Green Plains Inc.
Feb 8, 2012

Green Plains Reports Fourth Quarter and Full-Year 2011 Financial Results

Results for the Full-Year of 2011

Results for the Fourth Quarter of 2011

OMAHA, Neb., Feb. 8, 2012 (GLOBE NEWSWIRE) -- Green Plains Renewable Energy, Inc. (Nasdaq:GPRE) announced today its financial results for the fourth quarter and full-year ended December 31, 2011. Net income attributable to Green Plains for the full year of 2011 was $38.4 million, or $1.01 per diluted share, compared to $48.0 million or $1.51 per diluted share in 2010. Revenues were $3.6 billion for the year ended December 31, 2011, compared to $2.1 billion in 2010.

For the quarter ended December 31, 2011, net income attributable to Green Plains was $13.3 million, or $0.36 per diluted share, compared to $16.4 million, or $0.44 per diluted share, for the same period in 2010. Revenues were $922.8 million for the fourth quarter of 2011 compared to $757.0 million during the same period in 2010.

"In three short years, we have successfully built a large, diversified platform capable of generating solid operating results and strong cash flows - and we are not done growing," stated Todd Becker, President and Chief Executive Officer. "Our businesses handled and processed more than nine million tons of grain in 2011, marketed and distributed over a billion gallons of fuel and produced two million tons of animal feed which are all records for our young company. Our nine ethanol plants produced a record 722 million gallons of ethanol last year, an increase of nearly 33% over 2010. In addition, we developed a new business segment during 2011 that extracted 96 million pounds of corn oil, and we increased our grain storage capacity to 39 million bushels."

The Company generated $48.2 million of non-ethanol operating income from the corn oil production, agribusiness, and marketing and distribution segments in 2011. For the fourth quarter of 2011, non-ethanol operating income was $19.1 million, or 48% of total segment operating income. The corn oil production and agribusiness segments generated $9.0 million and $7.8 million of operating income in the quarter, respectively.

"Since late in the year spot ethanol margins have compressed. We are maintaining our disciplined approach to managing commodity risks and are continually assessing production levels to optimize our operating performance. The long-term fundamentals for ethanol are solid. There continues to be a strong economic incentive to blend ethanol and we expect certification of E15 in the near future," said Becker. "With our strategy of diversification and focus on operating efficiencies, combined with our strong cash balance, we believe we are well positioned to manage through sustained cyclical downturns."

EBITDA, which is defined as earnings before interest, income taxes, noncontrolling interests, depreciation and amortization, for the full-year of 2011 was $148.6 million compared to $129.6 million for the same period of 2010. Green Plains had $194.6 million total cash and equivalents and $221.6 million available under committed loan agreements at subsidiaries (subject to satisfaction of specified lending conditions and covenants) at December 31, 2011. EBITDA was $45.2 million for the fourth quarter of 2011 compared to $43.9 million during the same period of 2010. For reconciliations of EBITDA to net income attributable to Green Plains, see "EBITDA" below.

2011 Business Highlights

Conference Call

On February 9, 2012, Green Plains will hold a conference call to discuss its fourth quarter and full-year 2011 financial results. Green Plains' participants will include Todd Becker, President and Chief Executive Officer, Jerry Peters, Chief Financial Officer, and Jeff Briggs, Chief Operating Officer. The time of the call is 11:00 a.m. ET / 10:00 a.m. CT. To participate by telephone, the domestic dial-in number is 888-455-2308 and the international dial-in number is 719-325-2387. The conference call will be webcast and accessible at www.gpreinc.com. Listeners are advised to go to the website at least 10 minutes prior to the call to register, download and install any necessary audio software. A slide presentation will be available on Green Plains' website at http://investor.gpreinc.com/events.cfm. The conference call will also be archived and available for replay through February 16, 2012.

About Green Plains Renewable Energy, Inc.

Green Plains Renewable Energy, Inc. (Nasdaq:GPRE) is North America's fourth largest ethanol producer. The Company markets and distributes approximately one billion gallons of renewable motor fuel on an annual basis, including 740 million gallons of expected production from the Company's nine ethanol plants located throughout the U.S. Green Plains owns and operates grain handling and storage assets and provides complementary agronomy services to local grain producers through its agribusiness segment. Green Plains owns BlendStar LLC, a biofuels terminal operator with locations in the southern U.S. Green Plains is a joint venture partner in BioProcess Algae LLC, which was formed to commercialize advanced photo-bioreactor technologies for the growing and harvesting of algal biomass.

Safe Harbor

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such statements are identified by the use of words such as "anticipates," "believes," "estimates," "expects," "goal," "intends," "plans," "potential," "predicts," "should," "will," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Such statements are based on management's current expectations and are subject to various factors, risks and uncertainties that may cause actual results, outcome of events, timing and performance to differ materially from those expressed or implied by such forward-looking statements. Green Plains may experience significant fluctuations in future operating results due to a number of economic conditions, including, but not limited to, competition in the ethanol and other industries in which the Company operates, commodity market risks, financial market risks, counter-party 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 the growth potential of the algal biomass industry, and other risks detailed in the Company's reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2010, as amended, and in the Company's subsequent filings with the SEC. Green Plains assumes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The cautionary statements in this report expressly qualify all of the Company's forward-looking statements. In addition, the Company is not obligated, and does not intend, to update any of its forward-looking statements at any time unless an update is required by applicable securities laws.

Consolidated Financial Results

The following are consolidated statements of operations for Green Plains (in thousands, except per share amounts):

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010 2011 2010
         
Revenues  $ 922,791  $ 757,032  $ 3,553,712  $ 2,133,922
Cost of goods sold  870,738  705,414  3,381,480  1,981,396
Gross profit  52,053  51,618  172,232  152,526
Selling, general and administrative expenses  19,869  18,896  73,219  60,475
Operating income  32,184  32,722  99,013  92,051
Other income (expense)        
Interest income  87  90  310  313
Interest expense  (9,206)  (8,692)  (36,645)  (26,144)
Other, net  (309)  152  (779)  (169)
Total other expense  (9,428)  (8,450)  (37,114)  (26,000)
         
Income before income taxes  22,756  24,272  61,899  66,051
Income tax expense  9,495  7,900  23,686  17,889
Net income  13,261  16,372  38,213  48,162
Net (income) loss attributable to noncontrolling interests  5  12  205  (150)
Net income attributable to Green Plains  $ 13,266  $ 16,384  $ 38,418  $ 48,012
Earnings per share:        
Basic  $ 0.40  $ 0.47  $ 1.09  $ 1.55
Diluted  $ 0.36  $ 0.44  $ 1.01  $ 1.51
Weighted average shares outstanding:        
Basic  32,905  34,781  35,276  31,032
Diluted  39,467  39,083  41,808  32,347

Revenues increased by $165.8 million in the fourth quarter of 2011 compared to the same period of 2010 primarily as a result of acquisitions and increases in commodity prices. Green Plains acquired the Lakota and Riga ethanol plants in October 2010 and the Otter Tail ethanol plant in March 2011. Ethanol production increased during the fourth quarter of 2011 compared to the same period of 2010 while operating margins per gallon produced decreased. Operating expenses increased as a result of the expanded scope of the business resulting from the acquisitions completed. These factors contributed to a decrease in operating income of $0.5 million in the fourth quarter of 2011 compared to the same period of 2010.

Interest expense increased by $0.5 million in the fourth quarter of 2011 compared to the same period of 2010 due to debt issued to finance the acquisitions and $90.0 million of convertible notes issued in November 2010. Weighted average shares outstanding for diluted earnings per share purposes reflect additional shares outstanding under the as-if-converted method of accounting for the convertible notes. The following summarizes the effects of this method on net income attributable to Green Plains and weighted average shares outstanding for the periods indicated (in thousands):

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010 2011 2010
Net income attributable to Green Plains  $ 13,266  $ 16,384  $ 38,418  $ 48,012
Interest and amortization expense related to convertible debt  1,448  960  5,776  960
Tax savings related to interest and amortization expense on convertible debt  (543)  (260)  (2,166)  (260)
Net income on an as-if-converted basis  $ 14,171  $ 17,084  $ 42,028  $ 48,712
Effect of convertible debt on weighted average shares outstanding - diluted  6,280  4,028  6,280  1,015

Operating Segment Information

Green Plains' operating segments are as follows: (1) production of ethanol and related distillers grains, collectively referred to as ethanol production, (2) corn oil production, (3) grain warehousing and marketing, as well as sales and related services of agronomy and petroleum products, collectively referred to as agribusiness, and (4) marketing and distribution of Company-produced and third-party ethanol, distillers grains and corn oil, collectively referred to as marketing and distribution. Selling, general and administrative expenses, primarily consisting of compensation of corporate employees, professional fees and overhead costs not directly related to a specific operating segment, are reflected in the table below as corporate activities. The following are revenues, gross profit and operating income by segment for the periods indicated (in thousands):

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010 2011 2010
         
Revenues:        
Ethanol production  $ 535,512  $ 374,282  $ 2,133,921  $ 1,115,425
Corn oil production  14,508  1,702  44,857  1,702
Agribusiness  170,505  167,100  554,140  370,752
Marketing and distribution  766,469  616,395  3,064,965  1,821,600
Intersegment eliminations  (564,203)  (402,447)  (2,244,171)  (1,175,557)
   $ 922,791  $ 757,032  $ 3,553,712  $ 2,133,922
         
Gross profit:        
Ethanol production  $ 23,130  $ 35,176  $ 87,010  $ 105,079
Corn oil production  8,969  878  27,067  878
Agribusiness  14,324  10,281  34,749  25,199
Marketing and distribution  5,779  6,347  23,112  21,192
Intersegment eliminations  (149)  (1,064)  294  178
   $ 52,053  $ 51,618  $ 172,232  $ 152,526
         
Operating income:        
Ethanol production  $ 21,058  $ 31,399  $ 73,242  $ 93,410
Corn oil production  8,958  878  26,999  878
Agribusiness  7,787  4,419  11,721  5,614
Marketing and distribution  2,397  3,299  9,475  9,673
Intersegment eliminations  (139)  (1,055)  334  188
Segment operating income  40,061  38,940  121,771  109,763
Corporate activities  (7,877)  (6,218)  (22,758)  (17,712)
   $ 32,184  $ 32,722  $ 99,013  $ 92,051

Intersegment revenues and corresponding costs are eliminated in consolidation and do not impact consolidated results. Certain amounts previously reported have been reclassified to conform to the current presentation.

Ethanol Production Segment

The table below presents key operating data within the ethanol production segment for the periods indicated:

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010 2011 2010
         
Ethanol sold   180,955 161,606 721,535 544,388
(thousands of gallons)        
         
Distillers grains sold  511 467 2,047 1,566
(thousands of equivalent dried tons)      
         
Corn consumed  64,405 56,969 255,437 194,327
(thousands of bushels)        

Revenues in the ethanol production segment increased by $161.2 million for the fourth quarter of 2011 compared to the same period of 2010. Revenues for the fourth quarter of 2011 included a full quarter of production from the Lakota and Riga ethanol plants, which were acquired in October 2010, as well as production from the Otter Tail ethanol plant, which was acquired in March 2011. Combined revenues from the Lakota, Riga and Otter Tail plants increased by $82.8 million for the fourth quarter of 2011 compared to the same period of 2010. The remaining increase in revenues was due to increases in ethanol and distillers grains prices.

Cost of goods sold in the ethanol production segment increased by $173.3 million for the fourth quarter of 2011 compared to the same period of 2010. The increase was primarily due to the consumption of 7.4 million additional bushels of corn and a 6.6% increase in the average corn cost per bushel during the fourth quarter of 2011 compared to the same period of 2010. The volume increase was primarily due to the additional production from the Lakota, Riga and Otter Tail plants. Depreciation and amortization expense for the ethanol production segment was $11.2 million during the fourth quarter of 2011 compared to $9.6 million during the same period of 2010. Operating income in the ethanol production segment decreased by $10.3 million to $21.1 million for the fourth quarter of 2011 compared to the same period of 2010. The decrease in operating income was primarily a result of lower operating margins per gallon in the fourth quarter of 2011 when compared to the same period of the previous year.

Corn Oil Production Segment

Green Plains initiated corn oil production in the fourth quarter of 2010. By September 30, 2011, corn oil extraction equipment was deployed at all nine of the Company's ethanol plants. During the fourth quarter of 2011, the Company produced 31.9 million pounds of corn oil generating operating income of $9.0 million, compared to 5.0 million pounds and $0.9 million, respectively, for the fourth quarter of 2010. For the full year of 2011, the Company produced 96.3 million pounds of corn oil compared to 5.0 million pounds in 2010.

Agribusiness Segment

The table below presents key operating data within the agribusiness segment for the periods indicated:

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010  2011 2010
Grain sold  17,697 20,022 69,336 56,215
(thousands of bushels)      
         
Fertilizer sold  25,948 27,046 64,749 60,653
(tons)        

Revenues in the agribusiness segment increased by $3.4 million for the fourth quarter of 2011 compared to the same period of 2010. Gross profit for the segment increased by $4.0 million for the fourth quarter of 2011 compared to the same period in 2010. Revenues and gross profit increased primarily as a result of higher unit margins for grains and fertilizer, offset by decreases in volumes sold. Operating income increased by $3.4 million for the fourth quarter of 2011 compared to the same period of 2010 as a result of the above factors, offset by increased operating expenses due to the expanded scope of agribusiness operations.

Marketing and Distribution Segment

Revenues in the marketing and distribution segment increased by $150.1 million for the fourth quarter of 2011 compared to the same period of 2010. The increase in revenues was primarily due to an increase in commodity prices. Ethanol and distillers grains revenues within the marketing and distribution segment increased by $109.4 million and $21.2 million, respectively. The remainder of the increase in revenue is attributable to sales of corn oil produced by the corn oil production segment. The Company sold 259.3 million gallons of ethanol within the marketing and distribution segment during the fourth quarter of 2011 compared to 267.8 million gallons sold during the same period of 2010. Volumes decreased 3.2% due to a decrease in volumes marketed for third-party ethanol plants offset by increased production from Company-owned plants as a result of the addition of the Lakota, Riga and Otter Tail plants. For the year of 2011, the Company sold 1.1 billion gallons of ethanol within the marketing and distribution segment compared to 0.9 billion gallons sold in 2010.

EBITDA

Management uses EBITDA to measure the Company's financial performance and to internally manage its businesses. Management believes that EBITDA provides useful information to investors as a measure of comparison with peer and other companies. EBITDA should not be considered an alternative to, or more meaningful than, net income or cash flow as determined in accordance with generally accepted accounting principles. EBITDA calculations may vary from company to company. Accordingly, the Company's computation of EBITDA may not be comparable with a similarly-titled measure of another company. The following sets forth the reconciliation of net income attributable to Green Plains to EBITDA for the periods indicated (in thousands):

  Three Months Ended December 31, Twelve Months Ended December 31,
  2011 2010 2011 2010
Net income attributable to Green Plains  $ 13,266  $ 16,384  $ 38,418  $ 48,012
 Net income (loss) attributable to noncontrolling interests  (5)  (12)  (205)  150
 Interest expense  9,206  8,692  36,645  26,144
 Income taxes  9,495  7,900  23,686  17,889
 Depreciation and amortization  13,228  10,973  50,076  37,355
EBITDA  $ 45,190  $ 43,937  $ 148,620  $ 129,550

Summary Balance Sheets

The following is condensed consolidated balance sheet information (in thousands):

  December 31,
  2011 2010
ASSETS    
     
Current assets   $ 576,420  $ 606,686
Property and equipment, net  776,789  747,421
Other assets  67,619  43,672
Total assets  $ 1,420,828  $ 1,397,779
     
LIABILITIES AND STOCKHOLDERS' EQUITY  
     
Current liabilities  $ 360,965  $ 342,503
Long-term debt  493,407  527,900
Other liabilities  61,099  29,734
Total liabilities  915,471  900,137
Total stockholders' equity  505,357  497,642
Total liabilities and stockholders' equity  $ 1,420,828  $ 1,397,779

At December 31, 2011, Green Plains had $194.6 million in total cash and equivalents and $221.6 million available under committed loan agreements at subsidiaries (subject to satisfaction of specified lending conditions and covenants). Total debt was $636.8 million, including $69.6 million outstanding under working capital revolvers and other short-term borrowing arrangements in the marketing and distribution and agribusiness segments. Green Plains had total assets of approximately $1.4 billion and total stockholders' equity of approximately $505.4 million. As of December 31, 2011, Green Plains had approximately 32.9 million common shares outstanding.

CONTACT: Jim Stark, Vice President - Investor and Media Relations

         Green Plains Renewable Energy

         (402) 884-8700
Source: Green Plains Renewable Energy

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