Andersons Inc at BMO Capital Markets Chemicals at Farm to Market Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Great. So the Andersons' has operated as more of an asset light model in recent years, which has worked out very well for the company. What are the advantages of the Andersons' Asset light ag model, and do you expect the Anderssons to remain asset light over the longer term, excuse me, or venture into more investments in asset heavy model?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : So what is your view on the global ag supply demand balance through 2025? Will we return to a more oversupplied environment barring any major weather events, and how does that impact your view of the Anderson's earnings opportunities and potential?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Right. I mean given the WASDE on Monday, I mean, what were your thoughts around the 25%, 26% numbers? Or does anything stand out to you that's kind of bogus feeling? Or did it mostly make sense?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Can you talk about the overall financial health of the US farmer and implications for both farmer selling and fertilizer demand?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Can you discuss the impact that tariffs in Section 301 port fees are having on ag merchandizing? Are you bullish, neutral, or bearish about the net potential outcome given what we have seen so far, which is, to be fair, pretty fluid? What types of scenarios are you running, and do you think the Anderson's is well positioned in its current state to operate with tariffs and higher port fees?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : How does the [sky] and grain investment enhance your agribusiness footprint and what is the EBITDA contribution timing? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 14, 2025 / 1:30PM, ANDE.OQ - Andersons Inc at BMO Capital Markets Chemicals at Farm to Market

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : So moving on to ethanol, what is driving your ethanol earnings success relative to industry margins, and how are your ethanol assets differentiated from peers?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Yeah. And that's an important point I think with how this year is going to play out, which segues into my next question. Do you foresee the ethanol fundamentals getting better from here through 2025 through the end of 2025? And what would that look like from a margin component perspective?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Okay. In terms of in terms of the industry production and inventory levels, what is a benchmark that we can look at the end of July or at the, mid-August that's going to say, okay, inventory levels are at this, and this is why margins are better or worse. I think one of your competitors called out 22 million barrels is like getting to that level is key in terms of creating a better margin environment. Just curious your thoughts are.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : What is your updated outlook for corn oil prices given the recent recovery in the veg oil complex? Do you foresee a return of strong demand from renewable diesel producers, and can you frame what type of EBITDA contribution this could be? Now, clearly, The House tax bill draft just came out and on the surface it seems very favorable for or incrementally more favorable for veg oils as a feedstock. So again this is a three part question, so I hope you remember each aspect, but just frame up the corn oil opportunity and kind of what it's going to look like from an EBITDA perspective too.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Absolutely. And just staying on that trading desk opportunity for a second, have you already started to see an acceleration in purchasing of feedstocks ahead of what is expected to be a May RVO announcement, and also is there any other investment you need to make into that business? It's clearly very talent heavy, but how are you thinking about it from a cap standpoint? Is it minimal or are you, do you think something bigger needs to happen?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Getting back to your comment on East versus West basis, because I think this is very interesting and important to your trading opportunities for this year and next year. Can you frame the impact that basis has across your business, east versus west, and the implications there if the crops come in favorably as expected?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Business, specific to, well, trade in ethanol, if you could dissect it.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : And then your comment on the port of Houston, very interesting investment opportunity, soybean meal, export capabilities. What is the difference in market opportunity from selling domestically versus overseas for soybean meal and with all these crush plants coming online with the 45Z working out likely more favorably for soybean oil. How do you view the end demand versus future supply of soybean meal and just the opportunities there both domestically and export?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : So along those lines with your internal investments, how robust is the current internal growth project pipeline? What is the right level of CapEx for the business in '25 and '26, and what types of returns would you anticipate over what timeframe for those? Yeah.

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : And how big of a role does M&A play in your growth strategy given your under levered balance sheet, which is well below your stated target of 2.5 times? Is this a good environment for acquisitions, and are you looking to do more triples than singles or doubles now?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : And I want to ask about home runs too, but I don't want to get too greedy. Does using equity make sense in a in a deal for you guys, especially if there is a home run opportunity? I mean, you have over $200 million in cash on the balance sheet. We spoke about your leverage. I mean, how are you thinking about the financing side of some of these opportunities?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : And you guys used equity with Lansing, and that was the right deal. Okay, so then what about share repo? Is that a consideration, given your float and kind of like what, how do you think about that?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Okay, all right, so just to tie a bow on this discussion, what are some of the key milestones that Anderson investors, the Anderson investors should be focused on through the balance of the year? Like what should we be keyed in on as key events and sometimes it's very fluid, like you mentioned with the basis and trading opportunities, but how are you thinking about the balance of the year and you know you put out that $475 million target, you were right around $400 million in EBITDA for four years straight. So clearly if the right environment presents itself, you can really flex your muscles. What should we be looking for? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 14, 2025 / 1:30PM, ANDE.OQ - Andersons Inc at BMO Capital Markets Chemicals at Farm to Market

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Great. That's it from my end. Is there any other points you want to add?

Question: Benjamin Mayhew - BMO Capital Markets - Analyst : Well Brian. Thank you so much for being here.