Earnings Of $0.27 Per Diluted Share
MAUMEE, Ohio, May 6 /PRNewswire-FirstCall/ -- The Andersons, Inc. (Nasdaq: ANDE), today announced first quarter net income attributable to the company of $5.0 million, or $0.27 per diluted share, on revenues of $697 million. In the same three month period of 2008, the company reported results of $7.8 million, or $0.42 per diluted share, on $713 million of revenues.
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The Grain & Ethanol Group's first quarter operating income of $5.7 million was higher than its year earlier result of $2.2 million. This was the result of the grain business having a record quarter. The grain business benefited from significantly higher space income. In contrast, last year, the grain business suffered a significant basis loss during the quarter. The ethanol business lost less than $1.0 million in the first quarter due mainly to the combined performance of the company's equity investments in three ethanol limited liability companies. The ethanol business last year benefited from margins being locked in before the market decline, and earning $1.3 million in development fee income. The Lansing Trade Group quarterly results were significantly lower than last year, primarily due to declines in its trading business. Total first quarter revenues for the group were $481 million; this includes $206 million of grain and ethanol sales made by the group in accordance with origination and marketing agreements between the company and its ethanol joint ventures. In the first quarter of 2008, the group's total revenues were $499 million and included $186 million of the aforementioned sales.
The Rail Group's operating income was $0.9 million in the first quarter of 2009, which is down considerably from the $6.4 million earned during the same three month period a year ago. The group has been impacted by the continued double digit declines in rail traffic that began in late 2008. Revenues of $27 million for the quarter were down from the $35 million reported in 2008. This quarter, the group recognized $0.3 million in gross margin from the sale of railcars and related leases, whereas last year $2.2 million was recorded. Gross profit from the leasing business was significantly less due to lower utilization rates, the corresponding increase in storage expense from idle assets, increased maintenance expense, and decreased leasing rates. The group now has approximately 23,700 cars and locomotives, which is 2 percent more than it had twelve months ago. The average utilization rate (the percentage of the fleet in service) for the quarter was 86.8 percent in comparison to 93.4 percent for the same period last year. Nationwide a significant portion of the total US rail fleet is idle, which suggests a further decline in the Rail Group's utilization rate is possible. The gross profit of both the railcar repair and manufacturing businesses declined significantly in the first quarter due to reduced sales resulting from the overall economic decline.
The Plant Nutrient Group earned an operating income of $2.0 million during the first quarter of 2009, on revenues of $112 million. In the same three month period of 2008, the group reported a $7.5 million operating profit on $105 million of revenues. Overall margins were down this quarter in comparison to the prior year. Margins were positively impacted by a favorable product mix and the recognition of high gross margin profit on deferred sales and prepay contracts from 2008. Margins, however, were negatively impacted by a $2.9 million lower of cost or market inventory adjustment the group recorded this quarter. Total volume increased due to the eight additional fertilizer and lime facilities acquired after the first quarter of 2008. Excluding the newly acquired businesses, volume was down approximately 15 percent due primarily to de-stocking of the retail dealer inventory and weather related spring field work delays. As was recently announced, the group has entered into a definitive agreement to acquire the Hartung Brothers Inc. Fertilizer Division (HBI). HBI is a regional wholesale supplier of liquid fertilizers with five locations in Wisconsin and one in southeastern Minnesota. This acquisition will allow the group to grow its value added product offering, expand its wholesale customer base, and broaden its geographic territory.
The Turf & Specialty Group achieved operating income of $3.1 million on $45 million of revenues during the first quarter. Last year, the group reported $2.0 million of income on $40 million of revenues for the period. Turf products tonnage increased 13 percent from year to year. Gross profit per ton also increased this quarter. The group continues to experience positive results from its focus on proprietary products and expanded product lines.
