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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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OHIO
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34-1562374
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(State of incorporation
or organization)
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(I.R.S. Employer
Identification No.)
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1947 Briarfield Boulevard, Maumee, Ohio
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43537
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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ý
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Accelerated Filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Page No.
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PART I.
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Item 1. Business
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Item 1A. Risk Factors
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Item 1B. Unresolved Staff Comments
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Item 2. Properties
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Item 3. Legal Proceedings
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Item 4. Mine Safety
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PART II.
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Item 5. Market for the Registrant's Common Equity and Related Stockholder Matters
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Item 6. Selected Financial Data
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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk
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Item 8. Financial Statements and Supplementary Data
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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures
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Item 9A. Controls and Procedures
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PART III.
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Item 10. Directors and Executive Officers of the Registrant
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Item 11. Executive Compensation
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Item 12. Security Ownership of Certain Beneficial Owners and Management
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Item 13. Certain Relationships and Related Transactions
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Item 14. Principal Accountant Fees and Services
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PART IV.
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Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
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Item 16. Form 10-K Summary
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Exhibits
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Signatures
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|
|
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|||
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Agricultural Fertilizer
|
|||||
(in thousands)
|
|
Grain Storage
|
|
Dry Storage
|
|
Liquid Storage
|
|||
Location
|
|
(bushels)
|
|
(tons)
|
|
(tons)
|
|||
Canada
|
|
680
|
|
|
—
|
|
|
—
|
|
Illinois
|
|
12,464
|
|
|
56
|
|
|
11
|
|
Indiana
|
|
27,095
|
|
|
145
|
|
|
143
|
|
Iowa
|
|
2,600
|
|
|
—
|
|
|
70
|
|
Michigan
|
|
30,236
|
|
|
53
|
|
|
27
|
|
Minnesota
|
|
—
|
|
|
18
|
|
|
67
|
|
Nebraska
|
|
13,219
|
|
|
—
|
|
|
45
|
|
Ohio
|
|
37,710
|
|
|
189
|
|
|
65
|
|
Puerto Rico
|
|
—
|
|
|
—
|
|
|
10
|
|
Tennessee
|
|
3,567
|
|
|
—
|
|
|
—
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|
Texas
|
|
1,043
|
|
|
—
|
|
|
—
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|
Wisconsin
|
|
—
|
|
|
27
|
|
|
77
|
|
|
|
128,614
|
|
|
488
|
|
|
515
|
|
Name
|
Position
|
Age
|
Year Assumed
|
|
|
|
|
Jeffrey C. Blair
|
President, Plant Nutrient Group
Vice President of Sales (Intrepid Potash, Inc)
Director of Potash Sales (Intrepid Potash, Inc)
|
46
|
2017
2016
2013
|
Valerie M. Blanchett
|
Vice President, Human Resources
Vice President, Human Resources, Food Ingredients and Systems (Cargill)
|
57
|
2016
2010
|
Patrick E. Bowe
|
President and Chief Executive Officer
Corporate Vice President, Food Ingredients and Systems (Cargill)
|
60
|
2015
2007
|
Naran U. Burchinow
|
Senior Vice President, General Counsel and Secretary
|
65
|
2005
|
Srikanth R. Dasari
|
Vice President, Treasurer
Treasurer (Westinghouse Electric Company)
Head of Treasury Front Office (Dow Corning)
|
48
|
2017
2016
2010
|
Michael T. Hoelter
|
Corporate Controller
Assistant Corporate Controller
Grain Group Controller
Financial Reporting Manager
|
36
|
2019
2017
2015
2013
|
Michael S. Irmen
|
President, Ethanol Group
Vice President and General Manager, Ethanol Group
Vice President, Commodities and Risk, Ethanol Group
|
65
|
2016
2015
2012
|
Corbett J. Jorgenson
|
President, Andersons Trade Group
Vice President, Americas, Corporate Transportation (Cargill)
Vice President, Commercial Lead, AgHorizons USA (Cargill)
|
44
|
2016
2015
2013
|
William E. Krueger
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President, Andersons Trade Group
President and Chief Executive Officer, Lansing Trade Group, LLC
|
52
|
2018
1995
|
Anthony A. Lombardi
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Chief Information Officer
Vice President, Global Business Services and Chief Information Officer (Armstrong World Industries)
|
60
|
2016
2010
|
Joseph E. McNeely
|
President, Rail Group
President and Chief Executive Officer (FreightCar America, Inc.)
|
54
|
2017
2013
|
Anne G. Rex
|
Vice President, Strategy, Planning and Development
Vice President, Corporate Controller
|
54
|
2019
2012
|
Brian A. Valentine
|
Senior Vice President and Chief Financial Officer
Corporate Vice President and Chief Financial Officer (The Lubrizol Corporation)
|
50
|
2018
2011
|
Payment Date
|
|
Amount
|
1/24/2017
|
|
$0.1600
|
4/24/2017
|
|
$0.1600
|
7/24/2017
|
|
$0.1600
|
10/23/2017
|
|
$0.1600
|
1/23/2018
|
|
$0.1650
|
4/23/2018
|
|
$0.1650
|
7/23/2018
|
|
$0.1650
|
10/22/2018
|
|
$0.1650
|
1/23/2019
|
|
$0.1700
|
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Equity Compensation Plan Information
|
||||||
Plan category
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(a)
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
Weighted-average exercise price of outstanding options, warrants and rights
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Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
||||
Equity compensation plans approved by security holders
|
1,036,971 (1)
|
|
$
|
35.32
|
|
461,078 (2)
|
|
Equity compensation plans not approved by security holders (3)
|
—
|
|
—
|
|
—
|
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(1)
|
This number includes 325,000 Non-Qualified Stock Options (“Options”), 246,804 total shareholder return-based performance share units, 246,798 earnings per share-based performance share units, and 218,369 restricted shares outstanding under The Andersons, Inc. 2014 Long-Term Performance Compensation Plan. This number does not include any shares related to the Employee Share Purchase Plan. The Employee Share Purchase Plan allows employees to purchase common shares at the lower of the market value on the beginning or end of the calendar year through payroll withholdings. These purchases are completed as of December 31.
|
(2)
|
This number includes 51,414 Common Shares available to be purchased under the Employee Share Purchase Plan and 409,664 shares available under equity compensation plans.
|
(3)
|
In connection with the Company’s acquisition of the interests in LTG the Company did not already own the Company established the Lansing Acquisition 2018 Inducement and Retention Award Plan (the “Inducement Plan"). The Inducement Plan is to be used exclusively for the grant of equity awards to individuals who were not previously an employee or non-employee director of the Company (or following a bona fide period of non-employment), as an inducement material to each such individual entering into employment with the Company and to replace existing LTG equity awards. The Company expects to issue up to 650,000 shares of restricted stock under the Inducement Plan in multiple grants. Approximately 280,000 shares have vesting dates of June 30, 2019, April 1, 2020 and April 1, 2021; and the remaining shares have vesting dates of January 1, 2020, January 1, 2021 and January 1, 2022. All awards under the Inducement Plan are subject to each such employee’s continued employment with the Company on such vesting dates. Unvested shares of restricted stock are entitled to vote, entitled to dividends (provided that the actual payment of dividends is conditioned upon the vesting of the shares) and are not transferable.
|
Archer-Daniels-Midland Co.
|
Nutrien
|
GATX Corp.
|
The Greenbrier Companies, Inc.
|
Green Plains, Inc.
|
The Scott's Miracle-Gro Company
|
Ingredion Incorporated
|
|
|
Base Period
|
Cumulative Returns
|
||||||||||||||||
|
December 31, 2013
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||
The Andersons, Inc.
|
$
|
100.00
|
|
$
|
90.14
|
|
$
|
54.53
|
|
$
|
78.46
|
|
$
|
55.73
|
|
$
|
54.54
|
|
NASDAQ U.S.
|
100.00
|
|
114.75
|
|
122.74
|
|
133.62
|
|
173.22
|
|
168.30
|
|
||||||
New Peer Group Index
|
100.00
|
|
116.12
|
|
85.61
|
|
106.95
|
|
113.84
|
|
105.18
|
|
||||||
Former Peer Group Index
|
100.00
|
|
118.47
|
|
100.07
|
|
128.70
|
|
133.42
|
|
122.62
|
|
(in thousands, except for per share and ratios and other data)
|
For the years ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Operating results
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales and merchandising revenues (a)
|
$
|
3,045,382
|
|
|
$
|
3,686,345
|
|
|
$
|
3,924,790
|
|
|
$
|
4,198,495
|
|
|
$
|
4,540,071
|
|
Gross profit
|
302,005
|
|
|
318,799
|
|
|
345,506
|
|
|
375,838
|
|
|
397,139
|
|
|||||
Equity in earnings of affiliates
|
27,141
|
|
|
16,723
|
|
|
9,721
|
|
|
31,924
|
|
|
96,523
|
|
|||||
Other income, net (b)
|
16,002
|
|
|
22,507
|
|
|
12,473
|
|
|
46,472
|
|
|
31,125
|
|
|||||
Net income (loss)
|
41,225
|
|
|
42,609
|
|
|
14,470
|
|
|
(11,322
|
)
|
|
122,645
|
|
|||||
Net income (loss) attributable to The Andersons, Inc.
|
41,484
|
|
|
42,511
|
|
|
11,594
|
|
|
(13,067
|
)
|
|
109,726
|
|
|||||
EBITDA (c)
|
171,560
|
|
|
87,356
|
|
|
123,949
|
|
|
85,219
|
|
|
254,992
|
|
Financial position
|
|
|
|
|
|
|
|
|
|
|||||
Total assets
|
2,392,003
|
|
|
2,162,354
|
|
|
2,232,849
|
|
|
2,359,101
|
|
|
2,364,692
|
|
Working capital
|
189,848
|
|
|
260,495
|
|
|
258,350
|
|
|
241,485
|
|
|
226,741
|
|
Long-term debt, recourse (d)
|
349,834
|
|
|
418,339
|
|
|
397,065
|
|
|
436,208
|
|
|
298,638
|
|
Long-term debt, non-recourse (d)
|
146,353
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total equity
|
876,764
|
|
|
822,899
|
|
|
790,697
|
|
|
783,739
|
|
|
824,049
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash flows / liquidity
|
|
|
|
|
|
|
|
|
|
|||||
Cash flows from (used in) operations
|
(35,519
|
)
|
|
75,285
|
|
|
39,585
|
|
|
154,134
|
|
|
(10,071
|
)
|
Depreciation and amortization
|
90,297
|
|
|
86,412
|
|
|
84,325
|
|
|
78,456
|
|
|
62,005
|
|
Cash invested in acquisitions (e)
|
(2,248
|
)
|
|
(3,507
|
)
|
|
—
|
|
|
(128,549
|
)
|
|
(20,037
|
)
|
Purchase of investments
|
(1,086
|
)
|
|
(5,679
|
)
|
|
(2,523
|
)
|
|
(938
|
)
|
|
(238
|
)
|
Investments in property, plant and equipment and capitalized software
|
(142,579
|
)
|
|
(34,602
|
)
|
|
(77,740
|
)
|
|
(72,469
|
)
|
|
(59,675
|
)
|
Net proceeds from (investment in) Rail Group assets (f)
|
(87,566
|
)
|
|
(106,124
|
)
|
|
(28,579
|
)
|
|
(38,407
|
)
|
|
(57,968
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||
Per share data (g)
|
|
|
|
|
|
|
|
|
|
|||||
Net income (loss) - basic
|
1.47
|
|
|
1.51
|
|
|
0.41
|
|
|
(0.46
|
)
|
|
3.85
|
|
Net income (loss) - diluted
|
1.46
|
|
|
1.50
|
|
|
0.41
|
|
|
(0.46
|
)
|
|
3.84
|
|
Dividends declared
|
0.6650
|
|
|
0.6450
|
|
|
0.6250
|
|
|
0.5750
|
|
|
0.4700
|
|
Year-end market value
|
29.89
|
|
|
31.15
|
|
|
44.70
|
|
|
31.63
|
|
|
53.14
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Ratios and other data
|
|
|
|
|
|
|
|
|
|
|||||
Net income (loss) attributable to The Andersons, Inc. return on beginning equity attributable to The Andersons, Inc.
|
5.1
|
%
|
|
5.5
|
%
|
|
1.5
|
%
|
|
(1.6
|
)%
|
|
15.6
|
%
|
Funded long-term debt to equity ratio (h)
|
0.6-to-1
|
|
|
0.5-to-1
|
|
|
0.5-to-1
|
|
|
0.6-to-1
|
|
|
0.4-to-1
|
|
Weighted average shares outstanding (000's)
|
28,258
|
|
|
28,126
|
|
|
28,193
|
|
|
28,288
|
|
|
28,367
|
|
Effective tax rate
|
22.5
|
%
|
|
307.6
|
%
|
|
32.3
|
%
|
|
2.1
|
%
|
|
33.4
|
%
|
|
For the years ended December 31,
|
||||||||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
41,484
|
|
|
$
|
42,511
|
|
|
$
|
11,594
|
|
|
$
|
(13,067
|
)
|
|
$
|
109,726
|
|
Add:
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision (benefit) for income taxes
|
11,931
|
|
|
(63,134
|
)
|
|
6,911
|
|
|
(242
|
)
|
|
61,501
|
|
|||||
Interest expense
|
27,848
|
|
|
21,567
|
|
|
21,119
|
|
|
20,072
|
|
|
21,760
|
|
|||||
Depreciation and amortization
|
90,297
|
|
|
86,412
|
|
|
84,325
|
|
|
78,456
|
|
|
62,005
|
|
|||||
EBITDA
|
$
|
171,560
|
|
|
$
|
87,356
|
|
|
$
|
123,949
|
|
|
$
|
85,219
|
|
|
$
|
254,992
|
|
(in thousands)
|
Twelve months ended December 31,
|
||||
|
2018
|
|
2017
|
||
Primary Nutrients
|
1,424
|
|
|
1,477
|
|
Specialty Nutrients
|
694
|
|
|
654
|
|
Other
|
56
|
|
|
67
|
|
Total tons
|
2,174
|
|
|
2,198
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Sales and merchandising revenues
|
$
|
3,045,382
|
|
|
$
|
3,686,345
|
|
|
$
|
3,924,790
|
|
Cost of sales and merchandising revenues
|
2,743,377
|
|
|
3,367,546
|
|
|
3,579,284
|
|
|||
Gross profit
|
302,005
|
|
|
318,799
|
|
|
345,506
|
|
|||
Operating, administrative and general expenses
|
257,872
|
|
|
286,993
|
|
|
316,093
|
|
|||
Asset impairment
|
6,272
|
|
|
10,913
|
|
|
9,107
|
|
|||
Goodwill impairment
|
—
|
|
|
59,081
|
|
|
—
|
|
|||
Interest expense
|
27,848
|
|
|
21,567
|
|
|
21,119
|
|
|||
Equity in earnings of affiliates
|
27,141
|
|
|
16,723
|
|
|
9,721
|
|
|||
Other income, net
|
16,002
|
|
|
22,507
|
|
|
12,473
|
|
|||
Income (loss) before income taxes
|
53,156
|
|
|
(20,525
|
)
|
|
21,381
|
|
|||
Income (loss) attributable to noncontrolling interests
|
(259
|
)
|
|
98
|
|
|
2,876
|
|
|||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
53,415
|
|
|
$
|
(20,623
|
)
|
|
$
|
18,505
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
1,436,979
|
|
|
$
|
2,106,464
|
|
Cost of sales and merchandising revenues
|
1,307,125
|
|
|
1,975,076
|
|
||
Gross profit
|
129,854
|
|
|
131,388
|
|
||
Operating, administrative and general expenses
|
105,662
|
|
|
107,478
|
|
||
Asset impairment
|
1,564
|
|
|
10,913
|
|
||
Interest expense
|
11,843
|
|
|
8,320
|
|
||
Equity in earnings of affiliates
|
12,932
|
|
|
4,509
|
|
||
Other income, net
|
2,959
|
|
|
3,658
|
|
||
Income (loss) before income taxes
|
$
|
26,676
|
|
|
$
|
12,844
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
743,690
|
|
|
$
|
708,063
|
|
Cost of sales and merchandising revenues
|
725,285
|
|
|
688,206
|
|
||
Gross profit
|
18,405
|
|
|
19,857
|
|
||
Operating, administrative and general expenses
|
13,296
|
|
|
13,216
|
|
||
Interest (income) expense
|
(1,888
|
)
|
|
(67
|
)
|
||
Equity in earnings of affiliates
|
14,209
|
|
|
12,214
|
|
||
Other income, net
|
650
|
|
|
54
|
|
||
Income before income taxes
|
21,856
|
|
|
18,976
|
|
||
Income (loss) attributable to noncontrolling interests
|
(259
|
)
|
|
98
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
22,115
|
|
|
$
|
18,878
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
690,536
|
|
|
$
|
651,824
|
|
Cost of sales and merchandising revenues
|
591,635
|
|
|
547,179
|
|
||
Gross profit
|
98,901
|
|
|
104,645
|
|
||
Operating, administrative and general expenses
|
82,867
|
|
|
89,357
|
|
||
Goodwill impairment
|
—
|
|
|
59,081
|
|
||
Interest expense
|
6,499
|
|
|
6,420
|
|
||
Other income, net
|
2,495
|
|
|
5,092
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
12,030
|
|
|
$
|
(45,121
|
)
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
174,177
|
|
|
$
|
172,123
|
|
Cost of sales and merchandising revenues
|
119,332
|
|
|
119,664
|
|
||
Gross profit
|
54,845
|
|
|
52,459
|
|
||
Operating, administrative and general expenses
|
24,897
|
|
|
23,270
|
|
||
Asset impairment
|
4,708
|
|
|
—
|
|
||
Interest expense
|
11,377
|
|
|
7,023
|
|
||
Other income, net
|
3,516
|
|
|
2,632
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
17,379
|
|
|
$
|
24,798
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Sales and merchandising revenues
|
$
|
—
|
|
|
$
|
47,871
|
|
Cost of sales and merchandising revenues
|
—
|
|
|
37,421
|
|
||
Gross profit
|
—
|
|
|
10,450
|
|
||
Operating, administrative and general expenses
|
31,150
|
|
|
53,672
|
|
||
Interest (income) expense
|
17
|
|
|
(129
|
)
|
||
Other income, net
|
6,382
|
|
|
11,071
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
(24,785
|
)
|
|
$
|
(32,022
|
)
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Sales and merchandising revenues
|
$
|
2,106,464
|
|
|
$
|
2,357,171
|
|
Cost of sales and merchandising revenues
|
1,975,076
|
|
|
2,249,089
|
|
||
Gross profit
|
131,388
|
|
|
108,082
|
|
||
Operating, administrative and general expenses
|
107,478
|
|
|
112,507
|
|
||
Asset impairment
|
10,913
|
|
|
—
|
|
||
Interest expense
|
8,320
|
|
|
7,955
|
|
||
Equity in earnings of affiliates
|
4,509
|
|
|
(8,746
|
)
|
||
Other income, net
|
3,658
|
|
|
5,472
|
|
||
Income (loss) before income taxes
|
12,844
|
|
|
(15,654
|
)
|
||
Loss attributable to noncontrolling interests
|
—
|
|
|
(3
|
)
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
12,844
|
|
|
$
|
(15,651
|
)
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Sales and merchandising revenues
|
$
|
708,063
|
|
|
$
|
544,556
|
|
Cost of sales and merchandising revenues
|
688,206
|
|
|
524,252
|
|
||
Gross profit
|
19,857
|
|
|
20,304
|
|
||
Operating, administrative and general expenses
|
13,216
|
|
|
11,211
|
|
||
Interest (income) expense
|
(67
|
)
|
|
35
|
|
||
Equity in earnings of affiliates
|
12,214
|
|
|
18,467
|
|
||
Other income, net
|
54
|
|
|
77
|
|
||
Income (loss) before income taxes
|
18,976
|
|
|
27,602
|
|
||
Income attributable to noncontrolling interests
|
98
|
|
|
2,879
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
18,878
|
|
|
$
|
24,723
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Sales and merchandising revenues
|
$
|
651,824
|
|
|
$
|
725,176
|
|
Cost of sales and merchandising revenues
|
547,179
|
|
|
603,045
|
|
||
Gross profit
|
104,645
|
|
|
122,131
|
|
||
Operating, administrative and general expenses
|
89,357
|
|
|
102,892
|
|
||
Asset impairment
|
—
|
|
|
2,331
|
|
||
Goodwill impairment
|
59,081
|
|
|
—
|
|
||
Interest expense
|
6,420
|
|
|
6,448
|
|
||
Other income, net
|
5,092
|
|
|
3,716
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
(45,121
|
)
|
|
$
|
14,176
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Sales and merchandising revenues
|
$
|
172,123
|
|
|
$
|
163,658
|
|
Cost of sales and merchandising revenues
|
119,664
|
|
|
107,729
|
|
||
Gross profit
|
52,459
|
|
|
55,929
|
|
||
Operating, administrative and general expenses
|
23,270
|
|
|
18,971
|
|
||
Asset impairment
|
—
|
|
|
287
|
|
||
Interest expense
|
7,023
|
|
|
6,461
|
|
||
Other income, net
|
2,632
|
|
|
2,218
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
24,798
|
|
|
$
|
32,428
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Sales and merchandising revenues
|
$
|
47,871
|
|
|
$
|
134,229
|
|
Cost of sales and merchandising revenues
|
37,421
|
|
|
95,169
|
|
||
Gross profit
|
10,450
|
|
|
39,060
|
|
||
Operating, administrative and general expenses
|
53,672
|
|
|
70,512
|
|
||
Asset impairment
|
—
|
|
|
6,489
|
|
||
Interest (income) expense
|
(129
|
)
|
|
220
|
|
||
Other income, net
|
11,071
|
|
|
990
|
|
||
Income (loss) before income taxes attributable to The Andersons, Inc.
|
$
|
(32,022
|
)
|
|
$
|
(37,171
|
)
|
(in thousands)
|
December 31,
2018
|
|
December 31,
2017
|
|
Variance
|
||||||
Current Assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
22,593
|
|
|
$
|
34,919
|
|
|
$
|
(12,326
|
)
|
Accounts receivables, net
|
207,285
|
|
|
183,238
|
|
|
24,047
|
|
|||
Inventories
|
690,804
|
|
|
648,703
|
|
|
42,101
|
|
|||
Commodity derivative assets – current
|
51,421
|
|
|
30,702
|
|
|
20,719
|
|
|||
Other current assets
|
50,703
|
|
|
63,790
|
|
|
(13,087
|
)
|
|||
Assets held for sale
|
392
|
|
|
37,859
|
|
|
(37,467
|
)
|
|||
Total current assets
|
1,023,198
|
|
|
999,211
|
|
|
23,987
|
|
|||
Current Liabilities:
|
|
|
|
|
|
||||||
Short-term debt
|
205,000
|
|
|
22,000
|
|
|
183,000
|
|
|||
Trade and other payables
|
462,535
|
|
|
503,571
|
|
|
(41,036
|
)
|
|||
Customer prepayments and deferred revenue
|
32,533
|
|
|
59,710
|
|
|
(27,177
|
)
|
|||
Commodity derivative liabilities – current
|
32,647
|
|
|
29,651
|
|
|
2,996
|
|
|||
Accrued expenses and other current liabilities
|
79,046
|
|
|
69,579
|
|
|
9,467
|
|
|||
Current maturities of long-term debt
|
21,589
|
|
|
54,205
|
|
|
(32,616
|
)
|
|||
Total current liabilities
|
833,350
|
|
|
738,716
|
|
|
94,634
|
|
|||
Working capital
|
$
|
189,848
|
|
|
$
|
260,495
|
|
|
$
|
(70,647
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
(in thousands)
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
After 5 years
|
|
Total
|
||||||||||
Long-term debt, recourse
|
$
|
21,331
|
|
|
$
|
208,606
|
|
|
$
|
126,493
|
|
|
$
|
166,820
|
|
|
$
|
523,250
|
|
Long-term debt, non-recourse
|
4,829
|
|
|
130,859
|
|
|
9,961
|
|
|
6,370
|
|
|
152,019
|
|
|||||
Interest obligations (a)
|
18,131
|
|
|
38,816
|
|
|
20,289
|
|
|
38,190
|
|
|
115,426
|
|
|||||
Operating leases (b)
|
16,973
|
|
|
21,842
|
|
|
10,010
|
|
|
8,372
|
|
|
57,197
|
|
|||||
Purchase commitments (c)
|
967,417
|
|
|
132,855
|
|
|
—
|
|
|
—
|
|
|
1,100,272
|
|
|||||
Other long-term liabilities (d)
|
3,317
|
|
|
6,711
|
|
|
6,804
|
|
|
24,695
|
|
|
41,527
|
|
|||||
Construction commitment (e)
|
70,263
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70,263
|
|
|||||
Total contractual cash obligations
|
$
|
1,102,261
|
|
|
$
|
539,689
|
|
|
$
|
173,557
|
|
|
$
|
244,447
|
|
|
$
|
2,059,954
|
|
Method of Control
|
Financial Statement
|
|
Units
|
|
Owned - railcars available for sale
|
On balance sheet – current
|
|
373
|
|
Owned - railcar assets leased to others
|
On balance sheet – non-current
|
|
20,552
|
|
Railcars leased from financial intermediaries
|
Off balance sheet
|
|
2,271
|
|
Railcars in non-recourse arrangements
|
Off balance sheet
|
|
254
|
|
Total Railcars
|
|
|
23,450
|
|
Locomotive assets leased to others
|
On balance sheet – non-current
|
|
24
|
|
Locomotive assets leased from financial intermediaries
|
Off balance sheet
|
|
4
|
|
Total Locomotive Assets
|
|
|
28
|
|
Barge assets leased from financial intermediaries
|
Off balance sheet
|
|
15
|
|
Total Barges
|
|
|
15
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Net commodity position
|
$
|
3,373
|
|
|
$
|
(1,224
|
)
|
Market risk
|
337
|
|
|
(122
|
)
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Fair value of long-term debt, including current maturities
|
$
|
517,998
|
|
|
$
|
474,769
|
|
Carrying value less fair value
|
5,813
|
|
|
1,451
|
|
||
Market risk
|
6,611
|
|
|
7,643
|
|
Report of Independent Registered Public Accounting Firms - Deloitte & Touche LLP / KPMG LLP / PricewaterhouseCoopers LLP - Canada / Crowe LLP
|
|
Consolidated Balance Sheets
|
|
Consolidated Statements of Operations
|
|
Consolidated Statements of Comprehensive Income
|
|
Consolidated Statements of Cash Flows
|
|
Consolidated Statements of Equity
|
|
Notes to Consolidated Financial Statements
|
|
Schedule II - Consolidated Valuation and Qualifying Accounts
|
The Andersons, Inc.
Consolidated Balance Sheets
(In thousands)
|
|||||||
|
December 31,
2018 |
|
December 31,
2017 |
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
22,593
|
|
|
$
|
34,919
|
|
Accounts receivable, less allowance for doubtful accounts of $8,325 in 2018; $9,156 in 2017
|
207,285
|
|
|
183,238
|
|
||
Inventories (Note 2)
|
690,804
|
|
|
648,703
|
|
||
Commodity derivative assets – current (Note 6)
|
51,421
|
|
|
30,702
|
|
||
Other current assets
|
50,703
|
|
|
63,790
|
|
||
Assets held for sale
|
392
|
|
|
37,859
|
|
||
Total current assets
|
1,023,198
|
|
|
999,211
|
|
||
Other assets:
|
|
|
|
||||
Commodity derivative assets – noncurrent (Note 6)
|
480
|
|
|
310
|
|
||
Goodwill (Note 4)
|
6,024
|
|
|
6,024
|
|
||
Other intangible assets, net (Note 4)
|
99,138
|
|
|
112,893
|
|
||
Equity method investments
|
242,326
|
|
|
223,239
|
|
||
Other assets
|
22,341
|
|
|
12,557
|
|
||
|
370,309
|
|
|
355,023
|
|
||
Rail Group assets leased to others, net (Note 3)
|
521,785
|
|
|
423,443
|
|
||
Property, plant and equipment, net (Note 3)
|
476,711
|
|
|
384,677
|
|
||
Total assets
|
$
|
2,392,003
|
|
|
$
|
2,162,354
|
|
The Andersons, Inc.
Consolidated Balance Sheets (continued)
(In thousands)
|
|||||||
|
December 31,
2018 |
|
December 31,
2017 |
||||
Liabilities and equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Short-term debt (Note 5)
|
$
|
205,000
|
|
|
$
|
22,000
|
|
Trade and other payables
|
462,535
|
|
|
503,571
|
|
||
Customer prepayments and deferred revenue
|
32,533
|
|
|
59,710
|
|
||
Commodity derivative liabilities – current (Note 6)
|
32,647
|
|
|
29,651
|
|
||
Accrued expenses and other current liabilities
|
79,046
|
|
|
69,579
|
|
||
Current maturities of long-term debt (Note 5)
|
21,589
|
|
|
54,205
|
|
||
Total current liabilities
|
833,350
|
|
|
738,716
|
|
||
Other long-term liabilities
|
32,184
|
|
|
33,129
|
|
||
Commodity derivative liabilities – noncurrent (Note 6)
|
889
|
|
|
825
|
|
||
Employee benefit plan obligations (Note 7)
|
22,542
|
|
|
26,716
|
|
||
Long-term debt, less current maturities (Note 5)
|
496,187
|
|
|
418,339
|
|
||
Deferred income taxes (Note 8)
|
130,087
|
|
|
121,730
|
|
||
Total liabilities
|
1,515,239
|
|
|
1,339,455
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Common shares, without par value (63,000 shares authorized; 29,430 shares issued in 2018 and 2017)
|
96
|
|
|
96
|
|
||
Preferred shares, without par value (1,000 shares authorized; none issued)
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
224,396
|
|
|
224,622
|
|
||
Treasury shares, at cost (936 in 2018; 1,063 in 2017)
|
(35,300
|
)
|
|
(40,312
|
)
|
||
Accumulated other comprehensive loss
|
(6,387
|
)
|
|
(2,700
|
)
|
||
Retained earnings
|
647,517
|
|
|
633,496
|
|
||
Total shareholders’ equity of The Andersons, Inc.
|
830,322
|
|
|
815,202
|
|
||
Noncontrolling interests
|
46,442
|
|
|
7,697
|
|
||
Total equity
|
876,764
|
|
|
822,899
|
|
||
Total liabilities and equity
|
$
|
2,392,003
|
|
|
$
|
2,162,354
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Sales and merchandising revenues
|
$
|
3,045,382
|
|
|
$
|
3,686,345
|
|
|
$
|
3,924,790
|
|
Cost of sales and merchandising revenues
|
2,743,377
|
|
|
3,367,546
|
|
|
3,579,284
|
|
|||
Gross profit
|
302,005
|
|
|
318,799
|
|
|
345,506
|
|
|||
Operating, administrative and general expenses
|
257,872
|
|
|
286,993
|
|
|
316,093
|
|
|||
Asset impairment
|
6,272
|
|
|
10,913
|
|
|
9,107
|
|
|||
Goodwill impairment
|
—
|
|
|
59,081
|
|
|
—
|
|
|||
Interest expense
|
27,848
|
|
|
21,567
|
|
|
21,119
|
|
|||
Other income:
|
|
|
|
|
|
||||||
Equity in earnings of affiliates, net
|
27,141
|
|
|
16,723
|
|
|
9,721
|
|
|||
Other income, net
|
16,002
|
|
|
22,507
|
|
|
12,473
|
|
|||
Income (loss) before income taxes
|
53,156
|
|
|
(20,525
|
)
|
|
21,381
|
|
|||
Income tax provision (benefit)
|
11,931
|
|
|
(63,134
|
)
|
|
6,911
|
|
|||
Net income (loss)
|
41,225
|
|
|
42,609
|
|
|
14,470
|
|
|||
Net income (loss) attributable to the noncontrolling interests
|
(259
|
)
|
|
98
|
|
|
2,876
|
|
|||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
41,484
|
|
|
$
|
42,511
|
|
|
$
|
11,594
|
|
Per common share:
|
|
|
|
|
|
||||||
Basic earnings (loss) attributable to The Andersons, Inc. common shareholders
|
$
|
1.47
|
|
|
$
|
1.51
|
|
|
$
|
0.41
|
|
Diluted earnings (loss) attributable to The Andersons, Inc. common shareholders
|
$
|
1.46
|
|
|
$
|
1.50
|
|
|
$
|
0.41
|
|
Dividends declared
|
$
|
0.6650
|
|
|
$
|
0.6450
|
|
|
$
|
0.6250
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income (loss)
|
$
|
41,225
|
|
|
$
|
42,609
|
|
|
$
|
14,470
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Change in fair value of convertible preferred securities (net of income tax of $0, $0 and $74)
|
(86
|
)
|
|
344
|
|
|
(126
|
)
|
|||
Change in unrecognized actuarial gain and prior service cost (net of income tax of $(879), $(1,809) and $(4,355))
|
359
|
|
|
6,138
|
|
|
7,447
|
|
|||
Foreign currency translation adjustments
|
(3,834
|
)
|
|
3,286
|
|
|
1,039
|
|
|||
Cash flow hedge activity (net of income tax of $42, $0 and $(72))
|
(126
|
)
|
|
—
|
|
|
111
|
|
|||
Other comprehensive income (loss)
|
(3,687
|
)
|
|
9,768
|
|
|
8,471
|
|
|||
Comprehensive income (loss)
|
37,538
|
|
|
52,377
|
|
|
22,941
|
|
|||
Comprehensive income (loss) attributable to the noncontrolling interests
|
(259
|
)
|
|
98
|
|
|
2,876
|
|
|||
Comprehensive income (loss) attributable to The Andersons, Inc.
|
$
|
37,797
|
|
|
$
|
52,279
|
|
|
$
|
20,065
|
|
The Andersons, Inc.
Consolidated Statements of Cash Flows
(In thousands)
|
|||||||||||
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
41,225
|
|
|
$
|
42,609
|
|
|
14,470
|
|
|
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
90,297
|
|
|
86,412
|
|
|
84,325
|
|
|||
Bad debt expense
|
542
|
|
|
3,000
|
|
|
1,191
|
|
|||
Equity in (earnings) losses of affiliates, net of dividends
|
(23,167
|
)
|
|
(10,494
|
)
|
|
14,766
|
|
|||
Gain on sale of assets
|
(5,218
|
)
|
|
(14,401
|
)
|
|
(667
|
)
|
|||
Gains on sales of Rail Group assets and related leases
|
(9,558
|
)
|
|
(10,990
|
)
|
|
(11,019
|
)
|
|||
Deferred income taxes
|
11,018
|
|
|
(63,234
|
)
|
|
6,030
|
|
|||
Stock based compensation expense
|
6,624
|
|
|
6,097
|
|
|
6,987
|
|
|||
Goodwill impairment
|
—
|
|
|
59,081
|
|
|
—
|
|
|||
Asset impairment
|
6,272
|
|
|
10,913
|
|
|
9,107
|
|
|||
Other
|
(1,451
|
)
|
|
(55
|
)
|
|
(2,070
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(24,788
|
)
|
|
9,781
|
|
|
(26,429
|
)
|
|||
Inventories
|
(44,060
|
)
|
|
16,141
|
|
|
28,165
|
|
|||
Commodity derivatives
|
(16,610
|
)
|
|
20,285
|
|
|
(9,990
|
)
|
|||
Accounts payable and accrued expenses
|
(69,935
|
)
|
|
(74,237
|
)
|
|
(94,688
|
)
|
|||
Other assets
|
3,290
|
|
|
(5,623
|
)
|
|
19,407
|
|
|||
Net cash provided by (used in) operating activities
|
(35,519
|
)
|
|
75,285
|
|
|
39,585
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Acquisition of businesses, net of cash acquired
|
(2,248
|
)
|
|
(3,507
|
)
|
|
—
|
|
|||
Purchases of Rail Group assets
|
(167,005
|
)
|
|
(143,020
|
)
|
|
(85,268
|
)
|
|||
Proceeds from sale of Rail Group assets
|
79,439
|
|
|
36,896
|
|
|
56,689
|
|
|||
Purchases of property, plant and equipment and capitalized software
|
(142,579
|
)
|
|
(34,602
|
)
|
|
(77,740
|
)
|
|||
Proceeds from sale of assets and businesses
|
47,486
|
|
|
33,879
|
|
|
69,904
|
|
|||
Proceeds from returns of investments in affiliates
|
—
|
|
|
1,069
|
|
|
9,186
|
|
|||
Purchase of investments
|
(1,086
|
)
|
|
(5,679
|
)
|
|
(2,523
|
)
|
|||
Other
|
—
|
|
|
1,470
|
|
|
1,534
|
|
|||
Net cash provided by (used in) investing activities
|
(185,993
|
)
|
|
(113,494
|
)
|
|
(28,218
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Net change in short-term borrowings
|
183,000
|
|
|
(8,059
|
)
|
|
14,000
|
|
|||
Proceeds from issuance of long-term debt
|
132,000
|
|
|
85,175
|
|
|
81,760
|
|
|||
Payments of long-term debt
|
(121,090
|
)
|
|
(57,189
|
)
|
|
(97,606
|
)
|
|||
Proceeds from long-term financing arrangements
|
—
|
|
|
12,195
|
|
|
14,027
|
|
|||
Proceeds from (distributions to) noncontrolling interest owner
|
46,736
|
|
|
(377
|
)
|
|
(5,853
|
)
|
|||
Payments of debt issuance costs
|
(1,446
|
)
|
|
(2,024
|
)
|
|
(323
|
)
|
|||
Acquisition of noncontrolling interest
|
(10,000
|
)
|
|
—
|
|
|
—
|
|
|||
Dividends paid
|
(18,639
|
)
|
|
(18,152
|
)
|
|
(17,362
|
)
|
|||
Other
|
(1,375
|
)
|
|
(1,071
|
)
|
|
(1,130
|
)
|
|||
Net cash provided by (used in) financing activities
|
209,186
|
|
|
10,498
|
|
|
(12,487
|
)
|
|||
Increase (decrease) in cash and cash equivalents
|
(12,326
|
)
|
|
(27,711
|
)
|
|
(1,120
|
)
|
|||
Cash and cash equivalents at beginning of year
|
34,919
|
|
|
62,630
|
|
|
63,750
|
|
|||
Cash and cash equivalents at end of year
|
$
|
22,593
|
|
|
$
|
34,919
|
|
|
$
|
62,630
|
|
|
The Andersons, Inc. Shareholders’ Equity
|
|
|
|
|
||||||||||||||||||||||
|
Common
Shares
|
|
Additional
Paid-in
Capital
|
|
Treasury
Shares
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||
Balance at January 1, 2016
|
$
|
96
|
|
|
$
|
222,848
|
|
|
$
|
(52,902
|
)
|
|
$
|
(20,939
|
)
|
|
$
|
615,151
|
|
|
$
|
19,485
|
|
|
$
|
783,739
|
|
Net income
|
|
|
|
|
|
|
|
|
11,594
|
|
|
2,876
|
|
|
14,470
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
8,471
|
|
|
|
|
|
|
8,471
|
|
||||||||||||
Cash distributions to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
|
(5,853
|
)
|
|
(5,853
|
)
|
|||||||||||
Other changes to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(172
|
)
|
|
(172
|
)
|
||||||||||||
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $458 (196 shares)
|
|
|
67
|
|
|
7,489
|
|
|
|
|
|
|
|
|
7,556
|
|
|||||||||||
Dividends declared ($0.625 per common share)
|
|
|
|
|
|
|
|
|
(17,514
|
)
|
|
|
|
(17,514
|
)
|
||||||||||||
Performance share unit dividends equivalents
|
|
|
(5
|
)
|
|
30
|
|
|
|
|
(25
|
)
|
|
|
|
—
|
|
||||||||||
Balance at December 31, 2016
|
96
|
|
|
222,910
|
|
|
(45,383
|
)
|
|
(12,468
|
)
|
|
609,206
|
|
|
16,336
|
|
|
790,697
|
|
|||||||
Net income
|
|
|
|
|
|
|
|
|
42,511
|
|
|
98
|
|
|
42,609
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
9,768
|
|
|
|
|
|
|
9,768
|
|
||||||||||||
Cash distributions to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(377
|
)
|
|
(377
|
)
|
||||||||||||
Other changes in noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(8,360
|
)
|
|
(8,360
|
)
|
||||||||||||
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $(323) (138 shares)
|
|
|
1,707
|
|
|
5,007
|
|
|
|
|
|
|
|
|
6,714
|
|
|||||||||||
Dividends declared ($0.645 per common share)
|
|
|
|
|
|
|
|
|
(18,152
|
)
|
|
|
|
(18,152
|
)
|
||||||||||||
Performance share unit dividends equivalents
|
|
|
5
|
|
|
64
|
|
|
|
|
(69
|
)
|
|
|
|
—
|
|
||||||||||
Balance at December 31, 2017
|
96
|
|
|
224,622
|
|
|
(40,312
|
)
|
|
(2,700
|
)
|
|
633,496
|
|
|
7,697
|
|
|
822,899
|
|
|||||||
Net income
|
|
|
|
|
|
|
|
|
41,484
|
|
|
(259
|
)
|
|
41,225
|
|
|||||||||||
Other comprehensive income
|
|
|
|
|
|
|
(3,687
|
)
|
|
|
|
|
|
(3,687
|
)
|
||||||||||||
Cash received from (paid to) noncontrolling interest, net
|
|
|
(2,268
|
)
|
|
|
|
|
|
|
|
39,004
|
|
|
36,736
|
|
|||||||||||
Adoption of accounting standard, net of income tax of $3,492
|
|
|
|
|
|
|
|
|
(7,818
|
)
|
|
|
|
(7,818
|
)
|
||||||||||||
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $(267) (127 shares)
|
|
|
2,042
|
|
|
4,871
|
|
|
|
|
|
|
|
|
6,913
|
|
|||||||||||
Dividends declared ($0.665 per common share)
|
|
|
|
|
|
|
|
|
(19,504
|
)
|
|
|
|
(19,504
|
)
|
||||||||||||
Restricted share award dividend equivalents
|
|
|
|
|
141
|
|
|
|
|
(141
|
)
|
|
|
|
—
|
|
|||||||||||
Balance at December 31, 2018
|
$
|
96
|
|
|
$
|
224,396
|
|
|
$
|
(35,300
|
)
|
|
$
|
(6,387
|
)
|
|
$
|
647,517
|
|
|
$
|
46,442
|
|
|
$
|
876,764
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Grain
|
$
|
527,471
|
|
|
$
|
505,217
|
|
Ethanol and co-products
|
11,918
|
|
|
11,003
|
|
||
Plant nutrients and cob products
|
145,693
|
|
|
126,962
|
|
||
Railcar repair parts
|
5,722
|
|
|
5,521
|
|
||
|
$
|
690,804
|
|
|
$
|
648,703
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Land
|
$
|
29,739
|
|
|
$
|
22,388
|
|
Land improvements and leasehold improvements
|
68,826
|
|
|
69,127
|
|
||
Buildings and storage facilities
|
284,998
|
|
|
284,820
|
|
||
Machinery and equipment
|
393,640
|
|
|
373,127
|
|
||
Construction in progress
|
102,394
|
|
|
7,502
|
|
||
|
879,597
|
|
|
756,964
|
|
||
Less: accumulated depreciation
|
402,886
|
|
|
372,287
|
|
||
|
$
|
476,711
|
|
|
$
|
384,677
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Rail Group assets leased to others
|
$
|
640,349
|
|
|
$
|
531,391
|
|
Less: accumulated depreciation
|
118,564
|
|
|
107,948
|
|
||
|
$
|
521,785
|
|
|
$
|
423,443
|
|
(in thousands)
|
|
Grain
|
|
Plant Nutrient
|
|
Rail
|
|
Total
|
||||||||
Balance at January 1, 2016
|
|
$
|
—
|
|
|
$
|
59,767
|
|
|
$
|
4,167
|
|
|
$
|
63,934
|
|
Acquisitions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Balance at December 31, 2016
|
|
—
|
|
|
59,767
|
|
|
4,167
|
|
|
63,934
|
|
||||
Acquisitions
|
|
1,171
|
|
|
—
|
|
|
—
|
|
|
1,171
|
|
||||
Impairments
|
|
—
|
|
|
(59,081
|
)
|
|
—
|
|
|
(59,081
|
)
|
||||
Balance at December 31, 2017
|
|
1,171
|
|
|
686
|
|
|
4,167
|
|
|
6,024
|
|
||||
Acquisitions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Balance at December 31, 2018
|
|
$
|
1,171
|
|
|
$
|
686
|
|
|
$
|
4,167
|
|
|
$
|
6,024
|
|
(in thousands)
|
Original Cost
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||
December 31, 2018
|
|
|
|
|
|
||||||
Intangible asset class
|
|
|
|
|
|
||||||
Customer list
|
$
|
40,570
|
|
|
$
|
21,706
|
|
|
$
|
18,864
|
|
Non-compete agreement
|
3,313
|
|
|
2,753
|
|
|
560
|
|
|||
Supply agreement
|
9,060
|
|
|
5,824
|
|
|
3,236
|
|
|||
Technology
|
13,400
|
|
|
4,857
|
|
|
8,543
|
|
|||
Trademarks and patents
|
17,985
|
|
|
7,682
|
|
|
10,303
|
|
|||
Lease intangible
|
11,564
|
|
|
3,602
|
|
|
7,962
|
|
|||
Software
|
86,723
|
|
|
37,112
|
|
|
49,611
|
|
|||
Other
|
419
|
|
|
360
|
|
|
59
|
|
|||
|
$
|
183,034
|
|
|
$
|
83,896
|
|
|
$
|
99,138
|
|
December 31, 2017
|
|
|
|
|
|
||||||
Intangible asset class
|
|
|
|
|
|
||||||
Customer list
|
$
|
41,151
|
|
|
$
|
18,437
|
|
|
$
|
22,714
|
|
Non-compete agreement
|
4,665
|
|
|
3,563
|
|
|
1,102
|
|
|||
Supply agreement
|
9,806
|
|
|
5,699
|
|
|
4,107
|
|
|||
Technology
|
15,500
|
|
|
5,616
|
|
|
9,884
|
|
|||
Trademarks and patents
|
18,185
|
|
|
5,882
|
|
|
12,303
|
|
|||
Lease intangible
|
12,420
|
|
|
5,707
|
|
|
6,713
|
|
|||
Software
|
84,339
|
|
|
28,372
|
|
|
55,967
|
|
|||
Other
|
2,023
|
|
|
1,920
|
|
|
103
|
|
|||
|
$
|
188,089
|
|
|
$
|
75,196
|
|
|
$
|
112,893
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Short-term debt - non-recourse
|
$
|
—
|
|
|
$
|
—
|
|
Short-term debt - recourse
|
205,000
|
|
|
22,000
|
|
||
Total short-term debt
|
$
|
205,000
|
|
|
$
|
22,000
|
|
Current maturities of long-term debt – non-recourse
|
$
|
4,842
|
|
|
$
|
—
|
|
Current maturities of long-term debt – recourse
|
16,747
|
|
|
54,205
|
|
||
Total current maturities of long-term debt
|
$
|
21,589
|
|
|
$
|
54,205
|
|
Long-term debt, less current maturities – non-recourse
|
$
|
146,353
|
|
|
$
|
—
|
|
Long-term debt, less current maturities – recourse
|
349,834
|
|
|
418,339
|
|
||
Total long-term debt, less current maturities
|
$
|
496,187
|
|
|
$
|
418,339
|
|
(in thousands, except percentages)
|
2018
|
|
2017
|
|
2016
|
||||||
Maximum amount borrowed
|
$
|
555,000
|
|
|
$
|
367,000
|
|
|
$
|
412,000
|
|
Weighted average interest rate
|
3.32
|
%
|
|
2.56
|
%
|
|
1.94
|
%
|
|
December 31,
|
||||||
(in thousands, except percentages)
|
2018
|
|
2017
|
||||
Note payable, 4.07%, payable at maturity, due 2021
|
$
|
26,000
|
|
|
$
|
26,000
|
|
Note payable, 4.55%, payable at maturity, due 2023
|
24,000
|
|
|
24,000
|
|
||
Note payable, 4.85%, payable at maturity, due 2026
|
25,000
|
|
|
25,000
|
|
||
Note payable, 6.78%, payable at maturity, paid 2018
|
—
|
|
|
41,500
|
|
||
Note payable, 4.92%, payable in increasing amounts ($2.0 million for 2018), plus interest, due 2021 (a)
|
16,227
|
|
|
18,241
|
|
||
Note payable, 4.76%, payable in increasing amounts ($1.6 million for 2018) plus interest, due 2028 (a)
|
44,330
|
|
|
45,936
|
|
||
Note payable, variable rate (4.85% at December 31, 2018), payable in increasing amounts ($1.3 million for 2018) plus interest, due 2023 (a)
|
16,452
|
|
|
17,786
|
|
||
Note payable, 3.29%, payable in increasing amounts ($1.4 million for 2018) plus interest, due 2022 (a)
|
18,918
|
|
|
20,293
|
|
||
Note payable, 4.23%, payable quarterly in varying amounts ($0.5 million for 2018) plus interest, due 2021 (a)
|
9,948
|
|
|
10,479
|
|
||
Note payable, variable rate (4.19% at December 31, 2018), payable in varying amounts ($0.3 million for 2018), plus interest, due 2026 (a)
|
8,417
|
|
|
8,762
|
|
||
Note payable, 4.76%, payable quarterly in varying amounts ($0.3 million for 2018) plus interest, due 2028 (a)
|
8,288
|
|
|
8,581
|
|
||
Line of credit, variable rate (3.79% at December 31, 2018), payable at maturity, due 2022
|
50,000
|
|
|
100,000
|
|
||
Note payable, 3.33%, payable in increasing amounts ($1.1 million for 2018) plus interest, due 2025 (a)
|
24,888
|
|
|
25,960
|
|
||
Note payable, 4.5%, payable at maturity, due 2030
|
16,000
|
|
|
16,000
|
|
||
Note payable, 5.0%, payable at maturity, due 2040
|
14,000
|
|
|
14,000
|
|
||
Note payable, variable rate (4.15% at December 31, 2018), payable quarterly, ($1.25 million for 2018) due 2024 (a)
|
13,250
|
|
|
14,500
|
|
||
Industrial development revenue bonds:
|
|
|
|
||||
Variable rate (3.19% at December 31, 2018), payable at maturity, due 2019 (a)
|
4,650
|
|
|
4,650
|
|
||
Variable rate (3.18% at December 31, 2018), payable at maturity, due 2025 (a)
|
3,100
|
|
|
3,100
|
|
||
Variable rate (3.14% at December 31, 2018), payable at maturity, due 2036
|
21,000
|
|
|
21,000
|
|
||
Debenture bonds, 2.65% to 5.00%, due 2018 through 2032
|
27,323
|
|
|
30,432
|
|
||
|
$
|
371,791
|
|
|
$
|
476,220
|
|
Less: current maturities
|
16,747
|
|
|
54,205
|
|
||
Less: unamortized prepaid debt issuance costs
|
5,210
|
|
|
3,676
|
|
||
|
$
|
349,834
|
|
|
$
|
418,339
|
|
•
|
long-term debt to capitalization of not more than 70%;
|
•
|
working capital of not less than $150 million; and
|
•
|
interest coverage ratio of not less than 2.65 to 1.00.
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Line of credit, 4.46%, payable at maturity, due 2021
|
$
|
118,000
|
|
|
$
|
—
|
|
Non-recourse financing obligations, 3.60% to 4.94%, due 2019 through 2026
|
34,019
|
|
|
—
|
|
||
|
$
|
152,019
|
|
|
$
|
—
|
|
Less: current maturities
|
4,842
|
|
|
—
|
|
||
Less: unamortized prepaid debt issuance costs
|
824
|
|
|
—
|
|
||
|
$
|
146,353
|
|
|
$
|
—
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||
(in thousands)
|
Net Derivative Asset Position
|
|
Net Derivative Liability Position
|
|
Net Derivative Asset Position
|
|
Net Derivative Liability Position
|
||||||||
Collateral paid
|
$
|
14,944
|
|
|
$
|
—
|
|
|
$
|
1,351
|
|
|
$
|
—
|
|
Fair value of derivatives
|
22,285
|
|
|
—
|
|
|
17,252
|
|
|
—
|
|
||||
Balance at end of period
|
$
|
37,229
|
|
|
$
|
—
|
|
|
$
|
18,603
|
|
|
$
|
—
|
|
|
December 31, 2018
|
||||||||||||||||||
(in thousands)
|
Commodity Derivative Assets - Current
|
|
Commodity Derivative Assets - Noncurrent
|
|
Commodity Derivative Liabilities - Current
|
|
Commodity Derivative Liabilities - Noncurrent
|
|
Total
|
||||||||||
Commodity derivative assets
|
$
|
43,463
|
|
|
$
|
484
|
|
|
$
|
706
|
|
|
$
|
5
|
|
|
$
|
44,658
|
|
Commodity derivative liabilities
|
(6,986
|
)
|
|
(4
|
)
|
|
(33,353
|
)
|
|
(894
|
)
|
|
(41,237
|
)
|
|||||
Cash collateral
|
14,944
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,944
|
|
|||||
Balance sheet line item totals
|
$
|
51,421
|
|
|
$
|
480
|
|
|
$
|
(32,647
|
)
|
|
$
|
(889
|
)
|
|
$
|
18,365
|
|
|
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
|
|
|
Year Ended
December 31, |
||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||
Gains (Losses) on commodity derivatives included in cost of sales and merchandising revenues
|
$
|
4,236
|
|
|
5,417
|
|
|
(15,012
|
)
|
|
December 31, 2018
|
||||||||||
Commodity (in thousands)
|
Number of Bushels
|
|
Number of Gallons
|
|
Number of Pounds
|
|
Number of Tons
|
||||
Non-exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
250,408
|
|
|
|
|
|
|
|
|
—
|
|
Soybeans
|
22,463
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
14,017
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
26,230
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
244,863
|
|
|
—
|
|
|
—
|
|
Corn oil
|
—
|
|
|
—
|
|
|
2,920
|
|
|
—
|
|
Other
|
494
|
|
|
2,000
|
|
|
—
|
|
|
66
|
|
Subtotal
|
313,612
|
|
|
246,863
|
|
|
2,920
|
|
|
66
|
|
Exchange traded:
|
|
|
|
|
|
|
|
||||
Corn
|
130,585
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Soybeans
|
26,985
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Wheat
|
33,760
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Oats
|
1,475
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Ethanol
|
—
|
|
|
77,112
|
|
|
—
|
|
|
—
|
|
Subtotal
|
192,805
|
|
|
77,112
|
|
|
—
|
|
|
—
|
|
Total
|
506,417
|
|
|
323,975
|
|
|
2,920
|
|
|
66
|
|
|
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
|
|
Interest Rate Hedging Instrument
|
|
Year Entered
|
|
Year of Maturity
|
|
Initial Notional Amount
(in millions)
|
|
Hedged Item
|
|
Interest Rate
|
||
Long-term
|
|
|
|
|
|
|
|
|
|
|
||
Swap
|
|
2014
|
|
2023
|
|
$
|
23.0
|
|
|
Interest rate component of debt - not accounted for as a hedge
|
|
1.9%
|
Collar
|
|
2013
|
|
2021
|
|
$
|
40.0
|
|
|
Interest rate component of debt - not accounted for as a hedge
|
|
2.9% to 4.8%
|
Swap
|
|
2018
|
|
2021
|
|
$
|
40.0
|
|
|
Interest rate component of debt - accounted for as cash flow hedge
|
|
2.6%
|
Swap
|
|
2018
|
|
2021
|
|
$
|
25.0
|
|
|
Interest rate component of debt - accounted for as cash flow hedge
|
|
2.5%
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
||||
Interest rate contracts included in Other long-term assets (Other long-term liabilities)
|
$
|
(353
|
)
|
|
$
|
(1,244
|
)
|
Foreign currency contracts included in Other current assets (Accrued expenses and other current liabilities)
|
$
|
(1,122
|
)
|
|
$
|
426
|
|
Derivatives designated as hedging instruments
|
|
|
|
||||
Interest rate contract included in Other assets (Other long-term liabilities)
|
$
|
(168
|
)
|
|
$
|
—
|
|
|
Year ended December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
||||
Interest rate derivative gains (losses) included in Interest income (expense)
|
$
|
1,115
|
|
|
$
|
1,286
|
|
Foreign currency derivative gains (losses) included in Other income, net
|
$
|
(1,548
|
)
|
|
$
|
539
|
|
Derivatives designated as hedging instruments
|
|
|
|
||||
Interest rate derivative gains (losses) included in OCI
|
$
|
(168
|
)
|
|
$
|
—
|
|
Interest rate derivative gains (losses) included in Interest income (expense)
|
$
|
158
|
|
|
$
|
—
|
|
(in thousands)
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
Change in benefit obligation
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Benefit obligation at beginning of year
|
$
|
5,832
|
|
|
$
|
7,112
|
|
|
$
|
22,602
|
|
|
$
|
29,757
|
|
Service cost
|
—
|
|
|
—
|
|
|
319
|
|
|
391
|
|
||||
Interest cost
|
130
|
|
|
155
|
|
|
752
|
|
|
985
|
|
||||
Actuarial (gains) losses
|
(282
|
)
|
|
(245
|
)
|
|
(1,623
|
)
|
|
(7,903
|
)
|
||||
Participant contributions
|
—
|
|
|
—
|
|
|
145
|
|
|
463
|
|
||||
Retiree drug subsidy received
|
—
|
|
|
—
|
|
|
125
|
|
|
184
|
|
||||
Benefits paid
|
(1,318
|
)
|
|
(1,190
|
)
|
|
(1,682
|
)
|
|
(1,275
|
)
|
||||
Benefit obligation at end of year
|
$
|
4,362
|
|
|
$
|
5,832
|
|
|
$
|
20,638
|
|
|
$
|
22,602
|
|
(in thousands)
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
Change in plan assets
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Fair value of plan assets at beginning of year
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actual gains on plan assets
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Company contributions
|
1,318
|
|
|
1,190
|
|
|
1,537
|
|
|
812
|
|
||||
Participant contributions
|
—
|
|
|
—
|
|
|
145
|
|
|
463
|
|
||||
Benefits paid
|
(1,318
|
)
|
|
(1,190
|
)
|
|
(1,682
|
)
|
|
(1,275
|
)
|
||||
Fair value of plan assets at end of year
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Under funded status of plans at end of year
|
$
|
(4,362
|
)
|
|
$
|
(5,832
|
)
|
|
$
|
(20,638
|
)
|
|
$
|
(22,602
|
)
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Accrued expenses
|
$
|
(1,516
|
)
|
|
$
|
(1,232
|
)
|
|
$
|
(1,162
|
)
|
|
$
|
(1,098
|
)
|
Employee benefit plan obligations
|
(2,846
|
)
|
|
(4,600
|
)
|
|
(19,476
|
)
|
|
(21,504
|
)
|
||||
Net amount recognized
|
$
|
(4,362
|
)
|
|
$
|
(5,832
|
)
|
|
$
|
(20,638
|
)
|
|
$
|
(22,602
|
)
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
(in thousands)
|
Unamortized Actuarial Net Losses
|
|
Unamortized Prior Service Costs
|
|
Unamortized Actuarial Net Losses
|
|
Unamortized Prior Service Costs
|
||||||||
Balance at beginning of year
|
$
|
3,747
|
|
|
$
|
—
|
|
|
$
|
(7,506
|
)
|
|
|
|
|
Amounts arising during the period
|
(282
|
)
|
|
—
|
|
|
(1,623
|
)
|
|
—
|
|
||||
Amounts recognized as a component of net periodic benefit cost
|
(243
|
)
|
|
—
|
|
|
—
|
|
|
910
|
|
||||
Balance at end of year
|
$
|
3,222
|
|
|
$
|
—
|
|
|
$
|
(9,129
|
)
|
|
$
|
910
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Projected benefit obligation
|
$
|
4,362
|
|
|
$
|
5,832
|
|
Accumulated benefit obligation
|
$
|
4,362
|
|
|
$
|
5,832
|
|
Year
|
|
Expected Pension Benefit Payout
|
|
Expected Postretirement Benefit Payout
|
||||
2019
|
|
$
|
1,516
|
|
|
$
|
1,161
|
|
2020
|
|
1,262
|
|
|
1,185
|
|
||
2021
|
|
1,011
|
|
|
1,203
|
|
||
2022
|
|
210
|
|
|
1,225
|
|
||
2023
|
|
220
|
|
|
1,240
|
|
||
2024-2028
|
|
418
|
|
|
6,364
|
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||||||||||
|
December 31,
|
|
December 31,
|
||||||||||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
319
|
|
|
$
|
391
|
|
|
$
|
760
|
|
Interest cost
|
130
|
|
|
155
|
|
|
194
|
|
|
752
|
|
|
985
|
|
|
1,549
|
|
||||||
Expected return on plan assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(910
|
)
|
|
(455
|
)
|
|
(355
|
)
|
||||||
Recognized net actuarial loss
|
243
|
|
|
252
|
|
|
146
|
|
|
—
|
|
|
—
|
|
|
768
|
|
||||||
Benefit cost (income)
|
$
|
373
|
|
|
$
|
407
|
|
|
$
|
340
|
|
|
$
|
161
|
|
|
$
|
921
|
|
|
$
|
2,722
|
|
|
Pension Benefits
|
|
Postretirement Benefits
|
|||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
|||
Used to Determine Benefit Obligations at Measurement Date
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate (a)
|
N/A
|
|
N/A
|
|
N/A
|
|
4.1
|
%
|
|
3.4
|
%
|
|
4.0
|
%
|
Used to Determine Net Periodic Benefit Cost for Years ended December 31
|
|
|
|
|
|
|
|
|
|
|
|
|||
Discount rate (b)
|
N/A
|
|
N/A
|
|
N/A
|
|
3.4
|
%
|
|
3.7
|
%
|
|
4.2
|
%
|
Expected long-term return on plan assets
|
N/A
|
|
N/A
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
Rate of compensation increases
|
N/A
|
|
N/A
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
(a)
|
The calculated rate for the unfunded employee retirement plan was 3.20%, 2.50% and 2.40% in 2018, 2017 and 2016, respectively. Since it was terminated in 2015, the defined benefit pension plan did not have a discount rate during the three-year period presented above.
|
(b)
|
The calculated rate for the unfunded employee retirement plan was 2.50%, 2.40% and 2.60% in 2018, 2017 and 2016, respectively. Since it was terminated in 2015, the defined benefit pension plan did not have a discount rate during the three year period presented above.
|
Assumed Health Care Cost Trend Rates at Beginning of Year
|
|
|
|
||
|
2018
|
|
2017
|
||
Health care cost trend rate assumed for next year
|
3.0
|
%
|
|
3.0
|
%
|
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) (a)
|
N/A
|
|
|
N/A
|
|
Year that the rate reaches the ultimate trend rate (a)
|
N/A
|
|
|
N/A
|
|
(a)
|
In 2017, the Company's remaining uncapped participants were converted to a Medicare Exchange Health Reimbursement Arrangement, which put a 2% cap on the Company's share of the related costs.
|
(in thousands)
|
|
For the Year ended December 31, 2018
|
||
Revenues under ASC 606
|
|
$
|
898,885
|
|
Revenues under ASC 840
|
|
105,631
|
|
|
Revenues under ASC 815
|
|
2,040,866
|
|
|
Total Revenues
|
|
$
|
3,045,382
|
|
|
Twelve months ended December 31, 2018
|
||||||||||||||||||
(in thousands)
|
Grain
|
|
Ethanol
|
|
Plant Nutrient
|
|
Rail
|
|
Total
|
||||||||||
Specialty nutrients
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
260,821
|
|
|
$
|
—
|
|
|
$
|
260,821
|
|
Primary nutrients
|
—
|
|
|
—
|
|
|
399,566
|
|
|
—
|
|
|
399,566
|
|
|||||
Services
|
14,666
|
|
|
10,786
|
|
|
4,411
|
|
|
35,179
|
|
|
65,042
|
|
|||||
Co-products
|
—
|
|
|
114,489
|
|
|
—
|
|
|
—
|
|
|
114,489
|
|
|||||
Other
|
1,035
|
|
|
—
|
|
|
25,738
|
|
|
32,194
|
|
|
58,967
|
|
|||||
Total
|
$
|
15,701
|
|
|
$
|
125,275
|
|
|
$
|
690,536
|
|
|
$
|
67,373
|
|
|
$
|
898,885
|
|
(in thousands)
|
Contract liabilities
|
||
Balance at January 1, 2018
|
$
|
25,520
|
|
Balance at December 31, 2018
|
28,858
|
|
|
Balance Sheet
|
||||||||||
|
December 31, 2018
|
||||||||||
(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
|
$
|
22,593
|
|
|
$
|
—
|
|
|
$
|
22,593
|
|
Accounts receivable, net
|
207,285
|
|
|
—
|
|
|
207,285
|
|
|||
Inventories
|
690,804
|
|
|
74
|
|
|
690,878
|
|
|||
Commodity derivative assets - current
|
51,421
|
|
|
—
|
|
|
51,421
|
|
|||
Other current assets
|
51,095
|
|
|
(114
|
)
|
|
50,981
|
|
|||
Other noncurrent assets
|
370,309
|
|
|
—
|
|
|
370,309
|
|
|||
Rail Group assets leased to others, net
|
521,785
|
|
|
(22,709
|
)
|
|
499,076
|
|
|||
Property, plant and equipment, net
|
476,711
|
|
|
—
|
|
|
476,711
|
|
|||
Total assets
|
2,392,003
|
|
|
(22,749
|
)
|
|
2,369,254
|
|
|||
Short-term debt and current maturities of long-term debt
|
226,589
|
|
|
(4,842
|
)
|
|
221,747
|
|
|||
Trade and other payables and accrued expenses and other current liabilities
|
541,581
|
|
|
—
|
|
|
541,581
|
|
|||
Commodity derivative liabilities - current
|
32,647
|
|
|
—
|
|
|
32,647
|
|
|||
Customer prepayments and deferred revenue
|
32,533
|
|
|
—
|
|
|
32,533
|
|
|||
Commodity derivative liabilities - noncurrent and Other long-term liabilities
|
33,073
|
|
|
—
|
|
|
33,073
|
|
|||
Employee benefit plan obligations
|
22,542
|
|
|
—
|
|
|
22,542
|
|
|||
Long-term debt, less current maturities
|
496,187
|
|
|
(29,177
|
)
|
|
467,010
|
|
|||
Deferred income taxes
|
130,087
|
|
|
3,492
|
|
|
133,579
|
|
|||
Total liabilities
|
1,515,239
|
|
|
(30,527
|
)
|
|
1,484,712
|
|
|||
Retained earnings
|
647,517
|
|
|
7,778
|
|
|
655,295
|
|
|||
Common shares, additional paid-in-capital, treasury shares, accumulated other comprehensive loss and noncontrolling interests
|
229,247
|
|
|
—
|
|
|
229,247
|
|
|||
Total equity
|
876,764
|
|
|
7,778
|
|
|
884,542
|
|
|||
Total liabilities and equity
|
$
|
2,392,003
|
|
|
$
|
(22,749
|
)
|
|
$
|
2,369,254
|
|
|
Statement of Operations
|
||||||||||
|
December 31, 2018
|
||||||||||
(in thousands)
|
As Reported
|
|
ASC 606 Impact
|
|
Pro forma as if the previous accounting guidance was in effect
|
||||||
Sales and merchandising revenues
|
$
|
3,045,382
|
|
|
$
|
701,437
|
|
|
$
|
3,746,819
|
|
Cost of sales and merchandising revenues
|
2,743,377
|
|
|
703,358
|
|
|
3,446,735
|
|
|||
Gross profit
|
302,005
|
|
|
(1,921
|
)
|
|
$
|
300,084
|
|
||
Operating, administrative and general expenses
|
257,872
|
|
|
—
|
|
|
$
|
257,872
|
|
||
Asset impairment
|
6,272
|
|
|
—
|
|
|
$
|
6,272
|
|
||
Interest expense
|
27,848
|
|
|
(1,563
|
)
|
|
$
|
26,285
|
|
||
Other income:
|
|
|
|
|
|
|
|||||
Equity in earnings of affiliates, net
|
27,141
|
|
|
—
|
|
|
$
|
27,141
|
|
||
Other income, net
|
16,002
|
|
|
—
|
|
|
$
|
16,002
|
|
||
Income (loss) before income taxes
|
53,156
|
|
|
(358
|
)
|
|
$
|
52,798
|
|
||
Income tax provision
|
11,931
|
|
|
(89
|
)
|
|
$
|
11,842
|
|
||
Net income (loss)
|
41,225
|
|
|
(269
|
)
|
|
$
|
40,956
|
|
||
Net income attributable to the noncontrolling interests
|
(259
|
)
|
|
—
|
|
|
$
|
(259
|
)
|
||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
41,484
|
|
|
$
|
(269
|
)
|
|
$
|
41,215
|
|
•
|
While grain origination agreements, and their related sales contracts, will be accounted for under ASC 815, the Company is 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 under ASC 606. Since these transactions are now being recorded on a net basis, revenues and related cost of sales would have been $688.3 million higher under the previous guidance for the twelve months ended December 31, 2018.
|
•
|
ASC 606 requires certain Rail Group assets and related financing obligations to be recorded on the balance sheet as these transactions no longer qualify 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 is 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 Company from a customer.
|
•
|
Modified retrospective approach - see discussion in Note 1 regarding adoption elections.
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S.
|
$
|
46,678
|
|
|
$
|
(25,645
|
)
|
|
$
|
11,526
|
|
Foreign
|
6,478
|
|
|
5,120
|
|
|
9,855
|
|
|||
|
$
|
53,156
|
|
|
$
|
(20,525
|
)
|
|
$
|
21,381
|
|
|
Year ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Statutory U.S. federal tax rate
|
21.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Increase (decrease) in rate resulting from:
|
|
|
|
|
|
|||
State and local income taxes, net of related federal taxes
|
3.4
|
|
|
(4.2
|
)
|
|
5.8
|
|
Federal income tax credits
|
(3.4
|
)
|
|
—
|
|
|
(7.3
|
)
|
Change in federal and state tax rates
|
(2.1
|
)
|
|
374.8
|
|
|
—
|
|
Income taxes on foreign earnings
|
(1.5
|
)
|
|
(2.2
|
)
|
|
(1.3
|
)
|
Nondeductible compensation
|
1.5
|
|
|
(2.5
|
)
|
|
2.0
|
|
Tax effect of GILTI
|
1.4
|
|
|
—
|
|
|
—
|
|
Equity Method Investments
|
1.1
|
|
|
(0.4
|
)
|
|
0.3
|
|
Impacts related to the 2017 Tax Act
|
0.6
|
|
|
(7.1
|
)
|
|
—
|
|
Other, net
|
0.5
|
|
|
4.4
|
|
|
(0.8
|
)
|
Release (accrual) of unrecognized tax benefits
|
(0.1
|
)
|
|
3.0
|
|
|
0.1
|
|
Effect of noncontrolling interest
|
0.1
|
|
|
0.2
|
|
|
(4.7
|
)
|
Goodwill impairment
|
—
|
|
|
(93.5
|
)
|
|
—
|
|
Tax associated with accrued and unpaid dividends
|
—
|
|
|
0.1
|
|
|
3.2
|
|
Effective tax rate
|
22.5
|
%
|
|
307.6
|
%
|
|
32.3
|
%
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Property, plant and equipment and Rail Group assets leased to others
|
$
|
(168,345
|
)
|
|
$
|
(129,876
|
)
|
Equity method investments
|
(24,732
|
)
|
|
(31,223
|
)
|
||
Other
|
(7,999
|
)
|
|
(8,754
|
)
|
||
|
(201,076
|
)
|
|
(169,853
|
)
|
||
Deferred tax assets:
|
|
|
|
||||
Employee benefits
|
13,161
|
|
|
15,229
|
|
||
Accounts and notes receivable
|
2,069
|
|
|
2,317
|
|
||
Inventory
|
7,595
|
|
|
6,100
|
|
||
Federal income tax credits
|
13,075
|
|
|
10,225
|
|
||
Net operating loss carryforwards
|
12,766
|
|
|
5,753
|
|
||
Deferred interest (a)
|
6,476
|
|
|
—
|
|
||
Lease liability
|
8,473
|
|
|
—
|
|
||
Other
|
8,839
|
|
|
9,674
|
|
||
Total deferred tax assets
|
72,454
|
|
|
49,298
|
|
||
Valuation allowance
|
(1,185
|
)
|
|
(1,024
|
)
|
||
|
71,269
|
|
|
48,274
|
|
||
Net deferred tax liabilities
|
$
|
(129,807
|
)
|
|
$
|
(121,579
|
)
|
(in thousands)
|
|
||
Balance at January 1, 2016
|
$
|
1,431
|
|
Additions based on tax positions related to the current year
|
113
|
|
|
Additions based on tax positions related to prior years
|
—
|
|
|
Reductions based on tax positions related to prior years
|
(40
|
)
|
|
Reductions as a result of a lapse in statute of limitations
|
(52
|
)
|
|
Balance at December 31, 2016
|
1,452
|
|
|
|
|
||
Additions based on tax positions related to the current year
|
—
|
|
|
Reductions based on tax positions related to prior years
|
(92
|
)
|
|
Reductions as a result of a lapse in statute of limitations
|
(573
|
)
|
|
Balance at December 31, 2017
|
787
|
|
|
|
|
||
Additions based on tax positions related to the current year
|
—
|
|
|
Additions based on tax positions related to prior years
|
—
|
|
|
Reductions based on tax positions related to prior years
|
—
|
|
|
Reductions as a result of a lapse in statute of limitations
|
(169
|
)
|
|
Balance at December 31, 2018
|
$
|
618
|
|
Changes in Accumulated Other Comprehensive Income (Loss) by Component (a)
|
|||||||||||||||||||||
|
|
|
For the Year Ended December 31, 2018
|
||||||||||||||||||
|
(in thousands)
|
|
Losses on Cash Flow Hedges
|
|
Foreign Currency Translation Adjustments
|
|
Investment in Convertible Preferred Securities
|
|
Defined Benefit Plan Items
|
|
Total
|
||||||||||
Beginning Balance
|
|
$
|
—
|
|
|
$
|
(7,716
|
)
|
|
$
|
344
|
|
|
$
|
4,672
|
|
|
$
|
(2,700
|
)
|
|
|
Other comprehensive income before reclassifications
|
|
(284
|
)
|
|
(3,834
|
)
|
|
(86
|
)
|
|
1,031
|
|
|
(3,173
|
)
|
|||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
158
|
|
|
—
|
|
|
—
|
|
|
(672
|
)
|
|
(514
|
)
|
|||||
Net current-period other comprehensive income
|
|
(126
|
)
|
|
(3,834
|
)
|
|
(86
|
)
|
|
359
|
|
|
(3,687
|
)
|
||||||
Ending balance
|
|
$
|
(126
|
)
|
|
$
|
(11,550
|
)
|
|
$
|
258
|
|
|
$
|
5,031
|
|
|
$
|
(6,387
|
)
|
Changes in Accumulated Other Comprehensive Income (Loss) by Component (a)
|
|||||||||||||||||||||
|
|
|
For the Year Ended December 31, 2016
|
||||||||||||||||||
|
(in thousands)
|
|
Losses on Cash Flow Hedges
|
|
Foreign Currency Translation Adjustments
|
|
Investment in Convertible Preferred Securities
|
|
Defined Benefit Plan Items
|
|
Total
|
||||||||||
Beginning Balance
|
|
$
|
(111
|
)
|
|
$
|
(12,041
|
)
|
|
$
|
126
|
|
|
$
|
(8,913
|
)
|
|
$
|
(20,939
|
)
|
|
|
Other comprehensive income before reclassifications
|
|
111
|
|
|
1,039
|
|
|
—
|
|
|
7,668
|
|
|
$
|
8,818
|
|
||||
|
Amounts reclassified from accumulated other comprehensive loss
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|
(221
|
)
|
|
$
|
(347
|
)
|
||||
Net current-period other comprehensive income
|
|
111
|
|
|
1,039
|
|
|
(126
|
)
|
|
7,447
|
|
|
8,471
|
|
||||||
Ending balance
|
|
$
|
—
|
|
|
$
|
(11,002
|
)
|
|
$
|
—
|
|
|
$
|
(1,466
|
)
|
|
$
|
(12,468
|
)
|
(in thousands except per common share data)
|
Year ended December 31,
|
||||||||||
2018
|
|
2017
|
|
2016
|
|||||||
Net income (loss) attributable to The Andersons, Inc.
|
$
|
41,484
|
|
|
$
|
42,511
|
|
|
$
|
11,594
|
|
Less: Distributed and undistributed earnings allocated to non-vested restricted stock
|
—
|
|
|
1
|
|
|
9
|
|
|||
Earnings (losses) available to common shareholders
|
$
|
41,484
|
|
|
$
|
42,510
|
|
|
$
|
11,585
|
|
Earnings per share – basic:
|
|
|
|
|
|
||||||
Weighted average shares outstanding – basic
|
28,258
|
|
|
28,126
|
|
|
28,193
|
|
|||
Earnings (losses) per common share – basic
|
$
|
1.47
|
|
|
$
|
1.51
|
|
|
$
|
0.41
|
|
Earnings per share – diluted:
|
|
|
|
|
|
||||||
Weighted average shares outstanding – basic
|
28,258
|
|
|
28,126
|
|
|
28,193
|
|
|||
Effect of dilutive awards
|
194
|
|
|
170
|
|
|
238
|
|
|||
Weighted average shares outstanding – diluted
|
28,452
|
|
|
28,296
|
|
|
28,431
|
|
|||
Earnings (losses) per common share – diluted
|
$
|
1.46
|
|
|
$
|
1.50
|
|
|
$
|
0.41
|
|
•
|
Level 1 inputs: Quoted prices (unadjusted) for identical assets or liabilities in active markets;
|
•
|
Level 2 inputs: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly; and
|
•
|
Level 3 inputs: Unobservable inputs (e.g., a reporting entity's own data).
|
(in thousands)
|
December 31, 2018
|
||||||||||||||
Assets (liabilities)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Commodity derivatives, net (a)
|
37,229
|
|
|
(18,864
|
)
|
|
—
|
|
|
18,365
|
|
||||
Provisionally priced contracts (b)
|
(76,175
|
)
|
|
(58,566
|
)
|
|
—
|
|
|
(134,741
|
)
|
||||
Convertible preferred securities (c)
|
—
|
|
|
—
|
|
|
7,154
|
|
|
7,154
|
|
||||
Other assets and liabilities (d)
|
5,186
|
|
|
(353
|
)
|
|
—
|
|
|
4,833
|
|
||||
Total
|
$
|
(33,760
|
)
|
|
$
|
(77,783
|
)
|
|
$
|
7,154
|
|
|
$
|
(104,389
|
)
|
(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
|
)
|
(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 Consolidated Balance Sheets related to certain available for sale securities.
|
(d)
|
Included in other assets and liabilities are assets held by the Company 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
|
|
New investments
|
1,086
|
|
|
3,750
|
|
||
Sales proceeds
|
(6,400
|
)
|
|
—
|
|
||
Gains (losses) included in earnings
|
3,900
|
|
|
—
|
|
||
Unrealized gains (losses) included in other comprehensive income
|
1,180
|
|
|
344
|
|
||
Assets (liabilities) at December 31,
|
$
|
7,154
|
|
|
$
|
7,388
|
|
(in thousands)
|
Fair Value as of 12/31/17
|
|
Valuation Method
|
|
Unobservable Input
|
|
Weighted Average
|
||
Convertible preferred securities
|
$
|
7,388
|
|
|
Implied based on market prices
|
|
Various
|
|
N/A
|
Real Property
|
$
|
29,347
|
|
|
Third-Party Appraisal
|
|
N/A
|
|
N/A
|
(in thousands)
|
Carrying Amount
|
|
Fair Value
|
|
Fair Value Hierarchy Level
|
||||
2018
|
|
|
|
|
|
||||
Fixed rate long-term notes payable
|
$
|
261,618
|
|
|
$
|
256,447
|
|
|
Level 2
|
Debenture bonds
|
27,324
|
|
|
26,154
|
|
|
Level 2
|
||
|
$
|
288,942
|
|
|
$
|
282,601
|
|
|
|
|
|
|
|
|
|
||||
2017
|
|
|
|
|
|
||||
Fixed rate long-term notes payable
|
$
|
275,989
|
|
|
$
|
275,340
|
|
|
Level 2
|
Debenture bonds
|
30,432
|
|
|
29,452
|
|
|
Level 2
|
||
|
$
|
306,421
|
|
|
$
|
304,792
|
|
|
|
|
December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Sales
|
$
|
6,111,036
|
|
|
$
|
6,080,795
|
|
|
$
|
6,579,413
|
|
Gross profit
|
257,594
|
|
|
217,629
|
|
|
188,350
|
|
|||
Income from continuing operations
|
71,608
|
|
|
50,937
|
|
|
12,288
|
|
|||
Net income
|
68,876
|
|
|
42,970
|
|
|
6,445
|
|
|||
|
|
|
|
|
|
||||||
Current assets
|
1,111,826
|
|
|
1,045,124
|
|
|
898,081
|
|
|||
Non-current assets
|
526,169
|
|
|
538,671
|
|
|
565,416
|
|
|||
Current liabilities
|
792,184
|
|
|
802,161
|
|
|
665,387
|
|
|||
Non-current liabilities
|
281,103
|
|
|
309,649
|
|
|
359,816
|
|
|||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
3,628
|
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
The Andersons Albion Ethanol LLC
|
$
|
50,382
|
|
|
$
|
45,024
|
|
The Andersons Clymers Ethanol LLC
|
24,242
|
|
|
19,830
|
|
||
The Andersons Marathon Ethanol LLC
|
14,841
|
|
|
12,660
|
|
||
Lansing Trade Group, LLC
|
101,715
|
|
|
93,088
|
|
||
Thompsons Limited (a)
|
48,987
|
|
|
50,198
|
|
||
Other
|
2,159
|
|
|
2,439
|
|
||
Total
|
$
|
242,326
|
|
|
$
|
223,239
|
|
(a)
|
Thompsons Limited and related U.S. operating company held by joint ventures
|
|
% ownership at
December 31, 2018 |
|
December 31,
|
||||||||||
(in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|||||||
The Andersons Albion Ethanol LLC
|
55%
|
|
$
|
5,531
|
|
|
$
|
6,052
|
|
|
$
|
6,167
|
|
The Andersons Clymers Ethanol LLC
|
39%
|
|
4,846
|
|
|
4,591
|
|
|
6,486
|
|
|||
The Andersons Marathon Ethanol LLC
|
33%
|
|
3,832
|
|
|
1,571
|
|
|
5,814
|
|
|||
Lansing Trade Group, LLC
|
33% (a)
|
|
10,413
|
|
|
4,038
|
|
|
(9,935
|
)
|
|||
Thompsons Limited (b)
|
50%
|
|
2,568
|
|
|
696
|
|
|
1,189
|
|
|||
Other
|
5% - 50%
|
|
(49
|
)
|
|
(225
|
)
|
|
—
|
|
|||
Total
|
|
|
$
|
27,141
|
|
|
$
|
16,723
|
|
|
$
|
9,721
|
|
(a)
|
This does not consider restricted management units which, once vested, will reduce the ownership percentage by approximately 0.3%.
|
(b)
|
Thompsons Limited and related U.S. operating company held by joint ventures
|
|
December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Sales revenues
|
$
|
358,856
|
|
|
$
|
893,950
|
|
|
$
|
749,746
|
|
Service fee revenues (a)
|
20,843
|
|
|
24,357
|
|
|
17,957
|
|
|||
Purchases of product
|
741,736
|
|
|
615,739
|
|
|
463,832
|
|
|||
Lease income (b)
|
6,523
|
|
|
6,175
|
|
|
5,966
|
|
|||
Labor and benefits reimbursement (c)
|
13,487
|
|
|
13,894
|
|
|
12,809
|
|
|||
Other expenses
|
—
|
|
|
—
|
|
|
149
|
|
(a)
|
Service fee revenues include management fee, corn origination fee, ethanol and 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 unconsolidated ethanol LLCs and IANR.
|
(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.
|
|
December 31,
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Accounts receivable (d)
|
$
|
17,829
|
|
|
$
|
30,252
|
|
Accounts payable (e)
|
28,432
|
|
|
27,866
|
|
(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.
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues from external customers
|
|
|
|
|
|
||||||
Grain
|
$
|
1,436,979
|
|
|
$
|
2,106,464
|
|
|
$
|
2,357,171
|
|
Ethanol
|
743,690
|
|
|
708,063
|
|
|
544,556
|
|
|||
Plant Nutrient
|
690,536
|
|
|
651,824
|
|
|
725,176
|
|
|||
Rail
|
174,177
|
|
|
172,123
|
|
|
163,658
|
|
|||
Other
|
—
|
|
|
47,871
|
|
|
134,229
|
|
|||
Total
|
$
|
3,045,382
|
|
|
$
|
3,686,345
|
|
|
$
|
3,924,790
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Inter-segment sales
|
|
|
|
|
|
||||||
Grain
|
$
|
2,746
|
|
|
$
|
761
|
|
|
$
|
1,638
|
|
Plant Nutrient
|
—
|
|
|
241
|
|
|
470
|
|
|||
Rail
|
1,205
|
|
|
1,213
|
|
|
1,399
|
|
|||
Total
|
$
|
3,951
|
|
|
$
|
2,215
|
|
|
$
|
3,507
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Interest expense (income)
|
|
|
|
|
|
||||||
Grain
|
$
|
11,843
|
|
|
$
|
8,320
|
|
|
$
|
7,955
|
|
Ethanol
|
(1,888
|
)
|
|
(67
|
)
|
|
35
|
|
|||
Plant Nutrient
|
6,499
|
|
|
6,420
|
|
|
6,448
|
|
|||
Rail
|
11,377
|
|
|
7,023
|
|
|
6,461
|
|
|||
Other
|
17
|
|
|
(129
|
)
|
|
220
|
|
|||
Total
|
$
|
27,848
|
|
|
$
|
21,567
|
|
|
$
|
21,119
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Equity in earnings of affiliates
|
|
|
|
|
|
||||||
Grain
|
$
|
12,932
|
|
|
$
|
4,509
|
|
|
$
|
(8,746
|
)
|
Ethanol
|
14,209
|
|
|
12,214
|
|
|
18,467
|
|
|||
Total
|
$
|
27,141
|
|
|
$
|
16,723
|
|
|
$
|
9,721
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Income (loss) before income taxes
|
|
|
|
|
|
||||||
Grain
|
$
|
26,676
|
|
|
$
|
12,844
|
|
|
$
|
(15,651
|
)
|
Ethanol
|
22,115
|
|
|
18,878
|
|
|
24,723
|
|
|||
Plant Nutrient
|
12,030
|
|
|
(45,121
|
)
|
|
14,176
|
|
|||
Rail
|
17,379
|
|
|
24,798
|
|
|
32,428
|
|
|||
Other
|
(24,785
|
)
|
|
(32,022
|
)
|
|
(37,171
|
)
|
|||
Non-controlling interests
|
(259
|
)
|
|
98
|
|
|
2,876
|
|
|||
Total
|
$
|
53,156
|
|
|
$
|
(20,525
|
)
|
|
$
|
21,381
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Capital expenditures
|
|
|
|
|
|
||||||
Grain
|
$
|
17,203
|
|
|
$
|
10,899
|
|
|
$
|
21,428
|
|
Ethanol
|
101,320
|
|
|
3,690
|
|
|
2,301
|
|
|||
Plant Nutrient
|
15,723
|
|
|
10,735
|
|
|
15,153
|
|
|||
Rail
|
5,295
|
|
|
3,478
|
|
|
4,345
|
|
|||
Other
|
3,038
|
|
|
5,800
|
|
|
34,513
|
|
|||
Total
|
$
|
142,579
|
|
|
$
|
34,602
|
|
|
$
|
77,740
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Acquisition of businesses, net of cash acquired, and other investments
|
|
|
|
|
|
||||||
Grain
|
$
|
2,248
|
|
|
$
|
5,436
|
|
|
$
|
—
|
|
Other
|
1,086
|
|
|
3,750
|
|
|
2,500
|
|
|||
Total
|
$
|
3,334
|
|
|
$
|
9,186
|
|
|
$
|
2,500
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Depreciation and amortization
|
|
|
|
|
|
||||||
Grain
|
$
|
16,062
|
|
|
$
|
18,757
|
|
|
$
|
18,232
|
|
Ethanol
|
6,136
|
|
|
5,970
|
|
|
5,925
|
|
|||
Plant Nutrient
|
26,871
|
|
|
26,628
|
|
|
28,663
|
|
|||
Rail
|
29,164
|
|
|
23,081
|
|
|
20,082
|
|
|||
Other
|
12,064
|
|
|
11,976
|
|
|
11,423
|
|
|||
Total
|
$
|
90,297
|
|
|
$
|
86,412
|
|
|
$
|
84,325
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Rental and service income - operating leases
|
$
|
96,036
|
|
|
$
|
90,333
|
|
|
$
|
95,254
|
|
Rental expense
|
$
|
15,702
|
|
|
$
|
16,459
|
|
|
$
|
16,723
|
|
(in thousands)
|
Future Rental and Service Income - Operating Leases
|
|
Future Minimum
Rental Payments
|
||||
Year ended December 31,
|
|
|
|
||||
2019
|
$
|
84,984
|
|
|
$
|
11,178
|
|
2020
|
56,239
|
|
|
8,206
|
|
||
2021
|
38,139
|
|
|
7,259
|
|
||
2022
|
23,590
|
|
|
4,338
|
|
||
2023
|
13,871
|
|
|
3,263
|
|
||
Future years
|
29,202
|
|
|
8,048
|
|
||
|
$
|
246,025
|
|
|
$
|
42,292
|
|
|
Year ended December 31,
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Supplemental disclosure of cash flow information
|
|
|
|
|
|
||||||
Interest paid
|
$
|
29,607
|
|
|
$
|
23,958
|
|
|
$
|
21,407
|
|
Income taxes paid (refunded), net
|
(5,439
|
)
|
|
2,065
|
|
|
(10,587
|
)
|
|||
Noncash investing and financing activity
|
|
|
|
|
|
||||||
Debt resulting from accounting standard adoption
|
36,953
|
|
|
—
|
|
|
—
|
|
|||
Railcar assets resulting from accounting standard adoption
|
25,643
|
|
|
—
|
|
|
—
|
|
|||
Capital projects incurred but not yet paid
|
14,165
|
|
|
6,840
|
|
|
3,092
|
|
|||
Dividends declared not yet paid
|
5,515
|
|
|
4,650
|
|
|
4,493
|
|
|||
Debt financing fees incurred but not yet paid
|
2,288
|
|
|
—
|
|
|
—
|
|
|||
Investment merger (decreasing equity method investments and non-controlling interest)
|
—
|
|
|
8,360
|
|
|
—
|
|
|
2015
|
|
Risk free interest rate
|
1.80
|
%
|
Dividend yield
|
1.58
|
%
|
Volatility factor of the expected market price of the common shares
|
0.35
|
|
Expected life for the options (in years)
|
5.50
|
|
|
Shares
(in thousands)
|
|
Weighted- Average Exercise
Price
|
|
Weighted- Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value
(000's)
|
||||||
Options outstanding at January 1, 2018
|
325
|
|
|
$
|
35.40
|
|
|
|
|
|
|||
Options granted
|
—
|
|
|
—
|
|
|
|
|
|
||||
Options exercised
|
|
|
|
—
|
|
|
|
|
|
||||
Options cancelled / forfeited
|
—
|
|
|
—
|
|
|
|
|
|
||||
Options outstanding at December 31, 2018
|
325
|
|
|
$
|
35.40
|
|
|
—
|
|
|
$
|
—
|
|
Vested and expected to vest at December 31, 2018
|
325
|
|
|
$
|
35.40
|
|
|
—
|
|
|
$
|
—
|
|
Options exercisable at December 31, 2018
|
325
|
|
|
$
|
35.40
|
|
|
—
|
|
|
$
|
—
|
|
|
Year ended December 31,
|
||
(in thousands)
|
2018
|
||
Total intrinsic value of Options exercised
|
$
|
—
|
|
Total fair value of shares vested
|
$
|
1,123
|
|
Weighted average fair value of Options granted
|
$
|
—
|
|
|
Shares (in thousands)
|
|
Weighted-Average Grant-Date Fair Value
|
|||
Non-vested restricted shares at January 1, 2018
|
229
|
|
|
$
|
34.22
|
|
Granted
|
133
|
|
|
34.36
|
|
|
Vested
|
(137
|
)
|
|
34.25
|
|
|
Forfeited
|
(7
|
)
|
|
35.23
|
|
|
Non-vested restricted shares at December 31, 2018
|
218
|
|
|
$
|
34.25
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Total fair value of shares vested (000's)
|
$
|
4,681
|
|
|
$
|
3,751
|
|
|
$
|
4,038
|
|
Weighted average fair value of restricted shares granted
|
$
|
34.36
|
|
|
$
|
37.13
|
|
|
$
|
27.20
|
|
|
Shares (in thousands)
|
|
Weighted-Average Grant-Date Fair Value
|
|||
Non-vested at January 1, 2018
|
275
|
|
|
$
|
36.61
|
|
Granted
|
97
|
|
|
35.36
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(125
|
)
|
|
41.85
|
|
|
Non-vested at December 31, 2018
|
247
|
|
|
$
|
33.47
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Weighted average fair value of PSUs granted
|
$
|
35.36
|
|
|
$
|
39.20
|
|
|
$
|
27.54
|
|
|
2018
|
|
Risk free interest rate
|
2.34
|
%
|
Dividend yield
|
—
|
%
|
Volatility factor of the expected market price of the common shares
|
0.37
|
|
Expected term (in years)
|
2.83
|
|
Correlation coefficient
|
0.43
|
|
|
Shares (in thousands)
|
|
Weighted-Average Grant-Date Fair Value
|
|||
Non-vested at January 1, 2018
|
183
|
|
|
$
|
33.26
|
|
Granted
|
97
|
|
|
46.51
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(33
|
)
|
|
36.57
|
|
|
Non-vested at December 31, 2018
|
247
|
|
|
$
|
38.02
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Weighted average fair value of PSUs granted
|
$
|
46.51
|
|
|
$
|
42.53
|
|
|
$
|
26.43
|
|
|
2018
|
|
2017
|
|
2016
|
|||
Risk free interest rate
|
2.57
|
%
|
|
1.76
|
%
|
|
0.61
|
%
|
Dividend yield
|
2.23
|
%
|
|
2.06
|
%
|
|
1.96
|
%
|
Volatility factor of the expected market price of the common shares
|
0.33
|
|
|
0.28
|
|
|
0.36
|
|
Expected life for the options (in years)
|
1.00
|
|
|
1.00
|
|
|
1.00
|
|
(in thousands, except for per common share data)
|
Sales and merchandising revenues
|
|
Gross profit
|
|
Net income (loss) attributable to
The Andersons, Inc.
|
|
Earnings (losses) per share-basic
|
|
Earnings (losses) per share-diluted
|
||||||||||
Quarter ended 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
March 31
|
$
|
635,739
|
|
|
$
|
63,705
|
|
|
$
|
(1,700
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.06
|
)
|
June 30
|
911,402
|
|
|
90,474
|
|
|
21,529
|
|
|
0.76
|
|
|
0.76
|
|
|||||
September 30
|
685,579
|
|
|
53,864
|
|
|
(2,098
|
)
|
|
(0.07
|
)
|
|
(0.07
|
)
|
|||||
December 31
|
812,662
|
|
|
93,962
|
|
|
23,753
|
|
|
0.84
|
|
|
0.84
|
|
|||||
Year ended 2018
|
$
|
3,045,382
|
|
|
$
|
302,005
|
|
|
$
|
41,484
|
|
|
1.47
|
|
|
1.46
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||||
Quarter ended 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
March 31
|
$
|
852,016
|
|
|
$
|
76,458
|
|
|
$
|
(3,089
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
(0.11
|
)
|
June 30
|
993,662
|
|
|
87,834
|
|
|
(26,653
|
)
|
|
(0.94
|
)
|
|
(0.94
|
)
|
|||||
September 30
|
836,595
|
|
|
69,671
|
|
|
2,533
|
|
|
0.09
|
|
|
0.09
|
|
|||||
December 31
|
1,004,072
|
|
|
84,836
|
|
|
69,720
|
|
|
2.48
|
|
|
2.47
|
|
|||||
Year ended 2017
|
$
|
3,686,345
|
|
|
$
|
318,799
|
|
|
$
|
42,511
|
|
|
1.51
|
|
|
1.50
|
|
|
|
|
|
|
(a) (1)
|
|
|
The Consolidated Financial Statements of the Company are set forth under Item 8 of this report on Form 10-K.
|
|
|
|
|
||
(2
|
)
|
|
The following consolidated financial statement schedule is included in Item 15(d):
|
Page
|
|
|
|
||
|
II.
|
Consolidated Valuation and Qualifying Accounts - years ended December 31, 2018, 2017 and 2016
|
|
|
|
|
|
(3
|
)
|
|
Exhibits:
|
|
|
|
|
||
|
2.1
|
|
||
|
|
|
|
|
|
2.2
|
|
||
|
|
|
|
|
|
2.3
|
|
||
|
|
|
|
|
|
3.1
|
|
||
|
|
|
|
|
|
3.2
|
|
||
|
|
|
|
|
|
3.3
|
|
||
|
|
|
|
|
|
3.4
|
|
||
|
|
|
|
|
|
4.1
|
Form of Indenture dated as of October 1, 1985, between The Andersons, Inc. and Ohio Citizens Bank, as Trustee (Incorporated by reference to Exhibit 4 (a) in Registration Statement No. 33-819). Pursuant to regulation S-K Item 601(b)(4)(iii), the Company will furnish document to the SEC upon request.
|
|
|
|
|
|
|
|
|
4.2
|
|
||
|
|
|
|
|
|
4.3
|
|
||
|
|
|
|
|
|
10.10*
|
|
||
|
|
|
|
|
|
10.11
|
|
||
|
|
|
|
|
|
10.12
|
|
||
|
|
|
|
|
|
10.13*
|
|
||
|
|
|
|
|
|
10.14*
|
|
||
|
|
|
|
|
10.15*
|
|
||
|
|
|
|
|
|
10.16*
|
|
||
|
|
|
|
|
|
10.17*
|
|
||
|
|
|
|
|
|
10.18*
|
|
||
|
|
|
|
|
|
10.19
|
|
||
|
|
|
|
|
|
10.20*
|
|
||
|
|
|
|
|
|
10.21*
|
|
||
|
|
|
|
|
|
10.22*
|
|
||
|
|
|
|
|
|
10.23*
|
|
||
|
|
|
|
|
|
10.24*
|
|
||
|
|
|
|
|
|
10.25
|
|
||
|
|
|
|
|
|
10.26
|
|
||
|
|
|
|
|
|
10.27
|
|
||
|
|
|
|
|
|
10.28*
|
|
||
|
|
|
|
|
|
10.29*
|
|
||
|
|
|
|
|
|
10.30*
|
|
||
|
|
|
|
|
|
10.31*
|
|
||
|
|
|
|
|
|
10.32
|
|
||
|
|
|
|
|
|
10.33
|
|
||
|
|
|
|
|
|
10.34
|
|
||
|
|
|
|
|
|
10.35*
|
|
|
|
|
|
|
|
|
|
10.36*
|
|
||
|
|
|
|
|
|
10.37*
|
|
||
|
|
|
|
|
10.38
|
|
||
|
|
|
|
|
|
21
|
Consolidated Subsidiaries of The Andersons, Inc (filed herewith).
|
|
|
|
|
|
|
|
|
23.1
|
Consent of Independent Registered Public Accounting Firm - Deloitte & Touche LLP (filed herewith).
|
|
|
|
|
|
|
|
|
23.2
|
Consent of Independent Registered Public Accounting Firm - KPMG LLP (filed herewith).
|
|
|
|
|
|
|
|
|
23.3
|
Consent of Independent Registered Public Accounting Firm - KPMG LLP (filed herewith).
|
|
|
|
|
|
|
|
|
23.4
|
Consent of Independent Registered Public Accounting Firm - PricewaterhouseCoopers LLP - Canada (filed herewith).
|
|
|
|
|
|
|
|
|
23.5
|
Consent of Independent Registered Public Accounting Firm - Crowe LLP (filed herewith).
|
|
|
|
31.1
|
Certification of the Chief Executive Officer under Rule 13(a)-14(a)/15d-14(a) (filed herewith).
|
|
|
|
|
|
|
|
|
31.2
|
Certification of the Chief Financial Officer under Rule 13(a)-14(a)/15d-14(a) (filed herewith).
|
|
|
|
|
|
|
|
|
32.1
|
Certifications Pursuant to 18 U.S.C. Section 1350 (filed herewith).
|
|
|
|
|
|
|
|
|
101
|
Financial statements from the annual report on Form 10-K of The Andersons, Inc. for the year ended December 31, 2018, formatted in XBRL: (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Equity, (v) the Consolidated Statement of Cash Flows and (vi) the Notes to Consolidated Financial Statements.
|
|
|
|
|
|
(b)
|
|
Exhibits:
|
|
|
|
|
|
|
|
The exhibits listed in Item 15(a)(3) of this report, and not incorporated by reference, follow "Financial Statement Schedule" referred to in (c) below.
|
|
|
|
|
|
(c)
|
|
Financial Statement Schedule
|
|
|
|
|
|
|
|
The financial statement schedule listed in 15(a)(2) follows "Signatures."
|
|
(in thousands)
|
|
Additions
|
|
|
|||||||||||
Allowance for doubtful accounts receivable - Year ended December 31,
|
Balance at beginning of period
|
Charged to costs and expenses
|
Transferred from (to) allowance for accounts / notes receivable
|
(1)
Deductions
|
Balance at end of period
|
||||||||||
2018
|
$
|
9,156
|
|
$
|
542
|
|
$
|
—
|
|
$
|
(1,373
|
)
|
$
|
8,325
|
|
2017
|
7,706
|
|
3,000
|
|
—
|
|
(1,550
|
)
|
9,156
|
|
|||||
2016
|
6,938
|
|
1,191
|
|
—
|
|
(423
|
)
|
7,706
|
|
|
|
|
No.
|
|
Description
|
|
|
|
2.2
|
|
|
|
|
|
2.3
|
|
|
|
|
|
10.11
|
|
|
|
|
|
21
|
|
|
|
|
|
23.1
|
|
|
|
|
|
23.2
|
|
|
|
|
|
23.3
|
|
|
|
|
|
23.4
|
|
|
|
|
|
23.5
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101
|
|
Financial Statements from the annual report on Form 10-K of The Andersons, Inc. for the year ended December 31, 2018, formatted in XBRL: (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Equity, (v) the Consolidated Statement of Cash Flows and (vi) the Notes to Consolidated Financial Statements.
|
|
|
THE ANDERSONS, INC.
(Registrant)
|
|
|
|
Date: February 27, 2019
|
|
By /s/ Patrick E. Bowe
|
|
|
Patrick E. Bowe
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
|
Signature
|
Title
|
Date
|
|
Signature
|
Title
|
Date
|
/s/ Patrick E. Bowe
|
Chief Executive Officer
|
2/27/2019
|
|
/s/ Catherine M. Kilbane
|
Director
|
2/27/2019
|
Patrick E. Bowe
|
(Principal Executive Officer)
|
|
|
Catherine M. Kilbane
|
|
|
|
|
|
|
|
|
|
/s/ Brian A. Valentine
|
Senior Vice President and Chief Financial Officer
|
2/27/2019
|
|
/s/ Ross W. Manire
|
Director
|
2/27/2019
|
Brian A. Valentine
|
(Principal Financial Officer)
|
|
|
Ross W. Manire
|
|
|
|
|
|
|
|
|
|
/s/ Michael T. Hoelter
|
Corporate Controller
|
2/27/2019
|
|
/s/ Patrick S. Mullin
|
Director
|
2/27/2019
|
Michael T. Hoelter
|
(Principal Accounting Officer)
|
|
|
Patrick S. Mullin
|
|
|
|
|
|
|
|
|
|
/s/ Michael J. Anderson
|
Chairman
|
2/27/2019
|
|
/s/ John T. Stout, Jr.
|
Director
|
2/27/2019
|
Michael J. Anderson
|
|
|
|
John T. Stout, Jr.
|
|
|
|
|
|
|
|
|
|
/s/ Gerard M. Anderson
|
Director
|
2/27/2019
|
|
/s/ Jacqueline F. Woods
|
Director
|
2/27/2019
|
Gerard M. Anderson
|
|
|
|
Jacqueline F. Woods
|
|
|
|
|
|
|
|
|
|
/s/ Stephen F. Dowdle
|
Director
|
2/27/2019
|
|
/s/ Robert J. King, Jr.
|
Director
|
2/27/2019
|
Stephen F. Dowdle
|
|
|
|
Robert J. King, Jr.
|
|
|
|
|
|
|
|
|
|
a.
|
Purchaser hereby approves of, and waives any breach or default under Section 5.01 of the Agreement arising as a result of the changes in employee compensation as described on Schedule 1.1(a) hereto.
|
b.
|
The payment by the Company, on or before December 31, 2018, of a $410,250.00 capital contribution to Renwood Appreciation & Income Fund LLC shall be added back as a “current asset” for purposes of the calculation of Estimated Net Working Capital and Net Working Capital if, and only to the extent that (i) such payment is actually made in cash by the
|
c.
|
The payment by the Company, on or before December 31, 2018, of $2,666,437.50 under the Company’s Credit Agreement with Bank of America, N.A. (and the other parties thereto), dated as of October 3, 2016, shall be added back as a “current asset” for purposes of the calculation of Estimated Net Working Capital and Net Working Capital if, and only to the extent that, (i) such payment is actually made in cash by the Company prior to the Closing (and as a result the cash balance of the Company as of the Closing is reduced by an equal amount) and (ii) the Net Indebtedness Amount as of such payment was $0.
|
d.
|
In order to facilitate the timely payment of wages and compensation to the Company’s employees, Purchaser and the Company may agree to include a portion of the pre-Closing wages and compensation owed to Company employees in the first or second regularly scheduled payrolls of Purchaser after the Closing. For the avoidance of doubt, notwithstanding the foregoing, all such wages and compensation for Company employees prior to the Closing shall be current liabilities of the Company and shall be treated as such for purposes of calculating Estimated Net Working Capital and Net Working Capital.
|
1.
|
LTG Retention Bonuses. On March 15, 2019, Purchaser shall, with respect to each individual listed on Exhibit 1 to this Schedule, so long as such individual is employed by LGC at such payment date, (i) pay such person in cash the amount noted on Exhibit 1 or (ii) issue a Restricted Stock Award Agreement in the form of Exhibit E to the Agreement, (A) for the number of Purchaser Common Shares determined by dividing the dollar value shown opposite such individual’s name by an amount equal to 90% of the average of the daily closing price of Purchaser Common Shares for the month of February 2019 and (B) providing vesting of 1/3 on January 2, 2020, 1/3 on January 2, 2021, and 1/3 on January 2, 2022.
|
2.
|
Roll-over RMU and MUR Holders. On March 15, 2019, Purchaser shall, with respect to each individual who rolls over RMUs or MURs as listed on Annex VI to this Agreement, so long as such individual is employed by LGC at the Final Effective Time, issue a Restricted Stock Award Agreement in the form of Exhibit E to this Agreement, (A) for the number of Purchaser Common Shares determined by dividing (i) the aggregate Per Unit Closing Consideration allocable to such RMU or MUR rolled over, as set forth on the Payment Schedule, multiplied by 15% by (ii) an amount equal to 90% of the average of the daily closing price of Purchaser Common Shares for the month of February and (B) providing vesting of 1/3 on January 2, 2020, 1/3 on January 2, 2021, and 1/3 on January 2, 2022.”
|
a.
|
In the definition of “Average Purchaser Share Price” the number “60” is hereby deleted and replaced with the number “59”. Furthermore, the parties hereby agree that December 24, 2018 shall not be considered a trading day for purposes of the definition of “Average Purchaser Share Price” such that, in the event the Closing Date is January 1, 2019, the relevant measurement period for purposes of calculating the Average Purchaser Share Price will be September 28, 2018 through and including December 21, 2018.
|
b.
|
The definition of “Purchase Price Adjustment Consideration” is hereby deleted in
|
c.
|
The definition of Sellers Representative Admin Expense Fund Consideration is hereby deleted in its entirety.
|
1.
|
Commodity Supply Agreement, dated as of November 17, 2015, by and between Lansing Trade Group, LLC and New Hope Liuhe Co., Ltd.
|
2.
|
Pledge Agreement, dated as of November 17, 2015, by and between Lansing Trade Group, LLC and New Hope Liuhe Investment (USA) Inc.
|
3.
|
Collateralized Guaranty, dated as of November 17, 2015, from New Hope Liuhe Investment (USA) Inc. in favor of Lansing Trade Group, LLC
|
|
LANSING TRADE GROUP, LLC
|
|
By: /s/ William E. Krueger
|
|
Name: William E. Krueger
|
|
Its: Chief Executive Officer
|
|
|
|
THE ANDERSONS, INC.
|
|
By: /s/ Patrick E. Bowe
|
|
Name: Patrick E. Bowe
|
|
Its: Chief Executive Officer
|
|
|
|
BRISKET MERGER SUB 1, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
|
|
BRISKET MERGER SUB 2, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
|
|
BRISKET MERGER SUB 3, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
SELLERS REPRESENTATIVE
By: /s/ Sam Freitag
Name: Sam Freitag
|
|
|
|
LGC GROUP, INC.
|
|
By: /s/ William E. Krueger
|
|
Name: William E. Krueger
|
|
Its: Chief Executive Officer
|
a.
|
The definition of “Stock Consideration” is hereby deleted in its entirety and
|
b.
|
The definition of “Estimated Cash Purchase Price” is hereby deleted in its entirety
|
|
LANSING TRADE GROUP, LLC
|
|
By: /s/ William E. Krueger
|
|
Name: William E. Krueger
|
|
Its: Chief Executive Officer
|
|
|
|
THE ANDERSONS, INC.
|
|
By: /s/ Patrick E. Bowe
|
|
Name: Patrick E. Bowe
|
|
Its: Chief Executive Officer
|
|
|
|
BRISKET MERGER SUB 1, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
|
|
BRISKET MERGER SUB 2, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
|
|
BRISKET MERGER SUB 3, LLC
|
|
By: /s/ Naran U. Burchinow |
|
Name: Naran U. Burchinow
|
|
Its: President and Secretary
|
|
SELLERS REPRESENTATIVE
By: /s/ Sam Freitag
Name: Sam Freitag
|
|
|
|
LGC GROUP, INC.
|
|
By: /s/ William E. Krueger
|
|
Name: William E. Krueger
|
|
Its: Chief Executive Officer
|
◦
|
Registration Statement No. 333-228957 on Form S-8 dated December 21, 2018 pertaining to the registration of 650,000 shares under the Lansing Acquisition 2018 Inducement and Retention Plan;
|
◦
|
Registration Statement No. 333-202442 on Form S-8 dated March 2, 2015 pertaining to the registration of 1,750,000 shares under the Company’s 2014 Long-Term Incentive Compensation Plan;
|
◦
|
Registration Statement No. 333-182428 on Form S-3 dated June 29, 2012 pertaining to the shelf registration of $8,000,000 2.65% Five-Year Debentures, $6,000,000 3.50% Ten-Year Debentures and $6,000,000 4.50% Fifteen-Year Debentures; and
|
◦
|
Registration Statement No. 333-169826 on Form S-3 dated October 7, 2010 pertaining to the registration of $12,000,000 4.25% Ten-Year Debentures and $18,000,000 3.00% Five-Year Debentures
|
1
|
I have reviewed this report on Form 10-K of The Andersons, Inc.
|
2
|
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;
|
3
|
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;
|
4
|
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:
|
|
a)
|
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;
|
|
b)
|
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;
|
|
c)
|
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
|
|
d)
|
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
|
5
|
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):
|
|
a)
|
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
|
|
b)
|
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.
|
|
/s/ Patrick E. Bowe
|
|
Patrick E. Bowe
|
|
Chief Executive Officer (Principal Executive Officer)
|
1
|
I have reviewed this report on Form 10-K of The Andersons, Inc.
|
2
|
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;
|
3
|
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;
|
4
|
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:
|
|
a)
|
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;
|
|
b)
|
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;
|
|
c)
|
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
|
|
d)
|
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
|
5
|
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):
|
|
a)
|
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
|
|
b)
|
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.
|
|
/s/ Brian A. Valentine
|
|
Brian A. Valentine
|
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
(1)
|
The Report fully complies with the requirements of 13(a) or 15(d) of the Securities Exchange Act of 1934, and
|
(2)
|
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.
|
|
|
|
/s/ Patrick E. Bowe
|
|
Patrick E. Bowe
|
|
Chief Executive Officer (Principal Executive Officer)
|
|
|
|
/s/ Brian A. Valentine
|
|
Brian A. Valentine
|
|
Senior Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
|