Press Releases

The Andersons, Inc. Reports First Quarter Earnings Net Income Of $0.4 Million Consistent with Earlier Projections
EPS of $0.05 For Period Vs. $0.22 Last Year
PRNewswire-FirstCall
MAUMEE, Ohio

The Andersons, Inc. , today reported first quarter net income of $0.4 million, or $0.05 per diluted share. In the same three-month period of 2002, the company earned $1.6 million, or $0.22 per diluted share. Total revenues of $237.9 million for the period were 11 percent higher than the first quarter of 2002.

The company's Agriculture Group achieved an operating income of $0.3 million for the quarter, $2.2 million lower than the $2.5 million it realized in the first quarter of 2002. Revenues of $149.2 million for the quarter were 11 percent higher than 2002's first quarter total of $134.8 million. Plant nutrient sales volumes were higher, and average fertilizer margins rose slightly in spite of an increase in natural gas and nitrogen prices during January and February. These improvements were more than offset, however, by the continued reduction in grain storage income that had been anticipated. World grain stocks, especially corn, have declined significantly during the past two years, and the U.S. has borne a disproportionate share, about half, of this reduction. As a result, earnings from the group's elevators have declined. During the quarter, the group completed a previously announced transaction in which it acquired a minority interest in LGC Grain Company.

The first quarter is always an important period for the company's Processing Group as major retailers throughout the country gear up for the spring lawn and garden season and golf course superintendents work to get their greens, tees and fairways in prime condition following the winter. In the January - March period this year, the group achieved an operating income of $3.7 million. This was $1.3 million, or 54 percent, above its 2002 first quarter performance. Total revenues increased by $11.4 million from the $41.0 million generated in the first quarter of 2002 to $52.4 million this year. While product and customer mix shifts caused average gross margins to decline slightly, the volume of turf-care products sold during this three- month period was 24 percent higher than a year ago. Performance of the group's other businesses, the manufacture of cob-based chemical and feed ingredient carriers, animal bedding and litter products, was commensurate with year- earlier results.

Revenues and operating income of the company's Rail Group were relatively unchanged from the first three months of 2002. This year Rail's first quarter income amounted to $0.3 million on revenues of $4.4 million. In the corresponding period of 2002, income was $0.4 million on revenues of $4.2 million. The group's marketing unit continued to acquire railcars during the quarter and now controls a fleet of more than 5,700 railcars and 51 locomotives. The utilization rate of this fleet also improved from a year ago. Although the group benefited from a short-term car leasing opportunity early last year which was not repeated in the first quarter of 2003, this year-to-year decline was mostly offset by sales growth from a new line of railcar discharge gates.

The Retail Group experienced an 8 percent reduction in same-store sales for the quarter with revenues of $31.9 million this year vs. $34.8 million a year ago. Easter occurred in the first quarter last year, but fell in the second quarter in 2003. This and new competition in some markets explains some of the year-to-year first quarter sales decline. Colder weather experienced during the late winter months this year and economic uncertainty related to the situation in Iraq also seem to have caused retail consumers to curtail their spending. Because of the reduction in total sales, the group's operating loss for the first quarter increased from $1.7 million in 2002 to $2.6 million this year. Although total expenses grew slightly from a year ago, this was offset by favorable inventory performance and an improvement in average gross margins made possible in part by the recent addition of a meat market in three of the group's six stores.

"Our first quarter earnings were right in line with our expectations," said President and Chief Executive Officer Mike Anderson. "For some time now, I've been describing the factors underlying a decline in grain space income. As it turned out, our grain business did even better this quarter than I had anticipated. While sales in our retail stores were clearly affected by economic conditions during the first quarter, our lawn business continued to show solid improvement."

Anderson also stated "Based on our results so far and recognizing that we still have three-quarters of the year to go, our previous earnings projections of $1.15 to $1.30 per share for the full year still seem appropriate. This would be in line with historical averages and assumes, including a whole host of factors, that planting and growing conditions for eastern corn belt farmers this year fall somewhere within the 'normal' range."

The company will host a webcast on Tuesday, April 29, 2003 at 11:00 A.M. EDT, to discuss its first-quarter performance and full-year outlook. The webcast can be accessed under "Financial Information" on its website at www.andersonsinc.com or at www.firstcallevents.com/service/ajwz378674470gf12.html .

The Andersons, Inc. is a respected leader and dominant regional player in grain merchandising and agricultural nutrients distribution. Its strong position in these 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


                             The Andersons, Inc.
                    Consolidated Statements of Operations

                                                    Three Months ended
                                                         March 31
  (in thousands, except for per share
  amounts)                                       2003              2002

  Sales and merchandising revenues              $237,939          $214,831
  Cost of sales and merchandising revenues       204,054           178,811
  Gross profit                                    33,885            36,020

  Operating, administrative and general
   expenses                                       32,087            31,787
  Interest expense                                 2,303             2,713
  Other income                                     1,101               792
  Income before income taxes                         596             2,312
  Income taxes                                       207               703
  Net income                                        $389            $1,609

  Per common share:
        Basic earnings                             $0.05             $0.22
        Diluted earnings                           $0.05             $0.22
        Dividends paid                            $0.070            $0.065

  Weighted average shares outstanding-basic        7,179             7,288
  Weighted average shares outstanding-diluted      7,344             7,393


                           The Andersons, Inc.
                       Consolidated Balance Sheets
                               (Unaudited)

                                           March 31  December 31   March 31
             (in thousands)                  2003        2002        2002

  Assets
  Current assets:
    Cash and cash equivalents               $7,038      $6,095      $9,592
    Accounts receivable (net) and
     margin deposits                        79,057      59,800      72,826
    Inventories                            248,454     256,275     238,903
    Other current assets                    19,660      15,716      24,271
  Total current assets                     354,209     337,886     345,592

  Other assets                              13,568      12,591      11,074
  Railcar assets leased to others (net)     29,783      26,399      29,247
  Property, plant and equipment (net)       92,557      92,939      94,851
                                          $490,117    $469,815    $480,764

  Liabilities and shareholders' equity
  Current liabilities:
    Notes payable                         $118,200     $70,000    $128,200
    Other current liabilities              159,123     187,056     143,580
  Total current liabilities                277,323     257,056     271,780

  Deferred items, long-term liabilities
   and minority interest                    23,618      23,647      20,128
  Long-term debt                            84,481      84,272      92,269
  Shareholders' equity                     104,695     104,840      96,587
                                          $490,117    $469,815    $480,764


  Segment Data

  Quarter ended March 31, 2003

                Agriculture Processing  Rail   Retail     Other    Total
  Revenues from
   external
   customers     $149,193     $52,420  $4,382  $31,944       $-   $237,939
  Other income        543         203      50      138      167      1,101
                 $149,736     $52,623  $4,432  $32,082     $167   $239,040
  Operating
   income (loss)     $293      $3,739    $304  $(2,623) $(1,117)      $596

  Quarter ended March 31, 2002

  Revenues from
   external
   customers      $134,840    $40,981  $4,160  $34,850      $-    $214,831
  Other income         267        123       3      119      280        792
                  $135,107    $41,104  $4,163  $34,969     $280   $215,623
  Operating
   income (loss)    $2,524     $2,418    $380  $(1,739) $(1,271)    $2,312

SOURCE: The Andersons, Inc.

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