REX

Image source: The Motley Fool. Wednesday, Sept. 2, 2026 at 11:00 a.m. ET Chief Financial Officer - Douglas L. Bruggeman Executive Chairman - Stuart A. Rose Chief Executive Officer - Zafar A. Rizvi Operator: Good morning, and welcome to the REX American Resources Second Quarter Fiscal 26 Conference Call. As a reminder, today's call is being recorded. And at this time, all participants are in a listen-only mode. A brief Q&A session will follow the formal presentation. I would now like to turn the call over to Mr. Douglas Bruggeman, chief financial officer of Rex American. Please go ahead, sir. Douglas L. Bruggeman: Good morning, and thank you for joining Rex American Resources Q2 26 conference call. With me on our call today are Stuart A. Rose, REX Executive Chairman and Zafar A. Rizvi, REX Chief Executive Officer. We will get to our presentation and comments momentarily. As well as your questions. But first, I will review the safe harbor disclosure. In addition to historical facts or statements of current conditions, today's conference call contains forward-looking statements that involve risks and uncertainties within the meaning of the Private Securities Litigation Reform Act of 2000. Such forward-looking statements reflect the company's current expectations and beliefs but are not guarantees of future performance. As such, actual results may vary materially from expectations The risks and uncertainties associated with the forward-looking statements are described in today's news announcement and in the company's filings with the Securities and Exchange Commission including the company's reports on Form 10-K and 10-Q, REX American Resources assumes no obligation to publicly update or revise any forward-looking statements. I would now like to turn the call over to our Executive Chairman, Stuart A. Rose. Stuart A. Rose: Good morning. And thank you all for being here. The second quarter of fiscal 26 was another strong period for REX American Resources. We posted the highest second quarter net income per share in our company's history at $1.06 per share, Results like these reflect the discipline of our operating teams the strength of our commercial execution, and the benefits of the policy and market tailwinds that have been building for some time. 2 developments, 1 during and 1 subsequent to the quarter stand out as real markets of progress against our long-term growth agenda. First, our ethanol production expansion at the 1 Earth facility remains on schedule, and we continue to expect the added capacity to come online before the end of 26. Second, and Zafar will cover this in much more detail. We reported more 45Z credits We reached an important regulatory milestone on our carbon capture and sequestration project in August with the project receiving draft Class 6 well permits from the US EPA. Our balance sheet remains a genuine source of strength. We closed the quarter with no bank debt and substantial cash and short term investments which gives us the flexibility to fund our growth initiatives internally while we continue to evaluate the best uses of our capital going forward. I want to thank our employees across every facility for the consistency and care they bring to this business each day. It shows up directly in these results. I will now turn things over to our chief executive officer, Zafar A. Rizvi, to walk through our operational progress in more detail. Zafar A. Rizvi: Thank you, Stuart. Our expansion project at the 1 Earth Energy facility in Gibson City, continue to progress on schedule. We remain on track to complete construction of the additional ethanol production capacity by the end of 2026. This expanded capacity will strengthen our operating platform and enhance our ability to capture additional value under the 45Z production tax credit program. Turning to our carbon capture and sequestration project, we reached an important milestone just 2 weeks ago. On August 17, the US Environmental Protection Agency issued draft permits for 3 Class 6 injection wells associated with our 1 Earth carbon capture project. The EPA is now accepting public comment on those draft permits and we continue to work closely with the agency as we move toward final approval. The issuance of these draft permit represents a major step forward for the project. And we are encouraged by the continued engagement and progress with our regulatory partners. At the state level, the Illinois moratorium on carbon sequestration expired on July 1. The Illinois Commerce Commission initiated its rulemaking process and the Illinois Environment Protection Agency has also begun its permitting application process. We plan to submit our application for the approximately 5-mile connector pipeline as well as the acquired Illinois EPA application. As soon as possible. We will continue working closely with state and local regulators to obtain the remaining approvals necessary to move the project forward. On the policy side, 45Z production tax credit continue to make a meaningful contribution to our results. During the second quarter, we recognized $18.4 million in section 45Z production tax credit income. Bringing the year to date total to $26 million. The tax credit benefits flow directly through gross profit. We believe our carbon capture project once fully permitted and operational has the potential to further improve our carbon intensity score and increase the value we can capture under the 45Z program. From a capital investment viewpoint, our combined investment in the ethanol expansion and carbon capture projects totaled $191 million through the end of the second quarter. I will now turn the call over to Douglas L. Bruggeman to discuss our financial results in greater detail. Douglas L. Bruggeman: Thank you, Zafar. For information on this quarter's operational results, including production volumes and selling prices, please refer to our press release issued this morning. Net sales and revenue for the second quarter were $169 million compared to $159 million in the second quarter of 25 reflecting improved pricing across our product mix. Gross profit for the second quarter was $53.3 million compared to $14.3 million in the same period last year. This improvement reflects stronger crush margins together with the $18.4 million of production tax credit income during the quarter as was aforementioned. Even absent the benefit of 45Z tax credits, our gross profit grew 144% year over year. Selling, general and administrative expenses were $15.6 million for the quarter, versus $6.2 million in the second quarter of 25. The increase primarily relates to higher incentive compensation tied to the strength of our results and restricted stock awards issued during the quarter. Equity and income of unconsolidated affiliates was $7.2 million for the quarter, compared to $900 thousand in the second quarter of 25. Also benefiting from stronger industry dynamics and production tax credit contributions at our nonconsolidated facilities. Interest and other income was $3.2 million for the quarter, essentially in line with the $3.1 million in the second quarter of 25. Income before income taxes and noncontrolling interest was $48.1 million for the quarter, compared to $12.1 million in the second quarter of 25. Net income attributable to Rex shareholders was $34.9 million or $1.06 per diluted share compared to $7.1 million or $0.22 per diluted share in the second quarter of 25, We ended the quarter with $380 million in cash equivalents and short term investments, and we continue to carry no bank debt. We continue to fund our growth projects entirely from our own balance sheet. I will now turn things back over to Zafar. Zafar A. Rizvi: Thank you, Douglas. To summarize the quarter, Rex delivered its 20 fourth consecutive profitable quarter. And achieved record second quarter on an earnings per share basis. We successfully capitalized on favorable market condition through disciplined margin management while continuing to make important progress on our strategic growth initiatives. Looking ahead, at this early stage of the third quarter, we expect to remain profitable and anticipate that third quarter result will be better than the same period last year. Operationally, 1 Earth expansion remains on schedule for completion by the end of 2026. And our carbon capture project has reached an important regulatory milestone with EPA issuing of our draft permit for 3 Class 6 injection wells. We remain focused on completing the production capacity expansion. Advancing the carbon capture permitting, process with the EPA and Illinois regulators. And maintaining disciplined stewardship of our balance sheet as we evaluate additional opportunities. To create long term value for our shareholders. Market fundamentals are remain constructive at this point with continued record export demand supporting The US ethanol industry. And the 45Z program providing an important contribution to our margins. We appreciate the continued confidence of our shareholders and the hard work and dedication of our teams across all of our facilities. With that, I will turn the call back to the operator for questions. Operator? Operator: Thank you. If you would like to ask a question, you may press 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. Our first question comes from the line of Mason Born with AWH Capital. Please proceed with your question. Mason Byrne Bourne: Good morning. Thanks for taking the questions. To start, it sounds like you have had good progress on the expansion. When you say online by the end of the year, does that mean all 50 million gallons and do you think the $200 million is the long-term correct level for 1 Earth, or could you potentially go higher than that eventually? Zafar A. Rizvi: Mason, good morning. I think we have a step by step process as I have explained in several time before. We are producing at this time approximately 150 million gallons the next step will be 175 million once we accomplish 175 million, then we have to apply permit for 200 million. that is 1 of the requirements for IEPA and Illinois. EPA is Illinois EPA is requirements. So we expect hopefully, early next year or middle of that we will be close to 200 million gallons we will be producing. Mason Byrne Bourne: So it sounds like you are in discussions with Illinois EPA on that. it is great news to see on your draft permit on Class VI well. Did you talk about any timeline expectations? The federal EPA process is a little clearer from a timeline perspective, but Illinois, I think, is they already have approved wells in the state. So just wondering the clarity or any thoughts you have on the timeline there. Stuart A. Rose: I think our timeline is this is Stuart speaking. I think we do not have great clarity on it The EPA permit, we believe, will be issued sometime with within a reasonable period of time. The biggest thing we are waiting for is approval. We have a little pipeline connect about 5 miles and we need Illinois we need the commerce commissioner, the Illinois pipeline commission to approve that 1. And that 1, that just ended as afar said, they ended the moratorium the end of June. So we are able to apply for a permit, but we do not know at this time how long that is gonna take. And that is the thing that will hold us up, I believe, the longest. Mason Byrne Bourne: And then lastly, in your slide presentation, you have a note in there about potential third party gallons. Wondered if you could talk about that. You have significant excess capacity in your wells when they get online. So is this class 6 draft permit, is that sort of a clearing event to open up discussions because the feasibility of your project has basically been signed off on at that point, hopefully. Stuart A. Rose: Yeah. We would love to have someone like a direct air-to-CO2 project or something, but at this point in time, we have nothing imminent we will certainly, as you just mentioned, have the capacity to take on those type of projects But we are mostly concentrated on getting our own project going, which we deal with the 45Z rules the way they are currently. That would add to our to our bottom line. Yep for sure. Thank you. Operator: Thank you. Thank you. As a reminder, if you would like to join the question queue, please press 1 on your telephone keypad. Our next question comes from the line of David Leto with DJM Investments. Please proceed with your question. David Letho: Yes. Thank you. My question has been quite a bit of news this week about the RIN credits. And then exemptions, and I was just wondering how that might affect your thinking and I guess the cash flows over the next 12 to 18 months? Zafar A. Rizvi: The party line. I think, at this time, certainly, will be some impact on RINs. But I am not sure that will be impacted so much on ethanol sale. As you know, that ethanol export almost 13% increase this year. For 6 months. We expect that it will be almost it will continue to increase the increase the export But there is there may be some impact, but it is I do not anticipate the major impact because most of them is what you will see is there is also include biodiesel RINs and D4 and D6. Both of the range is included in that. So there could be some, but it is not going to be a major impact And also, we hope that E15 will also will be the California expected to have almost 695 million gallons you know, consumption, and they fully approved that also at the same time. David Letho: Okay. Understood. I guess, second set of questions. Given how close we are to carbon capture, being approved, what is your feeling on share buybacks and capital deployment going forward? it is clearly most of these 45Z credits are, you know, essentially based on production and do not have anything to do with the revenue lines. Stuart A. Rose: We have been really, really I think we are 1 of the leaders of not the leader, in share buybacks and percentage of all the shares we have had outstanding over the years. We buy on dips, and when we buy, we buy, we buy whatever we can buy at the price we are buying at. And that is been our method of choice in distributing capital and we certainly are doing the fact that we have so much capital just shows how well we are doing, and we will look either to distribute the capital that way. Or, again, there is other-- there are other ways to distribute capital, and there is we are always looking, and we did not mention it in the conference call, but we are always looking for either other ethanol plants to buy or something in a in a similar in a similar related industry that might make some sense. So, again, we are well aware that we are so lucky to have so much capital. Okay. David Letho: Thank you. Operator: Thank you. Ladies and gentlemen, that concludes our Q&A session. I will turn the floor back to Mr. Rose for final comments. Stuart A. Rose: Thank you. I would like to thank everyone for listening. Again, we have great locations. Very good corn growing areas. We have great plants using industry leading technology. We just had the best quarter in our company's history. and the most important thing we have going for us, in my opinion, the best people in the industry led by our CEO, Zafar A. Rizvi, and that includes all of our hardworking employees. I would like to thank everyone for listening, and we look forward to our next conference call at the end of our current quarter. Thank you. Thank you again. Bye-bye. Operator: Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation. Before you buy stock in Rex American Resources, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Rex American Resources wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $414,015!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,385,459!* Now, it’s worth noting Stock Advisor’s total average return is 960% — a market-crushing outperformance compared to 213% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of September 9, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. REX American Resources (REX) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Download the Complete Report Here Key Takeaways: Record second-quarter earnings reflected materially stronger core ethanol economics alongside a larger 45Z contribution. REX reported 2Q FY26 net sales and revenue of $168.5 million, up 6.3% from $158.6 million in 2Q FY25, while gross profit increased to $53.3 million from $14.3 million and gross margin expanded to 31.6% from 9.0%. 45Z production tax credit income contributed $18.4 million during the quarter, while core profitability also improved sharply, with gross profit excluding 45Z at approximately $34.9 million, up roughly 144% y/y. Income before taxes increased to $48.1 million from $12.1 million, and net income attributable to REX shareholders reached $34.9 million versus $7.1 million. Diluted EPS increased to $1.06 from $0.22, marking the strongest fiscal second quarter in company history and extending REX’s profitability streak to 24 consecutive quarters. Improved crush margins were the principal operating driver, with stronger ethanol and co-product pricing broadening the earnings improvement. Consolidated ethanol sales were 70.6 million gallons, consistent with 70.6 million gallons in the prior-year quarter, while realized ethanol pricing net of hedging increased to $1.78 per gallon from $1.75. Ethanol revenue reached approximately $125.8 million, representing 74.7% of quarterly revenue. Dried distillers grain ASP increased 16% to $166.55 per ton from $143.63, with volume of 145,081 tons versus 148,017 tons, generating approximately $24.2 million of revenue. Distillers corn oil provided another meaningful margin contribution, with volume increasing to 24.3 million pounds from 23.1 million and ASP rising 33% to $0.72 per pound from $0.54, resulting in approximately $17.6 million of revenue. Modified distillers grains contributed another $0.8 million at an ASP of $65.10 per ton. The improvement across ethanol, DDG and corn oil is consistent with a stronger crush environment and reinforces the earnings contribution from product mix as REX prepares to add incremental One Earth capacity. 45Z has become a material and increasingly visible earnings layer, with the quarterly contribution more than doubling sequentially. REX recognized $18.4 million of 45Z production tax credit income in 2Q, up from $7.5 million in 1Q, bringing 1H FY26 credits to approximately $26.0 million, net of estimated monetization expenses. REX currently intends to sell the transferable 45Z credits earned in FY26, compared with using FY25 credits to offset taxes due. Including $31.7 million recognized in FY25, cumulative 45Z benefits from consolidated facilities have reached approximately $57.7 million, including minority interests. The 2Q credit represented approximately 34.5% of reported gross profit of $53.3 million, while the first-half contribution represented approximately 31.5% of gross profit of $82.4 million. Because 45Z is recorded within gross profit rather than revenue, its growing contribution is making reported margins structurally less comparable with prior periods and should scale further as One Earth adds production volumes eligible for the credit. CCS creates a second economic layer through 45Q and potentially higher 45Z economics. Under the current framework, 45Z credits can be earned in $0.10 per gallon increments from $0.10 to $1.00 per gallon based on carbon intensity, with the first $0.10 available below a CI score of 47.5 and the program currently extending through calendar 2029. The 45Q framework provides an $85 per ton credit for qualifying sequestered carbon for 12 years following project commencement, with direct pay available during the first five years, and REX estimates potential annual 45Q benefits of approximately $36 million. During the 2025 to 2029 overlap period, REX can elect the economically more attractive program, providing flexibility to optimize credit economics as CCS lowers carbon intensity and final 45Z rules become clearer. One Earth remains the principal organic volume growth driver, with a phased path from approximately 150 million to 200 million gallons of annual capacity. The facility currently produces approximately 150 million gallons annually, with construction for the next capacity step progressing on schedule and additional production expected to come online before the end of 2026. The first operating milestone is approximately 175 million gallons, a roughly 17% increase from the current level. Following that step, additional EPA and Illinois EPA approvals are required before production can move toward approximately 200 million gallons, with production expected to approach that level around early to mid-2027. Reaching 200 million gallons would represent approximately 33% growth from the current One Earth base and would expand ethanol, co-product and eligible 45Z production while leveraging REX’s existing Corn Belt infrastructure and market access. Draft Class VI permits represent the most significant CCS regulatory milestone to date and materially reduce federal permitting uncertainty around the One Earth project. On August 17, the EPA issued draft Class VI permits for three injection wells with combined storage capacity of approximately 90 million tons, with the September presentation projecting final EPA permits in November 2026. Construction of the carbon capture and compression facility is substantially complete, with facility testing remaining. Cumulative investment in the ethanol expansion and CCS projects reached approximately $191.2 million at 2Q FY26-end, up from $176.3 million at 1Q-end and approximately $166 million at FY25-end. With the federal process materially advanced, the remaining project sequence centers on the approximately 5-mile connector pipeline, Illinois EPA approvals and local zoning requirements, with the pipeline approval appearing to be the principal milestone. Excess storage capacity creates meaningful third-party sequestration optionality and expands One Earth’s longer-term low-carbon fuel positioning. The project is designed to sequester approximately 560,000 tons of CO2 annually from One Earth following the expansion, compared with approximately 90 million tons of total storage capacity across the three wells. REX has secured consent from 100% of landowners for the pipeline route associated with Wells 1 and 2 and sufficient subsurface easements for Well 1 to sequester all One Earth emissions for approximately 15 years. The substantial excess capacity creates a potential fee-generating opportunity from third-party emitters, while lower-carbon ethanol could also support additional demand from sustainable aviation fuel markets. These opportunities remain longer-term, with REX currently focused on completing and permitting its own CCS project before pursuing third-party sequestration. Export growth and California E15 broaden the demand backdrop as One Earth prepares to add production capacity. U.S. ethanol exports increased approximately 13% during the first six months of 2026, with continued record export demand supporting industry fundamentals entering 3Q. California’s approval of E15 creates another meaningful demand channel, with management citing approximately 695 million gallons of potential consumption. Recent RIN exemption developments could pressure RIN economics, although management does not expect a major impact on ethanol sales given that the exemptions span both D4 and D6 credits and export demand remains strong. Together, sustained export growth and broader E15 adoption improve the industry’s ability to absorb incremental production as REX moves first toward 175 million gallons and subsequently approximately 200 million gallons at One Earth. Higher incentive compensation absorbed some operating leverage, while unconsolidated affiliates provided a materially larger earnings contribution. SG&A increased to $15.6 million from $6.2 million y/y, primarily reflecting higher incentive compensation tied to stronger results and restricted stock awards issued during the quarter. Equity in income of unconsolidated affiliates increased to $7.2 million from $0.9 million, benefiting from stronger industry conditions and production tax credit contributions at REX’s non-consolidated facilities. Interest and other income was broadly stable at $3.2 million versus $3.1 million y/y, reinforcing that the earnings improvement was primarily driven by operating performance, 45Z and stronger affiliate profitability. Liquidity and working capital strengthened despite higher project spending, reinforcing REX’s ability to fund One Earth and CCS internally. REX ended 2Q with $379.5 million of cash, cash equivalents and short-term investments, up from $364.3 million at the end of 1Q and $310.5 million a year earlier, while continuing to carry no bank debt. Working capital increased to $391.5 million from $376.2 million sequentially and $353.4 million y/y. First-half operating cash flow increased to $38.0 million from $12.8 million, while capital expenditures rose to $35.0 million from $28.9 million. REX currently expects to spend another $20 million to $30 million across its projects during the remainder of FY26, with all expenditures funded from available cash. The balance sheet therefore continued to strengthen even as cumulative One Earth and CCS spending reached $191.2 million, preserving flexibility for additional capital deployment as the projects move toward completion. Working-capital movements remained manageable, with higher receivables and prepaid assets offset by stable inventory and stronger cash generation. Accounts receivable increased to $23.5 million at July 31 from $14.7 million at FY25-end, while inventory was broadly stable at $29.0 million versus $28.4 million and accounts payable declined to $36.7 million from $38.4 million. During the first half, accounts receivable represented an $8.8 million use of operating cash and prepaid and other assets represented a $27.3 million use, while inventory absorbed only $0.6 million. Despite those uses, cash flow from operations increased nearly threefold to $38.0 million from $12.8 million, reflecting materially stronger earnings despite working-capital outflows. Capital allocation remains focused on completing organic growth projects, while repurchases and selective M&A retain strategic relevance. REX acquired approximately $1.6 million of treasury stock during 1H FY26 versus $33.4 million in the prior-year period, while first-half capital expenditures were $35.0 million and cumulative One Earth and CCS investment reached $191.2 million. Share repurchases have historically been a preferred method of distributing capital, and REX continues to evaluate acquisitions of ethanol plants and businesses in adjacent industries. With $379.5 million of cash and short-term investments, no bank debt and the major One Earth and CCS investments moving toward completion, the balance between additional organic investment, repurchases and selective acquisitions should become increasingly important to the equity story. Outlook remains constructive, with 3Q results expected to exceed the prior-year period as 45Z, exports and stronger core ethanol economics support the second-half setup. At this early stage of 3Q FY26, REX expects to remain profitable and anticipates results above the prior-year period, when diluted EPS was $0.71 on revenue of $175.6 million. First-half FY26 EPS reached $1.62 versus $0.47 y/y, while 45Z benefits totaled approximately $26.0 million and export demand remained strong. The One Earth expansion remains on track for construction completion by the end of 2026, with production expected to step toward approximately 175 million gallons, while the three draft Class VI permits represent another important step in advancing CCS. The medium-term setup remains tied to sustained crush economics, continued 45Z monetization, the One Earth ramp toward 175 million gallons followed by permitting toward approximately 200 million gallons, and completion of the remaining CCS approvals. Disclaimer: Exec Edge does not publish proprietary estimates, ratings, price targets, or investment recommendations. The valuation discussion below is illustrative only and is based on company filings, management commentary, and third-party data and estimates. It does not constitute a recommendation, price target, rating, or prediction of future pricing. Valuation remains reasonable following the step-up in earnings and improving visibility across One Earth, 45Z and CCS. At the September 3 close of $41.62, REX has a market capitalization of approximately $1.38 billion and enterprise value of ~$1.1 billion, and trades at 11.4x LTM EPS of $3.65, down from 16.6x at the end of the prior quarter and well below its three-year peak of 27.9x. We apply a 16x illustrative P/E multiple, representing an approximately 23% premium to the current profitable peer average of 13.0x, but still roughly 43% below REX’s three-year peak. We believe this modest premium to peers is supported by REX’s 24 consecutive profitable quarters, $379.5 million of liquidity, no bank debt, growing 45Z contribution, approaching One Earth capacity ramp and advancing CCS development, while the substantial discount to history appropriately reflects continued commodity, policy and permitting risk. Applying 16x to LTM EPS implies an illustrative value of approximately $58.4 per share. We note that cash, cash equivalents and short-term investments of $379.5 million equate to approximately $11.47 per share, or ~28% of the current share price, with REX continuing to carry no bank debt. Peer valuation provides a secondary cross-check, with REX trading below the profitable-peer average while maintaining substantial balance-sheet flexibility. GPRE trades at 8.9x LTM earnings, ALTO at 6.1x, ADM at 23.1x and VLO at 15.5x. The peer average is approximately 13.0x, placing REX’s 11.4x multiple at roughly a 12% discount. The discount remains notable given REX’s 24 consecutive profitable quarters, strong balance sheet and improving visibility across 45Z, One Earth and CCS. Further re-rating increasingly depends on execution across a visible set of catalysts. 45Z has already contributed approximately $26.0 million in 1H FY26, so the next drivers are whether those economics remain durable and improve as carbon intensity declines. Milestones include sustained core crush profitability and 45Z contribution, commissioning of One Earth toward approximately 175 million gallons and progression toward 200 million gallons, conversion of the draft Class VI permits into final approvals, advancement of the Illinois pipeline and environmental permitting processes, and disciplined deployment of $379.5 million of liquidity through organic growth, repurchases or selective acquisitions. Continued delivery across these areas would improve visibility into the durability and scale of REX’s earnings base as its low-carbon growth investments move closer to commercial operation. Read Exec Edge’s Initiation on REX Here Subscribe to our Weekly Newsletter to Receive All Research Contact: Executives-Edge.com [email protected] The post REX’s Record 2Q EPS, CCS Project Advances – Quarterly Update Report appeared first on ExecEdge.

This article first appeared on GuruFocus. Net Sales and Revenue: $168.5 million for Q2 2026, up from $158.6 million in Q2 2025, reflecting improved pricing across the product mix. Gross Profit: $53.3 million, compared to $14.3 million in the prior-year quarter, driven by stronger crush margins and $18.4 million in 45Z production tax credit income. SG&A Expenses: $15.6 million, up from $6.2 million in Q2 2025, primarily due to higher incentive compensation and restricted stock awards. Equity in Income of Unconsolidated Affiliates: $7.2 million, versus $900,000 in the same quarter last year, benefiting from stronger industry dynamics and tax credits. Interest and Other Income: $3.2 million, essentially in line with $3.1 million in Q2 2025. Income Before Income Taxes and Noncontrolling Interest: $48.1 million, compared to $12.1 million in Q2 2025. Net Income Attributable to REX Shareholders: $34.9 million, or $1.06 per diluted share, versus $7.1 million, or $0.22 per diluted share, in the prior-year quarter. Cash and Short-Term Investments: $379.5 million at quarter-end, with no bank debt. 45Z Production Tax Credit Income: Approximately $18.4 million recognized in Q2 2026, bringing the year-to-date total to roughly $26 million. Capital Investment: Combined investment in ethanol expansion and carbon capture projects totaled approximately $191.2 million through the end of Q2. Warning! GuruFocus has detected 3 Warning Sign with REX. Is REX fairly valued? Test your thesis with our free DCF calculator. Release Date: September 02, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record second-quarter net income per share of $1.06, the highest in company history. Gross profit surged to $53.3 million from $14.3 million year-over-year, driven by stronger crush margins and $18.4 million in 45Z tax credits. Received draft Class VI well permits from the EPA for the carbon capture project, a major regulatory milestone. Ethanol expansion at One Earth Energy remains on schedule, with capacity expected to increase to 175 million gallons and potentially 200 million gallons by early next year. Strong balance sheet with $379.5 million in cash and no bank debt, providing flexibility for growth and capital returns. 24th consecutive profitable quarter, with expectations for Q3 2026 results to exceed the prior year. Record ethanol export demand and potential E15 approval in California support positive market fundamentals. SG&A expenses increased significantly to $15.6 million from $6.2 million, due to higher incentive compensation and restricted stock awards. Uncertainty regarding the timeline for Illinois state permits for the carbon capture pipeline, which could delay the project. Potential negative impact on RIN credits from recent news on exemptions, though management sees limited effect on ethanol sales. Carbon capture project's full benefits depend on final regulatory approvals, which remain uncertain. No imminent third-party agreements for excess carbon capture capacity, limiting near-term revenue diversification. Expansion project requires step-by-step regulatory approvals for capacity increases, potentially slowing production growth. Q: Regarding the ethanol expansion at One Earth, does "online by the end of the year" mean all 50 million gallons, and is 200 million gallons the long-term capacity level?A: Zafar Rizvi (CEO) clarified that the expansion is a step-by-step process. The facility is currently producing approximately 150 million gallons, with the next step being 175 million. After achieving that, they must apply for the permit to reach 200 million gallons. He expects to be close to the 200 million gallon production level by early to middle of next year, pending regulatory approvals. Q: Can you provide a timeline for the Class VI well permits and the Illinois state approvals for the carbon capture project?A: Stuart Rose (Executive Chairman) stated that there is no great clarity on the timeline. While the EPA permit is expected to be issued within a reasonable period, the primary bottleneck is the approval for the 5-mile connector pipeline from the Illinois Commerce Commission. Since the state moratorium just ended in June, they can now apply, but the duration of that process is unknown and is expected to be the longest hold-up. Q: Does the draft Class VI permit open up discussions for third-party gallons, given the significant excess capacity in the wells?A: Stuart Rose (Executive Chairman) confirmed that they would welcome projects like a direct air CO2 capture facility to utilize excess capacity. However, nothing is imminent. The company's primary focus remains on getting its own carbon capture project operational, which would significantly add to the bottom line under current 45Z rules. Q: How might the recent news regarding RIN credits and exemptions impact cash flows over the next 12 to 18 months?A: Zafar Rizvi (CEO) stated that while there will be some impact on RINs, it may not significantly impact ethanol sales. He noted that ethanol exports have increased by almost 13% in the first six months of the year and are expected to continue growing. He also mentioned that the impact would be mitigated by the inclusion of biodiesel RINs (D4 and D6) and the potential approval of E15 in California, which is expected to consume nearly 695 million gallons. Q: Given the proximity of carbon capture approval, what are your thoughts on share buybacks and capital deployment?A: Stuart Rose (Executive Chairman) emphasized the company's history as a leader in share buybacks, stating they buy on dips and are always looking to distribute capital. He also mentioned that they are actively evaluating other opportunities, such as acquiring other ethanol plants or businesses in related industries, as a way to deploy their substantial capital. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Company receives Class VI injection well draft permit from U.S. EPA Generated $1.06 of net income per share in Fiscal Q2 ’26 vs. $0.22 of net income per share in Fiscal Q2 ‘25 Reported gross profit of $53.3 million for Fiscal Q2 ’26 vs. $14.3 million in Fiscal Q2 ‘25 Reported Net Income to REX shareholders of $34.9 million in Fiscal Q2 ‘26 vs. $7.1 million in Fiscal Q2 ‘25 DAYTON, Ohio, September 02, 2026--(BUSINESS WIRE)--REX American Resources Corporation ("REX" or the "Company") (NYSE: REX), a leading ethanol production company, today announced financial and operational results for the Company’s fiscal second quarter 2026. REX American Resources’ fiscal second quarter 2026 results principally reflect its interests in six ethanol production facilities. The One Earth Energy, LLC ("One Earth") and NuGen Energy, LLC ("NuGen") ethanol production facilities are consolidated, while the four other ethanol plants are reported as equity in income of unconsolidated affiliates. Investors can view REX’s updated investor presentation by visiting https://investors.rexamerican.com/news-events/events-presentations. Second Quarter 2026 Results REX reported Q2 ’26 net sales and revenue of $168.5 million, compared to Q2 ‘25 net sales and revenue of $158.6 million, primarily reflecting improved pricing. The Company reported production tax credit income of $18.4 million net of estimated monetization expenses in the second quarter of 2026. Second quarter 2026 gross profit for the Company was $53.3 million, compared with $14.3 million in Q2 ’25 reflecting improved crush margins and the benefits of the production tax credits. The Company reported interest and other income of $3.2 million in Q2 ’26, compared to $3.1 million in Q2 ’25. This led to Q2 ‘26 income before income taxes and noncontrolling interests of $48.1 million, compared with $12.1 million in Q2 ’25. Net income attributable to REX shareholders in Q2 ‘26 was $34.9 million, compared to $7.1 million in Q2 ’25. Second quarter ‘26 diluted net income per share attributable to REX common shareholders was $1.06, compared to $0.22 per share in Q2 ’25. Per share results for Q2 ’26 and Q2 ’25 are based on 33,090,000 and 33,010,000 diluted weighted average shares outstanding, respectively. The following table summarizes select operating data for our consolidated entities: Update on One Earth Energy Ethanol Production Expansion and Carbon Capture Projects REX is on-track to complete the construction phase of the expansion of ethanol production at the One Earth facility. The Company expects testing and commissioning to begin upon completion, with the expansion becoming operational during fiscal 2026. On August 17, 2026, the Company’s carbon capture and sequestration project received draft permits from the U.S. Environmental Protection Agency (EPA) for three Class VI injection wells. The EPA is currently accepting public comments on the draft permits. Capital expenditures to-date related to the One Earth Energy carbon capture and sequestration project and related expansion of ethanol production capacity at the Gibson City location totaled $191.2 million. Balance Sheet As of July 31, 2026, REX had $379.5 million of cash, cash equivalents, and short-term investments available and no bank debt. Management Commentary "During the second quarter of 2026 REX achieved several important milestones that further support and advance our long-term growth strategy," said Zafar Rizvi, Chief Executive Officer of REX. "We continued to benefit from the Section 45Z tax credit program in the second quarter, which contributed $18.4 million directly to gross profit. Excluding the impact from 45Z tax credits, our quarterly gross profit from our core operations increased 144% over the same period in the prior year. In addition, we received notice from the U.S. EPA that our One Earth carbon capture and sequestration project had been issued draft permits on August 17th for three Class VI injection wells. We are pleased to have reached this important regulatory milestone and look forward to advancing the project in coordination with the EPA and Illinois regulators. The second quarter marked REX’s 24th consecutive profitable quarter and represented a record second quarter on an earnings-per-share basis for the company. REX’s long-term prospects remain strong, supported by the continued dedication, hard work, and execution of our team across all of our operations." Conference Call Information REX will host a conference call at 11:00 a.m. ET today to discuss the Company’s fiscal second quarter results and will also host a question and answer session. To access the conference call, interested parties may dial (877) 269-7751 (US) or (201) 389-0908 (international). Participants can also view an updated presentation, as well as listen to a live webcast of the call by going to the Investors section on the REX website at www.rexamerican.com. A replay will be available shortly after the live conference call and can be accessed by dialing (844) 512-2921 (US) or (412) 317-6671 (international). The passcode for the replay is 13762348. The replay will be available for 30 days after the call. About REX American Resources CorporationREX American Resources Corporation has interests in six ethanol production facilities, which in aggregate have production capacity totaling approximately 730 million gallons per year. REX’s effective ownership of annual volumes is approximately 300 million gallons. Further information about REX is available at www.rexamerican.com. Forward-Looking Statements This press release contains or may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such statements can be identified by use of forward-looking terminology such as "may," "expect," "believe," "estimate," "anticipate" or "continue" or the negative thereof or other variations thereon or comparable terminology. Readers are cautioned that there are risks and uncertainties that could cause actual events or results to differ materially from those referred to in such forward-looking statements. These risks and uncertainties include the risk factors set forth from time to time in the Company’s filings with the Securities and Exchange Commission and include among other things: the impact of legislative and regulatory changes, the price volatility and availability of corn, distillers grains, ethanol, distillers corn oil, gasoline and natural gas, commodity market risk, ethanol plants operating efficiently and according to forecasts and projections, logistical interruptions, success in permitting and developing the planned carbon sequestration facility near the One Earth Energy ethanol plant, changes in the international, national or regional economies, the impact of inflation, the ability to attract employees, weather, results of income tax audits, changes in income tax laws or regulations, the impact of U.S. foreign trade policy and tariffs, changes in foreign currency exchange rates, the effects of terrorism or acts of war and the effect of pandemics on the Company’s business operations, including impacts on supplies, demand, personnel and other factors. The Company does not intend to update publicly any forward-looking statements except as required by law. View source version on businesswire.com: https://www.businesswire.com/news/home/20260902625787/en/ Contacts Investor Contacts Douglas BruggemanChief Financial OfficerCaldwell BaileyICR, [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved the highest second quarter net income per share in company history, attributed to disciplined operating teams and favorable market tailwinds. Performance was significantly bolstered by Section 45Z production tax credits, which contributed approximately $18.4 million directly to gross profit during the quarter. Gross profit grew approximately 144% year-over-year even when excluding the impact of 45Z tax credits, driven by stronger industry crush margins. Operational success is supported by a robust balance sheet with no bank debt and $379.5 million in cash and short-term investments, allowing for internal funding of all growth projects. Management attributes the record results to a combination of commercial execution and constructive market fundamentals, including record export demand for U.S. ethanol. Strategic positioning remains focused on low-carbon initiatives, with the carbon capture project viewed as a primary driver for future carbon intensity score improvements. Management anticipates third quarter results will exceed the prior year's performance, maintaining a positive outlook on near-term profitability. The One Earth facility expansion remains on schedule for completion by the end of 2026, with a phased production increase targeting 200 million gallons by mid-2027. Future value capture under the 45Z program is expected to increase once the carbon capture and sequestration project becomes fully operational. The company is actively evaluating capital allocation options, including potential ethanol plant acquisitions, related industry investments, and continued share buybacks. Regulatory progress continues with the EPA issuing draft Class VI well permits, though final timelines remain dependent on Illinois state-level pipeline approvals. SG&A expenses increased to $15.6 million from $6.2 million, primarily due to higher incentive compensation and restricted stock awards tied to record financial performance. The Illinois moratorium on carbon sequestration expired on July 1, allowing the company to begin the application process for a critical 5-mile connector pipeline. Total capital investment in ethanol expansion and carbon capture projects reached approximately $191.2 million through the end of the second quarter. Management noted potential impacts from RIN credit volatility but expects strong ethanol exports and E15 approval in California to mitigate major risks. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. The expansion will follow a step-by-step process, moving from the current 150 million gallons to 175 million gallons initially. Management expects to reach the 200 million gallon production level by early to mid-2027, following required EPA and Illinois EPA approvals. While federal EPA draft permits have been issued, the primary bottleneck is the approval of a 5-mile pipeline connector by the Illinois Commerce Commission. Management lacks exact clarity on the state-level timeline but will apply for the necessary permits as soon as possible following the end of the state moratorium. The company has significant excess capacity in its wells and is open to hosting third-party projects, such as direct air capture. Current focus remains exclusively on getting their own project operational to maximize 45Z tax credit benefits before pursuing external partnerships. Management anticipates some impact on RINs but does not expect a major disruption to ethanol sales due to a 13% year-to-date increase in exports. The expected approval of E15 in California is projected to add approximately 695 million gallons of consumption, providing a demand buffer.

REX American Resources Corporation (NYSE:REX) shares fell 4.6% following the release of fiscal second-quarter 2026 results that exceeded analyst earnings expectations but came in below the consensus revenue forecast. The ethanol producer reported adjusted earnings per share of $1.06, compared with an analyst estimate of $0.42. Revenue reached $168.5 million, below the consensus estimate of $194.8 million. However, revenue increased 6.2% from $158.6 million in the second quarter of fiscal 2025. Net income attributable to REX shareholders rose to $34.9 million from $7.1 million in the prior-year quarter. Gross profit increased to $53.3 million from $14.3 million a year earlier. According to the company, the improvement reflected higher crush margins as well as $18.4 million of production tax credit income associated with the Section 45Z programme. The increase in revenue primarily reflected improved pricing, according to the supplied information. Chief Executive Officer Zafar Rizvi commented on the company’s quarterly performance and ongoing projects. “During the second quarter of 2026 REX achieved several important milestones that further support and advance our long-term growth strategy,” said Zafar Rizvi, Chief Executive Officer of REX. “Excluding the impact from 45Z tax credits, our quarterly gross profit from our core operations increased 144% over the same period in the prior year.” The 144% increase represents the company’s calculation of gross profit growth from core operations excluding the impact of Section 45Z tax credits. REX also reported progress on its carbon capture and sequestration project. The company received draft permits from the U.S. Environmental Protection Agency on August 17 for three Class VI injection wells associated with the project. Draft permits represent a regulatory step in the process and do not constitute final approval. Capital expenditure on the One Earth Energy carbon capture project and ethanol production expansion totalled $191.2 million to date, according to the company. As of July 31, 2026, REX reported $379.5 million in cash, cash equivalents and short-term investments and said it had no bank debt. The company did not provide financial guidance for future quarters in the supplied information. REX shares declined 4.6% following the results. While the share-price movement occurred after the earnings release, the supplied information does not establish the extent to which the revenue result, earnings performance or other factors contributed to the decline. Rex American Resources stock price

Interested in REX American Resources Corporation? Here are five stocks we like better. Record profitability: REX’s second-quarter net income rose to $34.9 million, or $1.06 per diluted share, from $7.1 million a year earlier, marking its highest second-quarter EPS in company history. Revenue increased to $168.5 million, while gross profit surged to $53.3 million. 45Z credits boosted results: The company recognized approximately $18.4 million in Section 45Z production tax credits during the quarter, although management said gross profit still would have increased about 144% year over year without the credits. Expansion and carbon capture advancing: The One Earth ethanol expansion remains on schedule for completion by the end of 2026, while EPA draft permits for three carbon-injection wells mark progress for the carbon capture project. REX ended the quarter with $379.5 million in cash and short-term investments and no bank debt. Three Oversold REITs With Strong Fundamentals REX American Resources (NYSE:REX) reported record second-quarter earnings per share for fiscal 2026, supported by stronger ethanol margins, improved product pricing and contributions from the Section 45Z production tax credit program. Net income attributable to REX shareholders rose to $34.9 million, or $1.06 per diluted share, from $7.1 million, or $0.22 per diluted share, in the second quarter of 2025. Executive Chairman Stuart Rose said the result marked the company’s highest second-quarter net income per share in its history. → AST SpaceMobile Is Down 54%—Can FCC Progress and BlueBirds Reverse the Slide? Hunting for High-Yield Bargains? 2 REITs to Consider The company recorded its 24th consecutive profitable quarter, according to Chief Executive Officer Zafar Rizvi. Management said it expects to remain profitable in the third quarter and anticipates results will exceed those of the prior-year period. Second-quarter net sales and revenue increased to $168.5 million from $158.6 million a year earlier. Chief Financial Officer Doug Bruggeman attributed the increase to improved pricing across the company’s product mix. → Palo Alto’s Rally Has One Big Problem Ahead of Earnings 6 best ethanol stocks to buy now Gross profit climbed to $53.3 million from $14.3 million in the prior-year quarter. The increase reflected stronger crush margins as well as approximately $18.4 million in Section 45Z production tax credit income recognized during the quarter. Bruggeman said gross profit would still have increased approximately 144% year over year without the 45Z credits. The credits flowed directly through gross profit, management said. Second-quarter 45Z production tax credit income: approximately $18.4 million Year-to-date 45Z production tax credit income: approximately $26 million Income before income taxes and non-controlling interest: $48.1 million, compared with $12.1 million a year earlier Equity in income of unconsolidated affiliates: $7.2 million, compared with $900,000 in the prior-year quarter → Securing AI: 5 Most-Upgraded Stocks From the Q2 Reporting Season Selling, general and administrative expense increased to $15.6 million from $6.2 million. Bruggeman said the increase primarily stemmed from higher incentive compensation tied to company performance and restricted stock awards issued during the quarter. REX said its ethanol-production expansion at the One Earth Energy facility in Gibson City, Illinois, remains on track for construction completion by the end of 2026. Rizvi said the additional capacity is intended to strengthen the operating platform and increase the company’s ability to capture value under the 45Z tax-credit program. During the question-and-answer session, Rizvi said One Earth is currently producing approximately 150 million gallons. The next planned step is to reach 175 million gallons, after which the company will need to seek permits to reach 200 million gallons. He said the company expects it could be near 200 million gallons of production early or around the middle of next year, subject to the permitting process. REX’s combined investment in the ethanol expansion and carbon capture projects totaled approximately $191.2 million through the end of the second quarter. Management highlighted regulatory progress for its One Earth carbon capture and sequestration project. On Aug. 17, the U.S. Environmental Protection Agency issued draft permits for three Class VI injection wells associated with the project. The EPA is accepting public comments on the draft permits, and REX said it continues to work with the agency toward final approval. Rizvi said the company believes the carbon capture project could improve its carbon-intensity score once permitted and operational, potentially increasing the value it can receive under the 45Z program. At the state level, the Illinois moratorium on carbon sequestration expired July 1. The Illinois Commerce Commission has begun its rulemaking process, while the Illinois Environmental Protection Agency has initiated its permitting application process. REX plans to submit applications for an approximately five-mile connector pipeline and for the required Illinois EPA approval as soon as possible. Rose said the timing of final EPA approval was not fully clear, while describing approval of the five-mile pipeline connector by the Illinois Commerce Commission as the process most likely to take the longest. The company said it is focused primarily on advancing its own project, though Rose noted that available capacity could potentially accommodate third-party carbon dioxide projects in the future. He said no such arrangement was imminent. REX ended the quarter with $379.5 million in cash equivalents and short-term investments and no bank debt. Bruggeman said the company continues to fund its growth projects entirely from its balance sheet. Rose said the company has historically used share repurchases as a method of returning capital, buying shares on price declines. He added that REX is also evaluating other capital-allocation options, including potential acquisitions of ethanol plants or businesses in related industries. On ethanol market conditions, Rizvi said export demand has remained supportive, noting that ethanol exports increased nearly 13% during the first six months of the year. He said the company did not expect recent developments involving RIN credits and exemptions to have a major effect on ethanol sales, though he acknowledged there could be some impact. Management said market fundamentals remain constructive, citing record export demand for U.S. ethanol and the contribution of the 45Z program to margins. 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. In its alcohol fuels segment, the company operates an anhydrous ethanol production facility in Colwich, Kansas. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "REX American Resources Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved the highest second-quarter net income per share in company history, driven by disciplined margin management and favorable market tailwinds. Gross profit growth of 144% year-over-year, excluding tax credits, was primarily fueled by significantly stronger crush margins and improved pricing across the product mix. The 45Z production tax credit program contributed $18.4 million to gross profit this quarter, totaling $26 million year-to-date. Operational success is attributed to the strategic location of plants in high-yield corn areas and the utilization of industry-leading technology. Management maintains a debt-free balance sheet with $380 million in cash and short-term investments to internally fund all major growth initiatives. Higher SG&A expenses were intentionally incurred as incentive compensation tied directly to the company's record financial performance. Management anticipates third-quarter results will exceed the prior year's performance, with expectations to remain profitable in the near term. The One Earth facility expansion remains on schedule to bring additional ethanol production capacity online before the end of 2026. The carbon capture and sequestration project is expected to further improve carbon intensity scores, potentially increasing the future value captured under the 45Z program. Future capital allocation will focus on internal growth projects, opportunistic share buybacks during market dips, and potential acquisitions of ethanol plants or related businesses. The company plans to submit applications for a five-mile connector pipeline and required state permits following the expiration of the Illinois carbon sequestration moratorium. Received draft Class VI injection well permits from the US EPA in August, marking a major regulatory milestone for the carbon capture project. The Illinois moratorium on carbon sequestration expired on July 1, allowing the company to proceed with state-level permitting and rulemaking processes. Total investment in ethanol expansion and carbon capture projects reached $191 million by the end of the second quarter. Management identified the approval of the five-mile pipeline connector by the Illinois Commerce Commission as a potential primary timeline constraint for the carbon capture project. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management is following a step-by-step permitting process, currently producing approximately 150 million gallons with a goal of 175 million next. The company expects to reach a production level close to 200 million gallons by early or middle of next year, pending Illinois EPA requirements. Management expects some impact on RINs but does not anticipate a major impact on ethanol sales due to strong export demand, which rose 13% in the first half of the year. Optimism remains high regarding domestic consumption increases, specifically citing California's expected approval of E15. The company will have significant excess capacity in its wells and is open to third-party projects like direct air-to-CO2. While open to partnerships, management is currently prioritized on getting its own project operational to maximize 45Z tax benefits.