Green Plains Inc.
May 1, 2017

Green Plains Reports First Quarter 2017 Financial Results

OMAHA, Neb., May 01, 2017 (GLOBE NEWSWIRE) -- Green Plains Inc. (NASDAQ:GPRE) today announced financial results for the first quarter of 2017. Net loss attributable to the company was $3.6 million, or $(0.09) per diluted share, for the first quarter of 2017 compared with net loss of $24.1 million, or $(0.63) per diluted share, for the same period in 2016. Revenues were $887.7 million for the first quarter of 2017 compared with $749.2 million for the same period last year.

"We reported a nearly $50 million improvement in EBITDA year over year despite a seasonally soft first quarter," said Todd Becker, president and chief executive officer. "We had solid earnings contributions from our non-ethanol businesses during the quarter, with both Green Plains Cattle and Fleischmann's Vinegar reporting record quarters. We continue to diversify our revenue and income streams with a more balanced portfolio of businesses to minimize the impact of a soft ethanol quarter."

During the first quarter, Green Plains produced 326.4 million gallons of ethanol compared with 247.0 million gallons for the same period in 2016. The consolidated ethanol crush margin was $37.7 million, or $0.12 per gallon, for the first quarter of 2017 compared with $4.1 million, or $0.02 per gallon, for the same period in 2016. The consolidated ethanol crush margin is the ethanol production segment's operating income before depreciation and amortization, which includes corn oil production, plus intercompany storage, transportation and other fees, net of related expenses.

"U.S. ethanol exports have started 2017 stronger than any year on record and we have continued to focus on international markets, exporting approximately 20% of our production in the first quarter," Becker added. "Global demand for each of the products we produce, whether ethanol, corn oil or distillers grains, is strong and we are well positioned to benefit from these opportunities."

"We believe that 2017 could develop into a favorable year for ethanol margins as the forward curve is stronger going into the summer driving season compared with 2016. Our focus is to drive free cash flow in the current environment and further strengthen our balance sheet in 2017." 

Recent Developments

Results of Operations
Consolidated revenues increased $138.5 million for the three months ended March 31, 2017, compared with the same period in 2016. Revenues were impacted by an increase in ethanol, corn oil and cattle volumes sold, plus the addition of Fleischmann's Vinegar during the fourth quarter of 2016. This was partially offset by a decrease in grain trading activity volumes and lower average realized prices for grain and cattle.

Operating income increased $40.0 million for the three months ended March 31, 2017, compared with the same period last year primarily due to increased margins on ethanol and cattle production. Interest expense increased $7.7 million for the three months ended March 31, 2017, compared with the same period in 2016, primarily due to higher average debt outstanding and borrowing costs. Income tax benefit was $2.4 million for the three months ended March 31, 2017, compared with $14.9 million for the same period in 2016.

Earnings before interest, income taxes, depreciation and amortization (EBITDA) for the first quarter of 2017 was $43.8 million compared with $(5.8) million for the same period last year.

Segment Information
During the fourth quarter of 2016, management restructured its operating segments. The four segments are: (1) ethanol production, which includes ethanol, distillers grains and corn oil production, (2) agribusiness and energy services, which includes grain handling and storage, commodity marketing and merchant trading, (3) food and ingredients, which includes the vinegar, cattle feedlot and food-grade corn oil operations and (4) partnership, which includes fuel storage and transportation services. Intercompany fees charged to the ethanol production segment for storage and logistics services, grain procurement and product sales are included in the partnership, and agribusiness and energy services segments and eliminated upon consolidation. Third party costs of grain consumed and revenues from product sales are reported directly in the ethanol production segment. Prior periods have been reclassified to conform to the revised segment presentation.

GREEN PLAINS INC.
SEGMENT OPERATIONS
(unaudited, in thousands)
       
 Three Months Ended
March 31,
 
  2017   2016  % Var.
Revenues:      
Ethanol production$  621,375  $  528,328    17.6 %
Agribusiness and energy services   177,803     167,553    6.1  
Food and ingredients   98,060     58,748    66.9  
Partnership   27,229     23,789    14.5  
Intersegment eliminations   (36,783)    (29,214)   25.9  
 $  887,684  $  749,204    18.5 %
Gross margin:      
Ethanol production$  22,237  $  (6,170)  *%
Agribusiness and energy services   11,409     8,138    40.2  
Food and ingredients   15,025     (506)  * 
Partnership   27,229     23,789    14.5  
Intersegment eliminations   (112)    (734)   (84.7) 
 $  75,788  $  24,517   *%
Operating income (loss):      
Ethanol production$  (6,598) $  (29,565)   (77.7)%
Agribusiness and energy services   6,369     3,737    70.4  
Food and ingredients   9,626     (1,363)  * 
Partnership   16,619     13,071    27.1  
Intersegment eliminations   (75)    (698)   (89.3) 
Corporate activities   (8,549)    (7,828)   9.2  
 $  17,392  $  (22,646)  *%
Depreciation and amortization:      
Ethanol production$  20,342  $  15,780    28.9 %
Agribusiness and energy services   660     306    115.7  
Food and ingredients   2,880     271   * 
Partnership   1,254     1,217    3.0  
Corporate activities   947     571    65.8  
 $  26,083  $  18,145    43.7 %
       
* Percentage variance not considered meaningful.      
       


GREEN PLAINS INC.
OPERATING DATA BY PRODUCT
(unaudited, in thousands)
        
 Three Months Ended
March 31,
 
  
 2017 2016 % Var. 
Ethanol production       
Ethanol (gallons)  326,426   246,955   32.2% 
Distillers grains (equivalent dried tons)  877   646   35.8  
Corn oil (pounds)  75,356   59,839   25.9  
Corn consumed (bushels)  113,485   86,531   31.1  
        
Agribusiness and energy services       
Domestic ethanol sold (gallons)  293,750   277,156   6.0  
Export ethanol sold (gallons)  65,845   49,005   34.4  
   359,595   326,161   10.3  
Food and ingredients       
Company-owned cattle on feed (daily average head)  63   61   4.2  
        
Partnership       
Storage and throughput (gallons)  321,082   247,510   29.7  
        


GREEN PLAINS INC.
CONSOLIDATED CRUSH MARGIN
(unaudited)
        
 Three Months Ended
March 31,
 Three Months Ended
March 31,
  
  2017   2016   2017   2016 
 ($ in thousands) ($ per gallon produced)
Ethanol production:       
Operating loss$  (6,598) $  (29,565) $  (0.02) $  (0.12)
Depreciation and amortization   20,342     15,780     0.07     0.07 
Total ethanol production   13,744     (13,785)    0.05     (0.05)
        
Intercompany fees, net:       
Storage and logistics (partnership)   16,863     13,137     0.05     0.05 
Marketing and agribusiness fees (agribusiness and energy services)   7,120     4,721     0.02     0.02 
Consolidated crush margin$  37,727  $  4,073  $  0.12  $  0.02 
        

Liquidity and Capital Resources  
On March 31, 2017, Green Plains had $295.4 million in total cash and cash equivalents, and $129.2 million available under revolving credit agreements, some of which are subject to restrictions and other lending conditions. Total debt outstanding was $1,124.8 million, including $335.7 million outstanding under working capital revolvers and other short-term borrowing arrangements for the agribusiness and energy services, and the food and ingredients segments at March 31, 2017.

Conference Call Information
On May 2, 2017, Green Plains Inc. and Green Plains Partners LP will host a joint conference call at 11 a.m. Eastern time (10 a.m. Central time) to discuss first quarter 2017 financial and operating results for each company. Domestic and international participants can access the conference call by dialing 888.228.5279 and 913.312.0942, respectively. Participants are advised to call at least 10 minutes prior to the start time. Alternatively, the conference call and presentation can be accessed on Green Plains' website at http://investor.gpreinc.com/events.cfm. A transcript of the conference call will also be made available on the company's website as soon as practicable.

Non-GAAP Financial Measures
Management uses earnings before interest, income taxes, depreciation and amortization, or EBITDA, and consolidated ethanol crush margin to measure the company's financial performance and to internally manage its businesses. Management believes these measures provide useful information to investors for comparison with peer and other companies. These measures should not be considered alternatives to net income or segment operating income, which are determined in accordance with generally accepted accounting principles (GAAP). These non-GAAP calculations may vary from company to company. Accordingly, the company's computation of EBITDA and consolidated ethanol crush margins may not be comparable with similarly titled measures of another company.

About Green Plains Inc.
Green Plains Inc. (NASDAQ:GPRE) is a diversified commodity-processing business with operations related to ethanol production, grain handling and storage, cattle feedlots, food ingredients, and commodity marketing and logistics services. The company is the second largest consolidated owner of ethanol production facilities in the world with 17 dry mill plants, producing nearly 1.5 billion gallons of ethanol at full capacity. Green Plains owns a 62.5% limited partner interest and a 2.0% general partner interest in Green Plains Partners. For more information about Green Plains, visit www.gpreinc.com.

About Green Plains Partners LP
Green Plains Partners LP (NASDAQ:GPP) is a fee-based Delaware limited partnership formed by Green Plains Inc. to provide fuel storage and transportation services by owning, operating, developing and acquiring ethanol and fuel storage tanks, terminals, transportation assets and other related assets and businesses. For more information about Green Plains Partners, visit www.greenplainspartners.com.

Forward-Looking Statements
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements reflect management's current views, which are subject to risks and uncertainties including, but not limited to, anticipated financial and operating results, plans and objectives that are not historical in nature. These statements may be identified by words such as "believe," "expect," "may," "should," "will" and similar expressions. Factors that could cause actual results to differ materially from those expressed or implied include: competition in the industries in which Green Plains operates; commodity market risks, financial market risks; counterparty risks; risks associated with changes to federal policy or regulation; risks related to closing and achieving anticipated results from acquisitions; risks associated with the joint venture to commercialize algae production and growth potential of the algal biomass industry; risks associated with the recent acquisitions of three ethanol plants and Fleischmann's Vinegar; and other risks discussed in Green Plains' reports filed with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Green Plains assumes no obligation to update any such forward-looking statements, except as required by law.

Consolidated Financial Results

GREEN PLAINS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
    
 March 31,
2017
 December 31,
2016
  
ASSETS   
Current assets   
Cash and cash equivalents$  256,468 $  304,211
Restricted cash   38,974    51,979
Accounts receivable, net   96,986    147,495
Inventories   464,994    422,181
Other current assets   62,456    74,710
Total current assets   919,878    1,000,576
Property and equipment, net   1,171,728    1,178,706
Other assets   329,540    327,210
Total assets$  2,421,146 $  2,506,492
    
LIABILITIES AND STOCKHOLDERS' EQUITY   
Current liabilities   
Accounts payable$  129,100 $  192,275
Accrued and other liabilities   46,147    67,473
Short-term notes payable and other borrowings   335,695    291,223
Current maturities of long-term debt   6,171    35,059
Other current liabilities   7,131    8,916
Current liabilities   524,244    594,946
Long-term debt   782,957    782,610
Other liabilities   145,296    149,745
Total liabilities   1,452,497    1,527,301
    
Stockholders' equity   
Total Green Plains stockholders' equity   851,612    862,507
Noncontrolling interests   117,037    116,684
Total liabilities and stockholders' equity$  2,421,146 $  2,506,492
    


GREEN PLAINS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands except per share amounts)
       
 Three Months Ended
March 31,
 
  2017   2016  % Var.
Revenues      
Product$  886,212  $  747,183    18.6 %
Service   1,472     2,021    (27.2) 
Total revenues   887,684     749,204    18.5  
Costs and expenses      
Cost of goods sold   811,896     724,687    12.0  
Operations and maintenance   8,531     8,645    (1.3) 
Selling, general and administrative   23,782     20,373    16.7  
Depreciation and amortization   26,083     18,145    43.7  
Total costs and expenses   870,292     771,850    12.8  
Operating income (loss)   17,392     (22,646)  * 
Other income (expense)      
Interest income   364     410    (11.2) 
Interest expense   (18,496)    (10,798)   71.3  
Other, net   10     (1,675)  * 
Total other expense   (18,122)    (12,063)   50.2  
Loss before income taxes   (730)    (34,709)   (97.9) 
Income tax benefit   (2,381)    (14,893)   (84.0) 
Net income (loss)   1,651     (19,816)  * 
Net income attributable to noncontrolling interests   5,248     4,322    21.4  
Net loss attributable to Green Plains$  (3,597) $  (24,138)   (85.1)%
       
Earnings per share:      
Net loss attributable to Green Plains - basic$  (0.09) $  (0.63)   (85.2)%
Net loss attributable to Green Plains - diluted$  (0.09) $  (0.63)   (85.2)%
       
Weighted average shares outstanding:      
Basic   38,420     38,197    
Diluted   38,420     38,197    
       
* Percentage variance not considered meaningful.      
       


GREEN PLAINS INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited, in thousands)
    
 Three Months Ended
March 31,
 
  2017   2016 
Cash flows from operating activities:   
Net income (loss)$  1,651  $  (19,816)
Noncash operating adjustments:   
Depreciation and amortization   26,083     18,145 
Deferred income taxes   (2,934)    (20,387)
Other   6,554     7,706 
Net change in working capital   (69,766)    (65,455)
Net cash used by operating activities   (38,412)    (79,807)
    
Cash flows from investing activities:   
Purchases of property and equipment   (14,902)    (18,571)
Acquisition of a business, net of cash acquired   (4,074)    - 
Distributions from (investments in) unconsolidated subsidiaries   (2,399)    260 
Net cash used by investing activities   (21,375)    (18,311)
    
Cash flows from financing activities:   
Net proceeds (payments) - long-term debt   (32,145)    50,053 
Net proceeds - short-term borrowings   44,412     48,248 
Other   (223)    (1,608)
Net cash provided by financing activities   12,044     96,693 
    
Net change in cash and cash equivalents   (47,743)    (1,425)
Cash and cash equivalents, beginning of period   304,211     384,867 
Cash and cash equivalents, end of period$  256,468  $  383,442 
    


GREEN PLAINS INC.
RECONCILIATIONS TO NON-GAAP FINANCIAL MEASURES
(unaudited, in thousands)
    
 Three Months Ended
March 31,
 
  2017   2016 
Net income (loss)$  1,651  $  (19,816)
Interest expense   18,496     10,798 
Income taxes   (2,381)    (14,893)
Depreciation and amortization   26,083     18,145 
EBITDA$  43,849  $  (5,766)
    
Contact: Jim Stark | Vice President, Investor & Media Relations | 402.884.8700 | jim.stark@gpreinc.com