Alto Ingredients Reports $4.3 Million Net Income in Q1 2026, Up from Loss Last Year

Alto Ingredients, Inc. reported its financial results for the first quarter of 2026, revealing a net income of $4.3 million, a significant turnaround from a net loss of $11.7 million in the same period last year. The company’s net sales for the quarter totaled $224.7 million, a slight decrease of 0.8% from $226.5 million in the first quarter of 2025. The improvement in profitability was attributed to higher gross margins driven by an enhanced product mix and income from transferable tax credits, which amounted to $3.9 million for the quarter.

The company experienced a notable reduction in its cost of goods sold, which fell by 5.6% to $215.5 million compared to $228.3 million in the prior year. This decline in costs contributed to a gross profit of $9.2 million, compared to a gross loss of $1.8 million in the same quarter of 2025. The gross margin improved to 4.1%, reflecting operational efficiencies and a favorable shift towards higher-value renewable fuel export sales. Selling, general, and administrative expenses also decreased by 6.8% to $6.7 million, further supporting the company's improved financial performance.

Operationally, Alto Ingredients reported a decrease in total gallons sold, which fell to 85.9 million from 89.6 million in the previous year. The Pekin Campus production segment saw a slight increase in net sales to $108 million, while the marketing and distribution segment experienced a decline in sales to $47.3 million. The Western production segment reported a modest increase in sales to $16.7 million. The company’s average sales price per gallon for alcohol increased across all segments, contributing positively to revenue despite lower sales volumes.

In terms of strategic developments, Alto Ingredients continues to focus on optimizing its production capabilities and expanding its market presence. The company is currently executing several capital projects aimed at enhancing production efficiency and increasing throughput, particularly at its Columbia liquid CO2 processing facility. Additionally, the company is planning to invest approximately $25 million in capital expenditures throughout 2026, primarily for maintenance and optimization projects. The company ended the quarter with $21.6 million in cash and cash equivalents, alongside $29.3 million in unused borrowing capacity under its operating line of credit, indicating a solid liquidity position.

Looking ahead, Alto Ingredients anticipates continued growth driven by its strategic initiatives and favorable market conditions. The company expects to qualify for approximately $15 million in net proceeds from Section 45Z clean fuel production tax credits in 2026, which will further bolster its financial performance. Management remains focused on maximizing value from its diversified asset portfolio and is optimistic about capturing additional revenue opportunities in response to evolving market demands.