Green Plains reports improved plant performance, reduced OpEx
Green Plains Inc. reported its nine active ethanol plants ran at full capacity in Q1, a record high, as the company pursues $50M in cost savings. Despite a net loss of $72.9M, executives highlighted improved crush margins and operational performance. The company exited non-core operations and cut OpEx by over 3 cents/gallon, signaling progress toward profitability.
Green Plains Inc. on May 8 announced that its nine active ethanol plants operated at 100 capacity utilization during the first quarter. During a first quarter earnings call, company officials discussed ongoing initiatives to improve the company’s financial and operational performance.
Michelle Mapes, chief legal and administration officer at Green Plains, opened the call by noting the company’s past performance has not met expectations, but stressed “that is changing.”
According to Mapes, Green Plains is executing a zero-based approach cost structure, which has led to decisive actions across the organization. This includes exiting non-core operations, launching the sale of non-strategic assets, and focusing on a culture of operational excellence. In its fourth quarter 2024 earnings call, Green Plains committed to achieving $50 million in cost reductions. Mapes said the company is on track to meet that goal and has already achieved $30 million in annualized cost savings.
Chris Osowski, executive vice president of operations and technology at Green Plains, said the company’s platform continues to perform operationally at a high level. Green Plains’ nine active ethanol plants operated at 100% capacity utilization during the first quarter—the highest rate on record, he said. Operational expenses (OpEx) has fallen by more than 3 cents per gallon since the fourth quarter of last year, he added.
The company’s 119 MMgy ethanol plant in Fairmont, Minnesota, remains idle. Total capacity utilization across Green Plains’ total assets was 87.7% during the first quarter, down from 92.4% during the same period of last year, according to Phil Boggs, chief financial officer at Green Plains. Boggs said total plant utilization is expected to be maintained in the mid-90% utilization range for the year, even with scheduled maintenance underway.
Imre Havasi, head of trading and commercial operations at Green Plains, reported that ethanol crush margins have improved moving into the second and third quarters. He noted Green Plains has secured more than half of its second quarter crush margins at favorable levels, consistent with the company’s new approach to hedging and margin management.
Green Plains’ ethanol segment sold 195.3 million gallons of ethanol during the first quarter, down from 207.9 million gallons during the same period of last year. Consolidated crush margin was negative $14.7 million, compared to negative $9.3 million.
Net loss attributable to the company was $72.9 million, or $1.14 per diluted share, compared to a net loss attributable to the company of $51.4 million, or 81 cents per diluted share, during the same period of last year. Revenues were $601.5 million, down from $597.2 million, and adjusted EBITDA was negative $24.2 million, compared to negative $21.5 million.
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Source : Ethanol Producer Magazine
