|
|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
OHIO
|
|
34-1562374
|
(State of incorporation
or organization)
|
|
(I.R.S. Employer
Identification No.)
|
1947 Briarfield Boulevard, Maumee, Ohio
|
|
43537
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
Page No.
|
PART I. FINANCIAL INFORMATION
|
|
|
|
PART II. OTHER INFORMATION
|
|
The Andersons, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)(In thousands)
|
|||||||||||
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Assets
|
|
|
|
|
|
||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
31,497
|
|
|
$
|
34,919
|
|
|
$
|
29,645
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
752
|
|
|||
Accounts receivable, net
|
216,021
|
|
|
183,238
|
|
|
190,628
|
|
|||
Inventories (Note 2)
|
731,629
|
|
|
648,703
|
|
|
641,294
|
|
|||
Commodity derivative assets – current (Note 5)
|
43,810
|
|
|
30,702
|
|
|
48,049
|
|
|||
Other current assets
|
57,147
|
|
|
63,790
|
|
|
83,623
|
|
|||
Assets held for sale
|
57,775
|
|
|
37,859
|
|
|
—
|
|
|||
Total current assets
|
1,137,879
|
|
|
999,211
|
|
|
993,991
|
|
|||
Other assets:
|
|
|
|
|
|
||||||
Commodity derivative assets – noncurrent (Note 5)
|
1,739
|
|
|
310
|
|
|
339
|
|
|||
Goodwill
|
6,024
|
|
|
6,024
|
|
|
63,934
|
|
|||
Other intangible assets, net
|
108,855
|
|
|
112,893
|
|
|
103,057
|
|
|||
Other assets, net
|
28,566
|
|
|
12,557
|
|
|
8,108
|
|
|||
Equity method investments
|
224,449
|
|
|
223,239
|
|
|
208,993
|
|
|||
|
369,633
|
|
|
355,023
|
|
|
384,431
|
|
|||
Rail Group assets leased to others, net (Note 3)
|
462,253
|
|
|
423,443
|
|
|
342,936
|
|
|||
Property, plant and equipment, net (Note 3)
|
393,763
|
|
|
384,677
|
|
|
440,395
|
|
|||
Total assets
|
$
|
2,363,528
|
|
|
$
|
2,162,354
|
|
|
$
|
2,161,753
|
|
The Andersons, Inc.
Condensed Consolidated Balance Sheets (continued)
(Unaudited)(In thousands)
|
|||||||||||
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Liabilities and equity
|
|
|
|
|
|
||||||
Current liabilities:
|
|
|
|
|
|
||||||
Short-term debt (Note 4)
|
$
|
489,000
|
|
|
$
|
22,000
|
|
|
$
|
255,000
|
|
Trade and other payables
|
263,519
|
|
|
503,571
|
|
|
276,834
|
|
|||
Customer prepayments and deferred revenue
|
81,778
|
|
|
59,710
|
|
|
81,628
|
|
|||
Commodity derivative liabilities – current (Note 5)
|
15,424
|
|
|
29,651
|
|
|
29,914
|
|
|||
Accrued expenses and other current liabilities
|
60,095
|
|
|
69,579
|
|
|
65,952
|
|
|||
Current maturities of long-term debt (Note 4)
|
14,134
|
|
|
54,205
|
|
|
56,144
|
|
|||
Total current liabilities
|
923,950
|
|
|
738,716
|
|
|
765,472
|
|
|||
Other long-term liabilities
|
31,536
|
|
|
33,129
|
|
|
36,125
|
|
|||
Commodity derivative liabilities – noncurrent (Note 5)
|
1,414
|
|
|
825
|
|
|
450
|
|
|||
Employee benefit plan obligations
|
26,310
|
|
|
26,716
|
|
|
34,832
|
|
|||
Long-term debt, less current maturities (Note 4)
|
438,628
|
|
|
418,339
|
|
|
365,971
|
|
|||
Deferred income taxes
|
118,933
|
|
|
121,730
|
|
|
181,541
|
|
|||
Total liabilities
|
1,540,771
|
|
|
1,339,455
|
|
|
1,384,391
|
|
|||
Commitments and contingencies (Note 14)
|
|
|
|
|
|
||||||
Shareholders’ equity:
|
|
|
|
|
|
||||||
Common shares, without par value (63,000 shares authorized; 29,430 shares issued at 3/31/2018, 12/31/17 and 3/31/2017)
|
96
|
|
|
96
|
|
|
96
|
|
|||
Preferred shares, without par value (1,000 shares authorized; none issued)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Additional paid-in-capital
|
221,990
|
|
|
224,622
|
|
|
220,366
|
|
|||
Treasury shares, at cost (955, 1,063 and 1,074 shares at 3/31/2018, 12/31/17 and 3/31/2017, respectively)
|
(36,028
|
)
|
|
(40,312
|
)
|
|
(40,727
|
)
|
|||
Accumulated other comprehensive loss
|
(3,988
|
)
|
|
(2,700
|
)
|
|
(11,964
|
)
|
|||
Retained earnings
|
618,572
|
|
|
633,496
|
|
|
601,560
|
|
|||
Total shareholders’ equity of The Andersons, Inc.
|
800,642
|
|
|
815,202
|
|
|
769,331
|
|
|||
Noncontrolling interests
|
22,115
|
|
|
7,697
|
|
|
8,031
|
|
|||
Total equity
|
822,757
|
|
|
822,899
|
|
|
777,362
|
|
|||
Total liabilities and equity
|
$
|
2,363,528
|
|
|
$
|
2,162,354
|
|
|
$
|
2,161,753
|
|
|
Three months ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
635,739
|
|
|
$
|
852,016
|
|
Cost of sales and merchandising revenues
|
572,034
|
|
|
775,558
|
|
||
Gross profit
|
63,705
|
|
|
76,458
|
|
||
Operating, administrative and general expenses
|
64,257
|
|
|
81,545
|
|
||
Interest expense
|
6,999
|
|
|
6,100
|
|
||
Other income:
|
|
|
|
||||
Equity in earnings (loss) of affiliates, net
|
3,573
|
|
|
(1,878
|
)
|
||
Other income, net
|
1,686
|
|
|
7,495
|
|
||
Income (loss) before income taxes
|
(2,292
|
)
|
|
(5,570
|
)
|
||
Income tax provision (benefit)
|
(310
|
)
|
|
(2,535
|
)
|
||
Net income (loss)
|
(1,982
|
)
|
|
(3,035
|
)
|
||
Net income (loss) attributable to the noncontrolling interests
|
(282
|
)
|
|
54
|
|
||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
(1,700
|
)
|
|
$
|
(3,089
|
)
|
Per common share:
|
|
|
|
||||
Basic earnings (loss) attributable to The Andersons, Inc. common shareholders
|
$
|
(0.06
|
)
|
|
$
|
(0.11
|
)
|
Diluted earnings (loss) attributable to The Andersons, Inc. common shareholders
|
$
|
(0.06
|
)
|
|
$
|
(0.11
|
)
|
Dividends declared
|
$
|
0.165
|
|
|
$
|
0.160
|
|
|
Three months ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
Net income (loss)
|
$
|
(1,982
|
)
|
|
$
|
(3,035
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Change in fair value of convertible preferred securities (net of income tax of $(87) and $0)
|
(87
|
)
|
|
—
|
|
||
Change in unrecognized actuarial loss and prior service cost (net of income tax of $15 and $7)
|
(51
|
)
|
|
(10
|
)
|
||
Foreign currency translation adjustments (net of income tax of $0 and $0)
|
(1,150
|
)
|
|
514
|
|
||
Other comprehensive income (loss)
|
(1,288
|
)
|
|
504
|
|
||
Comprehensive income (loss)
|
(3,270
|
)
|
|
(2,531
|
)
|
||
Comprehensive income (loss) attributable to the noncontrolling interests
|
(282
|
)
|
|
54
|
|
||
Comprehensive income (loss) attributable to The Andersons, Inc.
|
$
|
(2,988
|
)
|
|
$
|
(2,585
|
)
|
|
Three months ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
Operating Activities
|
|
|
|
||||
Net income (loss)
|
$
|
(1,982
|
)
|
|
$
|
(3,035
|
)
|
Adjustments to reconcile net income (loss) to cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
22,679
|
|
|
21,003
|
|
||
Bad debt expense (recovery)
|
(531
|
)
|
|
629
|
|
||
Equity in (earnings) losses of affiliates, net of dividends
|
(2,360
|
)
|
|
1,931
|
|
||
Gains on sale of Rail Group assets and related leases
|
(2,280
|
)
|
|
(3,609
|
)
|
||
(Gain) loss on sale of assets
|
277
|
|
|
(4,698
|
)
|
||
Stock-based compensation expense
|
1,268
|
|
|
1,220
|
|
||
Other
|
(70
|
)
|
|
(725
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(30,730
|
)
|
|
7,563
|
|
||
Inventories
|
(85,262
|
)
|
|
33,456
|
|
||
Commodity derivatives
|
(45,775
|
)
|
|
4,017
|
|
||
Other assets
|
1,134
|
|
|
(9,375
|
)
|
||
Payables and other accrued expenses
|
(235,075
|
)
|
|
(277,612
|
)
|
||
Net cash provided by (used in) operating activities
|
(378,707
|
)
|
|
(229,235
|
)
|
||
Investing Activities
|
|
|
|
||||
Purchases of Rail Group assets
|
(29,516
|
)
|
|
(25,074
|
)
|
||
Proceeds from sale of Rail Group assets
|
14,575
|
|
|
5,621
|
|
||
Purchases of property, plant and equipment and capitalized software
|
(29,414
|
)
|
|
(5,608
|
)
|
||
Proceeds from sale of assets
|
6
|
|
|
13,912
|
|
||
Purchase of investments
|
—
|
|
|
(1,817
|
)
|
||
Other
|
—
|
|
|
(281
|
)
|
||
Net cash provided by (used in) investing activities
|
(44,349
|
)
|
|
(13,247
|
)
|
||
Financing Activities
|
|
|
|
||||
Net change in short-term borrowings
|
467,000
|
|
|
226,000
|
|
||
Proceeds from issuance of long-term debt
|
50,000
|
|
|
15,175
|
|
||
Proceeds from long-term financing arrangement
|
—
|
|
|
10,396
|
|
||
Payments of long-term debt
|
(106,515
|
)
|
|
(37,852
|
)
|
||
Proceeds from noncontrolling interest owner
|
14,700
|
|
|
—
|
|
||
Proceeds from sale of treasury shares to employees and directors
|
—
|
|
|
511
|
|
||
Payments of debt issuance costs
|
(787
|
)
|
|
(33
|
)
|
||
Dividends paid
|
(4,650
|
)
|
|
(4,483
|
)
|
||
Other
|
(114
|
)
|
|
(217
|
)
|
||
Net cash provided by (used in) financing activities
|
419,634
|
|
|
209,497
|
|
||
Decrease in cash and cash equivalents
|
(3,422
|
)
|
|
(32,985
|
)
|
||
Cash and cash equivalents at beginning of period
|
34,919
|
|
|
62,630
|
|
||
Cash and cash equivalents at end of period
|
$
|
31,497
|
|
|
$
|
29,645
|
|
|
Common
Shares
|
|
Additional
Paid-in
Capital
|
|
Treasury
Shares
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||
Balance at December 31, 2016
|
$
|
96
|
|
|
$
|
222,910
|
|
|
$
|
(45,383
|
)
|
|
$
|
(12,468
|
)
|
|
$
|
609,206
|
|
|
$
|
16,336
|
|
|
$
|
790,697
|
|
Net income (loss)
|
|
|
|
|
|
|
|
|
(3,089
|
)
|
|
54
|
|
|
(3,035
|
)
|
|||||||||||
Other comprehensive income (loss)
|
|
|
|
|
|
|
504
|
|
|
|
|
|
|
504
|
|
||||||||||||
Other change in noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(8,359
|
)
|
|
(8,359
|
)
|
||||||||||||
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $(323) (126 shares)
|
|
|
(2,549
|
)
|
|
4,604
|
|
|
|
|
|
|
|
|
2,055
|
|
|||||||||||
Dividends declared ($0.16 per common share)
|
|
|
|
|
|
|
|
|
(4,500
|
)
|
|
|
|
(4,500
|
)
|
||||||||||||
Restricted share award dividend equivalents
|
|
|
5
|
|
|
52
|
|
|
|
|
(57
|
)
|
|
|
|
—
|
|
||||||||||
Balance at March 31, 2017
|
$
|
96
|
|
|
$
|
220,366
|
|
|
$
|
(40,727
|
)
|
|
$
|
(11,964
|
)
|
|
$
|
601,560
|
|
|
$
|
8,031
|
|
|
$
|
777,362
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2017
|
$
|
96
|
|
|
$
|
224,622
|
|
|
$
|
(40,312
|
)
|
|
$
|
(2,700
|
)
|
|
$
|
633,496
|
|
|
$
|
7,697
|
|
|
$
|
822,899
|
|
Net income (loss)
|
|
|
|
|
|
|
|
|
(1,700
|
)
|
|
(282
|
)
|
|
(1,982
|
)
|
|||||||||||
Other comprehensive income (loss)
|
|
|
|
|
|
|
(1,288
|
)
|
|
|
|
|
|
(1,288
|
)
|
||||||||||||
Cash received from noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
14,700
|
|
|
14,700
|
|
||||||||||||
Adoption of accounting standard, net of income tax of $2,869
|
|
|
|
|
|
|
|
|
(8,441
|
)
|
|
|
|
(8,441
|
)
|
||||||||||||
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $(0) (105 shares)
|
|
|
(2,632
|
)
|
|
4,164
|
|
|
|
|
|
|
|
|
1,532
|
|
|||||||||||
Dividends declared ($0.165 per common share)
|
|
|
|
|
|
|
|
|
(4,663
|
)
|
|
|
|
(4,663
|
)
|
||||||||||||
Restricted share award dividend equivalents
|
|
|
|
|
|
120
|
|
|
|
|
(120
|
)
|
|
|
|
—
|
|
||||||||||
Balance at March 31, 2018
|
$
|
96
|
|
|
$
|
221,990
|
|
|
$
|
(36,028
|
)
|
|
$
|
(3,988
|
)
|
|
$
|
618,572
|
|
|
$
|
22,115
|
|
|
$
|
822,757
|
|
(in thousands)
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Grain
|
$
|
541,272
|
|
|
$
|
505,217
|
|
|
$
|
443,870
|
|
Ethanol and co-products
|
14,320
|
|
|
11,003
|
|
|
15,549
|
|
|||
Plant nutrients and cob products
|
170,748
|
|
|
126,962
|
|
|
165,584
|
|
|||
Retail merchandise
|
—
|
|
|
—
|
|
|
11,082
|
|
|||
Railcar repair parts
|
5,289
|
|
|
5,521
|
|
|
5,209
|
|
|||
|
$
|
731,629
|
|
|
$
|
648,703
|
|
|
$
|
641,294
|
|
(in thousands)
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Land
|
$
|
29,915
|
|
|
$
|
22,388
|
|
|
$
|
29,331
|
|
Land improvements and leasehold improvements
|
69,320
|
|
|
69,127
|
|
|
78,798
|
|
|||
Buildings and storage facilities
|
285,084
|
|
|
284,820
|
|
|
321,344
|
|
|||
Machinery and equipment
|
377,563
|
|
|
373,127
|
|
|
388,230
|
|
|||
Construction in progress
|
15,116
|
|
|
7,502
|
|
|
13,113
|
|
|||
|
776,998
|
|
|
756,964
|
|
|
830,816
|
|
|||
Less: accumulated depreciation
|
383,235
|
|
|
372,287
|
|
|
390,421
|
|
|||
|
$
|
393,763
|
|
|
$
|
384,677
|
|
|
$
|
440,395
|
|
(in thousands)
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Rail Group assets leased to others
|
$
|
577,678
|
|
|
$
|
531,391
|
|
|
$
|
448,761
|
|
Less: accumulated depreciation
|
115,425
|
|
|
107,948
|
|
|
105,825
|
|
|||
|
$
|
462,253
|
|
|
$
|
423,443
|
|
|
$
|
342,936
|
|
(in thousands)
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Short-term Debt – Non-Recourse
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term Debt – Recourse
|
489,000
|
|
|
22,000
|
|
|
255,000
|
|
|||
Total Short-term Debt
|
$
|
489,000
|
|
|
$
|
22,000
|
|
|
$
|
255,000
|
|
|
|
|
|
|
|
||||||
Current Maturities of Long-term Debt – Non-Recourse
|
$
|
2,922
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current Maturities of Long-term Debt – Recourse
|
11,212
|
|
|
54,205
|
|
|
56,144
|
|
|||
Total Current Maturities of Long-term Debt
|
$
|
14,134
|
|
|
$
|
54,205
|
|
|
$
|
56,144
|
|
|
|
|
|
|
|
||||||
Long-term Debt, Less: Current Maturities – Non-Recourse
|
$
|
72,977
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term Debt, Less: Current Maturities – Recourse
|
365,651
|
|
|
418,339
|
|
|
365,971
|
|
|||
Total Long-term Debt, Less: Current Maturities
|
$
|
438,628
|
|
|
$
|
418,339
|
|
|
$
|
365,971
|
|
|
March 31, 2018
|
|
December 31, 2017
|
|
March 31, 2017
|
||||||||||||||||||
(in thousands)
|
Net
derivative
asset
position
|
|
Net
derivative
liability
position
|
|
Net
derivative
asset
position
|
|
Net
derivative
liability
position
|
|
Net
derivative
asset
position
|
|
Net
derivative
liability
position
|
||||||||||||
Collateral paid (received)
|
$
|
54,762
|
|
|
$
|
—
|
|
|
$
|
1,351
|
|
|
$
|
—
|
|
|
$
|
(2,769
|
)
|
|
$
|
—
|
|
Fair value of derivatives
|
(18,874
|
)
|
|
—
|
|
|
17,252
|
|
|
—
|
|
|
32,310
|
|
|
—
|
|
||||||
Balance at end of period
|
$
|
35,888
|
|
|
$
|
—
|
|
|
$
|
18,603
|
|
|
$
|
—
|
|
|
$
|
29,541
|
|
|
$
|
—
|
|
|
March 31, 2018
|
||||||||||||||||||
(in thousands)
|
Commodity Derivative Assets - Current
|
|
Commodity Derivative Assets - Noncurrent
|
|
Commodity Derivative Liabilities - Current
|
|
Commodity Derivative Liabilities - Noncurrent
|
|
Total
|
||||||||||
Commodity derivative assets
|
$
|
29,861
|
|
|
$
|
1,851
|
|
|
$
|
3,115
|
|
|
$
|
47
|
|
|
$
|
34,874
|
|
Commodity derivative liabilities
|
(40,813
|
)
|
|
(112
|
)
|
|
(18,539
|
)
|
|
(1,461
|
)
|
|
(60,925
|
)
|
|||||
Cash collateral
|
54,762
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54,762
|
|
|||||
Balance sheet line item totals
|
$
|
43,810
|
|
|
$
|
1,739
|
|
|
$
|
(15,424
|
)
|
|
$
|
(1,414
|
)
|
|
$
|
28,711
|
|
|
December 31, 2017
|
||||||||||||||||||
(in thousands)
|
Commodity Derivative Assets - Current
|
|
Commodity Derivative Assets - Noncurrent
|
|
Commodity Derivative Liabilities - Current
|
|
Commodity Derivative Liabilities - Noncurrent
|
|
Total
|
||||||||||
Commodity derivative assets
|
$
|
36,929
|
|
|
$
|
311
|
|
|
$
|
489
|
|
|
$
|
1
|
|
|
$
|
37,730
|
|
Commodity derivative liabilities
|
(7,578
|
)
|
|
(1
|
)
|
|
(30,140
|
)
|
|
(826
|
)
|
|
(38,545
|
)
|
|||||
Cash collateral
|
1,351
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,351
|
|
|||||
Balance sheet line item totals
|
$
|
30,702
|
|
|
$
|
310
|
|
|
$
|
(29,651
|
)
|
|
$
|
(825
|
)
|
|
$
|
536
|
|
|
March 31, 2017
|
||||||||||||||||||
(in thousands)
|
Commodity Derivative Assets - Current
|
|
Commodity Derivative Assets - Noncurrent
|
|
Commodity Derivative Liabilities - Current
|
|
Commodity Derivative Liabilities - Noncurrent
|
|
Total
|
||||||||||
Commodity derivative assets
|
$
|
57,499
|
|
|
$
|
341
|
|
|
$
|
554
|
|
|
$
|
3
|
|
|
$
|
58,397
|
|
Commodity derivative liabilities
|
(6,681
|
)
|
|
(2
|
)
|
|
(30,468
|
)
|
|
(453
|
)
|
|
(37,604
|
)
|
|||||
Cash collateral
|
(2,769
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,769
|
)
|
|||||
Balance sheet line item totals
|
$
|
48,049
|
|
|
$
|
339
|
|
|
$
|
(29,914
|
)
|
|
$
|
(450
|
)
|
|
$
|
18,024
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Gains (losses) on commodity derivatives included in cost of sales and merchandising revenues
|
$
|
(25,236
|
)
|
|
$
|
27,025
|
|
|
March 31, 2018
|
||||||||||
Commodity
(in thousands)
|
Number of Bushels
|
|
Number of Gallons
|
|
Number of Pounds
|
|
Number of Tons
|
||||
Non-exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
335,887
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
48,003
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
16,639
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
40,555
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
280,243
|
|
|
|
|
|
—
|
|
Corn oil
|
—
|
|
|
—
|
|
|
5,048
|
|
|
—
|
|
Other
|
27
|
|
|
4,500
|
|
|
|
|
|
90
|
|
Subtotal
|
441,111
|
|
|
284,743
|
|
|
5,048
|
|
|
90
|
|
Exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
146,505
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
52,460
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
74,805
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
2,290
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
108,108
|
|
|
—
|
|
|
—
|
|
Subtotal
|
276,060
|
|
|
108,108
|
|
|
—
|
|
|
—
|
|
Total
|
717,171
|
|
|
392,851
|
|
|
5,048
|
|
|
90
|
|
|
December 31, 2017
|
||||||||||
Commodity
(in thousands)
|
Number of Bushels
|
|
Number of Gallons
|
|
Number of Pounds
|
|
Number of Tons
|
||||
Non-exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
218,391
|
|
|
|
|
|
|
|
|
—
|
|
Soybeans
|
18,127
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
14,577
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
25,953
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
197,607
|
|
|
—
|
|
|
—
|
|
Corn oil
|
—
|
|
|
—
|
|
|
6,074
|
|
|
—
|
|
Other
|
47
|
|
|
—
|
|
|
—
|
|
|
97
|
|
Subtotal
|
277,095
|
|
|
197,607
|
|
|
6,074
|
|
|
97
|
|
Exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
82,835
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
37,170
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
65,640
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
1,345
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
39,438
|
|
|
—
|
|
|
—
|
|
Other
|
—
|
|
|
840
|
|
|
—
|
|
|
—
|
|
Subtotal
|
186,990
|
|
|
40,278
|
|
|
—
|
|
|
—
|
|
Total
|
464,085
|
|
|
237,885
|
|
|
6,074
|
|
|
97
|
|
|
March 31, 2017
|
||||||||||
Commodity
(in thousands)
|
Number of Bushels
|
|
Number of Gallons
|
|
Number of Pounds
|
|
Number of Tons
|
||||
Non-exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
201,200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
29,015
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
7,956
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
46,861
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
178,040
|
|
|
—
|
|
|
—
|
|
Corn oil
|
—
|
|
|
—
|
|
|
6,279
|
|
|
—
|
|
Other
|
100
|
|
|
1,000
|
|
|
—
|
|
|
239
|
|
Subtotal
|
285,132
|
|
|
179,040
|
|
|
6,279
|
|
|
239
|
|
Exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
104,790
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
47,605
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
40,855
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
1,660
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
16,590
|
|
|
—
|
|
|
—
|
|
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
Subtotal
|
194,910
|
|
|
16,590
|
|
|
—
|
|
|
15
|
|
Total
|
480,042
|
|
|
195,630
|
|
|
6,279
|
|
|
254
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Interest rate derivative gains (losses) included in Interest income (expense)
|
$
|
1,408
|
|
|
$
|
389
|
|
Foreign currency derivative gains (losses) included in Other income, net
|
(1,122
|
)
|
|
98
|
|
|
Pension Benefits
|
||||||
(in thousands)
|
Three months ended March 31,
|
||||||
2018
|
|
2017
|
|||||
Interest cost
|
$
|
33
|
|
|
$
|
39
|
|
Recognized net actuarial loss
|
61
|
|
|
63
|
|
||
Benefit cost
|
$
|
94
|
|
|
$
|
102
|
|
|
Postretirement Benefits
|
||||||
(in thousands)
|
Three months ended March 31,
|
||||||
2018
|
|
2017
|
|||||
Service cost
|
$
|
87
|
|
|
$
|
123
|
|
Interest cost
|
187
|
|
|
300
|
|
||
Amortization of prior service cost
|
(228
|
)
|
|
—
|
|
||
Benefit cost
|
$
|
46
|
|
|
$
|
423
|
|
(in thousands)
|
Three months ended March 31, 2018
|
||
Revenues under ASC 606
|
$
|
193,650
|
|
Revenues under ASC 840
|
26,029
|
|
|
Revenues under ASC 815
|
416,060
|
|
|
Total Revenues
|
$
|
635,739
|
|
|
Three months ended March 31, 2018
|
||||||||||||||||||
(in thousands)
|
Grain
|
|
Ethanol
|
|
Plant Nutrient
|
|
Rail
|
|
Total
|
||||||||||
Specialty nutrients
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
75,078
|
|
|
$
|
—
|
|
|
$
|
75,078
|
|
Primary nutrients
|
—
|
|
|
—
|
|
|
53,219
|
|
|
—
|
|
|
53,219
|
|
|||||
Service
|
4,418
|
|
|
2,545
|
|
|
209
|
|
|
8,117
|
|
|
15,289
|
|
|||||
Co-products
|
—
|
|
|
26,646
|
|
|
—
|
|
|
—
|
|
|
26,646
|
|
|||||
Other
|
210
|
|
|
—
|
|
|
7,111
|
|
|
16,097
|
|
|
23,418
|
|
|||||
Total
|
$
|
4,628
|
|
|
$
|
29,191
|
|
|
$
|
135,617
|
|
|
$
|
24,214
|
|
|
$
|
193,650
|
|
in thousands
|
Contract liabilities
|
||
Balance at January 1, 2018
|
$
|
25,520
|
|
Balance at March 31, 2018
|
$
|
67,715
|
|
|
Balance Sheet
|
||||||||||
(in thousands)
|
As Reported
|
|
ASC 606 Impact
|
|
Pro forma as if the previous accounting guidance was in effect
|
||||||
Cash and cash equivalents and restricted cash
|
$
|
31,497
|
|
|
$
|
—
|
|
|
$
|
31,497
|
|
Accounts receivable, net
|
216,021
|
|
|
—
|
|
|
216,021
|
|
|||
Inventories
|
731,629
|
|
|
145
|
|
|
731,774
|
|
|||
Commodity derivative assets - current
|
43,810
|
|
|
—
|
|
|
43,810
|
|
|||
Other current assets
|
114,922
|
|
|
(170
|
)
|
|
114,752
|
|
|||
Other noncurrent assets
|
369,633
|
|
|
—
|
|
|
369,633
|
|
|||
Rail Group assets leased to others, net
|
462,253
|
|
|
(24,844
|
)
|
|
437,409
|
|
|||
Property, plant and equipment
|
393,763
|
|
|
—
|
|
|
393,763
|
|
|||
Total assets
|
2,363,528
|
|
|
(24,869
|
)
|
|
2,338,659
|
|
|||
Short-term debt and current maturities of long-term debt
|
503,134
|
|
|
(2,922
|
)
|
|
500,212
|
|
|||
Trade and other payables and accrued expenses and other current liabilities
|
323,614
|
|
|
—
|
|
|
323,614
|
|
|||
Commodity derivative liabilities - current
|
15,424
|
|
|
—
|
|
|
15,424
|
|
|||
Customer prepayments and deferred revenue
|
81,778
|
|
|
—
|
|
|
81,778
|
|
|||
Commodity derivative liabilities - noncurrent and Other long-term liabilities
|
32,950
|
|
|
—
|
|
|
32,950
|
|
|||
Employee benefit plan obligations
|
26,310
|
|
|
—
|
|
|
26,310
|
|
|||
Long-term debt, less current maturities
|
438,628
|
|
|
(33,318
|
)
|
|
405,310
|
|
|||
Deferred income taxes
|
118,933
|
|
|
2,942
|
|
|
121,875
|
|
|||
Total liabilities
|
1,540,771
|
|
|
(33,298
|
)
|
|
1,507,473
|
|
|||
Retained earnings
|
618,572
|
|
|
8,429
|
|
|
627,001
|
|
|||
Common shares, additional paid-in-capital, treasury shares, accumulated other comprehensive loss and noncontrolling interests
|
204,185
|
|
|
—
|
|
|
204,185
|
|
|||
Total equity
|
822,757
|
|
|
8,429
|
|
|
831,186
|
|
|||
Total liabilities and equity
|
2,363,528
|
|
|
(24,869
|
)
|
|
2,338,659
|
|
|
Statement of Operations
|
||||||||||
in thousands
|
As Reported
|
|
ASC 606 Impact
|
|
Pro forma as if the previous accounting guidance was in effect
|
||||||
Sales and merchandising revenues
|
$
|
635,739
|
|
|
$
|
164,189
|
|
|
$
|
799,928
|
|
Cost of sales and merchandising revenues
|
572,034
|
|
|
164,650
|
|
|
736,684
|
|
|||
Gross profit
|
63,705
|
|
|
(461
|
)
|
|
63,244
|
|
|||
Operating, administrative and general expenses
|
64,257
|
|
|
—
|
|
|
64,257
|
|
|||
Goodwill impairment
|
|
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
6,999
|
|
|
(403
|
)
|
|
6,596
|
|
|||
Other income:
|
|
|
|
|
|
||||||
Equity in earnings of affiliates, net
|
3,573
|
|
|
—
|
|
|
3,573
|
|
|||
Other income, net
|
1,686
|
|
|
—
|
|
|
1,686
|
|
|||
Income (loss) before income taxes
|
(2,292
|
)
|
|
(58
|
)
|
|
(2,350
|
)
|
|||
Income tax provision
|
(310
|
)
|
|
(22
|
)
|
|
(332
|
)
|
|||
Net income (loss)
|
(1,982
|
)
|
|
(36
|
)
|
|
(2,018
|
)
|
|||
Net income attributable to the noncontrolling interests
|
(282
|
)
|
|
—
|
|
|
(282
|
)
|
|||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
(1,700
|
)
|
|
$
|
(36
|
)
|
|
$
|
(1,736
|
)
|
•
|
While grain origination agreements, and their related sales contracts, will be accounted for under ASC 815, we are still required to evaluate the principal versus agent guidance in ASC 606 to determine whether realized gains or losses should be presented on a gross or net basis in the consolidated statements of operations upon physical settlement. The Company has determined that it is the agent in certain origination arrangements within our Grain Group and therefore realized gains or losses will be presented on a net basis upon adoption of ASC 606. As a result of these transactions now being recorded on a net basis, revenues and related cost of sales would have been $
161.9 million
higher under the previous guidance.
|
•
|
ASC 606 required certain Rail Group assets and related financing obligations to be recorded on the balance sheet as these transactions no longer qualified as sales as a result of the existence of repurchase options within the sales contracts. The result of this change primarily impacts geography within the income statement, as lease expense to the financial institution will be replaced with a combination of depreciation and interest expense.
|
•
|
The performance obligation is part of a contract that has an original expected duration of
one
year or less.
|
•
|
The variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with ASC 606-10-25-14(b), for which the criteria in ASC 606-10-32-40 have been met.
|
•
|
Future performance obligations - see discussion above.
|
•
|
Contract costs - see discussion above.
|
•
|
Shipping and handling activities - see discussion above.
|
•
|
Sales tax presentation - the Company has elected to exclude from the transaction price all sales taxes that are assessed by a governmental authority that are imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer.
|
•
|
Modified retrospective approach - see discussion in Note 1. regarding adoption elections.
|
|
|
|
Changes in Accumulated Other Comprehensive Income (Loss) by Component (a)
|
||||||||||||||
|
|
|
Three months ended March 31, 2018
|
||||||||||||||
(in thousands)
|
|
Foreign Currency Translation Adjustment
|
|
Investment in Convertible Preferred Securities
|
|
Defined Benefit Plan Items
|
|
Total
|
|||||||||
Beginning Balance
|
|
$
|
(7,716
|
)
|
|
$
|
344
|
|
|
$
|
4,672
|
|
|
$
|
(2,700
|
)
|
|
|
Other comprehensive income (loss) before reclassifications
|
|
(1,150
|
)
|
|
(87
|
)
|
|
117
|
|
|
$
|
(1,120
|
)
|
|||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
—
|
|
|
—
|
|
|
(168
|
)
|
|
$
|
(168
|
)
|
|||
Net current-period other comprehensive income (loss)
|
|
(1,150
|
)
|
|
(87
|
)
|
|
(51
|
)
|
|
(1,288
|
)
|
|||||
Ending balance
|
|
$
|
(8,866
|
)
|
|
$
|
257
|
|
|
$
|
4,621
|
|
|
$
|
(3,988
|
)
|
|
|
|
Changes in Accumulated Other Comprehensive Income (Loss) by Component (a)
|
|||||||||||
|
|
|
Three months ended March 31, 2017
|
|||||||||||
(in thousands)
|
|
|
Foreign Currency Translation Adjustment
|
|
Defined Benefit Plan Items
|
|
Total
|
|||||||
Beginning Balance
|
|
|
$
|
(11,002
|
)
|
|
$
|
(1,466
|
)
|
|
$
|
(12,468
|
)
|
|
|
Other comprehensive income (loss) before reclassifications
|
|
|
514
|
|
|
(10
|
)
|
|
504
|
|
|||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net current-period other comprehensive income (loss)
|
|
|
514
|
|
|
(10
|
)
|
|
504
|
|
||||
Ending balance
|
|
|
$
|
(10,488
|
)
|
|
$
|
(1,476
|
)
|
|
$
|
(11,964
|
)
|
|
|
Reclassifications Out of Accumulated Other Comprehensive Income (Loss) (a)
|
||||
(in thousands)
|
Three months ended March 31, 2018
|
|||||
Details about Accumulated Other Comprehensive Income (Loss) Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income (Loss)
|
|
Affected Line Item in the Statement Where Net Income Is Presented
|
||
Defined Benefit Plan Items
|
|
|
|
|
||
Amortization of prior-service cost
|
|
(228
|
)
|
|
(b)
|
|
|
|
(228
|
)
|
|
Total before tax
|
|
|
|
60
|
|
|
Income tax provision
|
|
|
|
$
|
(168
|
)
|
|
Net of tax
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
(168
|
)
|
|
Net of tax
|
(in thousands, except per common share data)
|
Three months ended March 31,
|
||||||
2018
|
|
2017
|
|||||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
(1,700
|
)
|
|
$
|
(3,089
|
)
|
Less: Distributed and undistributed earnings allocated to nonvested restricted stock
|
—
|
|
|
—
|
|
||
Earnings (losses) available to common shareholders
|
$
|
(1,700
|
)
|
|
$
|
(3,089
|
)
|
Earnings per share – basic:
|
|
|
|
||||
Weighted average shares outstanding – basic
|
28,237
|
|
|
28,281
|
|
||
Earnings (losses) per common share – basic
|
$
|
(0.06
|
)
|
|
$
|
(0.11
|
)
|
Earnings per share – diluted:
|
|
|
|
||||
Weighted average shares outstanding – basic
|
28,237
|
|
|
28,281
|
|
||
Effect of dilutive awards
|
—
|
|
|
—
|
|
||
Weighted average shares outstanding – diluted
|
28,237
|
|
|
28,281
|
|
||
Earnings (losses) per common share – diluted
|
$
|
(0.06
|
)
|
|
$
|
(0.11
|
)
|
(in thousands)
|
March 31, 2018
|
||||||||||||||
Assets (liabilities)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Commodity derivatives, net (a)
|
$
|
35,888
|
|
|
$
|
(7,177
|
)
|
|
$
|
—
|
|
|
$
|
28,711
|
|
Provisionally priced contracts (b)
|
(48,478
|
)
|
|
(31,847
|
)
|
|
—
|
|
|
(80,325
|
)
|
||||
Convertible preferred securities (c)
|
—
|
|
|
—
|
|
|
7,388
|
|
|
7,388
|
|
||||
Other assets and liabilities (d)
|
8,947
|
|
|
(454
|
)
|
|
—
|
|
|
8,493
|
|
||||
Total
|
$
|
(3,643
|
)
|
|
$
|
(39,478
|
)
|
|
$
|
7,388
|
|
|
$
|
(35,733
|
)
|
(in thousands)
|
December 31, 2017
|
||||||||||||||
Assets (liabilities)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Commodity derivatives, net (a)
|
18,603
|
|
|
(18,067
|
)
|
|
—
|
|
|
536
|
|
||||
Provisionally priced contracts (b)
|
(98,190
|
)
|
|
(67,094
|
)
|
|
—
|
|
|
(165,284
|
)
|
||||
Convertible preferred securities (c)
|
—
|
|
|
—
|
|
|
7,388
|
|
|
7,388
|
|
||||
Other assets and liabilities (d)
|
9,705
|
|
|
(1,244
|
)
|
|
—
|
|
|
8,461
|
|
||||
Total
|
$
|
(69,882
|
)
|
|
$
|
(86,405
|
)
|
|
$
|
7,388
|
|
|
$
|
(148,899
|
)
|
(in thousands)
|
March 31, 2017
|
||||||||||||||
Assets (liabilities)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Restricted cash
|
$
|
752
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
752
|
|
Commodity derivatives, net (a)
|
29,566
|
|
|
(11,542
|
)
|
|
—
|
|
|
18,024
|
|
||||
Provisionally priced contracts (b)
|
(86,314
|
)
|
|
(37,643
|
)
|
|
—
|
|
|
(123,957
|
)
|
||||
Convertible preferred securities (c)
|
—
|
|
|
—
|
|
|
3,294
|
|
|
3,294
|
|
||||
Other assets and liabilities (d)
|
8,518
|
|
|
(2,141
|
)
|
|
—
|
|
|
6,377
|
|
||||
Total
|
$
|
(47,478
|
)
|
|
$
|
(51,326
|
)
|
|
$
|
3,294
|
|
|
$
|
(95,510
|
)
|
(a)
|
Includes associated cash posted/received as collateral
|
(b)
|
Included in "Provisionally priced contracts" are those instruments based only on underlying futures values (Level 1) and delayed price contracts (Level 2)
|
(c)
|
Recorded in “Other noncurrent assets” on the Company’s Condensed Consolidated Balance Sheets related to certain available securities.
|
(d)
|
Included in other assets and liabilities are assets held in rabbi trusts to fund deferred compensation plans, ethanol risk management contracts, and foreign exchange derivative contracts (Level 1), and interest rate derivatives (Level 2).
|
|
Convertible Preferred Securities
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Assets (liabilities) at January 1,
|
$
|
7,388
|
|
|
$
|
3,294
|
|
Gains (losses) included in earnings
|
—
|
|
|
—
|
|
||
Assets (liabilities) at March 31,
|
$
|
7,388
|
|
|
$
|
3,294
|
|
(in thousands)
|
Fair Value as of December 31, 2017
|
|
Valuation Method
|
|
Unobservable Input
|
|
Weighted Average
|
||
Convertible preferred securities (a)
|
$
|
7,388
|
|
|
Implied based on market prices
|
|
N/A
|
|
N/A
|
Real Property (b)
|
$
|
29,347
|
|
|
Third-Party Appraisal
|
|
N/A
|
|
N/A
|
(in thousands)
|
Fair Value as of March 31, 2017
|
|
Valuation Method
|
|
Unobservable Input
|
|
Weighted Average
|
||
Convertible preferred securities (a)
|
$
|
3,294
|
|
|
Cost Basis, Plus Interest
|
|
N/A
|
|
N/A
|
(in thousands)
|
March 31,
2018 |
|
December 31,
2017 |
|
March 31,
2017 |
||||||
Fair value of long-term debt, including current maturities
|
$
|
448,346
|
|
|
$
|
474,769
|
|
|
$
|
426,105
|
|
Fair value in excess of carrying value (a)
|
8,241
|
|
|
1,451
|
|
|
1,036
|
|
(in thousands)
|
March 31, 2018
|
|
December 31, 2017
|
|
March 31, 2017
|
||||||
The Andersons Albion Ethanol LLC
|
$
|
46,145
|
|
|
$
|
45,024
|
|
|
$
|
38,694
|
|
The Andersons Clymers Ethanol LLC
|
20,339
|
|
|
19,830
|
|
|
19,946
|
|
|||
The Andersons Marathon Ethanol LLC
|
12,615
|
|
|
12,660
|
|
|
13,266
|
|
|||
Lansing Trade Group, LLC
|
94,483
|
|
|
93,088
|
|
|
88,339
|
|
|||
Thompsons Limited (a)
|
48,362
|
|
|
50,198
|
|
|
46,054
|
|
|||
Other
|
2,505
|
|
|
2,439
|
|
|
2,694
|
|
|||
Total
|
$
|
224,449
|
|
|
$
|
223,239
|
|
|
$
|
208,993
|
|
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
% Ownership at March 31, 2018
|
|
2018
|
|
2017
|
||||
The Andersons Albion Ethanol LLC
|
55%
|
|
$
|
1,121
|
|
|
$
|
(277
|
)
|
The Andersons Clymers Ethanol LLC
|
39%
|
|
509
|
|
|
207
|
|
||
The Andersons Marathon Ethanol LLC
|
33%
|
|
(44
|
)
|
|
(463
|
)
|
||
Lansing Trade Group, LLC
|
33% (a)
|
|
2,584
|
|
|
(711
|
)
|
||
Thompsons Limited (b)
|
50%
|
|
(669
|
)
|
|
(595
|
)
|
||
Other
|
5% - 50%
|
|
72
|
|
|
(39
|
)
|
||
Total
|
|
|
$
|
3,573
|
|
|
$
|
(1,878
|
)
|
(in thousands)
|
Three months ended March 31,
|
||||||
2018
|
|
2017
|
|||||
Revenues
|
$
|
1,459,331
|
|
|
$
|
1,459,557
|
|
Gross profit
|
56,096
|
|
|
38,391
|
|
||
Income (loss) from continuing operations
|
8,908
|
|
|
(3,765
|
)
|
||
Net income (loss)
|
9,462
|
|
|
(4,298
|
)
|
||
Net income (loss) attributable to companies
|
9,462
|
|
|
(3,867
|
)
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales revenues
|
$
|
88,815
|
|
|
$
|
198,068
|
|
Service fee revenues (a)
|
5,117
|
|
|
4,627
|
|
||
Purchases of product and capital assets
|
181,524
|
|
|
134,508
|
|
||
Lease income (b)
|
1,582
|
|
|
1,287
|
|
||
Labor and benefits reimbursement (c)
|
3,567
|
|
|
3,690
|
|
(a)
|
Service fee revenues include management fees, corn origination fees, ethanol and distillers dried grains (DDG) marketing fees, and other commissions.
|
(b)
|
Lease income includes the lease of the Company’s Albion, Michigan and Clymers, Indiana grain facilities as well as certain railcars to the various ethanol LLCs.
|
(c)
|
The Company provides all operational labor to the unconsolidated ethanol LLCs and charges them an amount equal to the Company’s costs of the related services.
|
(in thousands)
|
March 31, 2018
|
|
December 31, 2017
|
|
March 31, 2017
|
||||||
Accounts receivable (d)
|
$
|
27,438
|
|
|
$
|
30,252
|
|
|
$
|
19,999
|
|
Accounts payable (e)
|
33,184
|
|
|
27,866
|
|
|
19,888
|
|
(d)
|
Accounts receivable represents amounts due from related parties for sales of corn, leasing revenue and service fees.
|
(e)
|
Accounts payable represents amounts due to related parties for purchases of ethanol and other various items.
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Revenues from external customers
|
|
|
|
||||
Grain
|
$
|
276,852
|
|
|
$
|
478,528
|
|
Ethanol
|
172,838
|
|
|
154,153
|
|
||
Plant Nutrient
|
135,617
|
|
|
146,587
|
|
||
Rail
|
50,432
|
|
|
40,390
|
|
||
Other
|
—
|
|
|
32,358
|
|
||
Total
|
$
|
635,739
|
|
|
$
|
852,016
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Inter-segment sales
|
|
|
|
||||
Grain
|
$
|
531
|
|
|
$
|
66
|
|
Plant Nutrient
|
—
|
|
|
171
|
|
||
Rail
|
333
|
|
|
292
|
|
||
Total
|
$
|
864
|
|
|
$
|
529
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Income (loss) before income taxes
|
|
|
|
||||
Grain
|
$
|
(30
|
)
|
|
$
|
(5,073
|
)
|
Ethanol
|
1,839
|
|
|
1,716
|
|
||
Plant Nutrient
|
1,091
|
|
|
6,672
|
|
||
Rail
|
3,969
|
|
|
6,078
|
|
||
Other
|
(8,879
|
)
|
|
(15,017
|
)
|
||
Noncontrolling interests
|
(282
|
)
|
|
54
|
|
||
Total
|
$
|
(2,292
|
)
|
|
$
|
(5,570
|
)
|
(in thousands)
|
March 31, 2018
|
|
December 31, 2017
|
|
March 31, 2017
|
||||||
Identifiable assets
|
|
|
|
|
|
||||||
Grain
|
$
|
1,031,150
|
|
|
$
|
948,871
|
|
|
$
|
884,870
|
|
Ethanol
|
210,169
|
|
|
180,173
|
|
|
170,020
|
|
|||
Plant Nutrient
|
455,148
|
|
|
379,309
|
|
|
512,744
|
|
|||
Rail
|
530,994
|
|
|
490,448
|
|
|
415,801
|
|
|||
Other
|
136,067
|
|
|
163,553
|
|
|
178,318
|
|
|||
Total
|
$
|
2,363,528
|
|
|
$
|
2,162,354
|
|
|
$
|
2,161,753
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Supplemental disclosure of cash flow information
|
|
|
|
||||
Interest paid
|
$
|
9,854
|
|
|
$
|
8,670
|
|
Noncash investing and financing activity
|
|
|
|
||||
Capital projects incurred but not yet paid
|
7,115
|
|
|
2,216
|
|
||
Investment merger (decreasing equity method investments and non-controlling interest)
|
—
|
|
|
8,360
|
|
||
Outstanding receivable for sale of assets
|
—
|
|
|
3,597
|
|
||
Dividends declared not yet paid
|
4,663
|
|
|
4,501
|
|
||
Debt as a result of accounting standard adoption
|
36,953
|
|
|
—
|
|
||
Railcar assets as a result of accounting standard adoption
|
25,643
|
|
|
—
|
|
(in thousands)
|
Three months ended March 31,
|
||||
|
2018
|
|
2017
|
||
Ethanol (gallons shipped)
|
103,075
|
|
|
89,423
|
|
E-85 (gallons shipped)
|
14,901
|
|
|
9,257
|
|
Corn Oil (pounds shipped)
|
4,807
|
|
|
4,260
|
|
DDG (tons shipped) *
|
39
|
|
|
42
|
|
(in thousands)
|
Three months ended March 31,
|
||||
|
2018
|
|
2017
|
||
Primary nutrients
|
202
|
|
|
217
|
|
Specialty nutrients
|
186
|
|
|
209
|
|
Other
|
16
|
|
|
23
|
|
Total tons
|
404
|
|
|
449
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
635,739
|
|
|
$
|
852,016
|
|
Cost of sales and merchandising revenues
|
572,034
|
|
|
775,558
|
|
||
Gross profit
|
63,705
|
|
|
76,458
|
|
||
Operating, administrative and general expenses
|
64,257
|
|
|
81,545
|
|
||
Interest expense (income)
|
6,999
|
|
|
6,100
|
|
||
Equity in earnings (losses) of affiliates, net
|
3,573
|
|
|
(1,878
|
)
|
||
Other income (expense), net
|
1,686
|
|
|
7,495
|
|
||
Income (loss) before income taxes
|
(2,292
|
)
|
|
(5,570
|
)
|
||
Income (loss) attributable to noncontrolling interests
|
(282
|
)
|
|
54
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
(2,010
|
)
|
|
$
|
(5,624
|
)
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
276,852
|
|
|
$
|
478,528
|
|
Cost of sales and merchandising revenues
|
250,802
|
|
|
454,879
|
|
||
Gross profit
|
26,050
|
|
|
23,649
|
|
||
Operating, administrative and general expenses
|
25,954
|
|
|
25,327
|
|
||
Interest expense (income)
|
2,959
|
|
|
2,696
|
|
||
Equity in earnings (losses) of affiliates, net
|
1,987
|
|
|
(1,345
|
)
|
||
Other income (expense), net
|
846
|
|
|
646
|
|
||
Income (loss) before income taxes
|
$
|
(30
|
)
|
|
$
|
(5,073
|
)
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
172,838
|
|
|
$
|
154,153
|
|
Cost of sales and merchandising revenues
|
169,972
|
|
|
148,613
|
|
||
Gross profit
|
2,866
|
|
|
5,540
|
|
||
Operating, administrative and general expenses
|
3,029
|
|
|
3,247
|
|
||
Interest expense (income)
|
(41
|
)
|
|
(3
|
)
|
||
Equity in earnings (losses) of affiliates, net
|
1,586
|
|
|
(533
|
)
|
||
Other income (expense), net
|
93
|
|
|
7
|
|
||
Income (loss) before income taxes
|
1,557
|
|
|
1,770
|
|
||
Income (loss) attributable to noncontrolling interests
|
(282
|
)
|
|
54
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
1,839
|
|
|
$
|
1,716
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
135,617
|
|
|
$
|
146,587
|
|
Cost of sales and merchandising revenues
|
113,380
|
|
|
120,779
|
|
||
Gross profit
|
22,237
|
|
|
25,808
|
|
||
Operating, administrative and general expenses
|
20,357
|
|
|
23,060
|
|
||
Interest expense (income)
|
1,441
|
|
|
1,640
|
|
||
Other income (expense), net
|
652
|
|
|
5,564
|
|
||
Income (loss) before income taxes
|
$
|
1,091
|
|
|
$
|
6,672
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
50,432
|
|
|
$
|
40,390
|
|
Cost of sales and merchandising revenues
|
37,880
|
|
|
28,082
|
|
||
Gross profit
|
12,552
|
|
|
12,308
|
|
||
Operating, administrative and general expenses
|
6,231
|
|
|
5,500
|
|
||
Interest expense (income)
|
2,368
|
|
|
1,809
|
|
||
Other income (expense), net
|
16
|
|
|
1,079
|
|
||
Income (loss) before income taxes
|
$
|
3,969
|
|
|
$
|
6,078
|
|
|
Three months ended March 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
—
|
|
|
$
|
32,358
|
|
Cost of sales and merchandising revenues
|
—
|
|
|
23,205
|
|
||
Gross profit
|
—
|
|
|
9,153
|
|
||
Operating, administrative and general expenses
|
8,686
|
|
|
24,411
|
|
||
Interest expense (income)
|
272
|
|
|
(42
|
)
|
||
Other income (expense), net
|
79
|
|
|
199
|
|
||
Income (loss) before income taxes
|
$
|
(8,879
|
)
|
|
$
|
(15,017
|
)
|
(in thousands)
|
March 31, 2018
|
|
March 31, 2017
|
|
Variance
|
||||||
Current Assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
31,497
|
|
|
$
|
29,645
|
|
|
$
|
1,852
|
|
Restricted cash
|
—
|
|
|
752
|
|
|
(752
|
)
|
|||
Accounts receivable, net
|
216,021
|
|
|
190,628
|
|
|
25,393
|
|
|||
Inventories
|
731,629
|
|
|
641,294
|
|
|
90,335
|
|
|||
Commodity derivative assets – current
|
43,810
|
|
|
48,049
|
|
|
(4,239
|
)
|
|||
Other current assets
|
57,147
|
|
|
83,623
|
|
|
(26,476
|
)
|
|||
Assets held for sale
|
57,775
|
|
|
—
|
|
|
57,775
|
|
|||
Total current assets
|
1,137,879
|
|
|
993,991
|
|
|
143,888
|
|
|||
Current Liabilities:
|
|
|
|
|
|
||||||
Short-term debt
|
489,000
|
|
|
255,000
|
|
|
234,000
|
|
|||
Trade and other payables
|
263,519
|
|
|
276,834
|
|
|
(13,315
|
)
|
|||
Customer prepayments and deferred revenue
|
81,778
|
|
|
81,628
|
|
|
150
|
|
|||
Commodity derivative liabilities – current
|
15,424
|
|
|
29,914
|
|
|
(14,490
|
)
|
|||
Accrued expenses and other current liabilities
|
60,095
|
|
|
65,952
|
|
|
(5,857
|
)
|
|||
Current maturities of long-term debt
|
14,134
|
|
|
56,144
|
|
|
(42,010
|
)
|
|||
Total current liabilities
|
923,950
|
|
|
765,472
|
|
|
158,478
|
|
|||
Working Capital
|
$
|
213,929
|
|
|
$
|
228,519
|
|
|
$
|
(14,590
|
)
|
Method of Control
|
Financial Statement
|
|
Units
|
|
Owned - railcars available for sale
|
On balance sheet – current
|
|
503
|
|
Owned - railcar assets leased to others
|
On balance sheet – non-current
|
|
18,441
|
|
Railcars leased from financial intermediaries
|
Off balance sheet
|
|
3,138
|
|
Railcars in non-recourse arrangements
|
Off balance sheet
|
|
861
|
|
Total Railcars
|
|
|
22,943
|
|
Locomotive assets leased to others
|
On balance sheet – non-current
|
|
32
|
|
Locomotives leased from financial intermediaries
|
Off balance sheet
|
|
4
|
|
Total Locomotives
|
|
|
36
|
|
Barge assets leased to others
|
On balance sheet – non-current
|
|
—
|
|
Barge assets leased from financial intermediaries
|
Off balance sheet
|
|
65
|
|
Total Barges
|
|
|
65
|
|
|
|
|
No.
|
|
Description
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
12
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101
|
|
Financial Statements from the interim report on Form 10-Q of The Andersons, Inc. for the period ended March 31, 2018, formatted in XBRL: (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Equity, (v) the Condensed Consolidated Statement of Cash Flows and (vi) the Notes to Condensed Consolidated Financial Statements.
|
|
|
|
|
|
THE ANDERSONS, INC.
(Registrant)
|
|
|
|
Date: May 8, 2018
|
|
By /s/ Patrick E. Bowe
|
|
|
Patrick E. Bowe
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
|
|
Date: May 8, 2018
|
|
By /s/ Anne G. Rex
|
|
|
Anne G. Rex
|
|
|
Vice President, Corporate Controller & Interim Chief Financial Officer (Principal Financial Officer)
|
|
|
|
|
|
No.
|
|
Description
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
12
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101
|
|
Financial Statements from the interim report on Form 10-Q of The Andersons, Inc. for the period ended March 31, 2018 formatted in XBRL: (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Equity, (v) the Condensed Consolidated Statement of Cash Flows and (vi) the Notes to Condensed Consolidated Financial Statements.
|
Vested PSU Payout Percent
|
Performance Goals * 3-Year (2018-2020) Cumulative EPS
|
Maximum (200%)
|
$9.73 and above
|
Target (100%)
|
$6.89
|
Threshold (20%)
|
$4.55
|
0%
|
below $4.55
|
Goal
Achievement |
Company’s Annualized TSR Relative to Comparator Group’s Annualized TSR
|
Vested PSU Payout Percent
|
|
% of Target PSUs if Company TSR is Positive
|
% of Target PSUs if Company TSR is Negative
|
||
Maximum
|
+18 percentage points or more above Target
|
200%
|
100%
|
Above Target
|
For every +1 percentage points Company TSR is above Target
|
100% plus 5.56% of target
|
100%
|
Target
|
Comparator Group’s Annualized TSR
|
100%
|
100%
|
Below Target
|
For every -1 percentage points Company TSR is below Comparator Group
|
100% less 5% of target
|
100% less 5% of target
|
Threshold
|
-12 percentage points below
Comparator Group |
40%
|
40%
|
Below Threshold
|
More than -12 percentage points below Comparator Group
|
0%
|
0%
|
|
Vesting Date
|
|
Percent of Shares
|
|
|
January 2, 2019
|
|
33.3%
|
|
|
January 2, 2020
|
|
33.3%
|
|
|
January 2, 2021
|
|
33.3%
|
|
|
Vesting Date
|
|
Percent of Shares
|
|
|
May 1, 2018
|
|
100%
|
|
|
Three months ended March 31,
|
||||||
(in thousands, except for ratio)
|
2018
|
|
2017
|
||||
Computation of earnings
|
|
|
|
||||
Pretax income (a)
|
$
|
(5,864
|
)
|
|
$
|
(3,692
|
)
|
Add:
|
|
|
|
||||
Interest expense on indebtedness
|
6,999
|
|
|
6,100
|
|
||
Amortization of debt issue costs
|
391
|
|
|
292
|
|
||
Interest portion of rent expense (b)
|
1,740
|
|
|
2,537
|
|
||
Distributed income of equity investees
|
1,189
|
|
|
—
|
|
||
Earnings
|
$
|
4,455
|
|
|
$
|
5,237
|
|
|
|
|
|
||||
Computation of fixed charges
|
|
|
|
||||
Interest expense on indebtedness
|
$
|
6,999
|
|
|
$
|
6,100
|
|
Amortization of debt issue costs
|
391
|
|
|
292
|
|
||
Interest portion of rent expense (b)
|
1,740
|
|
|
2,537
|
|
||
Fixed charges
|
$
|
9,130
|
|
|
$
|
8,929
|
|
|
|
|
|
||||
Ratio of earnings to fixed charges
|
0.49
|
|
|
0.59
|
|
1
|
I have reviewed this report on Form 10-Q of The Andersons, Inc.
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2
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4
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The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5
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The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Patrick E. Bowe
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Patrick E. Bowe
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Chief Executive Officer (Principal Executive Officer)
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1
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I have reviewed this report on Form 10-Q of The Andersons, Inc.
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2
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4
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The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5
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The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Anne G. Rex
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Anne G. Rex
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Vice President, Corporate Controller & Interim Chief Financial Officer (Principal Financial Officer)
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(1)
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The Report fully complies with the requirements of 13(a) or 15(d) of the Securities Exchange Act of 1934, and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
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/s/ Patrick E. Bowe
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Patrick E. Bowe
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Chief Executive Officer
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/s/ Anne G. Rex
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Anne G. Rex
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Vice President, Corporate Controller & Interim Chief Financial Officer (Principal Financial Officer)
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