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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): August 25, 2016

 

REX AMERICAN RESOURCES CORPORATION

(Exact name of registrant as specified in its charter)

 

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

 

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

 

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

 

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

 

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

 

Item 2.02.   Results of Operations and Financial Condition

 

On August 25, 2016, REX American Resources Corporation issued a press release announcing financial results for the three month period ended July 31, 2016. 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 August 25, 2016

 

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: August 25, 2016 By:  /s/ DOUGLAS L. BRUGGEMAN
    Name:  Douglas L. Bruggeman
    Title: Vice President - Finance,
      Chief Financial Officer
      and Treasurer
 

Exhibit 99

 

 

News Announcement For Immediate Release

 

REX AMERICAN RESOURCES REPORTS
SECOND QUARTER DILUTED EPS OF $1.24

 

Dayton, Ohio, (August 25, 2016) -- REX American Resources Corporation (NYSE: REX) today reported financial results for its fiscal 2016 second quarter (“Q2 ’16”) ended July 31, 2016. REX management will host a conference call and webcast today at 11:00 a.m. ET. to review the results.

 

Conference Call: (303) 223-2697
   
Webcast / Replay URL: www.rexamerican.com/Corp/Page4.aspx
  The webcast will be available for replay for 30 days

 

REX American Resources’ Q2 ’16 results principally reflect its interests in six ethanol production facilities. The operations of One Earth Energy, LLC (“One Earth”) and NuGen Energy, LLC (“NuGen”) are consolidated, while those of its four remaining plants are reported as equity in income of unconsolidated ethanol affiliates. During the fiscal 2015 second quarter the Company sold its interest in Patriot Holdings, LLC (“Patriot”). As such, subsequent to June 1, 2015, equity in income of unconsolidated ethanol affiliates includes contributions from four ethanol production facilities, compared with five in the comparable year-ago period.

 

REX’s Q2 ’16 net sales and revenue were $115.7 million, compared with $113.5 million in Q2 ’15, principally reflecting volume increases in ethanol and dried distillers grains (“DDG”), which was partially offset by a decrease in their average selling prices. Primarily due to the decrease in DDG pricing and year-over-year increase in grain costs, the Company’s Q2 ’16 gross profit was $17.3 million, compared with $18.3 million in the prior year period.

 

Equity in income of unconsolidated ethanol affiliates in Q2 ’16 was $1.2 million, compared with $5.1 million in Q2 ’15, partially as a result of a $2.5 million pre-tax contribution from the Company’s interest in Patriot that did not recur this quarter. In addition, during the year ago period the Company recorded a $10.4 million pre-tax gain related to the June 2015 sale of its 26.6% interest in Patriot. Reflecting the factors above, income before income taxes and non-controlling interests in Q2 ’16 totaled $13.5 million, compared with $27.4 million in Q2 ’15. Excluding Patriot’s Q2 ’15 contribution to income of unconsolidated ethanol affiliates, REX’s gain on the sale of its interest in Patriot and related items, income before income taxes and non-controlling interests in Q2 ’15 totaled $15.4 million versus the aforementioned $13.5 million in the current year.

 

Net income attributable to REX shareholders in Q2 ’16 was $8.2 million, compared with $16.4 million in Q2 ’15, while Q2 ’16 diluted net income per share attributable to REX common shareholders was $1.24 per share, compared to $2.16 per share in Q2 ’15.

 

-more-

 
REX American Resources Q2’ 16 Results, 8/25/16 page 2

 

Per share results in Q2 ’16 and Q2 ’15 are based on 6,586,000 and 7,580,000 diluted weighted average shares outstanding, respectively.

 

REX Chief Executive Officer, Zafar Rizvi, commented, “Industry fundamentals improved during the second quarter and our employees did a great job efficiently operating and increasing the production at our ethanol plants, leading to a 5% increase in the number of gallons of ethanol sold during the quarter. In addition, during the quarter we neared the completion of our capital investment projects to further expand production at our consolidated plants which will leave us better positioned for future ethanol demand.”

 

Balance Sheet

At July 31, 2016, REX had cash and cash equivalents of $134.7 million, $63.5 million of which was at the parent company and $71.2 million of which was at its consolidated ethanol production facilities. This compares with cash and cash equivalents of $135.8 million at January 31, 2016, $57.2 million of which was at the parent company and $78.6 million of which was at its consolidated ethanol production facilities.

 

The Company is currently authorized to repurchase up to an additional 155,334 shares of common stock and has 6,582,029 shares outstanding.

 

The following table summarizes select data related to the Company’s consolidated alternative energy interests:

 

   Three Months
Ended		   Six Months
Ended		 
   July 31,   July 31, 
   2016   2015   2016   2015 
Average selling price per gallon of ethanol  $1.49   $1.50   $1.41   $1.46 
                     
Average selling price per ton of dried distillers grains  $134.81   $169.31   $130.12   $156.16 
                     
Average selling price per pound of non-food grade corn oil  $0.29   $0.28   $0.27   $0.28 
                     
Average selling price per ton of modified distillers grains   $56.60   $73.95   $58.54   $78.48 
                     
Average cost per bushel of grain  $3.73   $3.64   $3.63   $3.65 
                     
Average cost of natural gas (per mmbtu)  $2.71   $3.42   $2.96   $4.13 

 

-more-

 
REX American Resources Q2’ 16 Results, 8/25/16 page 3

 

Supplemental Data Related to REX’s Alternative Energy Interests:

 

REX American Resources Corporation
Ethanol Ownership Interests/Effective Annual Gallons Shipped as of July 31, 2016
(gallons in millions)
Entity Trailing
Twelve
Months
Gallons
Shipped		 Current
REX
Ownership
Interest		 REX’s Current
Effective Ownership
of Trailing Twelve
Month Gallons
Shipped
One Earth Energy, LLC
(Gibson City, IL)		 117.0  75.0% 87.8 
NuGen Energy, LLC
(Marion, SD)		 121.1  99.5% 120.5 
Big River Resources West Burlington, LLC
(West Burlington, IA)		 107.7  9.7% 10.4 
Big River Resources Galva, LLC
(Galva, IL)		 125.0  9.7% 12.1 
Big River United Energy, LLC
(Dyersville, IA)		 126.1  5.4% 6.8 
Big River Resources Boyceville, LLC
(Boyceville, WI)		 57.9  9.7% 5.6 
Total 654.8  n/a 243.2 

 

About REX American Resources Corporation

REX American Resources has interests in six ethanol production facilities, which in aggregate shipped approximately 655 million gallons of ethanol over the twelve month period ended July 31, 2016. REX’s effective ownership of the trailing twelve month gallons shipped (for the twelve months ended July 31, 2016) by the ethanol production facilities in which it has ownership interests was approximately 243 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 impact of legislative changes, the price volatility and availability of corn, dried and modified distillers grains, ethanol, corn oil, gasoline and natural gas, ethanol plants operating efficiently and according to forecasts and projections, changes in the international, national or regional economies, weather, the effects of terrorism or acts of war and the impact of Internal Revenue Service audits. The Company does not intend to update publicly any forward-looking statements except as required by law.

 

Contact:

Douglas Bruggeman Joseph Jaffoni, Norberto Aja
Chief Financial Officer JCIR
(937) 276-3931 (212) 835-8500
  rex@jcir.com

 

- statements of operations follow -

 
REX American Resources Q2’ 16 Results, 8/25/16 page 4

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Operations

(in thousands, except per share amounts)

Unaudited

 

   Three Months
Ended		   Six Months
Ended		 
   July 31,   July 31, 
   2016   2015   2016   2015 
Net sales and revenue  $115,707   $113,480   $215,929   $218,677 
Cost of sales   98,423    95,204    190,223    191,274 
Gross profit   17,284    18,276    25,706    27,403 
Selling, general and administrative expenses   (5,206)    (6,456)    (9,233)    (10,909) 
Equity in income of unconsolidated ethanol affiliates   1,186    5,063    1,419    6,543 
Gain on sale of investment   -    10,385    192    10,385 
Gain on disposal of property and equipment, net   185    12    185    495 
Interest and other income   97    107    257    325 
Income before income taxes   13,546    27,387    18,526    34,242 
Provision for income taxes   (4,517)    (8,676)    (6,031)    (11,092) 
Net income   9,029    18,711    12,495    23,150 
Net income attributable to non-controlling interests   (853)    (2,344)    (1,481)    (2,856) 
Net income attributable to REX common shareholders  $8,176   $16,367   $11,014   $20,294 
                     
Weighted average shares outstanding – basic and diluted   6,586    7,580    6,590    7,737 
                     
Basic and diluted net income per share attributable to REX common shareholders   $1.24    $2.16    $1.67    $2.62 
 
REX American Resources Q2’ 16 Results, 8/25/16 page 5

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Balance Sheets

(in thousands) Unaudited

 

   July 31,
2016		   January 31,
2016		 
ASSETS:        
CURRENT ASSETS:          
Cash and cash equivalents  $134,651   $135,765 
Restricted cash   110    54 
Accounts receivable   15,833    13,666 
Inventory   23,633    17,178 
Refundable income taxes   1,562    5,254 
Prepaid expenses and other   6,956    6,407 
Deferred taxes-net   1,036    1,036 
Total current assets   183,781    179,360 
Property and equipment-net   189,006    189,976 
Other assets   6,395    6,642 
Equity method investments   38,622    38,707 
TOTAL ASSETS  $417,804   $414,685 
LIABILITIES AND EQUITY          
CURRENT LIABILITIES:          
Accounts payable – trade  $7,056   $10,212 
Accrued expenses and other current liabilities   8,346    9,423 
Total current liabilities   15,402    19,635 
LONG TERM LIABILITIES:          
Deferred taxes   38,304    38,304 
Other long term liabilities   1,158    987 
Total long term liabilities   39,462    39,291 
COMMITMENTS AND CONTINGENCIES          
EQUITY:          
REX shareholders’ equity:          
Common stock, 45,000 shares authorized, 29,853 shares issued at par   299    299 
Paid in capital   145,721    144,844 
Retained earnings   486,888    475,874 
Treasury stock, 23,270 and 23,204 shares, respectively   (313,849)    (309,754) 
Total REX shareholders’ equity   319,059    311,263 
Non-controlling interests   43,881    44,496 
Total equity   362,940    355,759 
TOTAL LIABILITIES AND EQUITY  $417,804   $414,685 

 

- statements of cash flows follow -

 
REX American Resources Q2’ 16 Results, 8/25/16 page 6

 

REX AMERICAN RESOURCES CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Cash Flows

(in thousands) Unaudited

 

   Six Months Ended
July 31,		 
   2016   2015 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net income  $12,495   $23,150 
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation, impairment charges and amortization   9,748    9,430 
Income from equity method investments   (1,419)    (6,543) 
Gain on disposal of real estate and property and equipment   (185)    (495) 
Dividends received from equity method investments   1,504    5,638 
Gain on sale of investment   (192)    (10,385) 
Deferred income tax   -    (8,644) 
Stock based compensation expense   40    10 
Changes in assets and liabilities:          
Accounts receivable   (4,250)    (2,754) 
Inventories   (6,455)    (5,188) 
Other assets   2,989    192 
Accounts payable-trade   (3,087)    261 
Other liabilities   169    (2,110) 
Net cash provided by operating activities   11,357    2,562 
CASH FLOWS FROM INVESTING ACTIVITIES:          
Capital expenditures   (9,334)    (5,865) 
Restricted cash   (56)    (203) 
Restricted investments and deposits   409    250 
Proceeds from sale of investment   2,275    45,476 
Proceeds from sale of property and equipment   1,028    1,935 
Other   12    12 
Net cash (used in) provided by investing activities   (5,666)    41,605 
CASH FLOWS FROM FINANCING ACTIVITIES:          
Dividend payments to and purchases of stock from non-controlling interests   (2,096)    (507) 
Treasury stock acquired   (4,709)    (43,250) 
Net cash used in financing activities   (6,805)    (43,757) 
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS   (1,114)    410 
CASH AND CASH EQUIVALENTS-Beginning of period   135,765    137,697 
CASH AND CASH EQUIVALENTS-End of period  $134,651   $138,107 
Non cash investing activities – Accrued capital expenditures  $1,350   $370 
Non cash financing activities – Accrued treasury stock repurchases  $-   $2.938 
Non cash financing activities – Equity awards issued  $1,095   $- 

 

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