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- **45Z Tax Credit Windfall**: Q4 2025 expects $10-15M EBITDA boost; 2026+ credits could rise to $0.20/gallon with carbon sequestration.
- **Ethanol Expansion**: $425M investment in ethanol plants; 2026+ tax credits may fund larger M&A.
- **Agribusiness Recovery**: China sorghum purchases key to 2026 margin normalization; Skyland underperforming at $15M EBITDA vs. $30-40M target.
- **Financial Strength**: Debt-to-EBITDA 2x; $82M cash on hand despite $200M annual capex.

**【CEO Opening Remarks】**
- Acquired full ownership of ethanol plants in Q3, recognizing $9M in 45Z tax credits for 2025. Q4 expects $10-15M EBITDA benefit from tax credits.
- Investing in ethanol plant efficiency, including carbon sequestration at Clymers, IN, to lower carbon intensity scores.
- Agribusiness projects: soybean meal export capacity at Houston port (2026), mineral plant in NM, and expanded corn processing in IL.
- Ag cycle challenges persist due to domestic supply and trade policy uncertainty, but 2026 trade clarity could improve margins.

**【CFO Financial Commentary】**
- Q3 2025: Net income $20M ($0.59 EPS), adjusted net income $29M ($0.84 EPS). Adjusted EBITDA $78M vs. $97M in 2024.
- Capital spending $67M (vs. $38M in 2024), driven by growth projects and Skyland acquisition. Full-year capex ~$200M.
- Debt-to-EBITDA 2x, well below 2.5x target. Generated $68M cash from ops, ending with $82M cash.
- Agribusiness pretax income $2M (vs. $19M in 2024), EBITDA $29M (vs. $45M). Renewables pretax $46M (vs. $26M), EBITDA $67M (vs. $63M).

**【Q&A Highlights】**
- **45Z Tax Credits**: 2026+ credits could rise to $0.20/gallon if CI scores improve. Q4 2025 expects $10-15M EBITDA benefit.
- **Agribusiness Recovery**: China sorghum purchases could boost margins; 2026 trade clarity needed for normalization. Skyland EBITDA ~$15M in 2025 (vs. $30-40M target).
- **Ethanol Demand**: E15 approval in CA may offset export headwinds. Q4 corn basis decline may stabilize margins despite lower crush rates.
- **M&A Strategy**: Disciplined capital allocation; targeting $425M+ deals for scale, e.g., ethanol plants. 2026+ tax credits may enable larger acquisitions.
- **Fertilizer Outlook**: Q3 2025 margins up, but 2026 volumes uncertain due to farmer hesitation on fall applications.

The Andersons, Inc. (ANDE) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

ANDE

ANDE fundamentals

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