Press Releases

The Andersons, Inc. Reports Record 3rd Qtr. Earnings
Cites Growth in Rail and Agriculture Businesses
EPS of $0.14 for quarter beats last year by $0.47
PRNewswire-FirstCall
MAUMEE, Ohio

The Andersons, Inc. , today announced that its net income and earnings per share in the most recent three-month period were the best third-quarter performance in the company's history. For the period, The Andersons achieved net income of $1.0 million, or $0.14 per diluted share, compared to the net loss of $2.3 million, or $0.33 per diluted share, that it experienced in the third quarter of 2003. Total revenues of $251 million for the period were $2 million below the third quarter of last year. For the nine-months-to-date, the company's net income was $10.9 million, or $1.45 per diluted share, on revenues of $902 million. In the first nine months of last year, The Andersons earned $5.0 million, or $0.68 per diluted share, on revenues of $804 million.

The Agriculture Group achieved an operating income of $0.3 million for the quarter. In the third quarter of 2003, the group incurred an operating loss of $2.8 million. Revenues of $169 million in this year's third quarter were $9 million lower than a year ago. Third quarter revenues in the group's grain business were lower this year because of fewer bushels sold during the period. However, increased bushel receipts and higher average gross margins fueled gross profit growth and income improvement. The group's plant nutrient business also achieved gross profit and operating income improvement in the third quarter with increased fertilizer shipments and higher average gross margins. The Agriculture Group's operating income for the first nine months of 2004 amounted to $9.7 million, an increase of $5.6 million from the same period in 2003. Total revenues of $622 million for the nine-month period were $86 million higher than a year ago. At this time, the fall harvest is in full swing, and the USDA is predicting that U.S. farmers will realize record corn and soybean yields and production totals. The company also indicated that it is evaluating the possibility of investing in an ethanol production facility at one of several possible locations in its region.

The Rail Group's July - September 2004 performance far outpaced its prior year results. Operating income of $4.9 million in the third quarter this year was $4.2 million higher than the same three-month period of 2003. Total revenues of $19.4 million were $10.1 million higher than last year. Continued improvement in lease rates during the period contributed to this strong performance as did a $2.5 million year-to-year increase in gross profit on car sales. Through the first nine months of 2004, the group has achieved operating income of $8.2 million on revenues of $43.6 million. In the same period last year, income was $2.4 million on $26.3 million of revenues.

The Processing Group incurred an operating loss of $1.9 million in the third quarter this year. This was $0.7 million higher than the operating loss experienced in the same three-month period of 2003. Total revenues of $20.8 million were $2.7 million below last year. The third quarter is typically a loss period for this group's highly seasonal lawn fertilizer business. Through the first nine months of 2004, the group has achieved operating income of $2.4 million on $106 million of revenues. In the first nine months last year, the group had earned $2.6 million, and revenues amounted to $113 million. Although average gross margins have improved this year due to product mix improvements, volumes declined somewhat because of unfavorable weather patterns during the important lawn and garden season this spring. Noting recent escalation in some energy-related raw material costs, the company indicated that the Processing Group may also fall short of last year's better than normal fourth quarter volume and profitability levels.

The Retail Group's sales of $41.1 million in the third quarter were 1.9 percent below the same three-month period in 2003. Food-related product categories continued to achieve growth vs. prior-year levels, but home center products, especially lawn and garden categories, were down. In addition, labor and utility costs were higher than a year ago. As a result, the group's operating loss widened from $0.1 million in 2003, to $0.2 million in the third quarter this year. Through the first nine months of the year, the group has earned operating income of $1.2 million, or $0.4 million less than it did during the same period of 2003. Total revenues for the Retail Group year-to- date through September are $130 million, 1.4 percent above last year.

"The third quarter has traditionally been a loss period because of the seasonality in several of our businesses, so achieving net income in excess of a million dollars in the third quarter this year is gratifying," said President and Chief Executive Officer Mike Anderson. "During the quarter, when we saw that the Rail and Agriculture businesses were exceeding our performance expectations, we revised our full-year earnings per diluted share guidance upward. Now in the first week of November, the harvest is progressing well, fall fertilizer sales look promising, and the rail business remains strong. Although lawn fertilizer raw material costs have escalated and retail sales remain soft, I believe that the $1.80 to $2.05 full-year earnings guidance we issued in September is still appropriate."

The company will host a webcast on Thursday, November 4, 2004 at 11:00 A.M. EST, to discuss its third quarter performance and full-year outlook. This can be accessed under the heading "Financial Information" on its website at http://www.andersonsinc.com/ or at http://www.firstcallevents.com/service/ajwz410288278gf12.html .

The Andersons, Inc. is a diversified company with interests in the grain and plant nutrient sectors of U.S. agriculture, as well as in railcar marketing, industrial materials formulation, turf products production, and general merchandise retailing. Founded in Maumee, Ohio, in 1947, the company presently has operations in seven U.S. states plus rail equipment leasing interests in Canada and Mexico. Total revenues in 2003 exceeded $1.2 billion.

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 http://www.andersonsinc.com/

                           The Andersons, Inc.

                    Consolidated Statements of Income
                               (Unaudited)

                                     Three Months ended  Nine months ended
  (in thousands, except for per         September 30        September 30
   share amounts)                      2004      2003      2004      2003

  Sales and merchandising revenues   $250,682  $253,027  $901,631  $803,828
  Cost of sales and merchandising
   revenues                           209,942   222,789   768,761   692,978
  Gross profit                         40,740    30,238   132,870   110,850

  Operating, administrative and
   general expenses                    38,801    33,748   111,680   101,055
  Interest expense                      2,470     1,603     7,874     6,119
  Other income                          1,892     1,519     4,122     3,816
  Income before income taxes            1,361    (3,594)   17,438     7,492
  Income taxes                            313    (1,246)    6,574     2,528
  Net income                           $1,048   $(2,348)  $10,864    $4,964

  Per common share:
        Basic earnings                  $0.14    $(0.33)    $1.50     $0.70
        Diluted earnings                $0.14    $(0.33)    $1.45     $0.68
        Dividends paid                 $0.075    $0.075     $0.23    $0.225

  Weighted average shares
   outstanding-basic                    7,240     7,106     7,231     7,139
  Weighted average shares
   outstanding-diluted                  7,473     7,106     7,474     7,311


                           The Andersons, Inc.

                       Consolidated Balance Sheets
                               (Unaudited)

                                       September 30 December 31 September 30
             (in thousands)                2004         2003        2003
  Assets
  Current assets:
    Cash and cash equivalents              $8,138      $6,444      $3,964
    Restricted cash                         1,730         -           -
    Accounts receivable (net) and
     margin deposits                       63,520      68,546      71,092
    Inventories                           204,485     259,755     184,049
    Other current assets                   21,404      22,234      16,794
  Total current assets                    299,277     356,979     275,899

  Other assets                             20,662      13,702      14,915
  Railcar assets leased to others (net)   100,259      29,489      26,979
  Property, plant and equipment (net)      93,933      92,449      91,716
                                         $514,131    $492,619    $409,509

  Liabilities and shareholders' equity
  Current liabilities:
    Notes payable                         $10,600     $48,000     $80,000
    Other current liabilities             191,046     219,447     113,273
  Total current liabilities               201,646     267,447     193,273

  Deferred items and other long-term
   liabilities                             30,907      27,254      24,105
  Long-term debt non-recourse              67,121         -           -
  Long-term debt                           88,877      82,127      83,241
  Shareholders' equity                    125,580     115,791     108,890
                                         $514,131    $492,619    $409,509


                               Segment Data

                                         Agriculture      Rail    Processing
      Quarter ended September 30, 2004
  Revenues from external customers         $169,395     $19,385     $20,819
  Gross Profit                               15,719       9,464       4,162
  Other income                                1,114         183         314
  Operating income (loss)                       269       4,866      (1,859)

      Quarter ended September 30, 2003
  Revenues from external customers          178,377       9,252      23,522
  Gross Profit                               11,413       3,087       4,411
  Other income                                  647         128         464
  Operating income (loss)                    (2,828)        693      (1,139)

    Nine months ended September 30, 2004
  Revenues from external customers          621,796      43,598     106,076
  Gross Profit                               56,626      21,398      17,527
  Other income                                2,411         336         453
  Operating income (loss)                     9,680       8,207       2,371

    Nine months ended September 30, 2003
  Revenues from external customers          536,044      26,315     113,072
  Gross Profit                               48,138       8,587      18,051
  Other income                                1,705         213         782
  Operating income (loss)                     4,034       2,373       2,567


                               Segment Data

                                            Retail       Other       Total
      Quarter ended September 30, 2004
  Revenues from external customers          $41,083        $-      $250,682
  Gross Profit                               11,666         -        41,011
  Other income                                  131         150       1,892
  Operating income (loss)                      (232)     (1,683)      1,361

      Quarter ended September 30, 2003
  Revenues from external customers           41,876         -       253,027
  Gross Profit                               11,327         -        30,238
  Other income                                  156         124       1,519
  Operating income (loss)                       (65)       (255)     (3,594)

    Nine months ended September 30, 2004
  Revenues from external customers          130,161         -       901,631
  Gross Profit                               37,590         -       133,141
  Other income                                  541         381       4,122
  Operating income (loss)                     1,157      (3,977)     17,438

    Nine months ended September 30, 2003
  Revenues from external customers          128,397         -       803,828
  Gross Profit                               36,074         -       110,850
  Other income                                  689         427       3,816
  Operating income (loss)                     1,574      (3,056)      7,492

SOURCE: The Andersons, Inc.

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