The Andersons NASDAQ: ANDE reported its “strongest first quarter ever” for 2026, posting record net income and earnings per share as improved agricultural market conditions and strong renewables performance lifted results, executives said on the company’s earnings call.
Record first-quarter earnings
For the first quarter of 2026, the company reported net income attributable to The Andersons of $33 million, or $0.97 per diluted share, according to Executive Vice President and CFO Brian Valentine. Adjusted net income was $38 million, or $1.12 per diluted share, compared with adjusted net income of $4 million, or $0.12 per diluted share, in the first quarter of 2025.
Valentine said adjusted pre-tax earnings were $44 million, up from $3 million a year earlier, with improvements in both Agribusiness and Renewables and “including the recognition of 45Z producer tax credits in 2026.” Adjusted EBITDA totaled $91 million, compared with $57 million in the year-ago quarter. Operating expenses were “down slightly year-over-year,” while gross profit rose on better agricultural fundamentals compared with “the difficult market conditions” of early 2025.
Valentine said the company recorded an effective tax rate of 14% in the quarter and expects the full-year adjusted tax rate to range from 14% to 18%, largely influenced by tax credits and non-controlling interests. In response to an analyst question, Valentine added that 45Z credits are “recorded above the line in other income” and are “non-taxable tax credits.”
Policy and market backdrop: RVO finalized; volatility returns
President and CEO Bill Krueger highlighted a key industry development: the finalization of what he called “the largest ever renewable volume obligations for 2026 and 2027.” Krueger said the RVO provides greater regulatory clarity and is expected to support domestic demand for U.S. corn and soybeans, benefiting the company’s agribusiness and renewables platforms.
Krueger also said the company believes “the trough of the grain cycle occurred in 2025,” with underlying conditions improving despite ongoing global uncertainty. Management pointed to higher volatility in agricultural markets as a positive for merchandising performance, even as grain asset basis appreciation was “delayed” in the quarter.
Segment performance: Agribusiness rebounds, Renewables posts strong results
The Agribusiness segment reported adjusted pre-tax income attributable of $18 million, compared with break-even results in the first quarter of 2025, Valentine said. He attributed the improvement to volatility returning to agricultural markets as prices rallied and “old crop bushels still on farm came to market,” creating more merchandising opportunities. However, he noted that due to shifting market dynamics, the company’s asset footprint saw “limited basis appreciation.” Agribusiness adjusted EBITDA was $49 million, up from $31 million a year earlier.
Krueger said fertilizer margins improved year-over-year due to “strong product positioning amid supply disruptions,” and the Premium Ingredients business improved as well. In the Q&A, Krueger confirmed Premium Ingredients results doubled year-over-year in the quarter and said prior investments are now coming online, with another project underway in Mansfield, Illinois. He said the company sees “quite a long runway” for growth in Premium Ingredients and characterized returns in that business as generally higher, while noting it remains a smaller part of the company today.
Renewables delivered another strong quarter, with pre-tax income of $40 million versus $15 million in the year-ago quarter, Valentine said. He said ethanol operations produced “record first quarter production” and that crush margins were up significantly year-over-year on strong demand, though higher eastern corn basis and natural gas costs were headwinds. The company recorded $26 million of 45Z tax credits in the first quarter after qualifying for the next tier in 2026, Valentine said. Renewables EBITDA was $54 million, up from $37 million a year earlier.
Krueger said production volumes in Renewables have “consistently surpassed those of previous periods” due to efficient operations and robust demand. He also noted that some first-quarter ethanol margins were hedged “at historically favorable levels,” which limited upside as margins strengthened early in the quarter. In the Q&A, Krueger said the company traditionally only hedges production in the first quarter under certain conditions and said it did not hedge outside of Q1.
Investments, liquidity, and leverage
The company generated cash flow from operations before changes in working capital of $68 million, up from $57 million a year earlier, Valentine said. Short-term borrowings increased versus the prior year as the company funded the purchase of its partner’s share of the ethanol plants “last summer” and experienced a recent increase in market volatility. Valentine emphasized that readily marketable grain inventories remain “well in excess” of short-term debt, which he said is “consistently the case throughout the ag cycle.”
Capital spending in the quarter was $52 million compared with $47 million in 2025, reflecting previously announced growth projects and maintenance, Valentine said. He expects approximately $225 million of capital spending for the full year, excluding acquisitions. Long-term debt to EBITDA stands at 1.6x, “well below” the company’s stated target of less than 2.5x, he said.
Krueger provided updates on several projects:
- Port of Houston facility: Construction is progressing, with full operations expected in the third quarter. In the Q&A, Krueger said the investment is intended to provide an additional export outlet for soybean meal as U.S. soybean oil demand rises and crush increases under the RVO framework, adding that domestic meal demand growth may not keep pace with increased supply.
- Carlsbad mineral plant: Now operational, Krueger said.
- Mansfield, Illinois: Upgrades underway to increase cleaned corn capacity, he said.
- Clymers, Indiana: Preparations continue for a previously announced debottlenecking project expected to be completed by late 2027, Krueger said.
Outlook: demand tailwinds, policy watch items, and 2028 EPS target
Krueger said the company remains optimistic about 2026, pointing to a favorable outlook for agribusiness and “reduced uncertainty regarding renewable fuels regulations.” In agribusiness, he expects a year-over-year shift from corn to soybeans, while corn plantings remain above the five-year average. He said on-farm storage levels are substantial and should enter the market following spring planting.
Krueger also cited continued global fertilizer supply issues “due to the Iran conflict” and said tensions in the Middle East will influence agribusiness dynamics. In response to a question on fertilizer impacts, Krueger said a majority of the company’s farmer base—“and in some parts of our area, up to 85%”—had fertilizer prices locked in prior to Feb. 28 and the start of the war. He said the company is also focused on what fall applications in 2026 could look like and expects the U.S. to be affected less than some other countries, given domestic nitrogen supply.
In Renewables, Krueger said ethanol exports remain strong, with several countries increasing blend rates. He added that elevated crude prices in nations dependent on Middle Eastern supply have improved ethanol’s appeal as a gasoline additive, and he said voluntary blend rate increases are already occurring due to favorable ethanol economics versus gasoline. Krueger also said the company would like to see enactment of year-round E15 this year.
On 45Z policy, Krueger said the timing of finalization is uncertain, noting public comments are expected May 28 and offering a “best guess” of late summer to early fall based on historical patterns. He said the company is participating in the public comment process, including through industry groups such as Growth Energy. Krueger added that provisional emission rates for feedstocks without an established pathway are “important to the industry, but not to The Andersons,” because corn is the primary feedstock at all four ethanol plants. He said clarity on CSA-related programs would be needed to help producers prepare for the 2027 planting season.
Krueger reaffirmed the company’s long-range earnings goal, saying The Andersons is reaffirming its “long-range EPS target of $7 per share by the end of 2028,” which he said will require successful completion of key projects and sustained operational execution.
About Andersons NASDAQ: ANDE
The Andersons, Inc operates as a diversified agriculture company offering a broad range of products and services to farmers, retailers and industrial customers. Through its Grain Group, the company purchases, stores, merchandises and transports corn, soybeans and other commodities, while its Renewables Group produces ethanol and distillers grains at multiple plants in the U.S. The Rail Group provides locomotive leasing, railcar repair and related maintenance services, and the Horticulture Group supplies turf, specialty and horticultural products to landscaping professionals and consumer lawn and garden retailers.
Founded in 1947 and headquartered in Maumee, Ohio, The Andersons has grown from a regional grain elevator operator into an integrated agribusiness platform.
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