• Revenue: $584 million for Q4, down 18% year-over-year.
• Net Loss: $54.9 million or $0.86 per share for Q4.
• EBITDA: Negative $18.9 million for Q4.
• SG&A Costs: $25.6 million for Q4, $7.2 million lower than the prior year.
• Interest Expense: $7.7 million for Q4, $0.9 million lower than the prior year.
• Cash and Liquidity: $209.4 million in cash and equivalents, $200.7 million available under revolver.
• Capital Expenditures: $27 million for Q4, $95 million year-to-date.
• Plant Utilization Rate: 92% for Q4, compared to 95% in the prior year.
• Federal Net Loss Carryforward: $124.3 million available indefinitely.

• Warning! GuruFocus has detected 2 Warning Sign with GPRE.

Release Date: February 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Green Plains Inc (NASDAQ:GPRE) has identified up to $50 million in annualized cost savings, with $30 million already implemented, enhancing future profitability.
• The company achieved an operating rate of 92% in the fourth quarter, with expectations to maintain mid-90% utilization rates, indicating strong operational efficiency.
• Green Plains Inc (NASDAQ:GPRE) is on track to begin capturing biogenic CO2 in the second half of 2025, which is expected to significantly enhance earnings and valuation.
• The company has made significant progress in its protein and corn oil yields, with corn oil yields exceeding 1.2 to 1.3 pounds per bushel, showcasing operational improvements.
• Green Plains Inc (NASDAQ:GPRE) has secured a major contract with a large aquaculture company, marking a significant step in commercializing its protein products and expanding market reach.

Negative Points

• Green Plains Inc (NASDAQ:GPRE) reported a net loss of $54.9 million for the fourth quarter, reflecting ongoing challenges in the ethanol market.
• The company faced a negative EBITDA of $18.9 million for the quarter, highlighting the impact of weak market fundamentals and oversupply.
• The decision to shut down the Fairmont facility due to market conditions and a short corn crop indicates vulnerability to external agricultural factors.
• Green Plains Inc (NASDAQ:GPRE) experienced lower revenues in the fourth quarter, down 18% year-over-year, due to lower market prices for ethanol and related products.
• The protein market remains under pressure from oversupply, affecting the company's ability to achieve expected returns on its protein investments.

Q & A Highlights

Q: Can you provide more details on the $50 million cost-saving initiative and its impact on profitability? A: Todd Becker, President and CEO, explained that the initiative aims to increase overall profitability by rationalizing costs after years of investment in innovation. The company has already implemented $30 million in savings by streamlining corporate functions and reducing SG&A expenses. The focus is now on commercializing and marketing their products effectively.

Q: What is the status of the aquaculture market penetration and the project in South America? A: Todd Becker stated that Green Plains has successfully penetrated the aquaculture market, selling large quantities of their product to a major aquaculture company. The company no longer needs to conduct trials themselves, as customers have accepted their products. This marks a significant milestone after years of effort.

Q: Can you update us on the progress of the carbon capture and storage (CCS) project and its expected impact? A: Todd Becker confirmed that the CCS project is on track, with an expected in-service date in late Q3 or early Q4. The company is actively monitoring the construction of pipeline laterals and compression equipment. The project is anticipated to significantly enhance Green Plains' earnings power once operational.

Q: How is the company addressing the challenges with the Clean Sugar Technology (CST) initiative? A: Todd Becker acknowledged the wastewater challenge limiting CST's capacity. The company is exploring solutions to manage wastewater more effectively and is considering running the plant in a campaign mode. They have received necessary certifications and are in discussions with potential partners for technology expansion.

Q: What are the expectations for the corn oil market following the recent regulatory changes? A: Todd Becker noted that the company is seeing increased interest in their low-carbon corn oil, which is expected to trade at a premium to soybean oil. The regulatory changes have positioned their product favorably, and they anticipate strong demand from renewable diesel producers.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.