Alto Ingredients, Inc. (NASDAQ: ALTO), a leading producer and distributor of specialty alcohols and essential ingredients, reported its fourth quarter and full year 2021 financial results for the year ended December 31, 2021.

“In 2021, by focusing on higher margin, consistent revenue markets, we succeeded in becoming a profitable business with significant, unique opportunities for top- and bottom-line growth,” said Mike Kandris, CEO of Alto Ingredients. “During 2021, we invested in capacity, expanded our protein strategy, optimized assets, and secured valuable certifications. As a result, net sales reached $1.2 billion, up 35% over 2020, reflecting the solid specialty alcohol and essential ingredients business throughout the year and exceptional renewable fuel margins in the fourth quarter of 2021. In January 2022, we completed a downstream integration by acquiring a small-package distributor, Eagle Alcohol. Eagle fits perfectly into our strategic roadmap as we continue to raise the quality of our production to the highest grades of grain neutral spirits by further enhancing our distillation process, optimizing our production capabilities and integrating Eagle’s strong distribution and sales services. Also, Eagle further diversifies our business with less emphasis on revenue related to commodities. Looking ahead, we plan to invest further in key differentiating assets as well as evaluate capital expenditure programs to create long-term stakeholder value.”

Financial Results for the Three Months Ended December 31, 2021 Compared to 2020

  • Net sales were $385.5 million, compared to $168.8 million.
  • Cost of goods sold was $343.4 million, compared to $155.2 million.
  • Gross profit was $42.1 million, compared to $13.6 million.
  • Selling, general and administrative expenses were $9.4 million, compared to $6.7 million.
  • Operating income was $37.3 million, compared to an operating loss of $14.2 million.
  • Net income available to common stockholders was $35.4 million, or $0.49 per diluted share, compared a net loss of $20.5 million, or $0.30 per share.
  • Adjusted EBITDA was $43.4 million, compared to $16.2 million.
  • Cash and cash equivalents were $50.6 million at December 31, 2021, compared to $47.7 million at December 31, 2020.
  • On November 8, 2021, the company announced the sale of its renewable fuel production facility in Stockton, California for $24.0 million in cash.

Financial Results for the Twelve Months Ended December 31, 2021 Compared to 2020

  • Net sales were $1.2 billion, compared to $897.0 million.
  • Cost of goods sold was $1.1 billion, compared to $844.2 million.
  • Gross profit was $67.8 million, compared to $52.9 million.
  • Selling, general and administrative expenses were $29.2 million, compared to $32.0 million.
  • Operating income was $40.1 million, compared to $9.9 million.
  • Net income available to common stockholders was $44.2 million, or $0.61 per diluted share, compared to a net loss of $16.4 million, or $0.28 per share.
  • Adjusted EBITDA was $76.8 million, compared to $66.6 million.

Fourth Quarter 2021 Results Conference CallManagement will host a conference call at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time on Thursday, March 10, 2022, and will deliver prepared remarks via webcast followed by a question-and-answer session.

The webcast for the call can be accessed from Alto Ingredients’ website at www.altoingredients.com. Alternatively, you may dial the following number up to ten minutes prior to the scheduled conference call time: (877) 847-6066. International callers should dial 00-1 (970) 315-0267. The pass code will be 3612369. If you are unable to participate in the live call, the webcast will be archived for replay on Alto Ingredients’ website for one year. In addition, a telephonic replay will be available at 8:00 p.m. Eastern Time on Thursday, March 10, 2022, through 8:00 p.m. Eastern Time on Thursday, March 17, 2022. To access the replay, please dial (855) 859-2056. International callers should dial 00-1 (404) 537-3406. The pass code will be 3612369.

Use of Non-GAAP MeasuresManagement believes that certain financial measures not in accordance with generally accepted accounting principles ("GAAP") are useful measures of operations. The company defines Adjusted EBITDA as unaudited net income (loss) attributed to Alto Ingredients, Inc. before interest expense, interest income, provision (benefit) for income taxes, asset impairments, loss on extinguishment of debt, purchase accounting adjustments, fair value adjustments, and depreciation expense. A table is provided at the end of this release that provides a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, net income (loss) attributed to Alto Ingredients, Inc. Management provides this non-GAAP measure so that investors will have the same financial information that management uses, which may assist investors in properly assessing the company's performance on a period-over-period basis. Adjusted EBITDA is not a measure of financial performance under GAAP and should not be considered as an alternative to net income (loss) attributed to Alto Ingredients, Inc. or any other measure of performance under GAAP, or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA has limitations as an analytical tool and you should not consider this measure in isolation or as a substitute for analysis of the company's results as reported under GAAP.

About Alto Ingredients, Inc.Alto Ingredients, Inc. (ALTO) is a leading producer and distributor of specialty alcohols and essential ingredients. The company is focused on products for four key markets: Health, Home & Beauty; Food & Beverage; Essential Ingredients; and Renewable Fuels. The company’s customers include major food and beverage companies and consumer products companies. For more information, please visit www.altoingredients.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Statements and information contained in this communication that refer to or include Alto Ingredients’ estimated or anticipated future results or other non-historical expressions of fact are forward-looking statements that reflect Alto Ingredients’ current perspective of existing trends and information as of the date of the communication. Forward looking statements generally will be accompanied by words such as “anticipate,” “believe,” “plan,” “could,” “should,” “estimate,” “expect,” “forecast,” “outlook,” “guidance,” “intend,” “may,” “might,” “will,” “possible,” “potential,” “predict,” “project,” or other similar words, phrases or expressions. Such forward-looking statements include, but are not limited to, statements concerning the benefits of the acquisition of Eagle Alcohol; and Alto Ingredients’ other plans, objectives, expectations and intentions. It is important to note that Alto Ingredients’ plans, objectives, expectations and intentions are not predictions of actual performance. Actual results may differ materially from Alto Ingredients’ current expectations depending upon a number of factors affecting Alto Ingredients’ business. These factors include, among others, adverse economic and market conditions, including for specialty alcohols and essential ingredients; export conditions and international demand for the company’s products; fluctuations in the price of and demand for oil and gasoline; raw material costs, including production input costs, such as corn and natural gas; and the effects – both positive and negative – of the coronavirus pandemic and its resurgence or abatement. These factors also include, among others, the inherent uncertainty associated with financial and other projections; the anticipated size of the markets and continued demand for Alto Ingredients’ products; the impact of competitive products and pricing; the risks and uncertainties normally incident to the specialty alcohol production and marketing industries; changes in generally accepted accounting principles; successful compliance with governmental regulations applicable to Alto Ingredients’ facilities, products and/or businesses; changes in laws, regulations and governmental policies; the loss of key senior management or staff; and other events, factors and risks previously and from time to time disclosed in Alto Ingredients’ filings with the Securities and Exchange Commission including, specifically, those factors set forth in the “Risk Factors” section contained in Alto Ingredients’ Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 12, 2021.

Media Contact:Bryon McGregor, Alto Ingredients, Inc., 916-403-2768, mediarelations@altoingredients.com Company IR Contact:Michael Kramer, Alto Ingredients, Inc., 916-403-2755, Investorrelations@altoingredients.comIR Agency Contact: Kirsten Chapman, LHA Investor Relations, 415-433-3777, Investorrelations@altoingredients.com

 
ALTO INGREDIENTS, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(unaudited, in thousands, except per share data)
 
  Three Months EndedDecember 31,   Year EndedDecember 31,
  2021     2020   2021   2020
         
Net sales $ 385,492     $ 168,818     $ 1,207,892     $ 897,023  
Cost of goods sold   343,379       155,181       1,140,108       844,164  
Gross profit   42,113       13,637       67,784       52,859  
Selling, general and administrative expenses   (9,408 )     (6,735 )     (29,185 )     (31,980 )
Gain on sale of assets   4,571       3,223       4,571       1,580  
Gain on litigation settlement                     11,750  
Asset impairments         (24,356 )     (3,100 )     (24,356 )
Income (loss) from operations   37,276       (14,231 )     40,070       9,853  
Income from loan forgiveness               9,860        
Interest expense, net   (228 )     (3,790 )     (3,587 )     (17,943 )
Fair value adjustments         (2,462 )           (9,959 )
Other income, net   567       271       1,208       750  
Income (loss) before income taxes   37,615       (20,212 )     47,551       (17,299 )
Provision (benefit) for income taxes   1,469       (17 )     1,469       (17 )
Consolidated net income (loss)   36,146       (20,195 )     46,082       (17,282 )
Net loss attributed to noncontrolling interests                     2,166  
Net income (loss) attributed to Alto Ingredients, Inc. $ 36,146     $ (20,195 )   $ 46,082     $ (15,116 )
Preferred stock dividends $ (319 )   $ (319 )   $ (1,265 )   $ (1,268 )
Income allocated to participating securities $ (477 )   $     $ (600 )   $  
Net income (loss) available to common stockholders $ 35,350     $ (20,514 )   $ 44,217     $ (16,384 )
Net income (loss) per share, basic $ 0.50     $ (0.30 )   $ 0.62     $ (0.28 )
Net income (loss) per share, diluted $ 0.49     $ (0.30 )   $ 0.61     $ (0.28 )
Weighted-average shares outstanding, basic   71,387       67,512       71,098       58,609  
Weighted-average shares outstanding, diluted   72,222       67,512       72,219       58,609  

 
ALTO INGREDIENTS, INC.CONSOLIDATED BALANCE SHEETS(unaudited, in thousands, except par value)
         
  December 31,   December 31,
ASSETS 2021   2020
Current Assets:        
Cash and cash equivalents $ 50,612   $ 47,667
Restricted cash   11,513     520
Accounts receivable, net   86,888     43,491
Inventories   54,373     37,925
Derivative assets   15,839     17,149
Assets held-for-sale   1,000     58,295
Other current assets   9,301     8,999
Total current assets   229,526     214,046
Property and equipment, net   222,550     229,486
Other Assets:    
Right of use operating lease assets, net   13,413     11,046
Notes receivable   11,641     14,337
Other assets   7,823     7,903
Total other assets   32,877     33,286
Total Assets $ 484,953   $ 476,818

 
ALTO INGREDIENTS, INC.CONSOLIDATED BALANCE SHEETS (CONTINUED)(unaudited, in thousands, except par value)
     
  December 31,   December 31,
LIABILITIES AND STOCKHOLDERS’ EQUITY 2021   2020
Current Liabilities:          
Accounts payable – trade $ 23,251     $ 13,047  
Accrued liabilities   21,307       11,101  
Current portion – operating leases   3,909       2,180  
Current portion – long-term debt         25,533  
Derivative liabilities   13,582        
Liabilities held-for-sale         19,542  
Other current liabilities   7,553       15,524  
Total current liabilities   69,602       86,927  
     
Long-term debt, net of current portion   50,361       71,807  
Operating leases, net of current portion   9,382       8,715  
Other liabilities   10,394       13,134  
Total Liabilities   139,739       180,583  
     
Stockholders’ Equity:    
Alto Ingredients, Inc. Stockholders’ Equity:    
Preferred stock, $0.001 par value; 10,000 shares authorized;   Series A: 0 shares issued and outstanding as of   December 31, 2021 and 2020   Series B: 927 shares issued and outstanding as of   December 31, 2021 and 2020   1       1  
Common stock, $0.001 par value; 300,000 shares authorized;   72,778 and 72,487 shares issued and outstanding as of   December 31, 2021 and 2020, respectively   73       72  
Non-voting common stock, $0.001 par value; 3,553 shares   authorized; 1 share issued and outstanding as of   December 31, 2021 and 2020          
Additional paid-in capital   1,037,205       1,036,638  
Accumulated other comprehensive loss   (284 )     (3,878 )
Accumulated deficit   (691,781 )     (736,598 )
Total Stockholders’ Equity   345,214       296,235  
Total Liabilities and Stockholders’ Equity $ 484,953     $ 476,818  
               

Reconciliation of Adjusted EBITDA to Net Income (Loss)

  Three Months EndedDecember 31,   Years EndedDecember 31,
(unaudited) 2021   2020   2021   2020
Net income (loss) attributed to Alto Ingredients, Inc. $ 36,146     $ (20,195 )   $ 46,082     $ (15,116 )
Adjustments:                              
Interest expense   228       3,790       3,587       17,943  
Interest income   (177 )     (190 )     (730 )     (768 )
Asset impairments         24,356       3,100       24,356  
Fair value adjustments         2,462             9,959  
Provision (benefit) for income taxes   1,469       (17 )     1,469       (17 )
Depreciation expense   5,772       6,015       23,292       30,269  
Total adjustments   7,292       36,416       30,718       81,742  
Adjusted EBITDA $ 43,438     $ 16,221     $ 76,800     $ 66,626  
                               

Commodity Price Performance

  Three Months EndedDecember 31,   Years EndedDecember 31,
(unaudited) 2021   2020   2021   2020
Renewable fuel production gallons sold (in millions)   42.6     33.0     161.1     181.0
Specialty alcohol production gallons sold (in millions)   26.3     16.0     89.5     90.9
Third party renewable fuel gallons sold (in millions)   48.5     51.6     229.0     264.4
Total gallons sold (in millions)   117.4     100.6     479.6     536.3
                       
Total gallons produced (in millions)   69.6     53.0     251.7     262.1
Production capacity utilization   74%     47%     60%     53%
                       
Average sales price per gallon $ 3.04   $ 1.72   $ 2.46   $ 1.63
Average CBOT ethanol price per gallon $ 2.19   $ 1.41   $ 2.11   $ 1.25
                       
Corn cost – CBOT equivalent $ 5.69   $ 3.79   $ 5.70   $ 3.56
Average basis $ 0.49   $ 0.27   $ 0.52   $ 0.28
Delivered cost of corn $ 6.18   $ 4.06   $ 6.22   $ 3.84
                       
Total essential ingredient tons sold (in thousands)   349.7     270.0     1,236.2     1,447.5
Essential ingredient return % (1)   33.5%     42.6%     33.7%     44.1%
________________                      
(1) Essential ingredient revenue as a percentage of delivered cost of corn.                      
                       

Segment Financials

(unaudited) Three Months EndedDecember 31,   Years EndedDecember 31,
  2021   2020   2021   2020
Net sales                              
Pekin Campus production, recorded as gross:                              
Alcohol sales $ 156,227     $ 71,854     $ 498,195     $ 330,432  
Essential ingredient sales   48,865       32,103       189,535       130,270  
Intersegment sales   273       218       1,193       645  
Total Pekin Campus sales   205,365       104,175       688,923       461,347  
Marketing and distribution:                              
Alcohol sales, gross $ 123,720     $ 43,585     $ 379,422     $ 256,209  
Alcohol sales, net   264       405       1,753       1,529  
Intersegment sales   2,784       1,898       10,061       9,648  
Total marketing and distribution sales   126,768       45,888       391,236       267,386  
                               
Other production, recorded as gross:                              
Alcohol sales $ 44,622     $ 15,800     $ 107,931     $ 137,703  
Essential ingredient sales   11,794       5,071       31,056       40,880  
Intersegment sales   68       187       964       1,309  
Total Other production sales   56,484       21,058       139,951       179,892  
                               
Intersegment eliminations   (3,125 )     (2,303 )     (12,218 )     (11,602 )
Net sales as reported $ 385,492     $ 168,818     $ 1,207,892     $ 897,023  
                               
Cost of goods sold:                              
Pekin Campus production $ 169,595     $ 89,316     $ 638,371     $ 389,125  
Marketing and distribution   125,567       42,637       371,371       253,465  
Other production   49,348       25,069       136,401       206,412  
Intersegment eliminations   (1,131 )     (1,841 )     (6,035 )     (4,838 )
Cost of goods sold as reported $ 343,379     $ 155,181     $ 1,140,108     $ 844,164  
                               
Gross profit (loss):                              
Pekin Campus production $ 35,770     $ 14,859     $ 50,552     $ 72,222  
Marketing and distribution   1,201       3,251       19,865       13,921  
Other production   7,136       (4,011 )     3,550       (26,520 )
Intersegment eliminations   (1,994 )     (462 )     (6,183 )     (6,764 )
Gross profit as reported $ 42,113     $ 13,637     $ 67,784     $ 52,859  
Alto Ingredients (NASDAQ:ALTO)
Historical Stock Chart
From Jan 2023 to Feb 2023 Click Here for more Alto Ingredients Charts.
Alto Ingredients (NASDAQ:ALTO)
Historical Stock Chart
From Feb 2022 to Feb 2023 Click Here for more Alto Ingredients Charts.