Press Releases

The Andersons, Inc. Reports Fourth Quarter & Full Year Results
Full Year Earnings of $1.79 Per Diluted Share
PRNewswire-FirstCall
MAUMEE, Ohio

The Andersons, Inc. , today announced full year net income of $32.9 million, or $1.79 per diluted share, on $3.5 billion of revenues. In 2007, the company's full year net income was $68.8 million, or $3.75 per diluted share, and total revenues were $2.4 billion. These prior year results included $7.7 million in net after-tax one time gains, or $0.42 per diluted share. The full year results were heavily influenced by significant pre-tax inventory and contract adjustments of $97.2 million within the Plant Nutrient Group. The fourth quarter loss was $33.4 million, or $1.85 per diluted share, and total revenues were $770 million. In the same three month period of 2007, the company reported record net income of $23.5 million, or $1.28 per diluted share, on revenues of $785 million. The company will continue to monitor the fertilizer markets and could further adjust the value of its year end inventory if significant price appreciation or depreciation occurs prior to the company's 10K filing at the end of February. Recent fertilizer market prices have stabilized, and it is believed that the company has accounted for the majority, and possibly all, of the inventory adjustments.

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"Although our full year earnings could be viewed as respectable versus history, since they are our third best historical performance, this is overshadowed by the fact that I am deeply disappointed in our fourth quarter results --- we could have done better," said President and Chief Executive Officer Mike Anderson. "The decline in our results was largely a result of inventory and contract adjustments within our Plant Nutrient Group. I want our shareholders to know that we are taking a hard look at the risk management processes in that group and fully intend to make improvements that we believe will reduce the likelihood of similar events in the future."

The Grain & Ethanol Group's 2008 operating income was $43.6 million on revenues of $2.4 billion. This compares to the income record set in 2007 of $65.9 million on revenues of $1.5 billion. This year's revenues included $866 million of grain and ethanol sales made by the group in accordance with origination and marketing agreements between the company and its ethanol joint ventures, for which it receives a fee. Total revenues for the group have increased this year due to a considerable increase in both the volume and price of grain sold, and to an increase in the gallons of ethanol sold. The group's grain business benefited from higher gross profit on grain sales, and higher space and fee income; however, these were offset by higher expenses, primarily interest and bad debt reserves. Income from the ethanol business declined $14.5 million in 2008, due to the combined performance of the company's equity investments in three ethanol limited liability companies and a $4.1 million reduction in development fee income. The majority of the ethanol business differential occurred in the second half of the year. Full year income from the group's investment in Lansing Trade Group was $6.5 million lower than 2007, due to the company's $5.5 million share of Lansing Trade Group's fourth quarter loss. At the end of the third quarter, the income from this investment was well ahead of the prior year; however, during the fourth quarter Lansing Trade Group recorded significant reserves due to several counterparty exposures that took their otherwise profitable quarter to a loss. Lansing Trade Group is adequately reserved for these items as of the end of the year. For the fourth quarter, the Grain & Ethanol Group's operating income was $11.9 million, in contrast to $30.1 million earned in the same three month period last year. This fourth quarter decrease was due to the aforementioned income decreases in the ethanol business and Lansing Trade Group, which were then partially offset by considerable space income in the grain business. Total revenues for the fourth quarter were $565 million; in comparison, the group's revenues for the same period last year were $548 million.

The Rail Group's operating income for 2008 was $19.8 million, which is up slightly from the $19.5 million earned in 2007. The quality of earnings during 2008 improved significantly as gains from railcar sales were down $4.1 million this year. Revenues of $134 million for the year were up from $130 million in the prior year. The group grew the rail fleet by 5 percent during 2008, including the addition of 43 locomotives and ended the year with approximately 23,800 cars and locomotives. The group's average lease rates are slightly lower. The average utilization rate (the percentage of the fleet's railcars in service) for 2008 was 92.7 percent, which was up just slightly from the prior year. Due to reduced rail traffic, however, utilization rates for the fourth quarter decreased to 91.1 percent. Gross profit from the leasing business was higher due to wider relet spreads and growth in the size of the fleet. Additionally, both the railcar repair and manufacturing businesses experienced significant increases in gross profit during the year. The Rail Group generated $3.3 million in operating income in the fourth quarter on $28 million of revenues. In 2007, operating income for the same three month period was $3.8 million on similar revenues.

The Plant Nutrient Group ended the year with an operating loss of $12.3 million. This loss resulted from $97.2 million of lower of cost or market adjustments made to reduce inventory values to the current market value and recognize losses on purchase commitments caused by sharp declines in the fertilizer market. In 2007, the group had an operating income of $27.1 million. Revenues for 2008 and 2007 were $653 million and $466 million, respectively. Revenues were up significantly this year due to increased pricing in the fertilizer market, even though volume for the year was actually down close to 20 percent. Prior to the fourth quarter, volumes for the year were only slightly behind the prior year; however, volume during the fourth quarter dropped by 50 percent. For the fourth quarter, the group's operating loss was $74.5 million on $112 million of revenues. The quarter was impacted by the aforementioned volume decrease and significant inventory adjustments of $84.1 million. Last year the group's operating fourth quarter income was $8.7 million on revenues of $140 million.

The Turf & Specialty Group's full year operating income was $2.3 million on $119 million of revenues. In 2007, the group had operating income of $0.1 million, and total revenues were $104 million. The 2008 results are attributable to the group's successful focus on value added proprietary products, such as Contec DG®, which is a growth area for the group. Turf products tonnage increased slightly from year to year, however, gross profit per ton increased considerably. The cob business earnings this year were higher than in 2007, despite a corn cob inventory fire at the Delphi facility at the end of the year that led to increased expenses. The group incurred an operating loss of $1.1 million in the fourth quarter on $20 million of revenues. Last year, its operating loss was $0.8 million for the same period, and revenues were $19 million.

Total sales for the Retail Group were $173 million in 2008, or 4 percent below the 2007 total of $180 million. The group reported operating income of $0.8 million this year. In 2007, the group reported operating income of $0.1 million, which included a $1.9 million impairment charge on certain retail assets. The group continues to be impacted by the weakness in the overall economy and resulting reduced consumer spending. The Retail Group's fourth quarter operating profit was $1.0 million on $46 million of revenues. Last year, which includes the impairment, the operating loss was $0.6 million, and total revenues were $50 million in the same three month period.

"Clearly our full year earnings were heavily influenced by the results within our Plant Nutrient Group," Mr. Anderson stated. "The reduced earnings were also partially attributable to the economics in the ethanol industry and reduced income from our investment in Lansing Trade Group," Mr. Anderson added. "On a positive note, both our Grain Division and Rail Group had great years. Also, our propriety product strategy within the Turf & Specialty Group is proving to be successful. In addition, we made wise and timely decisions early in the year to improve the capital structure and liquidity of the Company."

The company will host a webcast on Friday, February 6, 2009 at 11:00 A.M. ET, to discuss its performance. This can be accessed under the heading "Investor" on its website at www.andersonsinc.com.

The Andersons, Inc. is a diversified company with interests in the grain, ethanol and plant nutrient sectors of U.S. agriculture, as well as in railcar leasing and repair, turf products production, and general merchandise retailing. Founded in Maumee, Ohio, in 1947, the company now has operations in 12 U.S. states and Puerto Rico, plus rail equipment leasing interests in Canada and Mexico.

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. 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.

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

                            FINANCIAL TABLES FOLLOW . . .



  The Andersons, Inc.
  Consolidated Statements of
   Income
  (Unaudited)
                                 Three Months ended   Twelve Months ended
                                    December 31           December 31
  (in thousands, except for
   per share amounts)             2008        2007     2008           2007

  Sales and merchandising
   revenues                      $770,065  $784,634  $3,489,478  $2,379,059
  Cost of sales and
   merchandising revenues         757,839   709,957   3,231,649   2,139,347
  Gross profit                     12,226    74,677     257,829     239,712

  Operating, administrative and
   general expenses                44,586    49,499     181,520     166,486
  Allowance for doubtful
   accounts receivable              5,808     2,165       8,710       3,267
  Interest expense                  6,099     5,662      31,239      19,048
  Other income / gains:
    Equity in earnings of
     affiliates                   (11,768)   14,689       4,033      31,863
    Other income, net                (148)    2,591       6,170      21,731
  Minority interest in net
   (income) loss of subsidiary      1,215       291       2,803       1,356
  Income before income taxes      (54,968)   34,922      49,366     105,861
  Income taxes                    (21,579)   11,430      16,466      37,077
  Net income                     $(33,389)  $23,492     $32,900     $68,784

  Per common share:
      Basic earnings               $(1.85)    $1.31       $1.82       $3.86
      Diluted earnings             $(1.85)    $1.28       $1.79       $3.75
      Dividends paid              $0.0850   $0.0775     $0.3250     $0.2200

  Weighted average shares
   outstanding-basic               18,094    17,928      18,068      17,833
  Weighted average shares
   outstanding-diluted             18,250    18,320      18,363      18,326



                            The Andersons, Inc.
                         Consolidated Balance Sheets
                                 (Unaudited)

                                               December 31       December 31
             (in thousands)                       2008              2007

  Assets
  Current assets:
    Cash and cash equivalents                 $   81,682       $    22,300
    Restricted cash                                3,927             3,726
    Accounts receivable, net                     130,091           106,257
    Margin deposits, net                          13,094            20,467
    Inventories                                  436,920           502,904
    Commodity derivative assets -
     current                                      84,919           205,956
    Other current assets                         105,329            43,281
  Total current assets                           855,962           904,891

  Investments and other assets                   153,488           137,518
  Commodity derivative assets                      3,662            29,458
  Railcar assets leased to others (net)          174,132           153,235
  Property, plant and equipment (net)            121,529            99,886
                                              $1,308,773        $1,324,988

  Liabilities and shareholders' equity
  Current liabilities:
    Short-term borrowings                     $      -          $  245,500
    Commodity derivative liabilities -
     current                                      67,055           122,488
    Other current liabilities                    458,208           359,224
  Total current liabilities                      525,263           727,212

  Deferred items and other long-term
   liabilities                                    80,687            49,631
  Commodity derivative liabilities                 3,706             2,090
  Long-term debt non-recourse                     40,055            56,277
  Long-term debt                                 293,955           133,195
  Minority interest                               11,694            12,219
  Shareholders' equity                           353,413           344,364
                                              $1,308,773        $1,324,988



  Segment Data

                                        Grain &            Plant    Turf &
                                        Ethanol   Rail    Nutrient Specialty
  Quarter ended December 31, 2008
  Revenues from external customers     $565,189  $27,552  $111,521  $20,116

  Gross Profit                           45,359    7,795   (59,815)   5,336

  Other income / Equity in earnings of
   affiliates                           (11,789)     (76)      167      181

  Operating income (loss)                11,917    3,318   (74,457)  (1,064)

  Quarter ended December 31, 2007
  Revenues from external customers     $548,222  $27,681  $140,258  $18,921

  Gross Profit                           32,399    8,143    15,328    4,747

  Other income / Equity in earnings of
   affiliates                            16,190      273       103       58

  Operating income (loss)                30,077    3,803     8,692     (785)



                                            Retail      Other       Total
  Quarter ended December 31, 2008
  Revenues from external customers         $45,687       $-       $770,065

  Gross Profit                              13,551        -         12,226

  Other income / Equity in earnings of
   affiliates                                  259       (658)     (11,916)

  Operating income (loss)                    1,015      4,303      (54,968)

  Quarter ended December 31, 2007
  Revenues from external customers         $49,552       $-       $784,634

  Gross Profit                              14,060        -         74,677

  Other income / Equity in earnings of
   affiliates                                  373        283       17,280

  Operating income (loss)                     (636)    (6,229)      34,922



                                    Grain &               Plant     Turf &
                                    Ethanol      Rail    Nutrient Specialty
  Year ended December 31, 2008
  Revenues from external customers $2,411,144  $133,898  $652,509  $118,856

  Gross Profit                        110,954    37,055    33,990    24,704

  Other income / Equity in
   earnings of affiliates               8,778       526       899       446

  Operating income (loss)              43,587    19,782   (12,325)    2,321

  Year ended December 31, 2007
  Revenues from external customers $1,498,652  $129,932  $466,458  $103,530

  Gross Profit                         79,367    37,040    50,602    19,738

  Other income / Equity in
   earnings of affiliates              43,591     1,038       909       438

  Operating income (loss)              65,934    19,505    27,055        95



                                           Retail      Other       Total
  Year ended December 31, 2008
  Revenues from external customers        $173,071      $-      $3,489,478

  Gross Profit                              51,126       -         257,829

  Other income / Equity in earnings of
   affiliates                                  692    (1,138)       10,203

  Operating income (loss)                      843    (4,842)       49,366

  Year ended December 31, 2007
  Revenues from external customers        $180,487      $-      $2,379,059

  Gross Profit                              52,965       -         239,712

  Other income / Equity in earnings of
   affiliates                                  840     6,778        53,594

  Operating income (loss)                      139    (6,867)      105,861

First Call Analyst:
FCMN Contact: debra_crow@andersonsinc.com

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SOURCE: The Andersons, Inc.

CONTACT: Gary L. Smith, VP, Finance & Treasurer, +1-419-891-6417,
gary_smith@andersonsinc.com, of The Andersons, Inc.