The Andersons, Inc. Reports Higher Revenues

EPS $0.33 Loss vs. $0.09 Loss Last Year

PRNewswire-FirstCall
MAUMEE, Ohio
Oct 22, 2003

The Andersons, Inc. , today announced a third-quarter operating loss of $2.3 million, or $0.33 per diluted share. In the same three-month period of 2002, the loss was $0.6 million, or $0.09 per diluted share. Total revenues of $253 million for the period were $48 million higher than the third quarter of 2002. Net income for the first nine months of this year was $5.0 million, or $0.68 per diluted share, with revenues of $804 million. In comparison, net income for the first nine months of 2002 totaled $11.9 million, or $1.58 per diluted share, on revenues of $721 million. These 2002 results and 2003 year- to-date performance reflect a restatement that was announced previously.

The Agriculture Group's grain business reported increased revenues for the third quarter as a result of volume growth and higher average prices, but continued to experience an operating income decline during the period. As the company has noted previously, poor growing conditions a year ago lowered U.S. stocks of corn and soybeans, thereby reducing demand for grain storage space. The 2003 harvest is currently underway, and some industry analysts are predicting record corn production. The group's plant nutrient business achieved volume, revenue and income growth in the most recent quarter. Continued growth in industrial and specialty agricultural products along with volume and margin strength in traditional product categories contributed to these positive results. In total, the Agriculture Group experienced a $2.8 million loss for the quarter, $3 million below the $0.2 million operating income it achieved in the third quarter of 2002. Operating income through the first nine months of 2003 was $4.0 million, down $6.2 million from the prior year. The group also indicated that the previously announced negotiations to acquire the shares of Agrico Canada, Ltd. have been discontinued.

The Rail Group's operating income of $0.7 million in the third quarter was essentially unchanged from the same three-month period in 2002. The number of railcars and locomotives that it owns or manages continues to increase from year-earlier levels. At this time, the fleet consists of 74 locomotives and more than 6,000 rail cars. During the third quarter, the railcar repair and fabrication shops continued to contribute significantly to the group's operating income. The Rail Group's total operating income for the first nine months of 2003 amounted to $2.4 million, almost double its year-earlier performance.

The Processing Group incurred a loss of $1.1 million for the third quarter, improving slightly on its prior year performance for the period. Year-to-date operating income was $2.6 million, or $1.6 million better than the first nine months of 2002. Through September, turf-care product volumes were up approximately 14 percent in professional markets and 24 percent in consumer/industrial markets. However, because of product and customer mix changes and increased raw material costs, gross margins were somewhat lower. Sales growth in the group's cob-based products business also contributed to the group's third quarter and year-to-date income improvement.

The Retail Group achieved a 2.8 percent increase in same-store sales in the third quarter compared to the same three-month period in 2002. Average margins were down slightly, however, and expenses were somewhat higher than a year ago. As a result, the group matched its year-earlier $0.1 million operating loss for the period. Through nine months, the group's operating income was $1.6 million. This was $0.9 million below the $2.5 million it reported for the same period of 2002.

"Our third quarter results reflect the roller-coaster nature of the grain business," said President and Chief Executive Officer Mike Anderson. "While grain storage earnings have been declining since 2002's poor crop harvests, I'm hopeful that we'll see stocks begin to rebuild this fall. Our overall performance in the third quarter was right in line with our expectations and consistent with the full-year projections we've mentioned previously. A few months ago, I indicated that we expected 2003 full-year earnings per diluted share (EPS) to come in 'near the upper end of the $1.15 to $1.30 range.' Despite the restatement that raised 2002 EPS by 13 cents and reduced 2003 EPS by an equivalent amount, we're not reducing our projection for this year. We're really saying that the outlook has improved, and our expectation for total 2002 - 2003 earnings has increased."

The company will host a webcast on Thursday, October 23, 2003 at 11:00 A.M. EDT, to discuss its third quarter performance and full-year outlook. This can be accessed under "Financial Information" on its website at www.andersonsinc.com or at www.firstcallevents.com/service/ajwz390953513gf12.html .

The Andersons, Inc. is a respected leader and dominant regional player in grain merchandising and agricultural plant nutrients distribution. Its strong position in these basic businesses has allowed the company to diversify into the production of turf care products, rail equipment leasing, and general merchandise retailing. The company has been in operation since 1947.

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, and the risk factors set forth from time to time in the company's filings with the Securities and Exchange Commission.

  The Andersons, Inc. is located on the Internet at www.andersonsinc.com

  FINANCIAL TABLES FOLLOW . . .


                             The Andersons, Inc.

                    Consolidated Statements of Operations

                                     Three Months ended   Nine Months ended
                                        September 30         September 30
  (in thousands, except for per
   share amounts)                       2003      2002     2003      2002
                                                  (as                (as
                                                restated)         restated)

  Sales and merchandising revenues   $253,027  $204,868  $803,828  $721,430
  Cost of sales and merchandising
   revenues                           222,789   171,089   692,978   603,717
  Gross profit                         30,238    33,779   110,850   117,713

  Operating, administrative and
   general expenses                    33,748    34,188   101,055   101,523
  Interest expense                      1,603     2,042     6,119     7,328
  Other income / Gains:
    Other income                        1,519       734     3,816     2,364
    Gain on involuntary conversion        -         -         -         -
  Income (loss) before income taxes
   and cumulative effect
   of accounting change                (3,594)   (1,717)    7,492    11,226
  Income taxes                         (1,245)   (1,087)    2,529     2,847
  Income (loss) before cumulative
   effect of accounting change         (2,349)     (630)    4,963     8,379
  Cumulative effect of accounting
   change, net of
   income tax benefit                     -         -         -       3,480
  Net income (loss)                   $(2,349)    $(630)   $4,963   $11,859

  Per common share:
        Basic earnings (loss)          $(0.33)   $(0.09)    $0.70     $1.62
        Diluted earnings (loss)        $(0.33)   $(0.09)    $0.68     $1.58
        Dividends paid                 $0.065    $0.065    $0.195    $0.195

  Weighted average shares
   outstanding-basic                    7,106     7,319     7,139     7,302
  Weighted average shares
   outstanding-diluted                  7,106     7,319     7,311     7,499


                           The Andersons, Inc.

                       Consolidated Balance Sheets
                               (Unaudited)

                                   September 30 December 31   September 30
             (in thousands)           2003          2002         2002
                                               (as restated) (as restated)
  Assets
  Current assets:
    Cash and cash equivalents         $3,964      $6,095        $7,835
    Accounts receivable (net) and
     margin deposits                  71,092      59,800        64,159
    Inventories                      184,049     256,275       201,247
    Other current assets              16,794      15,119        13,401
  Total current assets               275,899     337,289       286,642

  Other assets                        14,915      12,591        11,709
  Railcar assets leased
   to others (net)                    26,979      26,399        25,435
  Property, plant and
   equipment (net)                    91,716      92,939        93,039
                                    $409,509    $469,218      $416,825

  Liabilities and shareholders'
   equity
  Current liabilities:
    Notes payable                    $80,000     $70,000       $80,000
    Other current liabilities        113,273     185,534       125,791
  Total current liabilities          193,273     255,534       205,791

  Deferred items and other long-term
   liabilities                        24,105      23,647        20,812
  Long-term debt                      83,241      84,272        84,961
  Shareholders' equity               108,890     105,765       105,261
                                    $409,509    $469,218      $416,825


                                 Segment Data

  Quarter ended September 30, 2003       Agriculture  Processing    Rail
  Revenues from external customers        $178,376     $23,522     $9,252
  Other income                                 647         464        128
                                          $179,023     $23,986     $9,380

  Operating income (loss)                  $(2,828)    $(1,139)      $693

  Quarter ended September 30, 2002 (as
   restated)
  Revenues from external customers        $138,531     $20,466     $5,119
  Other income                                 340          63         24
                                          $138,871     $20,529     $5,143

  Operating income (loss)                     $188     $(1,358)      $733

  Nine months ended September 30, 2003
  Revenues from external customers        $536,044    $113,072    $26,315
  Other income                               1,705         782        213
                                          $537,749    $113,854    $26,528

  Operating income (loss)                   $4,034      $2,567     $2,373

  Nine months ended September 30, 2002
   (as restated)
  Revenues from external customers        $483,201     $93,730    $13,335
  Other income                                 827         352         57
                                          $484,028     $94,082    $13,392

  Operating income (loss)                  $10,278        $947     $1,253


                                 Segment Data

  Quarter ended September 30, 2003          Retail      Other      Total
  Revenues from external customers         $41,877       $-      $253,027
  Other income                                 156        124       1,519
                                           $42,033       $124    $254,546

  Operating income (loss)                     $(65)     $(255)    $(3,594)

  Quarter ended September 30, 2002 (as
   restated)
  Revenues from external customers         $40,752       $-      $204,868
  Other income                                 173        134         734
                                           $40,925       $134    $205,602

  Operating income (loss)                     $(60)   $(1,220)    $(1,717)

  Nine months ended September 30, 2003
  Revenues from external customers        $128,397       $-      $803,828
  Other income                                 689        427       3,816
                                          $129,086       $427    $807,644

  Operating income (loss)                   $1,574    $(3,056)     $7,492

  Nine months ended September 30, 2002
   (as restated)
  Revenues from external customers        $131,164       $-      $721,430
  Other income                                 547        581       2,364
                                          $131,711       $581    $723,794

  Operating income (loss)                   $2,508    $(3,760)    $11,226

SOURCE: The Andersons, Inc.

CONTACT: Gary Smith of The Andersons, Inc., +1-419-891-6417


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