REX American Resources Reports Decrease in Net Sales and Revenue for Q1 FY 2025

REX American Resources Corporation reported a decrease in net sales and revenue for the first quarter of fiscal year 2025, totaling $158.3 million, down from $161.2 million in the same period last year. The company's gross profit also saw a slight decline, falling to $14.3 million from $14.5 million year-over-year. Net income attributable to REX common shareholders was approximately $8.7 million, compared to $10.2 million in the prior year, reflecting a decrease in profitability. The basic net income per share was $0.51, down from $0.58 in the previous year.

The company experienced a 4% increase in ethanol revenue, driven by a 10% rise in the average selling price per gallon, despite a 5% decrease in the volume sold. Conversely, revenue from dried distillers grains dropped significantly by 27%, attributed to a 22% decline in average selling price and a 6% decrease in tons sold. The overall cost of sales decreased by 2%, with corn accounting for approximately 74% of total costs, amounting to $106.3 million.

In terms of operational developments, REX American Resources continues to focus on its investments in ethanol production, with majority ownership in NuGen Energy and One Earth Energy. The company is also advancing its carbon sequestration project at One Earth, having completed construction of a facility to capture and compress carbon dioxide. The project is awaiting necessary permits from the EPA, with expectations for a draft permit by November 2025. Additionally, REX is planning to expand the One Earth ethanol plant's production capacity from 150 million gallons to 175 million gallons per year.

The company’s cash flow from operating activities showed a net outflow of approximately $3.5 million for the quarter, compared to a $2.3 million outflow in the same period last year. REX's working capital decreased to approximately $356.2 million, with a current ratio of 9.4 to 1. The company also engaged in stock repurchases, acquiring approximately $32.7 million worth of its own shares during the quarter, reflecting its strategy to return value to shareholders.

Looking ahead, REX American Resources remains focused on managing commodity price volatility and optimizing its operational efficiencies. The company is also exploring various investment opportunities in the ethanol and energy sectors, as well as carbon sequestration initiatives, which may enhance its market position and profitability in the future. However, the company acknowledges the uncertainties surrounding regulatory changes and market conditions that could impact its operations and financial performance.