The Andersons, Inc. (NASDAQ: ANDE) shares dropped by 30% after it announced its first-quarter financial results for 2022. The company recorded a net income of $0.18 per diluted share, or $6.1 million attributable to the company’s continuing operations. Continuing operations EBITDA came to around $55.8 million in the same quarter.
Plant Nutrient reported a record-breaking pre-tax income of about $10.7 million. The company also announced that it had executed a sale agreement to offload its railcar repair business and that the deal was to close by the summer.
Management statements
The Andersons’ Chief Executive Officer and President Pat Bowe said:
The grain markets were impacted by the extreme run-up in futures prices resulting from the war in Ukraine. This drove grain basis values sharply lower. I’m proud of the merchandising teams as they worked through this unprecedented price volatility which allowed us to take larger ownership positions at good basis values.
Mr. Bowe claimed that Plant Nutrient continued its robust run by reporting its second consecutive record-breaking earnings. He says that this strong performance results from having a well-positioned inventory and strong specialty liquid results.
In Renewables, the CEO said production volume rose for both corn oil and ethanol. Co-product merchandising and renewable feedstocks were well above expectations.
The sale of its railcar repair business
When it comes to the sale agreement the company executed with Cathcart Rail, Mr. Bowe said:
“As announced in August of last year, we made a strategic decision to exit our rail segment to allow us to focus on and invest in our core agricultural verticals of grain and fertilizer. This sale also further strengthens our balance sheet and should enhance shareholder returns.”
He confirmed that the sale of the company’s railcar repair segment would finalize its departure from its rail department.
Cathcart Rail’s Chief Executive Officer, Casey Cathcart, claimed that the Andersons Inc’s railcar repair business aligns perfectly with their strategic goal of providing a wider variety of rail services.
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