REX American Resources Reports Record High Earnings for Fiscal Year 2025, Major Tax Credit Windfall, Facility Expansion Progress, and Aggressive Share Buybacks

Key Highlights for Investors

• Record Earnings: REX American Resources achieved diluted net income per share of \$2.50 for fiscal year 2025, a significant increase from \$1.65 in fiscal year 2024.
• Fourth Quarter Surge: In Q4 2025, net income per share jumped to \$1.32, up from \$0.31 in Q4 2024. Net income attributable to REX shareholders for Q4 was \$43.7 million, nearly quadruple the \$11.1 million earned in Q4 2024.
• 45Z Tax Credits: The company recognized approximately \$28.1 million in new 45Z tax credits in Q4 2025, dramatically reducing income tax expense and boosting net profitability.
• Operational Performance: Fiscal year 2025 gross profit was \$93.7 million, up from \$91.5 million in 2024, with stable gross margins at 14%. Ethanol sales volumes reached 290 million gallons for the year.
• Sales and Revenue: Net sales and revenue totaled \$650.5 million for 2025, a modest increase from \$642.5 million in the prior year, reflecting improved ethanol and corn oil pricing.
• Expansion and Capital Projects: The One Earth Energy ethanol production facility expansion is near completion, with commissioning expected soon and full operations targeted for fiscal 2026. Carbon capture and sequestration projects are underway, with total capital expenditures to date at \$166 million, and a total budget of \$220–\$230 million.
• Balance Sheet Strength: As of January 31, 2026, REX held \$375.8 million in cash, cash equivalents, and short-term investments, with zero bank debt.
• Share Buybacks: During fiscal year 2025, the company repurchased 1.65 million shares for \$32.9 million, reducing shares outstanding and potentially boosting EPS. 2.36 million shares remain authorized for repurchase.
• Management Outlook: CEO Zafar Rizvi highlighted record profitability, advancement of strategic projects, and positioning for sustainable growth, while focusing on leveraging 45Z tax credits for ongoing profit enhancement.

Detailed Financial Results

Full Fiscal Year 2025

• Net Sales and Revenue: \$650.5 million, up from \$642.5 million in 2024.
• Gross Profit: \$93.7 million, up from \$91.5 million.
• Gross Margin: 14%, unchanged year-over-year.
• Income Before Taxes: \$88.6 million, slightly down from \$92.9 million in 2024.
• Net Income Attributable to REX Shareholders: \$83.0 million (vs \$58.2 million in 2024).
• Diluted Net Income Per Share: \$2.50 (vs \$1.65 in 2024), based on 33.2 million diluted shares.
• Consolidated Ethanol Sales Volumes: 290 million gallons.

Fourth Quarter 2025

• Net Sales and Revenue: \$158.0 million (vs \$158.2 million in Q4 2024).
• Gross Profit: \$28.9 million (vs \$17.6 million in Q4 2024), driven by improved ethanol pricing and lower corn costs.
• Income Before Taxes: \$27.4 million (vs \$17.9 million in Q4 2024).
• Net Income Attributable to REX Shareholders: \$43.7 million (vs \$11.1 million in Q4 2024).
• Diluted Net Income Per Share: \$1.32 (vs \$0.31 in Q4 2024), based on 33.04 million diluted shares.
• 45Z Tax Credit Impact: \$28.1 million tax credit recognized, substantially enhancing net results.

Strategic Initiatives and Capital Projects

One Earth Energy Expansion

The company is completing a major expansion at the One Earth Energy facility, with testing and commissioning imminent. The expanded facility is expected to be fully operational during fiscal 2026, which could further boost production volumes and revenue.

Carbon Capture and Sequestration

REX is advancing its carbon capture and sequestration project, pending permitting for the Class VI injection well and associated CO₂ pipeline. Capital expenditures for the combined ethanol expansion and carbon capture initiatives at Gibson City have reached \$166 million, with a total budget set at \$220–\$230 million. These projects aim to position REX to qualify for additional tax credits and improve sustainability, potentially driving future profitability.

Share Repurchase Program

REX repurchased 1,651,252 shares in fiscal 2025, spending \$32.9 million. This repurchase reduced shares outstanding, supporting EPS growth. 2,357,186 shares remain authorized for buyback, indicating continued capital return to shareholders.

Balance Sheet Strength

The company maintains a robust balance sheet with \$375.8 million in liquidity and no bank debt, providing financial flexibility for ongoing and future projects.

Outlook and Potential Share Price Drivers

• Record Earnings: The substantial increase in net income and EPS may positively influence share price.
• 45Z Tax Credit: The \$28.1 million tax credit in Q4 2025 is a major windfall, enhancing profitability and potentially boosting future results as the company continues to qualify for this program.
• Facility Expansion and Carbon Capture: Near-term completion and commissioning of the One Earth Energy expansion and progress on the carbon capture project could raise production, qualify for additional tax credits, and improve environmental credentials, all of which may drive investor interest.
• Share Buybacks: Aggressive repurchase activity reduces share count and increases EPS, generally viewed positively by the market.
• Balance Sheet: The absence of bank debt and strong liquidity provide financial stability, enabling further investment or shareholder returns.

Investors should also note risks including regulatory changes, commodity price volatility, permitting uncertainties for carbon capture, weather impacts, and broader macroeconomic factors. These risks are highlighted by management as potential sources of share price fluctuation.

Management Commentary

“REX American delivered record earnings per share in fiscal 2025. We strengthened our record of profitable operations, advanced our ethanol production expansion, and continued working closely with government officials to drive progress on our carbon capture initiative,” stated CEO Zafar Rizvi. “We remain fully focused on our core operations and revenue-generating activities, while pursuing qualifications for the 45Z tax credit program to enhance profitability. The REX team continues to execute at a high level, positioning the company for sustainable growth and creating increasing value for our shareholders.”

Investor Call Information

REX will host a conference call at 11:00 a.m. ET today to discuss results and answer investor questions. Access details and a replay are available on the company website.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Readers should conduct their own research and consult with a financial advisor before making investment decisions. Forward-looking statements are subject to risks and uncertainties, which may cause actual results to differ materially from those projected. See REX American Resources’ SEC filings for a full list of risk factors.

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