Alto Ingredients, Inc. · NASDAQ:ALTO
Alto Ingredients — Q4 2023 Earnings Presentation
21 slides from Alto Ingredients's earnings presentation, Mar 11, 2024
Slide 1: Alto Ingredients Q4 & FY 2023 Investor Presentation
Alto Ingredients, Inc. Q4 & FY 2023 Investor Presentation March 11, 2024 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements and information contained in this communication that refer to or include Alto Ingredients’ estimated or anticipated future results or other non- historical expressions of fact are forward-looking statements that reflect Alto Ingredients’ current perspective of existi
Slide 3: Transforming corn into higher-margin specialty alcohol and essential ingredients
Transforming corn into higher-margin specialty alcohol and essential ingredients used in a wide range of consumer and commercial products 3
Slide 4: Producer and distributor of renewable fuel and essential ingredients
Producer and distributor of renewable fuel and essential ingredients and the largest producer of specialty alcohols Targeting Pursuing Optimizing Advancing Broadening higher-margin carbon capture & asset base traceability & customer markets with storage as part & executing sustainability base premiu
Slide 5: Targeting Higher-margin Markets
Targeting Higher-margin Markets Making everyday products better: Columbia Boardman, Oregon Pekin Campus • Health, Home & Beauty Headquarters Pekin, Illinois • Food & Beverage • Industry & Agriculture • Essential Ingredients • Renewable Fuels Engaging in decarbonization to support sustainability Magi
Slide 6: Producing Premium Products
Producing Premium Products Health, Home Food & Industry & Essential Renewable & Beauty Beverage Agriculture Ingredients Fuels API Grade Ethyl Grain Neutral Spirits Industrial Grade Ethyl Alto Yeast Transportation Fuel Alcohol Alcohol • Ethanol Vinegar Corn Meal USP Grade Ethyl Fertilizer Corn Oil Co
Slide 7: Pursuing Carbon Capture & Storage (CCS)
Pursuing Carbon Capture & Storage (CCS) • Signed letter of intent with Vault for safe and permanent CO2 storage deep underground in a secure geologic reservoir • Progressing in overall system design, community outreach, financing, vendor negotiations, EPA application preparations, and schedule align
Slide 8: Sustainability Efforts
Sustainability Efforts Published Inaugural Sustainability Report in December 2023 Earned at Pekin Campus • Safe Food/Safe Feed - a third-party product safety certification • 2 EcoVadis Silver Medals, 80th percentile among peers Completed materiality survey and initial roadmap • Strengthened environm
Slide 9: Investing in Premier Assets, Creating Differentiation, Increasing Efficiencies
Investing in Premier Assets, Creating Differentiation, Increasing Efficiencies Upgraded Installed Increased Increasing Corn Expanding Specialty Alcohol High-efficiency Corn Oil & Installing Alcohol Distillery Boiler Storage High Protein Distribution • 192 proof GNS & • Replaced two • Increased • Imp
Slide 10: Certifications Create Differentiation
Certifications Create Differentiation Deepen Relationships and Open Doors to New Customers Specialty Alcohols & Essential Ingredients: More challenging to produce Require certifications, audit trails and paperwork Create significant product performance impact for a small percentage of their cost 10
Slide 11: Expanding Customer Base
Expanding Customer Base Customers prioritize Alto’s certifications, reliability, service and quality Sample list follows: Health, Home Food & Industry & Essential Renewable & Beauty Beverage Agriculture Ingredients Fuels 11
Slide 12: Improved 2023 Gross Profit and Adj. EBITDA
Improved 2023 Gross Profit and Adj. EBITDA Improving Performance Strong Liquidity • $43M increase in gross profit YOY • $33M available under operating line of credit • $27M increase in Adj. EBITDA YOY • $65M available under term loan, subject to certain conditions unaudited, $ in thousands Dec. 31,
Slide 13: Capital Initiatives to Improve Adj. EBITDA
Capital Initiatives to Improve Adj. EBITDA Diversifying revenue, investing in assets and optimizing facilities In Operation Under Development For Future Evaluation • Primary Yeast • Biogas conversion • Corn Oil: 3 additional plants • High Protein: Specialty Carbon Capture 3 additional plants Alcohol
Slide 14: Expanding Higher-margin Production and Improving Profitability
Expanding Higher-margin Production and Improving Profitability Targeting higher-margin markets with premium products Pursuing CCS as part of lowering carbon footprint Optimizing asset base & executing efficiency initiatives Advancing traceability & sustainability certifications & programs Broadening
Slide 15: Appendix
Appendix 15
Slide 16: Experienced Leadership Team
Experienced Leadership Team Bryon McGregor Mike Kandris Rob Olander, CPA Jim Sneed (1) Auste Graham President & CEO Director and Interim COO Chief Financial Officer Chief Commercial Officer General Counsel 16 years with Alto 15 years with Alto 17 years with Alto 32 years with Alto 2 years with Alto
Slide 17: Senior Management with Deep Bench Strength
Senior Management with Deep Bench Strength Todd Benton (1) Dan Croghan Michael Kramer Patrick McKenzie VP, Site Manager at Pekin VP, Eagle General Manager VP, Treasurer VP, Business Development 25 years with Alto 2 years with Alto 17 years with Alto and Engineering 13 years with Alto Prior Experienc
Slide 18: Consolidated Statements of Operations
Consolidated Statements of Operations Three Months Ended Dec. 31, Year Ended Dec. 31, (unaudited, in thousands except per share data 2023 2022 2023 2022 Net sales $ 273,625 $ 328,437 $1,222,940 $1,335,621 Cost of goods sold 276,150 349,765 1,207,287 1,363,171 Gross profit (loss) (2,525) (21,328) 15,
Slide 19: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation 19
Slide 20: Use of Non-GAAP Measures
Use of Non-GAAP Measures Management believes that certain financial measures not in accordance with generally accepted accounting principles (“GAAP”) are useful measures of operations. The company defines Adjusted EBITDA as unaudited consolidated net income (loss) before interest expense, interest i
Slide 21: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Three Months Ended Dec. 31, Years Ended Dec. 31, (unaudited, in thousands) 2023 2022 2023 2022 Consolidated net loss $ (18,945) $ (33,072) $ (28,005) $ (41,597) Adjustments: Interest expense, net 2,126 968 7,425 1,827 Interest income (265) (169) (854) (510) Unrealized