The Andersons, Inc. Reports Strong Third Quarter Results

About this update from The Andersons, Inc.

MAUMEE, Ohio , Nov. 4, 2024 /PRNewswire/ -- The Andersons, Inc. (Nasdaq: ANDE) announces financial results for the third quarter ended September 30, 2024 . Third Quarter Highlights: Company reported net income attributable to The Andersons of $27 million , or $0.80 per diluted share and adjusted net income of $25 million , or $0.72 per diluted share Adjusted EBITDA was $97 million , producing a record for the third quarter Renewables reported best-ever third quarter pretax income of $53 million and pretax income attributable to The Andersons of $28 million on strong operating performance and ethanol margins Trade generated increased year-over-year pretax income of $26 million and adjusted pretax income of $23 million "Overall, we are pleased with our third quarter results given the lower commodity prices and reduced volatility in the ag markets. Renewables had a very strong quarter with increased ethanol production and improved yields in a period of good but softening crush margins. Trade results were significantly better than last year and include improved performance in our assets. Increased volume and margins in our specialty liquids and manufactured product lines resulted in improved results in Nutrient & Industrial," said President and CEO Bill Krueger . "Harvest is almost complete due to the near-perfect harvest weather, with both higher-than-normal quality and above trend-line yields. We have been able to buy grain at good basis values which should allow for carry opportunities into 2025. We continue to see the benefits of our portfolio mix with well-placed assets, a growing specialty ingredients business, efficient ethanol plant performance and merchandising opportunities across our businesses." "We continue to pursue growth opportunities. Most recently, we announced the closing of an $85 million investment for a 65% ownership interest in Skyland Grain, LLC , which operates a large grain and agronomy footprint spread across Southwest Kansas , Eastern Colorado , and the Texas and Oklahoma panhandles. These assets extend our geographic footprint and support our existing merchandising presence in the region," continued Krueger. "In addition, we announced a significant investment in our leased facility at the port of Houston to improve our current grain export program and add capacity for storing and exporting soybean meal. We continue to make progress on our longer-term Renewables projects, which are focused on lowering the carbon intensity of our high-performing ethanol plants. In addition to these projects, we continue our investment philosophy to improve efficiency and add capacity at our existing plants, as well as acquisition opportunities, which are in line with our strategy and generate appropriate returns." $ in millions, except per share amounts Q3 2024 Q3 2023 Variance YTD 2024 YTD 2023 Variance Pretax Income $ 62.2 $ 38.4 $ 23.8 $ 133.5 $ 77.8 $ 55.7 Pretax Income Attributable to the Company 1 38.1 17.6 20.5 85.8 73.7 12.1 Adjusted Pretax Income Attributable to the Company 1 34.6 10.1 24.5 86.1 90.7 (4.6) Trade 1 22.7 5.4 17.3 41.0 36.3 4.7 Renewables 1 28.5 26.3 2.2 63.8 65.0 (1.2) Nutrient & Industrial (6.1) (8.5) 2.4 15.4 23.7 (8.3) Other 1 (10.5) (13.1) 2.6 (34.1) (34.3) 0.2 Net Income Attributable to the Company 27.4 9.7 17.7 68.9 50.0 18.9 Adjusted Net Income Attributable to the Company 1 24.7 4.6 20.1 69.8 63.7 6.1 Diluted Earnings Per Share ("EPS") 0.80 0.28 0.52 2.01 1.46 0.55 Adjusted EPS 1 0.72 0.13 0.59 2.04 1.86 0.18 EBITDA 1 101.0 77.8 23.2 246.6 210.4 36.2 Adjusted EBITDA from Continuing Operations 1 $ 97.4 $ 70.3 $ 27.1 $ 246.9 $ 270.0 $ (23.1) 1 Non-GAAP financial measures; see appendix for explanations and reconciliations. Cash, Liquidity, and Long-Term Debt Management "Our businesses continue to generate consistent cash flows throughout the shift in ag markets, and our debt remains at a modest level," said Executive Vice President and CFO Brian Valentine . "With the strong cash flows and lower commodity prices, we continue to show a higher-than-normal cash position at this point in the year. We remain well below our long-term debt to EBITDA target of less than 2.5 times and are pleased with the strength of our balance sheet. We continue to evaluate new growth investments and acquisitions in a variety of strategic projects. We anticipate increased spending on growth projects in the fourth quarter and into 2025, in addition to the Skyland investment." The company used cash from operating activities of $2 million and generated cash from operating activities of $489 million in the third quarter of 2024 and 2023, respectively. Cash from operations before working capital changes in the same periods was $86 million and $50 million , respectively. Cash spent on capital projects in the quarter totaled $38 million , a $4 million increase from 2023. Third Quarter Segment Overview Trade Results Resilient in Less Volatile Ag Markets The Trade segment recorded pretax income of $26 million and adjusted pretax income of $23 million for the quarter compared to pretax income of $8 million and adjusted pretax income of $5 million in the third quarter of 2023. Results from our grain asset footprint were better than the prior year, due to strong elevation margins and space income, primarily related to corn and wheat. Trade's growing specialty ingredients business continued to benefit from recent growth investments. The merchandising business remained profitable with well-supplied commodity markets and limited volatility. As expected, farmer engagement ramped up during the quarter to bring significant old crop bushels to market and forward sell new crop in anticipation of an early and robust harvest. For comparison, prior year results include a $19 million pretax loss on a foreign currency issue. The portfolio mix of assets, ingredients and merchandising businesses provides a solid foundation to benefit from large crops and carry markets, as well as tight, demand-driven markets. Assets are well-positioned for an early and large harvest, which should allow us to buy bushels at low basis levels. Domestic specialty ingredient demand is also expected to stay solid and should continue to support recent capital growth investments. Trade's third quarter adjusted EBITDA was $38 million , compared to $21 million in 2023. Renewables had Record Quarter on Efficient Operations and Favorable Ethanol Margins The Renewables segment reported pretax income of $53 million and pretax income attributable to the company of $28 million in the third quarter. For the same period in 2023, the segment reported a pretax income of $47 million and pretax income attributable to the company of $26 million . Margins on ethanol production improved year-over-year on significantly lower corn basis in the eastern plants, despite a reduction in ethanol board crush margins in the quarter. Production facilities continued to operate efficiently with increased volume and higher ethanol yields. Plant co-product values were lower, with feed ingredients following the overall price reduction of corn; however, feed ingredient demand improved year-over-year. Renewable diesel feedstock volumes continue to grow albeit with compressed margins on industry fundamentals. All four plants completed their semi-annual maintenance shutdowns in the third quarter. A favorable ethanol margin environment should continue, supported by exports, higher blending rates and continued lower corn basis levels in the east. Renewables had third quarter EBITDA of $65 million in 2024, compared to $60 million in 2023. Nutrient & Industrial Improved in Seasonally Quiet Quarter The Nutrient & Industrial segment reported a pretax loss of $6 million , compared to a loss of $8 million in 2023. Overall volumes improved during a seasonally slow third quarter, but margins in base nutrients have reset to more normalized levels and did not repeat the outsized margin opportunities seen in recent years. The engineered granules business saw significant improvement in the quarter on higher sales volume and margins, with continued focus on operational improvements in this business. Looking forward, the fourth quarter should benefit from high yields and an early harvest, allowing for fall applications. Nutrient & Industrial's third quarter EBITDA was $5 million compared to breakeven EBITDA in the third quarter of 2023. Income Taxes; Corporate The company recorded income tax expense at an effective rate of 17% for the quarter. This rate was impacted by the tax treatment of noncontrolling interests and federal tax credits. We anticipate a full-year adjusted effective rate of approximately 14% - 18%. Conference Call The company will host a webcast on Tuesday, November 5, 2024 , at 11 a.m. Eastern Time , to discuss its performance and provide its outlook for the remainder of 2024 and preliminary views for 2025. To access the call, please dial 888-317-6003 or 412-317-6061 (elite entry number is 2387329). It is recommended that you call 10 minutes before the conference call begins. To access the webcast, click on the link: https://app.webinar.net/Bz3omkN6Ver and submit the requested information as directed. A replay of the call can also be accessed under the heading "Investors" on the company's website at www.andersonsinc.com . Forward-Looking Statements This release contains forward-looking statements. These statements involve risks and uncertainties that could cause actual results to differ materially. Without limitation, these risks include economic, weather and regulatory conditions, competition, geopolitical risk, and the risk factors set forth from time to time in the company's filings with the Securities and Exchange Commission . Although the company believes that the assumptions upon which the financial information and its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct. Non-GAAP Measures This release contains non-GAAP financial measures. The company believes that pretax income (loss) attributable to the company; adjusted pretax income (loss) attributable to the company; adjusted pretax income (loss); adjusted net income attributable to the company; adjusted diluted earnings per share; earnings before interest, taxes, depreciation, and amortization (or EBITDA); adjusted EBITDA; and cash from operations before working capital changes provide additional information to investors and others about its operations, allowing an evaluation of underlying operating performance and liquidity and better period-to-period comparability. The above measures are not and should not be considered as alternatives to pretax income (loss) or income (loss) before income taxes, net income (loss), diluted earnings (loss) per share attributable to The Andersons, Inc. common shareholders and cash provided by (used in) operating activities as determined by generally accepted accounting principles. Reconciliations of the GAAP to non-GAAP measures may be found within this press release and the financial tables provided herein. Company Description The Andersons, Inc. , named in 2024 to Forbes list of America's Most Successful Small Companies, Newsweek's list of America's Most Responsible Companies, and one of The Americas' Fastest Growing Companies by the Financial Times , is a diversified company rooted in agriculture that conducts business in the commodity merchandising, renewables, and nutrient & industrial sectors. Guided by its Statement of Principles, The Andersons is committed to providing extraordinary service to its customers, helping its employees improve, supporting its communities, and increasing the value of the company. For more information, please visit www.andersonsinc.com . The Andersons, Inc. Condensed Consolidated Statements of Operations (unaudited) Three months ended September 30 , Nine months ended September 30 , (in thousands, except per share data) 2024 2023 2024 2023 Sales and merchandising revenues $ 2,620,988 $ 3,635,691 $ 8,134,410 $ 11,537,112 Cost of sales and merchandising revenues 2,443,863 3,477,990 7,653,594 11,009,463 Gross profit 177,125 157,701 480,816 527,649 Operating, administrative and general expenses 120,494 126,306 356,466 359,548 Asset impairment — — — 87,156 Interest expense, net 8,361 8,188 21,494 38,766 Other income, net 13,922 15,178 30,651 35,623 Income before income taxes 62,192 38,385 133,507 77,802 Income tax provision 10,731 7,862 16,911 23,710 Net income 51,461 30,523 116,596 54,092 Net income attributable to noncontrolling interests 24,096 20,815 47,674 4,088 Net income attributable to The Andersons, Inc. $ 27,365 $ 9,708 $ 68,922 $ 50,004 Earnings per share attributable to The Andersons, Inc. common shareholders: Basic earnings: $ 0.80 $ 0.29 $ 2.03 $ 1.48 Diluted earnings: $ 0.80 $ 0.28 $ 2.01 $ 1.46 The Andersons, Inc. Condensed Consolidated Balance Sheets (unaudited) (in thousands) September 30, 2024 December 31, 2023 September 30, 2023 Assets Current assets: Cash and cash equivalents $ 454,065 $ 643,854 $ 418,055 Accounts receivable, net 756,618 762,549 816,686 Inventories 884,339 1,166,700 985,292 Commodity derivative assets – current 122,326 178,083 239,595 Other current assets 113,726 55,777 67,471 Total current assets 2,331,074 2,806,963 2,527,099 Property, plant and equipment, net 709,951 693,365 680,188 Other assets, net 347,274 354,679 380,815 Total assets $ 3,388,299 $ 3,855,007 $ 3,588,102 Liabilities and equity Current liabilities: Short-term debt $ 14,716 $ 43,106 $ 14,138 Trade and other payables 774,347 1,055,473 822,153 Customer prepayments and deferred revenue 67,899 187,054 211,867 Commodity derivative liabilities – current 85,640 90,849 142,511 Current maturities of long-term debt 27,727 27,561 27,535 Accrued expenses and other current liabilities 207,543 232,288 189,430 Total current liabilities 1,177,872 1,636,331 1,407,634 Long-term debt, less current maturities 542,564 562,960 569,730 Other long-term liabilities 144,855 139,329 161,652 Total liabilities 1,865,291 2,338,620 2,139,016 Total equity 1,523,008 1,516,387 1,449,086 Total liabilities and equity $ 3,388,299 $ 3,855,007 $ 3,588,102 The Andersons, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) Nine months ended September 30 , (in thousands) 2024 2023 Operating Activities Net income $ 116,596 $ 54,092 Adjustments to reconcile net income to cash provided by operating activities: Depreciation and amortization 91,626 93,800 Asset impairment — 87,156 Other 15,146 1,347 Changes in operating assets and liabilities: Accounts receivable 3,498 406,263 Inventories 278,947 748,118 Commodity derivatives 49,327 99,479 Other current and non-current assets (59,376) 2,048 Payables and other current and non-current liabilities (433,069) (796,216) Net cash provided by operating activities 62,695 696,087 Investing Activities Purchases of property, plant and equipment and capitalized software (93,230) (108,718) Acquisition of businesses, net of cash acquired (9,561) (24,385) Insurance proceeds 9,219 — Proceeds from sale of a business — 10,318 Other 2,980 5,522 Net cash used in investing activities (90,592) (117,263) Financing Activities Net payments under short-term lines of credit (27,054) (261,152) Payments of long-term debt (20,649) (42,734) Distributions to noncontrolling interest owner (87,325) (44,304) Dividends paid (19,466) (18,771) Value of shares withheld for taxes (8,101) (6,627) Proceeds from issuance of long-term debt — 100,000 Other — (2,258) Net cash used in financing activities (162,595) (275,846) Effect of exchange rates on cash and cash equivalents 703 (192) (Decrease) increase in cash and cash equivalents (189,789) 302,786 Cash and cash equivalents at beginning of period 643,854 115,269 Cash and cash equivalents at end of period $ 454,065 $ 418,055 The Andersons, Inc. Adjusted Net Income Attributable to The Andersons, Inc. A non-GAAP financial measure (unaudited) Three months ended September 30 , Nine months ended September 30 , (in thousands, except per share data) 2024 2023 2024 2023 Net income $ 51,461 $ 30,523 $ 116,596 $ 54,092 Net income attributable to noncontrolling interests 24,096 20,815 47,674 4,088 Net income attributable to The Andersons, Inc. 27,365 9,708 68,922 50,004 Adjustments: Gain on sale of assets — (5,643) — (5,643) Gain on cost method investment — (4,798) — (4,798) Transaction related compensation 1,668 1,999 8,568 4,606 Gain on deconsolidation of joint venture — — (3,117) (6,544) Insurance recoveries (5,204) — (5,204) (16,080) Asset impairment — 963 — 45,413 Income tax impact of adjustments1 884 2,367 632 (3,255) Total adjusting items, net of tax (2,652) (5,112) 879 13,699 Adjusted net income attributable to The Andersons, Inc. $ 24,713 $ 4,596 $ 69,801 $ 63,703 Diluted earnings per share attributable to The Andersons, Inc. common shareholders $ 0.80 $ 0.28 $ 2.01 $ 1.46 Impact on diluted earnings (loss) per share $ (0.08) $ (0.15) $ 0.03 $ 0.40 Adjusted diluted earnings per share $ 0.72 $ 0.13 $ 2.04 $ 1.86 1 The income tax impact of adjustments is taken at the statutory tax rate of 25% with the exception of certain transaction related compensation in both 2024 and 2023, respectively. Adjusted net income (loss) attributable to The Andersons, Inc. reflects reported net income (loss) available to The Andersons, Inc. common shareholders after the removal of specified items described above. Adjusted diluted earnings (loss) per share reflects the fully diluted EPS of The Andersons, Inc. after removal of the effect on EPS as reported of specified items described above. Management believes that Adjusted net income (loss) attributable to The Andersons, Inc. and Adjusted diluted earnings (loss) per share are useful measures of The Andersons, Inc. performance as they provide investors additional information about the operations of the company allowing better evaluation of underlying business performance and better comparability to previous periods. These non-GAAP financial measures are not intended to replace or be alternatives to Net income attributable to The Andersons, Inc. and Diluted earnings per share attributable to The Andersons, Inc. common shareholders as reported, the most directly comparable GAAP financial measures, or any other measures of operating results under GAAP. Earnings amounts described above have been divided by the company's average number of diluted shares outstanding for each respective period in order to arrive at an adjusted diluted earnings (loss) per share amount for each specified item. The Andersons, Inc. Segment Data (unaudited) (in thousands) Trade Renewables Nutrient &Industrial Other Total Three months ended September 30, 2024 Sales and merchandising revenues $ 1,747,715 $ 745,206 $ 128,067 $ — $ 2,620,988 Gross profit 98,776 60,375 17,974 — 177,125 Operating, administrative and general expenses 75,825 8,839 24,591 11,239 120,494 Other income, net 8,720 1,760 3,323 119 13,922 Income (loss) before income taxes 26,266 52,583 (6,132) (10,525) 62,192 Income attributable to noncontrolling interests — 24,096 — — 24,096 Income (loss) before income taxes attributable to The Andersons, Inc. 1 $ 26,266 $ 28,487 $ (6,132) $ (10,525) $ 38,096 Adjustments to income (loss) before income taxes2 (3,536) — — — (3,536) Adjusted income (loss) before income taxes attributable to The Andersons, Inc.1 $ 22,730 $ 28,487 $ (6,132) $ (10,525) $ 34,560 Three months ended September 30, 2023 Sales and merchandising revenues $ 2,639,059 $ 868,099 $ 128,533 $ — $ 3,635,691 Gross profit 85,997 53,045 18,659 — 157,701 Operating, administrative and general expenses 79,247 8,332 26,233 12,494 126,306 Other income, net 7,838 3,346 606 3,388 15,178 Income (loss) before income taxes 8,073 47,096 (8,452) (8,332) 38,385 Income attributable to noncontrolling interests — 20,815 — — 20,815 Income (loss) before income taxes attributable to The Andersons, Inc. 1 $ 8,073 $ 26,281 $ (8,452) $ (8,332) $ 17,570 Adjustments to income (loss) before income taxes2 (2,681) — — (4,798) (7,479) Adjusted income (loss) before income taxes attributable to The Andersons, Inc.1 $ 5,392 $ 26,281 $ (8,452) $ (13,130) $ 10,091 1 Income (loss) before income taxes attributable to The Andersons, Inc. for each operating segment is defined as net sales and merchandising revenues plus identifiable other income less all identifiable operating expenses, including interest expense for carrying working capital and long-term assets and is reported net of the noncontrolling interest share of income. 2 Additional information on the individual adjustments that are included in the adjustments to income (loss) before income taxes can be found in the Reconciliation to EBITDA and Adjusted EBITDA table. The Andersons, Inc. Segment Data (unaudited) (in thousands) Trade Renewables Nutrient &Industrial Other Total Nine months ended September 30, 2024 Sales and merchandising revenues $ 5,399,315 $ 2,088,372 $ 646,723 $ — $ 8,134,410 Gross profit 256,706 133,672 90,438 — 480,816 Operating, administrative and general expenses 220,886 24,592 75,427 35,561 356,466 Other income (loss), net 18,287 7,686 4,880 (202) 30,651 Income (loss) before income taxes 37,615 114,574 15,437 (34,119) 133,507 Income attributable to noncontrolling interests — 47,674 — — 47,674 Income (loss) before income taxes attributable to The Andersons, Inc. 1 $ 37,615 $ 66,900 $ 15,437 $ (34,119) $ 85,833 Adjustments to income (loss) before income taxes2 3,364 (3,117) — — 247 Adjusted income (loss) before income taxes attributable to The Andersons, Inc.1 $ 40,979 $ 63,783 $ 15,437 $ (34,119) $ 86,080 Nine months ended September 30, 2023 Sales and merchandising revenues $ 8,213,649 $ 2,585,396 $ 738,067 $ — $ 11,537,112 Gross profit 283,886 137,140 106,623 — 527,649 Operating, administrative and general expenses 220,373 24,804 79,251 35,120 359,548 Other income, net 18,149 11,655 1,952 3,867 35,623 Income (loss) before income taxes 52,427 31,187 23,675 (29,487) 77,802 Income attributable to noncontrolling interests — 4,088 — — 4,088 Income (loss) before income taxes attributable to The Andersons, Inc. 1 $ 52,427 $ 27,099 $ 23,675 $ (29,487) $ 73,714 Adjustments to income (loss) before income taxes2 (16,154) 37,906 — (4,798) 16,954 Adjusted income (loss) before income taxes attributable to The Andersons, Inc. 1 $ 36,273 $ 65,005 $ 23,675 $ (34,285) $ 90,668 1 Income (loss) before income taxes attributable to The Andersons, Inc. for each operating segment is defined as net sales and merchandising revenues plus identifiable other income less all identifiable operating expenses, including interest expense for carrying working capital and long-term assets and is reported net of the noncontrolling interest share of income. 2 Additional information on the individual adjustments that are included in the adjustments to income (loss) before income taxes can be found in the Reconciliation to EBITDA and Adjusted EBITDA table. All adjustments are consistent with the EBITDA reconciliation with the exception of a $42.7 million difference in the Renewables segment which represents the asset impairment expense attributable to the non-controlling interest that is reflected in Income attributable to the noncontrolling interest within the reconciliation above. The Andersons, Inc. Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) A non-GAAP financial measure (unaudited) (in thousands) Trade Renewables Nutrient &Industrial Other Total Three months ended September 30, 2024 Net income (loss) $ 26,266 $ 52,583 $ (6,132) $ (21,256) $ 51,461 Interest expense (income) 5,405 713 2,838 (595) 8,361 Tax provision — — — 10,731 10,731 Depreciation and amortization 9,377 11,942 8,145 944 30,408 EBITDA 41,048 65,238 4,851 (10,176) 100,961 Adjusting items impacting EBITDA: Transaction related compensation 1,668 — — — 1,668 Insurance recoveries (5,204) — — — (5,204) Total adjusting items (3,536) — — — (3,536) Adjusted EBITDA $ 37,512 $ 65,238 $ 4,851 $ (10,176) $ 97,425 Three months ended September 30, 2023 Net income (loss) $ 8,073 $ 47,096 $ (8,452) $ (16,194) $ 30,523 Interest expense (income) 6,515 963 1,484 (774) 8,188 Tax provision — — — 7,862 7,862 Depreciation and amortization 9,331 12,328 7,464 2,092 31,215 EBITDA 23,919 60,387 496 (7,014) 77,788 Adjusting items impacting EBITDA: Transaction related compensation 1,999 — — — 1,999 Gain on cost method investment — — — (4,798) (4,798) Gain on sale of assets (5,643) — — — (5,643) Gain on deconsolidation of joint venture 963 — — — 963 Total adjusting items (2,681) — — (4,798) (7,479) Adjusted EBITDA $ 21,238 $ 60,387 $ 496 $ (11,812) $ 70,309 Adjusted EBITDA is defined as earnings before interest, taxes and depreciation and amortization, adjusted for specified items. The company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of interest expense, tax expense and depreciation and amortization to net income (loss). Management believes that adjusted EBITDA is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Adjusted EBITDA is a non-GAAP financial measure and is not intended to replace or be an alternative to net income (loss), the most directly comparable GAAP financial measure. The Andersons, Inc. Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) A non-GAAP financial measure (unaudited) (in thousands) Trade Renewables Nutrient &Industrial Other Total Nine months ended September 30, 2024 Net income (loss) $ 37,615 $ 114,574 $ 15,437 $ (51,030) $ 116,596 Interest expense (income) 16,492 2,192 4,454 (1,644) 21,494 Tax provision — — — 16,911 16,911 Depreciation and amortization 27,946 35,626 23,903 4,151 91,626 EBITDA 82,053 152,392 43,794 (31,612) 246,627 Adjusting items impacting EBITDA: Transaction related compensation 8,568 — — — 8,568 Insurance recoveries (5,204) — — — (5,204) Gain on deconsolidation of joint venture — (3,117) — — (3,117) Total adjusting items 3,364 (3,117) — — 247 Adjusted EBITDA $ 85,417 $ 149,275 $ 43,794 $ (31,612) $ 246,874 Nine months ended September 30, 2023 Net income (loss) $ 52,427 $ 31,187 $ 23,675 $ (53,197) $ 54,092 Interest expense (income) 29,235 5,648 5,649 (1,766) 38,766 Tax provision — — — 23,710 23,710 Depreciation and amortization 26,659 39,224 21,518 6,399 93,800 EBITDA 108,321 76,059 50,842 (24,854) 210,368 Adjusting items impacting EBITDA: Transaction related compensation 4,606 — — — 4,606 Insurance recoveries (16,080) — — — (16,080) Gain on sale of assets (5,643) — — — (5,643) Gain on deconsolidation of joint venture — (6,544) — — (6,544) Gain on cost method investment — — — (4,798) (4,798) Asset impairment 963 87,156 — — 88,119 Total adjusting items (16,154) 80,612 — (4,798) 59,660 Adjusted EBITDA $ 92,167 $ 156,671 $ 50,842 $ (29,652) $ 270,028 Adjusted EBITDA is defined as earnings before interest, taxes and depreciation and amortization, adjusted for specified items. The company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of interest expense, tax expense and depreciation and amortization to net income (loss). Management believes that adjusted EBITDA is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Adjusted EBITDA is a non-GAAP financial measure and is not intended to replace or be an alternative to net income (loss), the most directly comparable GAAP financial measure. The Andersons, Inc. Trailing Twelve Months of EBITDA and Adjusted EBITDA A non-GAAP financial measure (unaudited) Three Months Ended, Twelve months ended September 30, 2024 (in thousands) December31, 2023 March 31 ,2024 June 30 , 2024 September30, 2024 Net income $ 78,437 $ 12,665 $ 52,470 $ 51,461 $ 195,033 Interest expense 8,101 6,522 6,611 8,361 29,595 Tax provision 13,324 1,303 4,876 10,731 30,234 Depreciation and amortization 31,306 30,949 30,269 30,408 122,932 EBITDA 131,168 51,439 94,226 100,961 377,794 Adjusting items impacting EBITDA: Transaction related compensation 3,212 2,852 4,049 1,668 11,781 Insurance recoveries — — — (5,204) (5,204) Gain on deconsolidation of joint venture — (3,117) — — (3,117) Goodwill impairment 686 — — — 686 Total adjusting items 3,898 (265) 4,049 (3,536) 4,146 Adjusted EBITDA $ 135,066 $ 51,174 $ 98,275 $ 97,425 $ 381,940 Three Months Ended, Twelve months ended September 30, 2023 December31, 2022 March 31 ,2023 June 30 ,2023 September30, 2023 Net income (loss) $ 21,170 $ (59,117) $ 82,686 $ 30,523 $ 75,262 Interest expense 14,087 16,625 13,953 8,188 52,853 Tax provision (benefit) 9,933 (5,884) 21,732 7,862 33,643 Depreciation and amortization 33,476 32,220 30,365 31,215 127,276 EBITDA 78,666 (16,156) 148,736 77,788 289,034 Adjusting items impacting EBITDA: Insured inventory expenses (recoveries) 15,993 (17,390) 1,310 — (87) Transaction related compensation — 1,668 939 1,999 4,606 Gain on sale of assets — — — (5,643) (5,643) Gain on cost method investment — — — (4,798) (4,798) Asset impairment 9,000 87,156 — 963 97,119 Gain on deconsolidation of joint venture — — (6,544) — (6,544) Total adjusting items 24,993 71,434 (4,295) (7,479) 84,653 Adjusted EBITDA $ 103,659 $ 55,278 $ 144,441 $ 70,309 $ 373,687 The Andersons, Inc. Cash from Operations Before Working Capital Changes A non-GAAP financial measure (unaudited) Three months ended September 30 , Nine months ended September 30 , (in thousands) 2024 2023 2024 2023 Cash (used in) provided by operating activities $ (2,112) $ 488,683 $ 62,695 $ 696,087 Changes in operating assets and liabilities Accounts receivable (11,786) 198,396 3,498 406,263 Inventories (198,776) 13,263 278,947 748,118 Commodity derivatives 13,317 (3,274) 49,327 99,479 Other current and non-current assets (8,789) 3,295 (59,376) 2,048 Payables and other current and non-current liabilities 117,728 214,870 (433,069) (796,216) Total changes in operating assets and liabilities (88,306) 426,550 (160,673) 459,692 Adjusting items impacting cash from operations before working capital changes: Less: Insured inventory recoveries — — — (16,080) Less: Unrealized foreign currency losses on receivables — (12,088) — (12,088) Cash from operations before working capital changes $ 86,194 $ 50,045 $ 223,368 $ 208,227 Cash from operations before working capital changes is defined as cash provided by (used in) operating activities before the impact of changes in working capital within the statement of cash flows. The Company calculates cash from operations by eliminating the effect of changes in accounts receivable, inventories, commodity derivatives, other assets, and payables and accrued expenses from the cash provided by (used in) operating activities. Management believes that cash from operations before working capital changes is a useful measure of the company's performance as it provides investors additional information about the company's operations allowing better evaluation of underlying business performance and improved comparability to prior periods. Cash from operations before working capital changes is a non-GAAP financial measure and is not intended to replace or be an alternative to cash provided by (used in) operating activities, the most directly comparable GAAP financial measure. View original content to download multimedia: https://www.prnewswire.com/news-releases/the-andersons-inc-reports-strong-third-quarter-results-302295825.html SOURCE The Andersons, Inc.

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