December tax cuts benefited yet another local company with The Andersons, Inc., reporting Wednesday an annual profit for 2017 of $41.2 million, or $1.46 a share, up 255 percent from the previous year when profits were $11.6 million, or 41 cents a share.
For the fourth quarter, which included the Dec. 22 tax-cut benefit, the Monclova Township-based agribusiness had a profit of $68.4 million, or $2.42 a share, up 574 percent from the same quarter a year earlier when profits were $10.1 million, or 36 cents a share.
Exterior of the headquarters for The Andersons, Inc. in Monclova Township.
For the year, The Andersons’ revenues were $3.68 billion, down 6 percent from $3.92 billion in 2016. For the quarter, revenues were $1 billion, down 10 percent from $1.1 billion for the fourth quarter of 2016.
"The company will certainly benefit from the U.S. federal income tax reform enacted in late December. We recorded a significant one-time income tax benefit of $74.2 million, primarily related to the new, lower tax rate on our deferred income-tax liabilities," Patrick Bowe, the company’s president and chief executive, said in a statement.
However, “Our fourth quarter performance was solid considering that we continue to face some challenging market conditions in several of our businesses, and we incurred some impairment expenses," Mr. Bowe said.
The impairments included expenses as part of an agreement, which will close next month, of the sale of company grain elevators in Humboldt, Kenton, and Dyer, Tenn., to a subsidiary of Tyson Foods, Inc. The Andersons owns three more elevators in Tennessee that are not a part of the sale.
"Notwithstanding expenses associated with our decision to sell the three Tennessee elevators, the Grain Group recorded better year-over-year results highlighted by significant improvement by Lansing Trade Group. For the full year, our adjusted grain earnings improved by almost $40 million," Mr. Bowe said.
As anticipated, he added, quarterly ethanol margins were lower again year-over-year despite continued strong U.S. exports.
The Plant Nutrient Group continued to face a challenging oversupply of nutrients and low farm income, even as year-over-year volumes were up considerably, Mr. Bowe said. The company also had to write down the remainder of its wholesale fertilizer goodwill balance because of a persistently soft fertilizer market. The Rail unit’s car-use rate improved for the third consecutive quarter, and the unit purchased over 1,200 railcars, the company president said.
The Andersons’ adjusted earnings were $1.15 a share, which beat the expected average of $1 a share, according to three analysts surveyed by Zacks Investment Research. Fourth-quarter earnings of 62 cents also beat Wall Street expectations of 42 cents a share.
On the Nasdaq exchange, shares of The Andersons rose 50 cents on Wednesday to close at $31.80.
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