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.

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.

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.

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.

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