Green Plains (GPRE) Q2 2024 earnings summary

Executive summary

• Net loss narrowed to $24.35 million ($0.38 per share) in Q2 2024, with EBITDA improving to $4.8 million, driven by stronger ethanol margins and record yields in renewable corn oil and Ultra-High Protein.

• Revenues declined 27.8% year-over-year to $618.8 million, mainly due to lower selling prices for ethanol, distillers grains, and corn oil, partially offset by higher volumes.

• Strategic initiatives included the startup of a major high-protein JV, commissioning of Clean Sugar Technology, and progress on carbon capture projects in Nebraska.

• Entered a definitive agreement to sell the Birmingham terminal, with proceeds to retire high-priced partnership debt and strengthen the financial position.

• Strategic review ongoing, with Bank of America and Vinson & Elkins LLP engaged as advisors to explore options for enhancing shareholder value.

Financial highlights

• Q2 2024 revenues were $618.8 million, down from $857.6 million in Q2 2023.

• Net loss attributable to the company was $24.35 million ($0.38 per share), improved from $52.6 million ($0.89 per share) in Q2 2023.

• EBITDA was $4.8 million, up from -$15 million in the prior year period; adjusted EBITDA was $5.0 million, up from $(14.9) million.

• Gross margin for Q2 2024 was $37.8 million, up from $15.5 million in Q2 2023.

• Cash and cash equivalents at quarter-end were $225.1 million, with $219.6 million available under a revolver.

Outlook and guidance

• Fundamentals remain strong for the rest of 2024, with Brazil expected to be short on export products in Q4, supporting U.S. export competitiveness.

• Q3 margins are projected in the high 20s to high 30s cents per gallon, with some production hedged at or above current levels.

• CapEx for 2024 is expected to be $90–$110 million, excluding $110 million for carbon capture equipment, which is already financed.

• Anticipated return to profitability in Q3, based on current market conditions and strong demand for high-protein and low-carbon products.

• 'Advantage Nebraska' carbon capture strategy on track for a second half 2025 start, with equipment ordered and construction to begin soon.