UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): March 28, 2024

 

REX AMERICAN RESOURCES CORPORATION

(Exact name of registrant as specified in its charter)

 
Delaware   001-09097   31-1095548
(State or other jurisdiction
of incorporation)
  (Commission File No.)   (IRS Employer Identification No.)
         

 

7720 Paragon Road Dayton, Ohio   45459
(Address of principal executive offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (937) 276-3931

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading symbol Name of each exchange on which registered
Commons stock, $0.01 par value REX New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.                                                   

 

Item 2.02.   Results of Operations and Financial Condition

 

On March 28, 2024, REX American Resources Corporation issued a press release announcing financial results for the three-month period ended January 31, 2024. The press release is furnished as Exhibit 99 to this report.

 

Item 9.01.   Financial Statements and Exhibits
    (c)

Exhibits. The following exhibits are furnished with this report:

 

99   Press Release dated March 28, 2024

      104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  REX AMERICAN RESOURCES CORPORATION  
   
Date: March 28, 2024 By: /s/ DOUGLAS L. BRUGGEMAN  
    Name: Douglas L. Bruggeman  
    Title:   Vice President - Finance,  
      Chief Financial Officer  
      and Treasurer  

 

false 0000744187 0000744187 2024-03-28 2024-03-28

EXHIBIT 99

 

 

REX American Resources Reports Full Fiscal Year 2023 Net Income Per Share Attributable to REX Common Shareholders of $3.47, the Second Highest in Company History

 

§Generated $1.16 and $3.47 of net income per share in Q4 and Full Fiscal Year ‘23, respectively; Full Fiscal Year net income per share was the second highest in company history
§Reported gross profit of $30.4 million and $98.2 million for Q4 and Full Fiscal Year ‘23, respectively, an increase of more than 100% over each of the respective periods for 2022
§Reported net sales and revenue of $187.6 million and $833.4 million for Q4 and Full Fiscal Year ’23, respectively, a decrease of approximately 6% and 3% from each of the respective periods for 2022
§Reported consolidated ethanol sales volumes of 72.1 million gallons and 285.9 million gallons for Q4 and Full Fiscal Year ’23, respectively, an increase of approximately 13% and 8% over each of the respective periods for 2022
§Commenced site construction on the One Earth Energy carbon capture facility at the Gibson City, Illinois facility during Q3; expect completion of the compression facility during Q2 ‘24

 

Dayton, OH - Thursday, March 28, 2024 - REX American Resources Corporation (“REX” or the “Company”) (NYSE: REX), a leading ethanol production company, today announced financial and operational results for the Company’s full year and fiscal fourth quarter 2023.

 

REX American Resources’ Q4 and full fiscal year 2023 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.

 

Full Fiscal Year 2023 Results

 

For the full fiscal year 2023, REX reported net sales and revenue of $833.4 million, compared with $855.0 million for full fiscal year 2022. The year-over-year net sales and revenue decrease primarily reflects reduced pricing for ethanol and co-products. Full fiscal year 2023 gross profit for the Company was $98.2 million, compared with $48.6 million in full fiscal year 2022, reflecting decreased corn and natural gas prices and increased production levels. This led to full fiscal year 2023 income before income taxes and non-controlling interests of $98.5 million, compared with $47.5 million in the prior year period.

 

Net income attributable to REX shareholders in full fiscal year 2023 was $60.9 million, compared to $27.7 million in full fiscal year 2022. Full fiscal year diluted net income per share attributable to REX common shareholders was $3.47, compared to $1.57 per share in full fiscal year 2022. Per share results for full fiscal years 2023 and 2022 are based on 17,576,000 and 17,638,000 diluted weighted average shares outstanding, respectively, reflecting the Company’s 3-for-1 common stock split effected August 5, 2022.

 

Fourth Quarter 2023 Results

 

REX reported Q4 ’23 net sales and revenue of $187.6 million, compared to Q4 ‘22 net sales and revenue of $200.2 million. The year-over-year net sales and revenue decrease primarily reflects lower product pricing. Q4 ‘23 gross profit for the Company was $30.4 million, compared with $13.3 million in Q4 ’22, a result of decreases in corn and natural gas prices, and increased production levels. This led to Q4 ‘23

 

 

income before income taxes and non-controlling interests of $32.5 million, compared with $13.3 million in Q4 ’22.

 

Net income attributable to REX shareholders in Q4 ‘23 was $20.6 million, compared to $8.2 million in Q4 ’22. Q4 ‘23 diluted net income per share attributable to REX common shareholders was $1.16, compared to $0.47 per share in Q4 ’22. Per share results for Q4 ’23 and Q4 ’22 are based on 17,657,000 and 17,416,000 diluted weighted average shares outstanding, respectively, reflecting the Company’s 3-for-1 common stock split effected August 5, 2022.

 

One Earth Energy Carbon Capture Project

 

REX commenced site construction operations for its One Earth Energy carbon capture and sequestration project during Q3 2023, at the Company’s Gibson City, Illinois location. Construction of the capture and compression facility is expected to be completed during the second quarter of 2024.

 

The Environmental Protection Agency (EPA) Class VI injection well permitting process is ongoing. Approval of REX’s Class VI injection well application is necessary to begin construction on the sequestration portion of the project and to begin operations. Permitting for a 6-mile carbon transport pipeline to deliver carbon from the compression facility to the sequestration facility, is also ongoing with the Illinois Commerce Commission.

 

To-date capital expenditures related to the One Earth Energy carbon capture and sequestration project and related expansion of ethanol production capacity at the Gibson City location total $38.6 million. The Company is currently budgeting $165-$175 million for this project.

 

Balance Sheet

 

At the end of fiscal year 2023 on January 31, 2024, REX had $378.7 million of cash, cash equivalents, and short-term investments available and no bank debt.

 

Management Commentary

 

“REX American’s strong results for 2023 reflect our company’s ongoing commitment to efficient operations and a laser focus on profitability,” said Mr. Zafar Rizvi, REX Chief Executive Officer. “Achieving the second highest net income per share in the Company’s history in 2023 is an incredible outcome, and one which we are very proud of. Day in and day out, our team evaluates our outlook for the ethanol market, monitoring and managing our exposure to meet our goals. We plan to continue this focus on profitable, sustainable operations through all market conditions, and as we grow our operations into additional areas, like carbon capture and sequestration.

 

“We continue to make progress on our One Earth Energy CCS project at the Gibson City facility, with installation of the compression facility still slated for completion in the second quarter of 2024. We are at the same time working on the previously announced expansion of ethanol production at our Gibson City facility to 200 million gallons per year. While we await all required approvals, we expect both of these projects will be additive to REX’s bottom line, and support continued profitable operations,” concluded Mr. Rizvi.

 

Change in Accounting Principles

 

As previously discussed, during the fiscal 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.

 

Conference Call Information

 

To access the conference call, interested parties may dial (877) 269-7751 (US) or (201) 389-0908 (international). Participants can also view an updated presentation, as well as listen to a live webcast of the call by going to the Investors section on the REX website at www.rexamerican.com. A replay will be available shortly after the live conference call and can be accessed by dialing (844) 512-2921 (US) or (412) 317-6671 (international). The passcode for the replay is 13745209. The replay will be available for 30 days after the call.

 

About REX American Resources Corporation
REX American Resources Corporation has interests in six ethanol production facilities, which in aggregate have production capacity totaling approximately 730 million gallons per year. REX’s effective ownership of annual volumes is approximately 300 million gallons. Further information about REX is available at www.rexamerican.com.

 

Forward-Looking Statements

 

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.

 

Investor Contacts

Douglas Bruggeman
Chief Financial Officer

 

Caldwell Bailey
ICR, Inc.
rexamerican@icrinc.com

 

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except per share amounts)

Unaudited

 

   Three Months Ended   Year Ended 
   January 31,   January 31, 
   2024   2023   2024   2023 
Net sales and revenue  $187,614   $200,167   $833,384   $855,000 
Cost of sales   157,204    186,849    735,166    806,398 
Gross profit   30,410    13,318    98,218    48,602 
Selling, general and administrative expenses   (7,383)    (5,138)    (29,379)    (22,827) 
Equity in income of unconsolidated ethanol affiliates   4,646    2,535    13,921    8,745 
Interest and other income, net   4,789    2,621    15,724    12,959 
Income before income taxes and noncontrolling interests   32,462    13,336    98,484    47,479 
Provision for income taxes   (7,164)    (2,168)    (22,560)    (9,542) 
Net Income   25,298    11,168    75,924    37,937 
Net Income attributable to noncontrolling interests   (4,730)    (3,007)    (14,989)    (10,240) 
Net income attributable to REX common shareholders  $20,568   $8,161   $60,935   $27,697 
                     
Weighted average shares outstanding – basic   17,548    17,416    17,482    17,638 
                     
Basic net income per share attributable to REX common shareholders  $1.17   $0.47   $3.49   $1.57 
                     
Weighted average shares outstanding – diluted   17,657    17,416    17,576    17,638 
                     
Diluted net income per share attributable to REX common shareholders  $1.16   $0.47   $3.47   $1.57 

 

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands)

Unaudited

 

   January 31,
2024
   January 31,
2023
 
ASSETS            
CURRENT ASSETS:              
Cash and cash equivalents    $223,397     $69,612 
Short-term investments     155,260      211,331 
Restricted cash     -      1,735 
Accounts receivable     23,185      25,162 
Inventory     26,984      48,744 
Refundable income taxes     5,728      2,962 
Prepaid expenses and other     17,549      13,098 
Total current assets     452,103      372,644 
Property and equipment, net     155,587      135,497 
Operating lease right-of-use assets     13,038      15,214 
Other assets     9,138      23,179 
Equity method investment     34,936      33,045 
TOTAL ASSETS    $664,802     $579,579 
LIABILITIES AND EQUITY              
CURRENT LIABILITIES:              
Accounts payable – trade    $42,073     $34,091 
Current operating lease liabilities     4,469      5,180 
Accrued expenses and other current liabilities     19,717      15,328 
Total current liabilities     66,259      54,599 
LONG-TERM LIABILITIES:              
Deferred taxes     1,598      1,097 
Long-term operating lease liabilities     8,378      9,855 
Other long-term liabilities     970      3,034 
Total long-term liabilities     10,946      13,986 
EQUITY:              
REX shareholders’ equity:              
Common stock     299      299 
Paid-in capital     3,769      578 
Retained earnings     701,761      640,826 
Treasury stock     (191,911)      (193,721) 
Total REX shareholders’ equity     513,918      447,982 
Noncontrolling interests     73,679      63,012 
Total equity     587,597      510,994 
TOTAL LIABILITIES AND EQUITY    $664,802     $579,579 
 

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

 

   Year Ended 
   January 31,
2024
   January 31,
2023
 
CASH FLOWS FROM OPERATING ACTIVITIES:              
Net Income including noncontrolling interest    $75,924     $37,937 
Adjustments to reconcile net income to net cash provided by operating activities:              
Depreciation     17,794      17,976 
Amortization of operating lease right-of-use assets     5,245      5,328 
Income from equity method investments     (13,921)      (8,745) 
Dividends received from equity method investments     12,030      6,266 
Interest income from investments     (10,008)      (2,839) 
Deferred income taxes     14,627      915 
Stock based compensation expense     6,209      1,930 
Loss (gain) on sale of property and equipment – net     243      (102) 
Changes in assets and liabilities:              
Accounts receivable     1,977      659 
Inventories     21,760      (6,519) 
Income taxes refundable     (2,766)      3,715 
Prepaid expenses and other assets     (4,495)      (452) 
Accounts payable – trade     7,868      1,478 
Accrued expense and other liabilities     (4,517)      (2,752) 
Net cash provided by operating activities     127,970      54,795 
CASH FLOWS FROM INVESTING ACTIVITIES:              
Capital expenditures     (37,663)      (15,578) 
Purchase of short-term investments     (448,507)      (399,350) 
Maturities of short-term investments     514,586      216,735 
Deposits     (43)      (319) 
Proceeds from sale of real estate and property and equipment     29      5 
Net cash provided by (used in) investing activities     28,402      (198,507) 
CASH FLOWS FROM FINANCING ACTIVITIES:              
Treasury stock acquired     -      (13,012) 
Capital contributions from minority investor     22      - 
Payments to noncontrolling interests holders     (4,344)      (3,997) 
Net cash used in financing activities     (4,322)      (17,009) 
               
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH     152,050      (160,721) 
CASH, CASH EQUIVALENTS AND RESTRICTED CASH – Beginning of year     71,347      232,068 
CASH, CASH EQUIVALENTS AND RESTRICTED CASH – End of year    $223,397     $71,347 
Non-cash financing activities – Stock awards accrued    $2,172     $965 
Non-cash financing activities – Stock awards issued    $965     $1,539 
Non-cash investing activities – Accrued capital expenditures    $918     $425 
Right-of-use assets acquired and liabilities incurred upon lease execution    $3,210     $9,321 
 

 

The following table summarizes the impact of the Company’s

retrospective change in accounting principle:

 

   Three Months Ended
January 31, 2023
 
   As Previously
Reported
   Effect of
Change
   As Currently
Reported
 
Cost of Sales    $185,268     $1,581     $186,849 
                      
Gross Profit    $14,899     $(1,581)     $13,318 
                      
Selling, general and administrative expenses    $(6,719)     $1,581     $(5,138) 
                      
   Year Ended
January 31, 2023
 
   As Previously
Reported
   Effect of
Change
   As Currently
Reported
 
Cost of Sales    $800,269     $6,129     $806,398 
                      
Gross Profit    $54,731     $(6,129)     $48,602 
                      
Selling, general and administrative expenses    $(28,956)     $6,129     $(22,827) 

 

Source: REX American Resources Corporation