Green Plains (GPRE) Jefferies Global Industrial Conference 2024 summary

Transition to free cash flow generation

• Concluding a major investment cycle, shifting focus from capital outflows to generating free cash flow as assets run more efficiently.

• Asset modernization and operational improvements are yielding better run rates and returns, with a transition from building to earning.

• Maintenance CapEx is expected to be $35–$40 million annually, with large investments largely complete except for carbon projects.

• Balance sheet remains strong, with high liquidity and ongoing efforts to refinance high-cost debt.

Protein business outlook

• Protein production ramped up to 60–65k tons last quarter, with expectations for record output and full asset utilization in 2025.

• Tharaldson JV nearing 90% capacity; 2025 shipments projected at 350–450k tons depending on yields.

• Despite compressed spreads due to increased soy crush capacity, protein assets are generating returns and maintaining premiums over distillers' grains.

• Focus is shifting to higher-value Sequence products, especially for pet food and aquaculture, with strong market acceptance and unique low-carbon attributes.

• Long-term protein demand growth expected to absorb current oversupply, with tailored nutritional solutions driving future growth.

Clean Sugar platform and margin dynamics

• Shenandoah sugar platform is fully built but undergoing mechanical retrofits, with restart targeted for September.

• Margins for converting corn to dextrose remain strong due to limited supply expansion and robust demand across beverage and ingredient markets.

• Payback on sugar investments is rapid, with $0.67–$0.80/gallon uplift and no margin compression observed.

• Future expansion of sugar systems depends on successful operation and customer demand.