Q4 2019 Earnings Call
[laughter].
[laughter] Rex American resources This school.
Oh.
During the presentation, all participants will be.
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[noise] sexual officer. Please go ahead.
Thank you for joining Rex American resources fiscal 2000.
That's cool.
Well get to our presentation at comments momentarily.
Intercession, that's first I'll review, the Safe Harbor disclosure.
Dr State.
<unk>.
Today's conference call.
That involve risk and uncertainties within the meetings or the private.
Reform Act of 1995.
Such forward looking statements.
Occasions, and beliefs, but are not guarantees of future performance.
Okay very materially from expectations.
Sure it with the forward looking statements are described in today's news announcement.
I think with the Securities Exchange Commission, including the company's reports on.
Rex American resources assumes no obligation to <unk>.
Any forward looking statements.
I have joining.
Chairman of the board ends a four <unk> chief executive.
First review, our financial performance and then turn the call over to Stewart for his comments.
Sales for the quarter increased approximately.
Primarily reflecting higher year over year ethanol price.
Based upon 65.9 million gallons this year.
6 million into prior year fourth quarter.
Sales for the four year were based on.
5.3 million gallons this year versus 285 point.
Prior year.
The reduced ethanol gallons were primarily up and.
Due to the impact of the wet weather in rough interrupting rail service in the spring.
Probably fewer corn acres planted near the facility and the resulting impact on.
And not area.
Gross profit for the ethanol and by products.
The fourth quarter from 5.4 million the 8.1 million.
Due to improved crush spreads in the early part of the fourth quarter, which fell off faster.
Crushed.
The refined coal segment had a gross loss of 1.5.
Fourth quarter versus 3.2 million for their prior year with increased reflecting lower demand at the facility.
SGN expense.
The fourth quarter from 4.5 point 5 million to 5.6 million largely due to higher ethanol freight charges recorded in SG in a due to serve.
Yes.
The company record income from its unconsolidated equity.
For the fourth quarter this year versus a loss of $646 per year.
This improvement is consistent with ethanol industry conditions during those quarters.
We recognize a tax benefit of 3.4 million in nature.
First as a benefit of 4.6 million in the prior years fourth quarter.
Segment contributed a benefit of 1.5 million this year versus four point.
In the prior year fourth quarter, reflecting the aforementioned deliver.
Yeah.
This resulted in net income for the fourth quarter increase.
4 million to 4.4 million ended diluted earnings per share increasing.
Since deciding to somebody sense.
Sure I'll now turn the call over to you.
Thank you Doug.
Quarter after at all or a whole operation is running that up boss.
Caused by by yet at all among the reasons that wasn't that that's.
The loss was a bad harvest and part of the country and stuff explain.
Lower oil prices well when oil prices.
Good.
You know outbreak [noise].
[laughter].
I'm sorry.
[laughter], which I'll turn it well crush spread.
[noise] men and I'm, saying something to my throat.
<unk>.
Jeremy.
Oh the plants are running that are currently running idle.
We believe that.
Natural gas prices and lower then then expect.
The pricing coal now in our opinion, it's making it.
Well I call operation.
On the goods side of that we have no need.
This time, so it's not its not something that would do.
In terms of our company itself, we saved our cash.
What a which currently looks like very very good move in Charlotte.
About 205 million usage this cat.
We're now at <unk>, where certainly now actively looking.
Possible buybacks about 350000 shares remained ought to us.
Right at right now our stock is selling at a price.
Possibly makes at attractive depending where it is on any given day.
So looking at carbon capture possibilities in Illinois.
We're just looking at new businesses. This is the same company that 10 years ago sell TV.
But where certainly kept <unk> capable if this is prolong didn't they.
Making a pivot.
And where we're looking if an ethanol plant a very good.
Very bargain price would consider it.
So far which we are keys.
Sure well now discuss where they're the ethanol business and the overall.
<unk>.
Hello.
Hello.
Well I guess going before I go back just doing good morning, everybody.
No, but you guys getting Cogs agenda challenging environment has gone up in New York.
<unk>.
Company across several issues, you would rather than the lid problems, which then.
I want you did that in an unexpected delay into halt.
But the prices in 2019, what are some subject <unk> <unk>.
Now I'd like to obtain an annual grants light yet on that you would you seem to be inside.
We had production has fallen off this black Knight.
Hi.
<unk> based its outboard production up it's not like interrupted Gordon.
<unk>, <unk>, <unk>, well know, but well have yet [laughter].
[laughter].
Good good talking to one he isn't continued challenges including abuse.
<unk> and <unk> a decline in the price and the in emerging.
Look 19 endemic Oliver <unk> like to do but even if you will.
The next giving back when the gosh margins.
Kinda Goldman diabetes.
I guess I'd wise, he was also distance and walking modeling from.
We have taken and what do you steps cookie bargain why you saved and all.
<unk> role and convention.
And Steve Peck, though.
As I mentioned, but even see I wouldn't do you get on face many challenges.
And then sponsor to go over 19 and adjusting industry.
We just last week, we keep the bond.
AD hoc pardon.
Looking at what wouldn't I, either use and the gross margin cookies, we haven't yet.
Graduating public seamless steps, one well I'm not saying that you see.
And you should stay at home or does and wash them often have going [laughter].
[laughter], that's largely we got expecting a lawsuit that's not segmenting the Boston.
Well dog and Pony.
Well what might be.
Good.
And do some do not.
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Got it again, we are you didn't see continued uncertainty because.
And the small declines the exemption.
In 2000, I am not like.
1.5 billion got <unk> 1.7 billion gotten them talking.
[laughter], but let's not productive.
England pinpoint it.
Well I want you can get caught the U.S. exports.
What.
Well talk to 19.7 vitamin D N.
But my point, what could be but I would call them.
Scott.
Got a little bit above what as we walked away that's <unk>.
We had one thing that they know nearest different I'm always go slow when it got them split.
Well I'm not going to eat the plant produces approximately 500000.
He got them at that site.
Yeah, they typically mapping.
And the modeling that.
Your bonds triggered that storage potentially the Mt snow.
No that's in the event steel Philadelphia energy deliveries are expected to happen.
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Let's go to your Oh God people, you must do you have knowledge and I'm missing.
You did a feasibility study on deck.
As Scott.
But at some than what the broad debt.
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Brad that we wouldn't be able to <unk>.
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In somebody inspire don't very difficult challenging environment.
Reviews, and that often thought that yet as well that supports Galapagos [laughter].
[laughter] one segment.
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I will get back.
He's gone there so what.
Thanks, Thank you I'd conclusion.
[laughter].
It's probably less Adams I've ever seen and they got set off business.
Corn being dealt with corn prices.
[laughter] corn availability.
[laughter] oil going down cobot nights in its oh.
Same time, but we haven't experienced management team.
So we have lots of cash we have always say over the past.
Yes.
Yes, we will do our best they have to at least time suite, we hope to come out.
[laughter].
We should but we'll see hitting these uncertain times its.
All right.
Not only the floor open for questions.
Thank you [laughter], if he would like to register a question. Please press the.
For your telephone you'll hear a three told prompt technology work.
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One moment for the first question.
[laughter].
[noise] [noise] enough.
Oh, well cut off with Raymond James Please proceed.
[laughter].
[laughter] Pleasant morning, Thanks for taking the questions or these are.
[laughter].
Since everything.
Around a pandemic these days I.
I thought I would.
Several other economics companies have started.
[noise], Oh re purpose or at least no.
[laughter] begin to use their ethanol plants to supply.
Yes, Hello alcohol for the manufacturing okay.
[laughter] as part of the treasuries [laughter] emergency often.
[noise] last week do you have any interesting on doing that I know youre et cetera.
[laughter] Zipcar, So let me answer.
Yeah I.
I think.
Let me say that we are looking into this.
But.
We need the mic solar we followed the idea that speed, which did.
Alright line and we happen to be just didn't get the F.D., who makes a lot.
Yeah also looking at some of the plot Missy WAM does.
On the deadlocked sense, but.
No.
Boxing badly I do 500, Gatland Uh huh.
Oh, sorry, [laughter] when it was down about Senate I just think public.
At this stage I think goods.
So to me that isn't.
We are looking into it but as what at some so I'm not up.
I don't think that wanted to be sold many gatland knowledge.
See I mean, one doctor not agree with we've told you have gotten them, but it's not.
[laughter] million government bonds, and we get sold it it'd be quite hundred gotten them.
So, yes, Oh, we will be looking into it but at this stage.
No that business is going to be done bulk.
We wouldn't do what we can.
He said that if any and we are working on talking to and Sanitizers, but.
So far just said anyone that takes that is going to make any footprints on that.
One question, then that will be very very minimal, we make millions and millions but.
You're talking about buying south hundreds and thousands yeah [laughter] short answer.
That's an out loud here and people that will sell it and.
No problem is getting the bottles and getting the licenses.
Just described.
And we are where we don't want to do what we can't say.
Okay, so but don't expect that.
You have any significant.
[laughter] change to our forecast, which we just went a little.
[laughter] understood why one more on.
[laughter] vacant related [laughter] question.
I see I said of course are in Ohio, which is one of the stage and are locked.
More and more we are seeing these.
Locked down and not.
Order set the state level I do you ever knowledge our aim.
Oh, the ethanol production facilities, either the ones you up.
[laughter] or other class [laughter] are any of that.
Shut down because of the lock net [laughter] just across the industry.
[laughter] Oh, hi.
Yes, there is some of the news when we got them Sydney got warmed up you know D.
You know, Illinois has locked down but on the same time the margins on exactly.
Thanks, Deane and it's not also economically to produce up to now let me.
If you pipe sense.
When the long they're getting 51.
There's no margin dogs, so, but we got off.
[music].
Hi line, what exactly is every state hot Abbvie, even see deeds.
So you're not both double basin, we have Leah inception.
Hi.
Where this would be how distance they've had uh huh.
Okay, and what it all issues I didn't really meant dude.
Since August.
Wharton done anything as and we are taking all of those steps, yes, we did see effecting, but the made getting back to not only Gordon.
Paul <unk>, the ethanol pricing and the gasoline pricing and that.
<unk> shrinking margins.
That's WB happening.
But I suppose Velez, you know a lot of company to announce shut downs.
Others I'm sure considering shutdowns.
At this point there. It was just stay cost in a sort of shut down or margins. It's the same effect.
We can't make money as if so period.
Yeah. Just last question for me about God. This one on kind of separate topic. So it's been about three months since the phase one.
I know obviously a lot of happened since then in China and everywhere else.
To your understanding is China buying any U.S. ethanol, but [laughter].
Oh, no we have not seen really gotten any anyway.
In the Mark good that China is buying any of our knowledge or.
But we are putting this do you want on that deal done at buying BD.
Bids on find dog that was not Chinese what buying WG, but beyond <unk>.
Oh, well and going on do you have joined NYSE buying the phone.
On the yesterday I came up on price was little bit gone high out to be got good luck.
I was trying to buy 1 million thought metric ton.
And.
Just add the owned <unk> goes up and that's not prices degree the.
Good old I guess nearly does not have [laughter] and that's a weekend.
That's not buys also screwed up the same rates, but it uses.
No we have not seen and yet not bus jet Sunshine, though at this stage.
Okay. Thank you guy they shape.
Thanks.
I remind you actually read.
And your kind of phones.
[laughter].
There's no more questions I, thank everyone for listening.
Like things will get better in the future. We appreciate your sticky.
Thank you very much like you have got Lubbock.
That does conclude the call for today, we think participation and that's the piece just catching.
[laughter].
[music].