The Andersons, Inc. Reports Second Quarter Results

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August 1, 2023 4:09 PM EDT

MAUMEE, Ohio, Aug. 1, 2023 /PRNewswire/ -- The Andersons, Inc. (Nasdaq: ANDE) announces financial results for the second quarter ended June 30, 2023.

Second Quarter Highlights:

  • Company reported net income attributable to The Andersons of $55 million, or $1.61 per diluted share and adjusted net income of $52 million, or $1.52 per diluted share
  • Adjusted EBITDA was $144 million for the quarter
  • Renewables reported pretax income of $67 million and adjusted pretax income attributable to The Andersons of $32 million on strong crush margins
  • Nutrient & Industrial reported pretax income of $43 million on increased volume on delayed planting season
  • Trade reported pretax income of $5 million and adjusted pretax income of $7 million

"Ethanol margins in the Renewables business and increased volume in our Nutrient & Industrial business led the way for the quarter. This was a significant improvement for Nutrient & Industrial after a softer first quarter. While we expected that some of the typical first quarter nutrient sales volume would shift into the second quarter, we are pleased with the extent of the recovery. In our Trade segment, we had some very strong merchandising results but, as expected, did not repeat the outsized second quarter 2022 performance due to good execution following the Russian invasion of Ukraine," said President and CEO Pat Bowe. "With the strong first quarter in Trade which likely pulled some sales forward, our year-to-date results remain ahead of last year in this business. Geopolitical concerns continue to bring price volatility which is typically beneficial to us."

"We remain focused on executing within our stated strategy in our core grain and fertilizer verticals. We recently closed on the acquisition of ACJ International, a pet food ingredient supplier that fits well within our strategy for growth in the premium pet food ingredient industry," continued Bowe. "We continue to explore opportunities for growth in the merchandising of renewable diesel feedstocks, while maintaining our strong position in renewable fuels production along with potential carbon-reduction opportunities."

$ in millions, except per share amounts     





Q2 2023

Q2 2022

Variance

YTD 2023

YTD 2022

Variance

Pretax Income from Continuing Operations

$       104.4

$       118.2

$       (13.8)

$         39.4

$       128.8

$       (89.4)

Pretax Income from Continuing Operations
Attributable to the Company1

76.8

96.3

(19.5)

56.1

106.5

(50.4)

Adjusted Pretax Income (Loss) from
Continuing Operations Attributable to the
Company1

72.5

97.0

(24.5)

80.6

107.2

(26.6)

     Trade1

7.2

24.4

(17.2)

30.9

28.0

2.9

     Renewables1

32.4

45.9

(13.5)

38.7

51.4

(12.7)

     Nutrient & Industrial

42.6

38.3

4.3

32.1

49.1

(17.0)

     Other

(9.7)

(11.6)

1.9

(21.2)

(21.4)

0.2

Net Income from Continuing Operations
Attributable to the Company

55.0

80.5

(25.5)

40.3

86.6

(46.3)

Adjusted Net Income from Continuing
Operations Attributable to the Company1

51.8

82.2

(30.4)

58.6

88.2

(29.6)

Diluted Earnings Per Share from Continuing
Operations (EPS)

1.61

2.34

(0.73)

1.18

2.52

(1.34)

Adjusted Diluted Earnings Per Share from
Continuing Operations1

1.52

2.39

(0.87)

1.72

2.57

(0.85)

EBITDA from Continuing Operations1

148.7

168.6

(19.9)

132.6

224.5

(91.9)

Adjusted EBITDA from Continuing
Operations1

$       144.4

$       169.3

$       (24.9)

$       199.7

$       225.2

$       (25.5)

1 Non-GAAP financial measures; see appendix for explanations and reconciliations.

Cash, Liquidity, and Long-Term Debt Management

"Our businesses continue to generate strong cash flows," said Executive Vice President and CFO Brian Valentine. "With some moderation of commodity pricing and intentional working capital management in light of the higher interest rate environment, our short-term debt at the end of the second quarter of 2023 totaled $103 million, a steep decline from the $1.2 billion outstanding a year ago. We remain well below our long-term debt to EBITDA target of less than 2.5 times and are pleased with the strength of our balance sheet."

The company generated $541 million and $353 million in cash from operating activities for the second quarters of 2023 and 2022, respectively, and $118 million and $135 million in cash from operations before working capital changes for the same periods, respectively. Included in our investing activities are several strategic growth projects along with normal spending to maintain our facilities.

Second Quarter Segment Overview

Trade Merchandising Remains Solid; YTD Results Ahead of Strong Prior Year

The Trade segment recorded pretax income of $5 million and adjusted pretax income of $7 million for the quarter compared to pretax income of $24 million in the second quarter of 2022.

Trade results were mixed with an overall decline in gross profit from the second quarter of 2022, which included certain margin impacts from the Russian invasion of Ukraine that were not expected to repeat. Volumes handled declined from the second quarter of 2022, but the Group generated strong earnings from certain well-positioned merchandising businesses. Recent investments in food and pet food ingredients also contributed to earnings in the quarter. When combined with the very strong first quarter, adjusted earnings and gross profit remain ahead of 2022. Winter wheat volume accumulated from the just-completed harvest was higher than expected and at good qualities in our draw area.

With the strong South American harvest, combined with improving U.S. crop conditions, the outlook for global grain stocks has improved. With the mix of assets and merchandising capabilities across key geographies, Trade is well-positioned.

Trade's second quarter adjusted EBITDA was $27 million, compared to second quarter 2022 adjusted EBITDA of $47 million.

Renewables Generates Solid Earnings on Strong Margins

The Renewables segment reported pretax income of $67 million and adjusted pretax income attributable to the company of $32 million in the second quarter. For the same period in 2022, the segment reported pretax income of $68 million and pretax income attributable to the company of $46 million. These 2022 results included $9 million of USDA Biofuels Producer COVID relief funds and $24 million of positive mark-to-market impacts.

A $7 million pretax gain on the deconsolidation of ELEMENT, triggered when the entity was placed into receivership, has been adjusted from 2023 earnings.

Ethanol crush margins strengthened over the quarter, and the current margin outlook, despite volatility, remains strong. Production facilities operated efficiently in the quarter with improved ethanol and corn oil yield and lower costs than the comparable quarter in 2022. The merchandising businesses, including renewable diesel feedstocks, continue to deliver solid earnings on higher volumes and strong co-product values, and exceeded our second quarter 2022 results. Our eastern corn belt production facilities remain well-positioned for corn supply.

Renewables had second quarter adjusted EBITDA of $74 million in 2023, compared to 2022 second quarter EBITDA of $86 million.

Nutrient & Industrial Ag Businesses Recover on Improved Volume

The Nutrient & Industrial segment posted pretax income of $43 million, compared to prior year second quarter pretax income of $38 million. After a slow first quarter when reduced sales reflected the falling price environment and planting delays, volumes improved during the 2023 planting period driving a 21% increase in tons sold from the second quarter of 2022. Gross profit improved by $4 million, and reflects these higher volumes partially offset by margin compression from peak levels in 2022.

Nutrient & Industrial's second quarter EBITDA was $52 million compared to 2022 second quarter EBITDA of $47 million.

Income Taxes; Corporate

The company recorded an income tax benefit at an effective rate of 21% for the quarter due to the tax treatment of non-controlling interests. We anticipate a full-year adjusted effective rate of approximately 22% - 25%.

Conference Call

The company will host a webcast on Wednesday, August 2, 2023, at 11 a.m. Eastern Daylight Time, to discuss its performance and provide its outlook for the remainder of 2023. To access the call, please dial 888-317-6003 or 412-317-6061 (elite entry number is 5878900). It is recommended that you call 10 minutes before the conference call begins.

To access the webcast, click on the link: https://app.webinar.net/dwMKAr514rB and submit the requested information as directed. A replay of the call can also be accessed under the heading "Investors" on the company's 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, the ongoing economic impacts from the war in Ukraine, 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.

Non-GAAP Measures

This release contains non-GAAP financial measures. The company believes that pretax income (loss) from continuing operations attributable to the company; adjusted pretax income (loss) from continuing operations attributable to the company; adjusted pretax income (loss) from continuing operations; adjusted net income from continuing operations attributable to the company; adjusted diluted earnings per share from continuing operations; earnings before interest, taxes, depreciation, and amortization (or EBITDA); EBITDA from continuing operations; adjusted EBITDA; adjusted EBITDA from continuing operations; and cash from operations before working capital changes provide additional information to investors and others about its operations, allowing an evaluation of underlying operating performance and liquidity and better period-to-period comparability. The above measures are not and should not be considered as alternatives to net income from continuing operations, pretax income from continuing operations or income (loss) before income taxes from continuing operations, diluted earnings (loss) per share attributable to The Andersons, Inc. common shareholders from continuing operations and cash provided by (used in) operating activities as determined by generally accepted accounting principles. Reconciliations of the GAAP to non-GAAP measures may be found within this press release and the financial tables provided herein.

Company Description

The Andersons, Inc., named to Forbes list of America's Best Small Companies for 2023 and one of America's Greatest Workplaces for Diversity 2023 by Newsweek®, is a diversified company rooted in agriculture that conducts business in the commodity merchandising, renewables, and nutrient & industrial sectors. Guided by its Statement of Principles, The Andersons is committed to providing extraordinary service to its customers, helping its employees improve, supporting its communities, and increasing the value of the company. For more information, please visit www.andersonsinc.com. 

 

The Andersons, Inc.
Condensed Consolidated Statements of Operations
(unaudited)



Three months ended
June 30,


Six months ended
June 30,

(in thousands, except per share data)

2023


2022


2023


2022

Sales and merchandising revenues

$ 4,020,183


$ 4,450,617


$ 7,901,421


$ 8,428,571

Cost of sales and merchandising revenues

3,798,246


4,219,776


7,531,473


8,078,195

Gross profit

221,937


230,841


369,948


350,376

Operating, administrative and general expenses

116,007


112,559


233,242


214,546

Asset impairment

—


—


87,156


—

Interest expense, net

13,953


16,921


30,578


27,780

Other income, net

12,441


16,792


20,445


20,710

Income before income taxes from continuing operations

104,418


118,153


39,417


128,760

Income tax provision from continuing operations

21,732


15,753


15,848


19,856

Net income from continuing operations

82,686


102,400


23,569


108,904

Loss from discontinued operations, net of income taxes

—


(739)


—


(1,294)

Net income

82,686


101,661


23,569


107,610

Net income (loss) attributable to noncontrolling interests

27,640


21,856


(16,727)


22,303

Net income attributable to The Andersons, Inc.

$      55,046


$      79,805


$      40,296


$      85,307









Earnings (loss) per share attributable to The Andersons, Inc. common
shareholders:








Basic earnings (loss):








Continuing operations

$           1.63


$           2.38


$           1.20


$           2.56

Discontinued operations

—


(0.02)


—


(0.04)


$           1.63


$           2.36


$           1.20


$           2.52

Diluted earnings (loss):








Continuing operations

$           1.61


$           2.34


$           1.18


$           2.52

Discontinued operations

—


(0.02)


—


(0.04)


$           1.61


$           2.32


$           1.18


$           2.48

 

The Andersons, Inc.
Condensed Consolidated Balance Sheets
(unaudited)


(in thousands)

June 30, 2023


December 31, 2022


June 30, 2022

Assets






Current assets:






  Cash and cash equivalents

$                     96,293


$                    115,269


$                      86,035

  Accounts receivable, net

1,030,271


1,248,878


1,141,167

  Inventories

990,789


1,731,725


1,618,326

  Commodity derivative assets – current

347,684


295,588


638,357

  Current assets held-for-sale

—


2,871


18,627

  Other current assets

72,228


71,622


70,367

Total current assets

2,537,265


3,465,953


3,572,879

Other assets:






Goodwill

129,342


129,342


129,342

Other intangible assets, net

89,605


100,907


105,222

Right of use assets, net

60,003


61,890


50,233

Other assets held-for-sale

—


—


24,298

Other assets, net

90,390


87,175


91,758

Total other assets

369,340


379,314


400,853

Property, plant and equipment, net

663,441


762,729


763,443

Total assets

$                3,570,046


$                 4,607,996


$                 4,737,175







Liabilities and equity






Current liabilities:






  Short-term debt

$                   102,752


$                    272,575


$                 1,161,428

  Trade and other payables

641,376


1,423,633


772,996

  Customer prepayments and deferred revenue

189,947


370,524


184,154

  Commodity derivative liabilities – current

251,101


98,519


185,903

  Current maturities of long-term debt

27,511


110,155


53,951

  Current liabilities held-for-sale

—


—


7,314

  Accrued expenses and other current liabilities

180,552


245,916


211,830

Total current liabilities

1,393,239


2,521,322


2,577,576

Long-term lease liabilities

34,435


37,147


28,929

Long-term debt, less current maturities

576,489


492,518


563,447

Deferred income taxes

57,030


64,080


63,383

Other long-term liabilities held-for-sale

—


—


3,113

Other long-term liabilities

70,371


63,160


83,521

Total liabilities

2,131,564


3,178,227


3,319,969

Total equity

1,438,482


1,429,769


1,417,206

Total liabilities and equity

$                3,570,046


$                 4,607,996


$                 4,737,175

 

The Andersons, Inc.
Consolidated Statements of Cash Flows
(unaudited)



Six months ended June 30,

 (in thousands)

2023


2022

Operating Activities




Net income from continuing operations

$                 23,569


$               108,904

Loss from discontinued operations, net of income taxes

—


(1,294)

Net income

23,569


107,610

Adjustments to reconcile net income to cash provided by (used in) operating activities:




Depreciation and amortization

62,585


67,945

Bad debt expense, net

3,720


3,069

Equity in losses of affiliates, net of dividends

231


6,278

Losses (gains) on sales of assets, net

679


(10,305)

Stock-based compensation expense

6,000


4,708

Deferred federal income tax

(7,948)


(13,755)

Asset impairment

87,156


—

Other

(1,730)


8,549

Changes in operating assets and liabilities:




Accounts receivable

207,867


(289,196)

Inventories

734,855


186,685

Commodity derivatives

102,753


(189,090)

Other current and non-current assets

(1,247)


5,106

Payables and other current and non-current liabilities

(1,011,086)


(609,403)

Net cash provided by (used in) operating activities

207,404


(721,799)

Investing Activities




Purchases of property, plant and equipment and capitalized software

(74,991)


(43,472)

Proceeds from sale of assets

1,192


4,672

Purchases of investments

(544)


(2,105)

Purchases of Rail assets

—


(27,276)

Proceeds from sale of Rail assets

2,871


36,341

Other

(201)


1,746

Net cash used in investing activities

(71,673)


(30,094)

Financing Activities




Net receipts (payments) under short-term lines of credit

(173,384)


862,698

Proceeds from issuance of short-term debt

—


350,000

Payments of short-term debt

—


(550,000)

Proceeds from issuance of long-term debt

100,000


—

Payments of long-term debt

(35,861)


(15,077)

Contributions from noncontrolling interest owner

—


2,450

Distributions to noncontrolling interest owner

(24,344)


(9,980)

Payments of debt issuance costs

(767)


(7,802)

Dividends paid

(12,527)


(12,245)

Proceeds from exercises of stock options

—


5,024

Common stock repurchased

(1,747)


—

Value of shares withheld for taxes

(6,616)


(3,349)

Other

259


394

Net cash (used in) provided by financing activities

(154,987)


622,113

Effect of exchange rates on cash and cash equivalents

280


(629)

Decrease in cash and cash equivalents

(18,976)


(130,409)

Cash and cash equivalents at beginning of period

115,269


216,444

Cash and cash equivalents at end of period

$                 96,293


$                 86,035

 

The Andersons, Inc.
Adjusted Net Income Attributable to The Andersons, Inc.
A non-GAAP financial measure
(unaudited)



Three months ended
June 30,


Six months ended
June 30,

(in thousands, except per share data)

2023


2022


2023


2022

Net income from continuing operations

$   82,686


$ 102,400


$   23,569


$ 108,904

Net income (loss) attributable to noncontrolling interests

27,640


21,856


(16,727)


22,303

Net income from continuing operations attributable to The Andersons, Inc.

55,046


80,544


40,296


86,601

Adjustments:








Gain on deconsolidation of joint venture

(6,544)


—


(6,544)


—

Insured inventory expenses (recoveries)

1,310


—


(16,080)


—

Transaction related compensation

939


—


2,607


—

Gain on sale of frac sand assets

—


(3,762)


—


(3,762)

Impairment on equity method and cost method investments

—


4,455


—


4,455

Asset Impairment

—


—


44,450


—

Income tax impact of adjustments1

1,074


940


(6,108)


940

Total adjusting items, net of tax

(3,221)


1,633


18,325


1,633

Adjusted net income from continuing operations attributable to
The Andersons, Inc.

$   51,825


$   82,177


$   58,621


$   88,234









Diluted earnings per share from continuing operations attributable to
The Andersons, Inc. common shareholders

$        1.61


$        2.34


$        1.18


$        2.52









Impact on diluted earnings (loss) per share from continuing operations

$      (0.09)


$        0.05


$        0.54


$        0.05

Adjusted diluted earnings per share from continuing operations

$        1.52


$        2.39


$        1.72


$        2.57


1 The income tax impact of adjustments is taken at the statutory tax rate of 25%.


Adjusted net income (loss) from continuing operations attributable to The Andersons, Inc. reflects reported net income (loss) from continuing operations available to The Andersons, Inc. common shareholders after the removal of specified items described above. Adjusted diluted earnings (loss) from continuing operations per share reflects the fully diluted EPS of The Andersons, Inc. after removal of the effect on EPS as reported of specified items described above. Management believes that Adjusted net income (loss) from continuing operations attributable to The Andersons, Inc. and Adjusted diluted earnings (loss) from continuing operations per share are useful measures of The Andersons, Inc. performance as they provide investors additional information about the operations of the company allowing better evaluation of underlying business performance and better comparability to previous periods. These non-GAAP financial measures are not intended to replace or be alternatives to Net income from continuing operations attributable to The Andersons, Inc. and Diluted earnings per share from continuing operations attributable to The Andersons, Inc. common shareholders as reported, the most directly comparable GAAP financial measures, or any other measures of operating results under GAAP. Earnings amounts described above have been divided by the company's average number of diluted shares outstanding for each respective period in order to arrive at an adjusted diluted earnings (loss) from continuing operations per share amount for each specified item.

 

The Andersons, Inc.
Segment Data 
(unaudited)


(in thousands)

Trade


Renewables


Nutrient &
Industrial


Other


Total

Three months ended June 30, 2023










Sales and merchandising revenues

$  2,696,810


$       877,781


$        445,592


$              —


$  4,020,183

Gross profit

80,711


68,292


72,934


—


221,937

Operating, administrative and general expenses

69,146


7,568


28,886


10,407


116,007

Other income, net

4,328


7,468


500


145


12,441

Income (loss) before income taxes from continuing operations

4,990


66,604


42,565


(9,741)


104,418

Income attributable to noncontrolling interests

—


27,640


—


—


27,640

Income (loss) before income taxes from continuing operations
attributable to The Andersons, Inc.1

$         4,990


$         38,964


$          42,565


$       (9,741)


$       76,778

Adjustments to income (loss) before income taxes from
continuing operations2

2,249


(6,544)


—


—


(4,295)

Adjusted income (loss) before income taxes from continuing
operations attributable to The Andersons, Inc.1

$         7,239


$         32,420


$          42,565


$       (9,741)


$       72,483











Three months ended June 30, 2022










Sales and merchandising revenues

$  3,097,767


$       882,567


$        470,283


$              —


$  4,450,617

Gross profit

101,994


59,888


68,959


—


230,841

Operating, administrative and general expenses

62,977


8,590


29,591


11,401


112,559

Other income (loss), net

(2,051)


18,490


866


(513)


16,792

Income (loss) before income taxes from continuing operations

23,666


67,776


38,311


(11,600)


118,153

Income attributable to noncontrolling interests

—


21,856


—


—


21,856

Income (loss) before income taxes from continuing operations
attributable to The Andersons, Inc.1

$       23,666


$         45,920


$          38,311


$     (11,600)


$       96,297

Adjustments to income before income taxes from continuing
operations2

693


—


—


—


693

Adjusted income (loss) before income taxes from continuing
operations attributable to The Andersons, Inc.1

$       24,359


$         45,920


$          38,311


$     (11,600)


$       96,990


1 Income (loss) from continuing operations before income taxes attributable to The Andersons, Inc. for each operating segment 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.

2 Additional information on the individual adjustments that are included in the adjustments to income (loss) from continuing operations before income taxes
can be found in the Reconciliation to EBITDA and Adjusted EBITDA table.

 

The Andersons, Inc.
Segment Data (continued)
(unaudited)











(in thousands)

Trade


Renewables


Nutrient &
Industrial


Other


Total

Six months ended June 30, 2023










Sales and merchandising revenues

$  5,574,590


$    1,717,297


$         609,534


$           —


$  7,901,421

Gross profit

197,889


84,095


87,964


—


369,948

Operating, administrative and general expenses

141,126


16,472


53,018


22,626


233,242

Other income, net

10,311


8,309


1,346


479


20,445

Income (loss) before income taxes from continuing operations

44,354


(15,909)


32,127


(21,155)


39,417

Loss attributable to noncontrolling interests

—


(16,727)


—


—


(16,727)

Income (loss) before income taxes from continuing operations
attributable to The Andersons, Inc.1

$       44,354


$              818


$           32,127


$  (21,155)


$       56,144

Adjustments to income (loss) before income taxes from
continuing operations2

(13,473)


37,906


—


—


24,433

Adjusted income (loss) before income taxes from continuing
operations attributable to The Andersons, Inc.1

$       30,881


$         38,724


$           32,127


$  (21,155)


$       80,577











Six months ended June 30, 2022










Sales and merchandising revenues

$  6,182,448


$    1,565,798


$         680,325


$           —


$  8,428,571

Gross profit

169,613


75,079


105,684


—


350,376

Operating, administrative and general expenses

122,520


16,480


54,916


20,630


214,546

Other income (loss), net

1,729


18,918


1,670


(1,607)


20,710

Income (loss) before income taxes from continuing operations

27,335


73,738


49,054


(21,367)


128,760

Income attributable to noncontrolling interests

—


22,303


—


—


22,303

Income (loss) before income taxes from continuing operations
attributable to The Andersons, Inc.1

$       27,335


$         51,435


$           49,054


$  (21,367)


$     106,457

Adjustments to income before income taxes from continuing
operations2

693


—


—


—


693

Adjusted income (loss) before income taxes from continuing
operations attributable to The Andersons, Inc.1

$       28,028


$         51,435


$           49,054


$  (21,367)


$     107,150


1 Income (loss) from continuing operations before income taxes attributable to The Andersons, Inc. for each operating segment 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.

2 Additional information on the individual adjustments that are included in the adjustments to income (loss) from continuing operations before income taxes
can be found in the Reconciliation to EBITDA and Adjusted EBITDA table.

 

The Andersons, Inc.
Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
A non-GAAP financial measure
(unaudited)


(in thousands)

Trade


Renewables


Nutrient &
Industrial


 Other


 Total

Three months ended June 30, 2023










Net income (loss)1

$           4,990


$         66,604


$         42,565


$       (31,473)


$         82,686

Interest expense (income)

10,903


1,588


1,983


(521)


13,953

Tax provision

—


—


—


21,732


21,732

Depreciation and amortization

8,683


12,425


7,097


2,160


30,365

EBITDA1

24,576


80,617


51,645


(8,102)


148,736

Adjusting items impacting EBITDA:










Transaction related compensation

939


—


—


—


939

Insured inventory expenses

1,310


—


—


—


1,310

Gain on deconsolidation of joint venture

—


(6,544)


—


—


(6,544)

Total adjusting items

2,249


(6,544)


—


—


(4,295)

Adjusted EBITDA1

$         26,825


$         74,073


$         51,645


$         (8,102)


$       144,441











Three months ended June 30, 2022










Net income (loss) from continuing operations

$         23,666


$         67,776


$         38,311


$       (27,353)


$       102,400

Interest expense (income)

13,300


2,012


1,923


(314)


16,921

Tax provision

—


—


—


15,753


15,753

Depreciation and amortization

8,914


15,875


6,595


2,183


33,567

EBITDA from continuing operations

45,880


85,663


46,829


(9,731)


168,641

Adjusting items impacting EBITDA:










Gain on sale of frac sand assets

(3,762)


—


—


—


(3,762)

Impairment on equity method and cost method
investments

4,455


—


—


—


4,455

Total adjusting items

693


—


—


—


693

Adjusted EBITDA from continuing operations

$         46,573


$         85,663


$         46,829


$         (9,731)


$       169,334


1 Amounts for the three months ended June 30, 2023, contain no activity from discontinued operations. As such, references to EBITDA and EBITDA from continuing operations, as well as, Adjusted EBITDA and Adjusted EBITDA from continuing operations will yield the same results for the three months ended June 30, 2023.


Adjusted EBITDA is defined as earnings before interest, taxes and depreciation and amortization, adjusted for specified items. The company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of interest expense, tax expense and depreciation and amortization to net income (loss). Management believes that adjusted EBITDA is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Adjusted EBITDA is a non-GAAP financial measure and is not intended to replace or be an alternative to net income (loss), the most directly comparable GAAP financial measure.

 

The Andersons, Inc.
Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
A non-GAAP financial measure
(unaudited)


(in thousands)

Trade


Renewables


Nutrient &
Industrial


Other


Total

Six months ended June 30, 2023










Net income (loss)1

$         44,354


$       (15,909)


$         32,127


$       (37,003)


$         23,569

Interest expense (income)

22,720


4,685


4,165


(992)


30,578

Tax provision

—


—


—


15,848


15,848

Depreciation and amortization

17,328


26,896


14,054


4,307


62,585

EBITDA1

84,402


15,672


50,346


(17,840)


132,580

Adjusting items impacting EBITDA:










Transaction related compensation

2,607


—


—


—


2,607

Insured inventory recoveries

(16,080)


—


—


—


(16,080)

Gain on deconsolidation of joint venture

—


(6,544)


—


—


(6,544)

Asset Impairment

—


87,156


—


—


87,156

Total adjusting items

(13,473)


80,612


—


—


67,139

Adjusted EBITDA1

$         70,929


$         96,284


$         50,346


$       (17,840)


$       199,719











Six months ended June 30, 2022










Net income (loss) from continuing operations

$         27,335


$         73,738


$         49,054


$       (41,223)


$       108,904

Interest expense (income)

21,487


3,779


3,384


(870)


27,780

Tax provision

—


—


—


19,856


19,856

Depreciation and amortization

17,888


32,514


13,174


4,368


67,944

EBITDA from continuing operations

66,710


110,031


65,612


(17,869)


224,484

Adjusting items impacting EBITDA:










Gain on sale of frac sand assets

(3,762)


—


—


—


(3,762)

Impairment on equity method and cost method investments

4,455


—


—


—


4,455

Total adjusting items

693


—


—


—


693

Adjusted EBITDA from continuing operations

$         67,403


$       110,031


$         65,612


$       (17,869)


$       225,177


1 Amounts for the six months ended June 30, 2023, contain no activity from discontinued operations. As such, references to EBITDA and EBITDA from continuing operations, as well as, Adjusted EBITDA and Adjusted EBITDA from continuing operations will yield the same results for the six months ended June 30, 2023.


Adjusted EBITDA is defined as earnings before interest, taxes and depreciation and amortization, adjusted for specified items. The company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of interest expense, tax expense and depreciation and amortization to net income (loss). Management believes that adjusted EBITDA is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Adjusted EBITDA is a non-GAAP financial measure and is not intended to replace or be an alternative to net income (loss), the most directly comparable GAAP financial measure.

 

The Andersons, Inc.
Trailing Twelve Months of EBITDA and Adjusted EBITDA from Continuing Operations
A non-GAAP financial measure
(unaudited)

 



Three Months Ended,


 Twelve months ended
June 30, 2023

(in thousands)

September
30, 2022


December
31, 2022


March 31,
2023


June 30,
2023


Net income (loss) from continuing operations

$         24,880


$         21,170


$       (59,117)


$         82,686


$                           69,619

Interest expense

14,982


14,087


16,625


13,953


59,647

Tax provision (benefit)

9,839


9,933


(5,884)


21,732


35,620

Depreciation and amortization

33,322


33,476


32,220


30,365


129,383

EBITDA from continuing operations

83,023


78,666


(16,156)


148,736


294,269

Adjusting items impacting EBITDA from
continuing operations:










Transaction related compensation expense

—


—


1,668


939


2,607

Insured inventory expenses (recoveries)

—


15,993


(17,390)


1,310


(87)

Gain on deconsolidation of joint venture

—


—


—


(6,544)


(6,544)

Asset impairment including equity
method investments

—


9,000


87,156


—


96,156

Total adjusting items

—


24,993


71,434


(4,295)


92,132

Adjusted EBITDA from continuing operations

$         83,023


$       103,659


$         55,278


$       144,441


$                         386,401












Three Months Ended,


Twelve months ended
June 30, 2022


September
30, 2021


December
31, 2021


March 31,
2022


June 30,
2022


Net income from continuing operations

$         12,290


$         65,473


$           6,504


$       102,400


$                         186,667

Interest expense

8,799


8,444


10,859


16,921


45,023

Tax provision

4,027


11,163


4,103


15,753


35,046

Depreciation and amortization

42,811


36,797


34,377


33,567


147,552

EBITDA from continuing operations

67,927


121,877


55,843


$       168,641


414,288

Adjusting items impacting EBITDA from
continuing operations:










Transaction related compensation expense

243


274


—


—


517

Gain on sale of a business

(14,619)


—


—


—


(14,619)

Asset impairments including equity
method investments

—


8,321


—


4,455


12,776

Loss from cost method investment

2,784


—


—


—


2,784

      Gain on sales of assets

—


—


—


(3,762)


(3,762)

Total adjusting items

(11,592)


8,595


—


693


(2,304)

Adjusted EBITDA from continuing operations

$         56,335


$       130,472


$         55,843


$       169,334


$                         411,984

 

The Andersons, Inc.
Cash from Operations Before Working Capital Changes
A non-GAAP financial measure
(unaudited)



Three months ended June 30,


Six months ended June 30,

(in thousands)

2023


2022


2023


2022

Cash provided by (used in) operating activities

$         540,939


$         353,199


$       207,404


$     (721,799)

Changes in operating assets and liabilities








Accounts receivable

82,754


(74,184)


207,867


(289,196)

Inventories

556,845


323,505


734,855


186,685

Commodity derivatives

19,605


88,671


102,753


(189,090)

Other current and non-current assets

16,296


43,916


(1,247)


5,106

Payables and other current and non-current liabilities

(250,794)


(163,307)


(1,011,086)


(609,403)

Total changes in operating assets and liabilities

424,706


218,601


33,142


(895,898)

Adjusting items impacting cash from operations before
working capital changes:








Less: Insured inventory expenses (recoveries)

1,310


—


(16,080)


—

Cash from operations before working capital changes

$         117,543


$         134,598


$       158,182


$       174,099


Cash from operations before working capital changes is defined as cash provided by (used in) operating activities before the impact of changes in working capital within the statement of cash flows. The Company calculates cash from operations by eliminating the effect of changes in accounts receivable, inventories, commodity derivatives, other assets, and payables and accrued expenses from the cash provided by (used in) operating activities. Management believes that cash from operations before working capital changes is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Cash from operations before working capital changes is a non-GAAP financial measure and is not intended to replace or be an alternative to cash provided by (used in) operating activities, the most directly comparable GAAP financial measure.

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/the-andersons-inc-reports-second-quarter-results-301890907.html

SOURCE The Andersons, Inc.


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