Andersons Inc Q4 2024 Earnings Call Transcript

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

Question: Ben Klieve - Lake Street Capital Markets, LLC - Analyst : All right. Thanks for taking my questions and congratulations on a really nice quarter here to end a good year. Bill, I'd like to start with the comments you just made at the end of your prepared remarks regarding the renewable segment and investments into that space around lowering the carbon intensity of those locations. Can you -- excuse me, can you elaborate a bit on kind of how your thought process has evolved over the last several months on those investment opportunities, how the return profile of those potential investments is changing in your mind and then also comment on the degree to which those type of investments are included within your CapEx expectations this year?

Question: Ben Klieve - Lake Street Capital Markets, LLC - Analyst : Got it. Very good, thank you. And regarding the consolidation of the [A&I] and Trade Group, those businesses seem to be operating relatively efficiently. So I wouldn't expect there's a lot of expense synergies that are going to come out of this. But can you just comment on a high level regarding kind of a magnitude of synergies on the expense side or even on the revenue side as you guys see fit?

Question: Ben Klieve - Lake Street Capital Markets, LLC - Analyst : Got it. Got it. That makes plenty of sense. Very good. One more for me and then I'll go back in queue. Within the quarter, in the ethanol space, margin compression, from kind of being in the quarter to the end for several reasons that are entirely out of your control. But you guys posted still really nice quarter. Can you just comment on kind of what allowed you to still deliver really quite solid results in that back -- in the context of that macro backdrop and the efficacy of your hedging strategy throughout the quarter? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 19, 2025 / 1:30PM, ANDE.OQ - Q4 2024 Andersons Inc Earnings Call

Question: Ben Klieve - Lake Street Capital Markets, LLC - Analyst : Very good. Well, clearly worked in the period. Congratulations again to all for a great quarter. Thanks for taking my questions and I'll get back in queue.

Question: Pooran Sharma - Stephens Inc. - Analyst : Thank you and congrats on the quarter. I just wanted to get a sense of the potential outcomes that you're thinking about for trade tariffs. I think in the release, you mentioned that you face challenges and opportunities. So just from a trade tariff backdrop, just want to get a sense of maybe what are the top outcomes that you're planning for and how this would impact your business?

Question: Pooran Sharma - Stephens Inc. - Analyst : Okay. Great. No, I appreciate that color. Just wondering if maybe we could talk about Skyland a little bit more. I know you provided some color in the commentary, but just seeing if we could flush out any more details on the progress of integration, what's left and how's this been versus your expectations. Are you still on track to achieve the -- I believe it's $30 million to $40 million in EBITDA contribution? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 19, 2025 / 1:30PM, ANDE.OQ - Q4 2024 Andersons Inc Earnings Call

Question: Pooran Sharma - Stephens Inc. - Analyst : I appreciate the color there, and now it sounds like it's progressing well. I guess, on that if I could just squeeze one more in before I jump back in the queue, but just on the nutrient and industrial side of the business, I think you mentioned an increase in corn acres and how that could potentially result in increased volumes. Could you remind us which crop kind of requires more inputs? And if you could maybe just give us a sense either qualitatively or quantitatively the magnitude difference in input requirements between, let's say, like corn and soybeans?

Question: Pooran Sharma - Stephens Inc. - Analyst : Great. Well, I appreciate the color and, again, congrats on the quarter.

Question: Ben Mayhew - BMO Capital Markets - Analyst : Hey guys, good morning. My first question is just around the momentum you're seeing in the renewable diesel feedstock trading since 45Z guidelines were finalized. Do you think transacting is back to more normal levels, or is the market still cautious to transact with the Trump risk out there? Thank you.

Question: Ben Mayhew - BMO Capital Markets - Analyst : That makes sense. And my second question is around -- I mean, also has to do with 45Z, but it's around ethanol. And I'm just wondering, does the market environment for acquiring ethanol plants, has that become more attractive now that 45Z guidelines are in place? And what are some of the characteristics that would make certain ethanol plants more valuable than others? Thanks.

Question: Ben Mayhew - BMO Capital Markets - Analyst : Thank you. That's great. And then I'm just going to sneak one more in here. And this is more of just a general question about the US farmer and how they're approaching 2025. I mean, certainly, there's a lot of just unknowns -- there are a lot of unknowns out there. But it would seem like with just corn, just looking at corn, that the price appreciation is kind of lending to some optimism or some building optimism, at least. So how do you think about the merchandising environment for corn in '25? Is the outlook generally better? I mean, that's my perception. And what are the farmers thinking? Put us in the mind of the US farmer and what is their kind of game plan for this year, and I'll leave it there. Thanks.