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Jul 31, 2023
REX American Q2 2023 Earnings Report
REX American Resources reported Q2 2023 results, reflecting interests in six ethanol production facilities.
Key Takeaways
REX American Resources reported a decrease in net sales and revenue, but an increase in gross profit due to lower corn and natural gas pricing. The company's focus on operational efficiency resulted in its twelfth consecutive quarter of profitability.
Net sales and revenue decreased to $212.0 million compared to $240.3 million in Q2 2022, primarily due to lower ethanol sales quantities and prices.
Gross profit increased by 30.1% to $18.4 million, up from $14.1 million in Q2 2022, driven by lower corn and natural gas prices.
Net income attributable to REX shareholders was $9.1 million, compared to $11.2 million in the same quarter last year.
Basic and diluted net income per share attributable to REX common shareholders was $0.52, compared to $0.63 per share in Q2 2022.
REX American
REX American
Forward Guidance
REX American Resources is focusing on operational efficiency, carbon capture projects, and return-focused investments to strengthen plants and their operational efficiency.
Positive Outlook
- Operational efficiency leading to twelfth consecutive quarter of profitability.
- Focus on the One Earth Energy carbon capture project.
- NuGen Energy facility agreement to be part of Summit Carbon Solutions' pipeline.
- Solid financial position and balance sheet flexibility.
- Company-wide focus on operational excellence.
Challenges Ahead
- Net sales and revenue decline due to reduced ethanol sales quantities and lower prices.
- Net income attributable to REX shareholders decreased compared to the previous year.
- Income before income taxes and non-controlling interests decreased compared to the comparable year-ago period.
- COVID-19 relief grants benefited Q2 2022 results, which were not present in Q2 2023.
- Risk factors set forth from time to time in the Company’s filings with the Securities and Exchange Commission.