REX American Resources Q4 Earnings Call Highlights

26 Mar 2026, 17:36 by Danessa Lincoln · The Markets Daily

REX American Resources (NYSE:REX) executives highlighted record ethanol sales volume, an earnings boost from the federal 45Z tax credit, and continued progress on a major capacity expansion project during the company’s fourth-quarter and full fiscal year 2025 earnings call.

Management characterized fiscal 2025 as an “exceptional” and “transformative” year, pointing to strong export demand, operational execution, and a balance sheet with substantial cash and no bank debt. The company also discussed the status of its carbon capture and sequestration (CCS) initiative at the One Earth Energy facility, which remains subject to permitting timelines.

Operational performance and volumes

Chief Financial Officer Doug Bruggeman said REX posted an all-time high in ethanol sales volume for fiscal 2025, with 290.0 million gallons sold, slightly above 289.7 million gallons in fiscal 2024. Fourth-quarter ethanol volume was 70.1 million gallons, down from 74.6 million gallons in the year-ago quarter. Average consolidated ethanol selling price was approximately $1.74 per gallon for the full year and $1.72 per gallon in the fourth quarter.

Co-product performance was mixed. Dried distillers grains (DDGs) sales volume totaled 612,000 tons for fiscal 2025, down 3% from 632,000 tons in fiscal 2024, and fourth-quarter DDG volume declined about 9% year over year to roughly 151,000 tons. Average DDG selling price was approximately $144.06 per ton for the year and $147.25 per ton in the fourth quarter.

Modified distillers grains volume increased to 81,900 tons in fiscal 2025 from about 70,000 tons in fiscal 2024. Fourth-quarter modified distillers grains volume was about 19,700 tons, up roughly 1% year over year. Average selling price for modified distillers grains was approximately $65.82 per ton for the year and $67.92 per ton in the fourth quarter.

Corn oil volumes increased sharply, with fiscal 2025 sales of approximately 97.0 million pounds versus 88.1 million pounds in fiscal 2024. Fourth-quarter corn oil volume rose 7% to about 25.2 million pounds. The average selling price for corn oil was approximately $0.54 per pound for both the full year and the fourth quarter.

Financial results and the 45Z tax credit impact

Gross profit for fiscal 2025 was $93.7 million, up from about $91.5 million in fiscal 2024. Fourth-quarter gross profit rose to $28.9 million from $17.6 million a year earlier, which Bruggeman attributed primarily to improved ethanol pricing and reduced corn costs.

SG&A expense increased to $32.6 million in fiscal 2025 from $27.1 million in fiscal 2024. Fourth-quarter SG&A rose to about $12.3 million from $6.2 million in the prior-year quarter, primarily due to higher incentive bonuses tied to profitability.

Interest and other income was $15.0 million for fiscal 2025, down from $19.2 million in fiscal 2024. For the fourth quarter, interest and other income was about $4.5 million versus $4.2 million in the year-ago period.

Income before taxes and non-controlling interest for fiscal 2025 was approximately $88.6 million, down about 5% from $92.9 million in fiscal 2024, while fourth-quarter income before taxes and non-controlling interest increased to about $27.4 million from $17.9 million.

Net income attributable to REX shareholders was $83.0 million for fiscal 2025, compared with $58.2 million in fiscal 2024. Fourth-quarter net income attributable to shareholders increased to $43.7 million from $11.1 million in the year-ago quarter.

Bruggeman said the fourth quarter benefited from the recognition of approximately $28 million in 45Z tax credits “as the regulations became more clear.” In the Q&A, management clarified that the $28 million figure referenced the full fiscal year 2025 amount. Diluted earnings per share for fiscal 2025 reached an all-time high of $2.50, up from $1.65 in fiscal 2024. Fourth-quarter diluted EPS was $1.32 versus $0.31 a year earlier.

On the call, REX executives said they completed assessments with multiple independent experts to establish carbon intensity (CI) scores across facilities, and that the company qualified for 45Z “with the purchase of energy credits.” In response to an analyst question, management indicated the current benefit is about $0.10 per gallon and applies across volumes.

One Earth expansion and CCS: budget and timelines

Executives emphasized continued progress on expanding production capacity at the One Earth Energy ethanol facility to 200 million gallons per year. Chief Executive Officer Zafar Rizvi said the expansion project is nearing completion, with testing and commissioning expected to begin upon completion and the facility becoming fully operational in fiscal 2026.

Rizvi also provided an update on the company’s CCS initiative, stating that the carbon capture facility is complete, but the project is “awaiting permitting for the Class VI well and associated carbon dioxide connector pipeline.” The company said it remains engaged with the U.S. Environmental Protection Agency and the Illinois Commerce Commission during the permitting process.

In Q&A, management said the EPA website timeline for the Class VI permit has moved to September, but the company described being at the final stage of technical review and said it has provided requested documents. Rizvi also cautioned that the company does not expect to capture additional 45Z credits due to carbon capture in 2026, noting that timing depends on permits.

As of fiscal year-end 2025, REX had invested approximately $166 million in its carbon capture and ethanol expansion projects combined and said it remains within its previously stated total budget range of $220 million to $230 million.

Market environment and outlook themes for fiscal 2026

Rizvi framed the company’s fiscal 2026 priorities around “profit, position, and policy.” He said REX has delivered 22 consecutive quarters of profitability and expects a profitable first quarter of fiscal 2026. He also cited expanded capacity, continued focus on the core business, and expected 45Z contributions as tailwinds.

On demand, management pointed to strong ethanol exports, with Rizvi stating that U.S. export volumes reached record levels again in 2025 and that the strength has continued into 2026. In response to a question on tariffs, executives said they have seen no impact on ethanol exports and cited Canada as a key export destination. They also discussed Brazil’s import activity early in calendar 2026 as part of broader export market commentary.

On inputs, Rizvi said corn supplies remain favorable, supporting “manageable input cost” and “expected healthy crush margins.”

On the policy front, management said the 45Z tax credit provides meaningful near-term benefits through 2029 and that CCS could significantly increase credits by further reducing carbon intensity. Executives did not disclose a specific CI score improvement, though they characterized the potential reduction as significant and, in response to another question, suggested CCS could reduce CI scores by “at least 30-35 points more.” They also discussed E15, with Chairman Stuart Rose saying nationwide E15 would be beneficial but that he does not expect it to happen, while anticipating continued adoption of E15 pumps by independent retailers.

REX ended fiscal 2025 with cash, cash equivalents, and short-term investments of $375.8 million, up from $359.1 million at fiscal year-end 2024, and Bruggeman said the company finished the year with no bank debt.

About REX American Resources (NYSE:REX)

REX American Resources Corp. is a diversified agribusiness and renewable energy company headquartered in Kansas City, Missouri. Founded in 2005 through a reorganization of existing agricultural interests, the company focuses on two primary business segments: fuel ethanol production and specialty ingredient solutions. REX American Resources leverages its integrated operations to supply clean-burning fuel, animal feed co-products and sweetener ingredients to a broad customer base in North America and beyond.