The Andersons, Inc. Reports Fourth Quarter & Full Year Results

Fourth Quarter Earnings of $0.88 per Diluted Share Full Year Earnings of $2.08 per Diluted Share

PRNewswire-FirstCall
MAUMEE, Ohio
Feb 8, 2010

The Andersons, Inc. , today announced fourth quarter earnings of $16.2 million, or $0.88 per diluted share, and total revenues of $916 million. In the same three month period of 2008, the company reported a loss of $33.4 million, or $1.84 per diluted share, on revenues of $770 million. The prior year fourth quarter loss resulted from the recording of significant inventory adjustments within the Plant Nutrient Group. The 2009 net income attributable to the company was $38.4 million, or $2.08 per diluted share, on $3.0 billion of revenues. In the prior year, the company's full year earnings were $32.9 million, or $1.79 per diluted share, and total revenues were $3.5 billion.

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The Grain & Ethanol Group's 2009 operating income was $51.4 million. This compares to an operating income of $43.6 million in 2008. The group's grain business had a record year, while the ethanol business had its second highest year resulting from significantly increased margins during the second half of the year. Full year income from the investment in Lansing Trade Group was lower than 2008, as a good fourth quarter was not enough to offset a modest loss incurred in the first half of the year. Total 2009 revenues for the Grain & Ethanol Group were $2.2 billion; this includes $806 million of grain and ethanol sales made in accordance with origination and marketing agreements between the company and its ethanol joint ventures. In 2008, the group's total revenues were $2.4 billion and included $866 million of the previously mentioned sales. For the fourth quarter, the Grain & Ethanol Group's operating income was $27.8 million, in contrast to $11.9 million earned during the same period in 2008. This fourth quarter increase in operating income was due to markedly improved results in the ethanol business and Lansing Trade Group. The ethanol business had its highest quarter since entering the business four years ago. These improvements were partially offset by lower quarterly results in the grain business due primarily to the late harvest in 2009. Total revenues for the fourth quarter were $722 million; in comparison, the group's revenues for the same period last year were $565 million.

The Rail Group had an operating loss of $1.0 million in 2009, which is down significantly from the $19.8 million earned in 2008. The group continues to be impacted by the double digit declines in national rail traffic. Gross profit from the leasing business was significantly lower than the prior year due mainly to lower utilization rates and the corresponding increase in storage expense from idle cars. The average utilization rate (the percentage of the fleet's railcars in service) for 2009 was 78.1 percent, which was down significantly from the prior year rate of 92.5 percent. The group ended the year with a utilization rate of 70.5 percent. The full year results include gains on sales of railcars and related leases of $1.7 million in 2009, and $4.0 million in 2008. Additionally, both the railcar repair and manufacturing businesses experienced significant decreases in gross profit during the year, as sales were down more than 30 percent. The rail fleet ended the year with approximately 23,800 cars and locomotives, which is comparable to the 2008 year end total. Revenues of $93 million for 2009 were down considerably from the $134 million reported in the prior year. The Rail Group had an operating loss of $1.5 million in the fourth quarter on $21 million of revenues. In 2008, operating income for the same three month period was $3.3 million on revenues of $28 million.

The Plant Nutrient Group ended the year with operating income of $11.3 million. In 2008, the group had an operating loss of $12.3 million due to significant lower of cost or market adjustments caused by sharp declines in nutrient prices. Revenues for 2009 and 2008 were $491 million and $653 million, respectively. Revenues declined in 2009 due to a significant decrease in the average selling price, offset by a modest volume increase. For the fourth quarter, the group's operating income was $1.7 million on $111 million of revenues. Last year the group had an operating loss of $74.5 million during the fourth quarter on revenues of $112 million, due to $84.1 million of the aforementioned adjustments being made during the quarter. The integration of the Hartung Brothers Inc.'s Fertilizer Division, which was acquired on August 1, 2009, was successfully completed by year end.

The Turf & Specialty Group's full year operating income was a record $4.7 million on $125 million of revenues. In 2008, the group had operating income of $2.3 million, and total revenues were $119 million. The 2009 results are mainly attributable to the group's lawn volume increasing by almost 20 percent. The group's focus on proprietary products in its lawn business is continuing to show positive results, even though there has been some softness in the professional product market. The group incurred an operating loss of $1.1 million in the fourth quarter on $19 million of revenues. Last year, its operating loss for the same period was also $1.1 million, on revenues of $20 million.

The Retail Group had an operating loss of $2.8 million in 2009. In the prior year, the group's operating income was $0.8 million. Total sales for the group were $162 million in 2009, or 6 percent below the 2008 total of $173 million. The group continues to be impacted by the weakness in the overall economy and resulting reduced consumer spending. Margins, however, have remained consistent with the prior year. The Retail Group's fourth quarter operating loss was $0.7 million on $42 million of revenues. Last year, during the same three month period, the operating income was $1.0 million, and total revenues were $46 million.

"Clearly, our full year earnings were heavily influenced by the results within our agricultural business units," CEO Mike Anderson stated. "The record full year earnings in our grain business, reflects our solid position in this industry. The significant turn around in ethanol margins enabled our ethanol business to report its best ever quarterly results. Our Turf & Specialty Group had a record year. Our Plant Nutrient Group returned to profitability, following the extraordinary loss incurred in 2008," Mr. Anderson added. "Our 2009 Rail and Retail Group results, however, were negatively impacted by the weak economy. Economic conditions such as these confirm that our strategy of purposeful diversification allows us to remain a strong company, even when external factors are significantly impacting one or more of our groups."

The company will host a webcast on Tuesday, February 9, 2010 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 16 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)               2009      2008        2009        2008
                                    ----      ----        ----        ----
                                                                        
  Sales and merchandising
   revenues                      $915,958  $770,065  $3,025,304  $3,489,478
  Cost of sales and
   merchandising revenues         846,170   757,839   2,769,798   3,231,649
                                  -------   -------   ---------   ---------
  Gross profit                     69,788    12,226     255,506     257,829
                                                                        
  Operating, administrative and
   general expenses                54,560    50,394     199,116     190,230
  Interest expense                  4,714     6,099      20,688      31,239
  Other income (loss):                                                    
    Equity in earnings (loss) 
     of affiliates                 15,078   (11,768)     17,463       4,033
    Other income - net              1,925      (148)      8,331       6,170
                                    -----      ----       -----       -----
  Income before income taxes       27,517   (56,183)     61,496      46,563
  Income tax provision              9,127   (21,579)     21,930      16,466
                                    -----   -------      ------      ------
  Net income                       18,390   (34,604)     39,566      30,097
    Net (income) loss attributable
     to the noncontrolling
     interest                      (2,159)    1,215      (1,215)      2,803
                                   ------     -----      ------       -----
  Net income attributable to The
   Andersons, Inc.                $16,231  $(33,389)    $38,351     $32,900
                                  =======  ========     =======     =======
                                                                        
  Per common share:                                                     
        Basic earnings              $0.89    $(1.84)      $2.10       $1.82
                                    =====    ======       =====       =====
        Diluted earnings            $0.88    $(1.84)      $2.08       $1.79
                                    =====    ======       =====       =====
        Dividends paid            $0.0875   $0.0850     $0.3475     $0.3250
                                  =======   =======     =======     =======



  The Andersons, Inc.                                    
  Consolidated Balance Sheets                            
  (Unaudited)                                            
                                                          
                                            December 31   December 31
  (in thousands)                               2009          2008
                                               ----          ----
  Assets                                                         
  Current assets:                                                
    Cash and cash equivalents                $145,929       $81,682
    Restricted cash                             3,123         3,927
    Accounts receivable, net                  137,195       126,255
    Margin deposits, net                       27,012        13,094
    Inventories                               407,845       436,920
    Commodity derivative assets - current      24,255        84,919
    Other current assets                       41,464       109,165
                                               ------       -------
  Total current assets                        786,823       855,962
                                                                 
  Investments and other assets                182,989       153,488
  Commodity derivative assets                   3,137         3,662
  Railcar assets leased to others (net)       179,154       174,132
  Property, plant and equipment (net)         132,288       121,529
                                              -------       -------
                                           $1,284,391    $1,308,773
                                           ==========    ==========
                                                                 
  Liabilities and shareholders' equity                           
  Current liabilities:                                           
    Commodity derivative                                         
     liabilities - current                    $24,871       $67,055
    Other current liabilities                 454,250       458,208
                                              -------       -------
  Total current liabilities                   479,121       525,263
                                                                 
  Deferred items and other long-term
   liabilities                                 90,138        80,687
  Commodity derivative liabilities                830         3,706
  Long-term debt non-recourse                  19,270        40,055
  Long-term debt                              288,756       293,955
  Shareholders' equity                        406,276       365,107
                                              -------       -------
                                           $1,284,391    $1,308,773
                                           ==========    ==========



  Segment Data

                             Grain &               Plant      Turf &
                             Ethanol      Rail    Nutrient   Specialty
                             -------      ----    --------   ---------
  Quarter ended December
   31, 2009
  Revenues from external
   customers                $722,294   $21,101    $111,447     $19,400

  Gross Profit                35,692     3,104      14,585       4,956

  Equity in earnings
   (loss) of affiliates       15,076         -           2           -

  Other income (loss), net       419       232         160         303

  Income before income
   taxes                      29,969    (1,471)      1,671      (1,090)

  Income attributable to
   the noncontrolling
   interest                   (2,159)        -           -           -

  Operating income (loss)(a)  27,810    (1,471)      1,671      (1,090)


  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

  Equity in earnings
   (loss) of affiliates      (11,770)        -           2           -

  Other income (loss), net       (19)      (76)        165         181

  Income before income
   taxes                      10,702     3,318     (74,457)     (1,064)

  Income attributable to
   the noncontrolling
   interest                    1,215         -           -           -

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


  Twelve months ended
   December 31, 2009
  Revenues from external
   customers              $2,153,978   $92,789    $491,293    $125,306

  Gross Profit               106,804    16,816      59,419      25,457

  Equity in earnings
   (loss) of affiliates       17,452         -           8           -

  Other income (loss), net     2,319       485       1,755       1,131

  Income before income
   taxes                      52,569    (1,034)     11,294       4,735

  Income attributable to
   the noncontrolling
   interest                   (1,215)        -           -           -

  Operating income (loss)(a)  51,354    (1,034)     11,294       4,735


  Twelve months 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

  Equity in earnings
   (loss) of affiliates        4,027         -           6           -

  Other income (loss), net     4,751       526         893         446

  Income before income
   taxes                      40,784    19,782     (12,325)      2,321

  Income attributable to
   the noncontrolling
   interest                    2,803         -           -           -

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



                                         Retail       Other        Total
                                         ------       -----        -----
  Quarter ended December 31, 2009
  Revenues from external customers      $41,716          $-     $915,958

  Gross Profit                           11,451           -       69,788

  Equity in earnings (loss) of
   affiliates                                 -           -       15,078

  Other income (loss), net                  325         486        1,925

  Income before income taxes               (721)       (841)      27,517

  Income attributable to the
   noncontrolling interest                    -           -       (2,159)

  Operating income (loss) (a)              (721)       (841)      25,358


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

  Gross Profit                           13,551           -       12,226

  Equity in earnings (loss) of
   affiliates                                 -           -      (11,768)

  Other income (loss), net                  259        (658)        (148)

  Income before income taxes              1,015       4,303      (56,183)

  Income attributable to the
   noncontrolling interest                    -           -        1,215

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


  Twelve months ended December 31, 2009
  Revenues from external customers     $161,938          $-   $3,025,304

  Gross Profit                           47,010           -      255,506

  Equity in earnings (loss) of
   affiliates                                 -           3       17,463

  Other income (loss), net                  683       1,958        8,331

  Income before income taxes             (2,843)     (3,225)      61,496

  Income attributable to the
   noncontrolling interest                    -           -       (1,215)

  Operating income (loss) (a)            (2,843)     (3,225)      60,281


  Twelve months ended December 31, 2008
  Revenues from external customers     $173,071          $-   $3,489,478

  Gross Profit                           51,126           -      257,829

  Equity in earnings (loss) of
   affiliates                                 -           -        4,033

  Other income (loss), net                  692      (1,138)       6,170

  Income before income taxes                843      (4,842)      46,563

  Income attributable to the
   noncontrolling interest                    -           -        2,803

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


  (a) Operating income (loss) for each Group 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) loss.

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

Photo: http://www.newscom.com/cgi-bin/prnh/20081104/CLTU081LOGO

SOURCE: The Andersons, Inc.

CONTACT: Nicholas C. Conrad, VP, Finance & Treasurer, +1-419-891-6415,
nick_conrad@andersonsinc.com


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