The Andersons, Inc. Reports Second Quarter Results

Second Quarter Earnings of $1.36 per Diluted Share The Grain & Ethanol and Plant Nutrient Groups Lead Earning Results

PRNewswire-FirstCall
MAUMEE, Ohio
Aug 4, 2010

The Andersons, Inc. , today announced second quarter net income attributable to the company of $25.2 million, or $1.36 per diluted share, on revenues of $811 million. In the same three month period of 2009, the company reported results of $15.9 million, or $0.87 per diluted share, on similar revenues. For the first six months of 2010, the company earned $37.4 million, or $2.02 per diluted share. In the first half of 2009, The Andersons reported results of $20.9 million, or $1.14 per diluted share. The first six months of both years had revenues of $1.5 billion. It is important to remember that revenues in commodity-based businesses do not serve as good predictors of income or economic performance.

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The Grain & Ethanol Group's operating income of $19.6 million in the second quarter was significantly higher than its year earlier result of $8.9 million. This was the result of both the grain and ethanol businesses achieving record second quarter results. The grain business benefited primarily from increased space income, which resulted primarily from sizeable basis gains. The ethanol business continued to benefit from a large portion of the ethanol sales being contracted during prior periods, when margins were at high levels. Second quarter 2010 income from the group's investment in Lansing Trade Group was also higher than the prior year. Total second quarter revenues for the group were $474 million; this includes $195 million of grain and ethanol sales made by the Grain & Ethanol Group in accordance with origination and marketing agreements between the company and its ethanol joint ventures. In the second quarter of 2009, the group's total revenues were $500 million and included $188 million of the aforementioned sales. The Grain & Ethanol Group's operating income through the first six months was a record $40.3 million in 2010 and $14.7 million in 2009. Total revenues through June 2010 and 2009 were $995 million and $981 million, respectively. During the quarter, the company finalized the acquisition of the assets of O'Malley Grain, Inc.'s two grain cleaning and storage facilities in Mansfield, Ill., and Fairmont, Neb.

The Plant Nutrient Group achieved operating income of $19.0 million during the second quarter of 2010, on revenues of $228 million. This is the second highest second quarter results in the group's history. In the same three month period of 2009, the group had an operating income of $10.3 million on revenues of $198 million. Margins were up slightly from the prior year and tons sold increased by more than a third as the industry returned to more traditional nutrient application rates on phosphates and potassium. Retail farm centers were building and maintaining inventories versus the de-stocking that took place in 2009. The group's first half 2010 operating income was $19.7 million on $332 million of revenues. Last year, its operating income through the first six months was $12.4 million on revenues of $309 million.

The Rail Group's operating income was $0.1 million in the second quarter of 2010, whereas the group earned $0.6 million for the same three month period a year ago. Second quarter revenues were $24 million in both 2010 and 2009. Gross profit from the leasing business was significantly less primarily due to lower utilization rates and the corresponding carrying costs of idle assets. This quarter, the group recognized $1.7 million in gross margin from the scrapping and sale of railcars, whereas last year $0.8 million was recorded. The group has approximately 22,800 cars and locomotives, which is down slightly from the prior year. The average utilization rate (the percentage of the fleet in service) for the quarter was 71.0 percent compared to 80.6 percent for the same period last year. As of the end of June, utilization was 71.4 percent. The rail repair business showed improvement during the second quarter. The group's first half operating income this year was $1.1 million on $50 million of revenues. In 2009, operating income through June was $1.5 million and revenues were $51 million. These results included gains on sales of railcars and related leases of $4.3 million and $1.1 million in 2010 and 2009, respectively. During the second quarter the Rail Group made a significant minority investment in a short-line railroad - the Iowa Northern Railway Company.

The Turf & Specialty Group had an operating income of $2.5 million in the second quarter this year on $41 million of revenues. Last year, the group reported a record $3.0 million of operating income on $40 million of revenues for the same period. Turf products tonnage increased slightly, but gross profit per ton decreased due to product mix. Through the first half of 2010, the group's operating income was $5.2 million on $83 million of revenues. Last year, its operating income was a record $6.1 million through the first six months and revenues were $84 million.

The Retail Group had an operating income of $2.1 million during the second quarter of 2010 on revenues of $44 million. During the same period of the prior year, the group had an operating income of $2.9 million and total revenues were $49 million. Through the first six months, the group lost $0.7 million and total revenues were $74 million. Last year through June, the group earned $0.2 million on total revenues of $83 million.

"We are pleased with our second quarter performance," CEO Mike Anderson stated. "The Grain & Ethanol Group led our results with record performance in both the grain and ethanol areas. Our Plant Nutrient Group also had a strong quarter. As I review these results, I am again reminded that our strategy of purposeful diversification allows us to remain a strong and profitable company even when one or more of our business units is under performing," added Mr. Anderson.

The company will host a webcast on Thursday, August 5, 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 across the United States, in Puerto Rico, and has 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         Six Months ended
                                    June 30             June 30
  (in thousands, except for
   per share amounts)             2010      2009       2010        2009
                                  ----      ----       ----        ----

  Sales and merchandising
   revenues                   $810,999  $810,954 $1,532,997  $1,508,346
  Cost of sales and
   merchandising revenues      723,445   737,620  1,386,893   1,373,638
                               -------   -------  ---------   ---------
  Gross profit                  87,554    73,334    146,104     134,708

  Operating, administrative
   and general expenses         51,107    46,723     96,510      93,253
  Interest expense               4,663     5,161      9,298      10,851
  Other income (loss):
    Equity in earnings (loss)
     of affiliates               6,667       784     16,572      (2,890)
    Other income, net            1,881     2,724      5,535       3,963
                                 -----     -----      -----       -----
  Income before income taxes    40,332    24,958     62,403      31,677
  Income taxes                  14,553     9,312     23,968      12,118
                                ------     -----     ------      ------
  Net income                    25,779    15,646     38,435      19,559
    Net (income) loss
     attributable to the
     noncontrolling interest      (610)      272     (1,001)      1,311
                                  ----       ---     ------       -----
  Net income attributable to
   The Andersons, Inc.         $25,169   $15,918    $37,434     $20,870
                               =======   =======    =======     =======

  Per common share:
        Basic earnings           $1.37     $0.87      $2.04       $1.15
                                 =====     =====      =====       =====
        Diluted earnings         $1.36     $0.87      $2.02       $1.14
                                 =====     =====      =====       =====
        Dividends paid         $0.0900   $0.0875    $0.1775     $0.1725
                               =======   =======    =======     =======





  The Andersons, Inc.
  Consolidated Balance Sheets
  (Unaudited)


                                                 December
                                     June 30         31       June 30
  (in thousands)                          2010        2009         2009
                                          ----        ----         ----

  Assets
  Current assets:
    Cash and cash equivalents         $204,317    $145,929     $179,752
    Restricted cash                      3,548       3,123        4,243
    Accounts receivable, net           132,701     137,195      130,824
    Margin deposits, net                 7,384      27,012       38,009
    Inventories                        237,994     407,845      205,084
    Commodity derivative assets -
     current                            14,150      24,255       48,635
    Other current assets                32,176      41,464       40,564
                                        ------      ------       ------
  Total current assets                 632,270     786,823      647,111

  Investments and other assets         209,290     182,989      153,281
  Commodity derivative assets              389       3,137        1,354
  Railcar assets leased to
   others (net)                        169,331     179,154      176,656
  Property, plant and equipment
   (net)                               144,165     132,288      120,535
                                    $1,155,445  $1,284,391   $1,098,937
                                    ==========  ==========   ==========

  Liabilities and shareholders'
   equity
  Current liabilities:
    Commodity derivative
     liabilities -current               54,918      24,871       66,698
    Other current liabilities          278,051     454,250      243,056
                                       -------     -------      -------
  Total current liabilities            332,969     479,121      309,754

  Other noncurrent liabilities          95,268      90,138       85,772
  Commodity derivative
   liabilities                           2,911         830        4,555
  Long-term debt                       281,740     308,026      314,557
  Shareholders' equity                 442,557     406,276      384,299
                                    $1,155,445  $1,284,391   $1,098,937
                                    ==========  ==========   ==========





  Segment Data

                                   Grain &             Plant   Turf &
                                   Ethanol     Rail  Nutrient Specialty
                                   -------     ----  -------- ---------
  Quarter ended June 30, 2010
  Revenues from external customers $473,680  $23,635 $228,404   $41,182

  Gross Profit                       30,073    4,351   31,563     8,032

  Equity in earnings (loss) of
   affiliates                         6,665        -        2         -

  Other income (loss), net              624      499      302       377

  Income before income taxes         20,232      114   19,017     2,486

  (Income) loss attributable to
   the noncontrolling interest         (610)       -        -         -

  Operating income (loss) (a)        19,622      114   19,017     2,486

  Quarter ended June 30, 2009
  Revenues from external customers $500,401  $23,762 $197,638   $39,752

  Gross Profit                       23,325    4,815   22,106     7,614

  Equity in earnings of affiliates      781        -        3         -

  Other income (loss), net              590      221      770       236

  Income before income taxes          8,659      619   10,345     3,042

  (Income) loss attributable to
   the noncontrolling interest          272        -        -         -

  Operating income (loss) (a)         8,931      619   10,345     3,042


                                   Grain &             Plant   Turf &
                                   Ethanol     Rail  Nutrient Specialty
                                   -------     ----  -------- ---------
  Six months ended June 30, 2010
  Revenues from external customers $994,569  $50,325 $331,562   $82,815

  Gross Profit                       56,006    8,353   43,559    16,472

  Equity in earnings (loss) of
   affiliates                        16,568        -        4         -

  Other income (loss), net            1,297    2,308      633       794

  Income before income taxes         41,339    1,140   19,736     5,150

  (Income) loss attributable to
   the noncontrolling interest       (1,001)

  Operating income (loss)            40,338    1,140   19,736     5,150

  Six months ended June 30, 2009
  Revenues from external customers $980,922  $50,532 $309,400   $84,455

  Gross Profit                       46,624   10,546   36,628    16,033

  Equity in earnings (loss) of
   affiliates                        (2,895)       -        5         -

  Other income (loss), net            1,149      187    1,258       541

  Income before income taxes         13,355    1,501   12,392     6,139

  (Income) loss attributable to
   the noncontrolling interest        1,311

  Operating income (loss)            14,666    1,501   12,392     6,139






                                           Retail    Other      Total
                                           ------    -----      -----
  Quarter ended June 30, 2010
  Revenues from external customers         $44,098        $-    $810,999

  Gross Profit                              13,535         -      87,554

  Equity in earnings (loss) of affiliates        -         -       6,667

  Other income (loss), net                     157       (78)      1,881

  Income before income taxes                 2,078    (3,595)     40,332

  (Income) loss attributable to the
   noncontrolling interest                       -         -        (610)

  Operating income (loss) (a)                2,078    (3,595)     39,722

  Quarter ended June 30, 2009
  Revenues from external customers         $49,401        $-    $810,954

  Gross Profit                              15,474         -      73,334

  Equity in earnings of affiliates               -         -         784

  Other income (loss), net                     136       771       2,724

  Income before income taxes                 2,864      (571)     24,958

  (Income) loss attributable to the
   noncontrolling interest                       -         -         272

  Operating income (loss) (a)                2,864      (571)     25,230



                                           Retail    Other      Total
                                           ------    -----      -----
  Six months ended June 30, 2010
  Revenues from external customers         $73,726        $-  $1,532,997

  Gross Profit                              21,714         -     146,104

  Equity in earnings (loss) of affiliates        -         -      16,572

  Other income (loss), net                     276       227       5,535

  Income before income taxes                  (749)   (4,213)     62,403

  (Income) loss attributable to the
   noncontrolling interest                                        (1,001)

  Operating income (loss)                     (749)   (4,213)     61,402

  Six months ended June 30, 2009
  Revenues from external customers         $83,037        $-  $1,508,346

  Gross Profit                              24,877         -     134,708

  Equity in earnings (loss) of affiliates        -         -      (2,890)

  Other income (loss), net                     247       581       3,963

  Income before income taxes                   163    (1,873)     31,677

  (Income) loss attributable to the
   noncontrolling interest                                         1,311

  Operating income (loss)                      163    (1,873)     32,988

  (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.

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SOURCE: The Andersons, Inc.

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


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