REX American Resources Corporation

Second-quarter net sales and revenue were $168.5 million, up from $158.6 million in Q2 2025. Gross profit was $53.3 million versus $14.3 million a year ago, helped by stronger crush margins and $18.4 million of Section 45Z income; management said gross profit still grew about 144% year over year even excluding 45Z. SG&A rose to $15.6 million from $6.2 million, equity in income of unconsolidated affiliates increased to $7.2 million from $900,000, and net income attributable to REX shareholders was $34.9 million, or $1.06 per diluted share, versus $7.1 million, or $0.22 per diluted share. The company ended the quarter with $379.5 million in cash, cash equivalents and short-term investments and no bank debt. For guidance, management said it expects third-quarter results to be better than the same period last year and remain profitable; the One Earth expansion is still targeted for completion by the end of 2026.

CEO Zafar Rizvi emphasized operational execution and strategic progress, saying the company is moving ahead on schedule with the One Earth expansion and making progress on carbon capture permitting. He highlighted the EPA’s draft Class VI permits for three injection wells as a major milestone and said the project should further improve carbon intensity and 45Z value once fully permitted. His tone was constructive and focused on continued regulatory work, disciplined operations, and long-term value creation.

CFO Doug Bruggeman focused on the quarter’s financial step-up: revenue of $168.5 million, gross profit of $53.3 million, SG&A of $15.6 million, and net income of $34.9 million, or $1.06 per share. He tied the stronger gross profit to improved crush margins and $18.4 million of 45Z income, and noted that the company held $379.5 million in cash, cash equivalents and short-term investments with no bank debt. He also said growth projects are being funded entirely from the balance sheet.

Analysts pressed on the expansion timeline, with management clarifying that current production is about 150 million gallons, the next step is 175 million, and only then can the company apply for 200 million gallons. On carbon capture timing, Stuart Rose said the EPA permit should come within a reasonable period, but the Illinois pipeline approval and related state processes are the biggest uncertainty and could take the longest. Questions on RIN credits and exemptions drew a cautious but not alarmed response: management expects some impact, but does not anticipate a major effect on ethanol sales, citing continued export growth and E15 support. On capital allocation, management reiterated that share buybacks remain a preferred use of capital, while also leaving open acquisitions in ethanol or adjacent industries.