,
		2023			2022					2023			2022
Average selling price per gallon of ethanol		$	2.32		$	2.49				$	2.32		$	2.48
Average selling price per ton of dried distillers grains		$	194.94		$	230.29				$	220.92		$	232.51
Average selling price per pound of distillers corn oil		$	0.61		$	0.74				$	0.60		$	0.70
Average selling price per ton of modified distillers grain		$	85.86		$	116.49				$	104.94		$	120.23
Ethanol gallons sold (in millions)			73.2			66.3					213.8			202.1

Change in Accounting Principles

In the previous quarter ended July 31, 2023 the Company made a change in the method of accounting to begin classifying shipping and handling costs as cost of sales, instead of within selling, general and administrative expenses (SG&A), as historically presented, in order to improve the comparability of gross profit and SG&A reported. The Company has applied a retrospective application of the new accounting policy.

The following table summarizes the impact of the Company's retrospective change in accounting principle:
	Three Months Ended
	October 31, 2022
	As Previously Reported				Effect of Change				As Currently Reported
Cost of Sales	$	208,941			$	2,063			$	211,004
Gross Profit	$	11,336			$	(2,063	)		$	9,273
Selling, general and administrative expenses	$	(7,886	)		$	2,063			$	(5,823	)

	Nine Months Ended
	October 31, 2022
	As Previously Reported				Effect of Change				As Currently Reported
Cost of Sales	$	615,001			$	4,548			$	619,549
Gross Profit	$	39,832			$	(4,548	)		$	35,284
Selling, general and administrative expenses	$	(22,237	)		$	4,548			$	(17,689	)

Third Quarter Conference Call

REX will host a conference call at 11:00 a.m. ET today to discuss the quarterly results and will host a question and answer session. The dial in number for the audio conference call is 212/231-2938 (domestic and international callers). Participants can also listen to a live webcast of the call on the Company's website at, www.rexamerican.com. A webcast replay will be available for 30 days following the live event.

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 704 million gallons of ethanol over the twelve-month period ended October 31, 2023. REX's effective ownership of the trailing twelve-month gallons shipped (for the twelve months ended October 31, 2023) by the ethanol production facilities in which it has ownership interests was approximately 282 million gallons. Further information about REX is available at www.rexamerican.com.

This news announcement contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by use of forward-looking terminology such as "may," "expect," "believe," "estimate," "anticipate" or "continue" or the negative thereof or other variations thereon or comparable terminology. Readers are cautioned that there are risks and uncertainties that could cause actual events or results to differ materially from those referred to in such forward-looking statements. These risks and uncertainties include the risk factors set forth from time to time in the Company's filings with the Securities and Exchange Commission and include among other things: the effect of pandemics such as COVID-19 on the Company's business operations, including impacts on supplies, demand, personnel and other factors, the impact of legislative and regulatory changes, the price volatility and availability of corn, distillers grains, ethanol, distillers corn oil, commodity market risk, gasoline and natural gas, ethanol plants operating efficiently and according to forecasts and projections, logistical interruptions, success in permitting and developing the planned carbon sequestration facility near the One Earth Energy ethanol plant, changes in the international, national or regional economies, the impact of inflation, the ability to attract employees, weather, results of income tax audits, changes in income tax laws or regulations, the impact of U.S. foreign trade policy, changes in foreign currency exchange rates and the effects of terrorism or acts of war. The Company does not intend to update publicly any forward-looking statements except as required by law.

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations (in thousands, except per share amounts) Unaudited
			Three Months Ended								Nine Months Ended
			October 31,								October 31,
				2023				2022				2023				2022
Net sales and revenue			$	221,079			$	220,277			$	645,770			$	654,833
Cost of sales				181,789				211,004				577,962				619,549
Gross profit				39,290				9,273				67,808				35,284
Selling, general and administrative expenses				(7,609	)			(5,823	)			(21,996	)			(17,689	)
Equity in income of unconsolidated ethanol affiliates				4,738				661				9,275				6,210
Interest and other income, net				4,863				1,983				10,935				10,338
Income before income taxes and noncontrolling interests				41,282				6,094				66,022				34,143
Provision for income taxes				(9,640	)			(1,196	)			(15,396	)			(7,374	)
Net Income				31,642				4,898				50,626				26,769
Net Income attributable to noncontrolling interests				(5,566	)			(1,714	)			(10,259	)			(7,233	)
Net income attributable to REX common shareholders			$	26,076			$	3,184			$	40,367			$	19,536
Weighted average shares outstanding - basic and diluted				17,531				17,591				17,461				17,714
Basic and diluted net income per share attributable to REX common shareholders			$	1.49			$	0.18			$	2.31			$	1.10

- balance sheets follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets (in thousands) Unaudited
			October 31,				January 31,
			2023				2023
ASSETS:
CURRENT ASSETS:
Cash and cash equivalents			$	72,828			$	69,612
Short-term investments				259,172				211,331
Restricted cash				1,728				1,735
Accounts receivable				30,138				25,162
Inventory				37,515				48,744
Refundable income taxes				4,448				2,962
Prepaid expenses and other				12,256				13,098
Total current assets				418,085				372,644
Property and equipment, net				144,567				135,497
Operating lease right-of-use assets				14,516				15,214
Other assets				13,589				23,179
Equity method investment				36,807				33,045
TOTAL ASSETS			$	627,564			$	579,579
LIABILITIES AND EQUITY:
CURRENT LIABILITIES:
Accounts payable - trade			$	28,766			$	34,091
Current operating lease liabilities				5,082				5,180
Accrued expenses and other current liabilities				14,842				15,328
Total current liabilities				48,690				54,599
LONG-TERM LIABILITIES:
Deferred taxes				1,097				1,097
Long-term operating lease liabilities				9,157				9,855
Other long-term liabilities				3,072				3,034
Total long-term liabilities				13,326				13,986
EQUITY:
REX shareholders' equity:
Common stock				299				299
Paid-in capital				3,475				578
Retained earnings				681,193				640,826
Treasury stock				(191,974	)			(193,721	)
Total REX shareholders' equity				492,993				447,982
Noncontrolling interests				72,555				63,012
Total equity				565,548				510,994
TOTAL LIABILITIES AND EQUITY			$	627,564			$	579,579

- statements of cash flows follow -

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (in thousands) Unaudited
		Nine Months Ended
		October 31,				October 31,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income including noncontrolling interest		$	50,626			$	26,769
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			13,371				13,503
Amortization of operating lease right-of-use assets			3,766				4,105
Income from equity method investments			(9,275	)			(6,210	)
Dividends received from equity method investments			5,513				3,007
Interest income from investments			(6,950	)			(1,098	)
Deferred income taxes			10,048				4,964
Stock based compensation expense			5,146				1,295
Loss (gain) on sale of property and equipment - net			205				(91	)
Changes in assets and liabilities:
Accounts receivable			(4,976	)			3,146
Inventories			11,229				180
Refundable income taxes			(1,486	)			66
Other assets			409				649
Accounts payable - trade			(5,622	)			7,990
Other liabilities			(4,812	)			(4,281	)
Net cash provided by operating activities			67,192				53,994
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures			(22,359	)			(7,182	)
Purchase of short-term investments			(378,381	)			(307,371	)
Sale of short-term investments			337,490				180,527
Deposits			(27	)			-
Proceeds from sale of real estate and property and equipment			10				-
Net cash used in investing activities			(63,267	)			(134,026	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Treasury stock acquired			-				(13,012	)
Payments to noncontrolling interests holders			(716	)			(1,730	)
Net cash used in financing activities			(716	)			(14,742	)
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH			3,209				(94,774	)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH - Beginning of period			71,347				232,068
CASH, CASH EQUIVALENTS AND RESTRICTED CASH - End of period		$	74,556			$	137,294
Non-cash financing activities - Stock awards accrued		$	1,467			$	679
Non-cash financing activities - Stock awards issued		$	965			$	1,539
Non-cash investing activities - Accrued capital expenditures		$	722			$	93
Right-of-use assets acquired and liabilities incurred upon lease execution		$	3,210			$	7,632

Contacts

Douglas Bruggeman
Chief Financial Officer
[phone]

Joseph Jaffoni, Norberto Aja
JCIR
[phone] / [e-mail]