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The Andersons,
Inc. Reports Record Earnings For Fourth Quarter and Fiscal Year 2007
Maumee, OH—The Andersons, Inc. (NASDAQ:ANDE),
announced Feb. 6 that both its full year and fourth quarter results
established new records for the company.
For the full year, net income was $68.8 million, or $3.75 per diluted
share, on $2.4 billion of revenues.
In 2006, the company's full year net income was $36.3 million, or $2.19
per share, and total revenues were $1.5 billion.
The fourth quarter net income was $23.5 million, or $1.28 per diluted
share, and total revenues were $785 million.
In the same three month period of 2006, the company reported net income
of $13.8 million, or $0.76 per share, on revenues of $463 million.
The Grain & Ethanol Group's 2007 operating income
of $65.9 million was more than double its previous income record of
$28.0 million achieved in 2006.
Total revenues were $1.5 billion for the year.
This included $407 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.
The group's 2006 revenues were $791 million.
Total revenues in the Grain & Ethanol Group have increased for both
the quarter and year due to a considerable increase in both the volume
and price of grain sold, and due to an increase in the gallons of ethanol
sold.
Income from the ethanol investments grew significantly during the year
because of the three ethanol plants in operation or under development;
the Albion, MI plant began production in August 2006, the Clymers, IN
plant began production in April 2007 and the third plant in Greenville,
OH is scheduled to begin production within the next week.
The group's grain business also benefited from higher space and fee
income.
Additionally, income from the group's investment in Lansing
Trade Group LLC was more than double the prior year.
For the fourth quarter, the Grain & Ethanol Group's operating income
was $30.1 million, in contrast to $12.3 million earned in the same three
month period of 2006.
Total revenues for the quarter were $548 million, including $144 million
of grain and ethanol sales made by the group in accordance with origination
and marketing agreements with the ethanol joint ventures, for which
only a fee is received.
In comparison, the group's fourth quarter revenues last year were $305
million.
The Rail Group's operating income for 2007 was $19.5
million, which is the same as 2006.
Revenues of $130 million
for the year were up from $113 million in the prior year.
The group grew the rail fleet by more than 8 percent during 2007, and
ended the year with more than 22,700 cars and locomotives.
The group's average lease rates have remained stable.
The average utilization rate (the percentage of the fleet's railcars
in service) for 2007 was 92.6 percent, which was down from the 2006
average of 95.2 percent; however the year ended with a utilization rate
of 93.4 percent.
Including gains from railcar sales and related leases entered into during
the year, gross profit in the group's leasing business was slightly
higher than year earlier results.
The railcar repair and manufacturing businesses experienced declines
in gross profit during the year, but saw some improvement in the fourth
quarter.
The Rail Group generated $3.8 million in operating income in the fourth
quarter of 2007 on $28 million of revenues.
In 2006, operating income for the same three month period was $3.4 million
and revenues amounted to $24 million.
In 2007, the Plant Nutrient Group exceeded income records
ending the year with operating income of $27.1 million on $466 million
of revenues.
This compares to the prior year operating income of $3.3 million on
revenues of $265 million.
The 2007 income is more than double the group's prior record of $10.4
million, established in 2005.
Total nutrient volume for the year increased by more than 40 percent;
this was influenced by both an approximate 20 percent increase in corn
acreage and market share growth.
Margin improvement also contributed significantly to the improved bottom
line.
For the fourth quarter, the group's operating income was $8.7 million
on $140 million of revenues.
Last year its operating income was $1.3 million on revenues of $67 million
for the same three month period.
Sales volume remained high in the fourth quarter as a result of increased
wheat acres and stepped up buying in the face of further escalation
of nutrient prices and robust demand driven by anticipated strong corn
acres in 2008.
The Turf & Specialty Group's full year operating
income was $0.1 million on $104 million of revenues.
In 2006, the group had operating income of $3.2 million, and total revenues
were $111 million.
The 2007 shortfall in the lawn business was attributable to reduced
sales of insecticide and fungicide products, and the escalation of raw
material costs.
The cob business had lower earnings during 2007 mainly due to the need
to outsource a portion of the cob from competitors, which resulted in
a significantly higher cob cost for the year.
The group incurred an operating loss of $0.8 million in the fourth quarter
on $19 million of revenues.
Last year, its operating income was $0.2 million for the same period,
and revenues were $18 million.
Total sales for the Retail Group were $180 million
in 2007, or 1.9 percent above the 2006 total of $177 million.
Same store sales, however, were down approximately 1 percent.
The group reported operating income of $0.1 million in 2007 after recording
a $1.9 million impairment charge on certain retail assets.
In the prior year, the group earned operating income of $3.2 million.
The Retail Group's fourth quarter operating loss was $0.6 million on
$50 million of revenues, which includes the impairment.
Last year, operating income was $1.9 million, and total revenues were
$49 million in the same three month period.
"To be reporting record breaking results for the fourth consecutive
year is truly gratifying.
"Our Grain & Ethanol and Plant Nutrient groups achieved phenomenal
income growth this year, and the Rail Group maintained solid performance
despite some tightening in the rail industry," said President and
Chief Executive Officer Mike Anderson.
Mr. Anderson added, "To see the results of our strategic growth
initiatives is very satisfying.
"Our investments in the ethanol business and Lansing Trade Group,
and continual expansion of the rail business are clearly paying dividends.
"It was also rewarding to watch the Plant Nutrient Group rebound
from the tough market realities of 2006 and end 2007 with record earnings
--- what a difference a year can make.
"My thanks to all our employees whose hard work made our current
year performance possible."
The company will host a webcast on Feb. 7 at 11:00 A.M. ET, to discuss
its performance and full year outlook.
For more information, call Gary Smith at 419-891-6417.
For complete finacial report,
click here.
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