Green Plains Q1 Earnings Call Highlights

Key Points

• Green Plains posted $71.5 million adjusted EBITDA in Q1 — up $22 million sequentially and more than $95 million year‑over‑year — driven by ~97% utilization, stronger ethanol and co‑product margins, cost reductions and a roughly $55 million EBITDA contribution from its carbon program, with net income of $33 million versus a prior‑year loss.
• The company early‑adopted ASU 2025‑10 to record 45Z tax credits as a current asset and reduce COGS; 45Z credits generated $65.6 million gross (about $55.2 million net to adjusted EBITDA) in Q1, and management raised full‑year 2026 45Z guidance to $200–$225 million.
• Capital allocation prioritizes sustaining capex of $15–$25 million, short‑payback efficiency and CI projects (including 4.5 million bushels of grain storage at Wood River and low‑energy distillation work at York), retiring $60 million of 2027 convertibles at maturity, and preserving liquidity with cash and restricted cash now above $200 million.

Green Plains NASDAQ: GPRE reported a strong start to fiscal 2026, with management pointing to higher utilization, improved commodity margins, ongoing cost reductions and the first full-quarter contribution from the company’s carbon strategy as key drivers of results.

First-quarter results fueled by operations, margins and carbon credits

President and CEO Chris Osowski said the first quarter reflected “a different level of execution across the business,” noting that the period is typically the most challenging quarter for ethanol producers. Green Plains posted first-quarter adjusted EBITDA of $71.5 million, which Osowski said was $22 million higher than the fourth quarter and more than $95 million above the first quarter of 2025.

Osowski attributed the improvement to four factors: higher operating rates, “strong sustainable demand” and favorable pricing while input costs “remained in check,” continued simplification and cost structure work, and a $55 million EBITDA contribution from the company’s carbon program in its first full quarter following startups completed last year.

Operationally, Green Plains produced 174 million gallons during the quarter, or roughly 97% of operating capacity. Osowski highlighted production records at two sites, saying the York, Nebraska facility set a monthly production record in March and the Superior, Iowa facility set a quarterly production record. He added that ethanol, corn oil and protein yields “remain strong across the fleet” and contributed to gross margin.

Osowski also highlighted safety performance, saying Green Plains finished the quarter with no recordable injuries and noting the Central City plant received “Highly Protected Risk” recognition from FM Global.

Financial details and accounting change for 45Z credits

Chief Financial Officer Ann Reis said consolidated crush margins improved “meaningfully” year-over-year, driven by stronger ethanol margins, higher corn oil demand, and the contribution from 45Z production tax credits.

For the quarter, Green Plains generated gross margin of $88 million versus $3 million in the first quarter of 2025. Revenue totaled $446 million, which Reis said reflected lower gallons following the sale of the Obion, Tennessee facility. Net income attributable to Green Plains was $33 million, or $0.42 per diluted share, compared to a net loss in the prior-year quarter.

On costs, Reis reported consolidated SG&A of $19.5 million in Q1 and said the company remains on track for a full-year SG&A target of approximately $90 million. Interest expense was $11.5 million, with full-year interest expense expected to align with prior guidance of about $35 million. Depreciation and amortization expense was $23.6 million.

Reis also described an accounting change related to government grants. Beginning in the first quarter, Green Plains early adopted ASU 2025-10, which provides a framework for accounting for government grants. As a result, 45Z credits are recorded as earned credits on the balance sheet as a current asset and recognized as a reduction to cost of goods sold rather than through the income tax line. Reis said the change “does not impact cash flow or the underlying economics of the business,” and prior periods have been recast for comparability.

On 45Z value in the quarter, Reis said Green Plains generated $65.6 million of tax credit value on a gross basis, and that net of monetization discounts and operating costs, production tax credits contributed $55.2 million to adjusted EBITDA in Q1. She said the increase versus the fourth quarter was primarily due to a full quarter of operational carbon sequestration at the company’s three Nebraska facilities.

2026 carbon guidance raised; additional upside from on-farm practices not included

Green Plains raised its 2026 outlook for EBITDA contribution from 45Z credits. Osowski said the company is raising its expectation to $200 million to $225 million for the full year, up from prior guidance of at least $188 million, with Advantage Nebraska forecast to contribute $140 million to $165 million of that amount.

In response to a question about how to think about the updated range, Osowski cited high utilization in Q1 and noted Q2 is typically when the company performs spring maintenance, along with fall maintenance later in the year. He also said the company has gained confidence in capture efficiency performance and was “comfortable with updating that projection.”

During Q&A, Reis said the company’s guidance does not include potential benefits from on-farm practices, noting the Treasury’s proposed ruling mentions the topic but final guidance and a final calculator have not been released. She said Green Plains believes there are opportunities, particularly in regions where plants receive significant farmer-delivered bushels, and linked this to the company’s planned grain storage expansion at Wood River. Reis said the company is not prepared to quantify potential CI score impacts at this time.

Reis also addressed an increase in expected 45Z contribution from non-Nebraska plants, citing several factors:

• Removal of the iLUC penalty for corn starting in 2026, which she said reduced CI by about six points.
• The ability to buy renewable energy credits (RECs) to offset electricity.
• Improved plant efficiency.

Commercial backdrop: export demand, corn oil strength, and hedging discipline

Senior Vice President of Trading and Commercial Operations Imre Havasi said the first quarter delivered strong ethanol crush margins, especially in the second half, supported by lower corn prices, solid domestic and international demand, and rising corn oil values. He added that energy commodity prices were a tailwind during March amid elevated geopolitical risk premiums.

Havasi said that even before 45Z contributions, gross margin per gallon was about $0.10 higher than the first quarter of last year. Exports were “again an important part of the story,” as demand tied to blending mandates and compliance requirements in destination markets supported “steady and sustainable export flow,” he said.

Havasi also discussed the Renewable Fuel Standard, saying the EPA finalized 2026 and 2027 Renewable Volume Obligations in March at the highest levels in the program’s history. Conventional ethanol volumes remain at 15 billion gallons, while biomass-based diesel volumes increase sharply, he said. Combined with restrictions on imported feedstocks, Havasi said the company expects continued strong demand for low-carbon-intensity corn oil. He added that pricing has improved significantly and that protein remained a solid margin contributor, with the relative value of the company’s Ultra-High Protein product versus soybean meal strengthening.

Looking to Q2, Havasi said current margins, co-product pricing and carbon contributions “all support a stronger result than in Q1.” He emphasized a hedging approach focused on downside protection with upside participation, spanning the “full margin stack” including co-products and inputs such as physical corn ownership and natural gas. He said proactive risk management resulted in a $0.04 per gallon hedging adjustment as ethanol rallied late in the quarter, reflecting a trade-off made to lock in margins and protect cash flow.

Capital priorities: maintenance first, then efficiency and CI projects

Osowski said the company’s focus is shifting from stabilization and simplification to “disciplined execution and capital deployment,” with priorities centered on protecting and enhancing margins, converting earnings into cash, and deploying capital to the highest-return opportunities.

Management outlined capital allocation priorities, starting with sustaining capital expenditures of $15 million to $25 million for maintenance, safety and regulatory projects, according to Reis. Osowski said plant reliability is critical to capturing margins. From there, the company plans to fund modest efficiency and carbon intensity improvement projects with short paybacks, including formal benchmarking across plants to identify operational gaps and best practices.

Osowski said Green Plains plans to retire $60 million of 2027 convertible notes at maturity. Reis added that the remaining $60 million of 2027 convertible notes became a current maturity during the quarter and the company expects to address the notes with available cash at maturity. Reis also noted that in April the company reduced the size of its working capital facility and extended the maturity by six months, which she said will provide immediate cost savings and additional runway to pursue a longer-term extension later in the year.

As examples of growth and efficiency projects, Osowski said Green Plains approved construction of about 4.5 million bushels of grain storage at Wood River, Nebraska, aimed at reducing corn basis risk, improving procurement flexibility and supporting consistent operations. He also said the company is engineering low-energy distillation upgrades at York, Nebraska, intended to reduce energy consumption and operating costs, and lower the plant’s carbon intensity score. In response to a question on corn oil production, Osowski said the company is also evaluating projects to improve processing yields, including leveraging MSC technology at certain plants and boosting oil yields at non-MSC plants.

On liquidity, Reis reported unrestricted cash and equivalents of $95.7 million as of March 31, down from year-end primarily due to seasonal working capital requirements. She said the final cash payment from the sale of 2025 45Z credits was received in April, and the company is working to ensure compliance requirements are in place to monetize 2026 credits. Reis added that the company’s cash and restricted cash balance is now over $200 million.

In closing remarks, Osowski said Green Plains is operating from a “much stronger position than it was a year ago,” citing improved reliability, a strengthened balance sheet, and what he described as strong, sustainable demand across ethanol, corn oil and protein, alongside meaningful value from the carbon program.

About Green Plains NASDAQ: GPRE

Green Plains Inc is a leading producer of fuel-grade ethanol and related co-products in the United States. Headquartered in Omaha, Nebraska, the company operates an integrated network of biorefineries that convert corn and other grains into renewable fuels. Through its production facilities, Green Plains supplies ethanol to domestic fuel markets and export channels, supporting efforts to reduce greenhouse gas emissions and promote cleaner-burning transportation options.

Beyond ethanol, Green Plains manufactures a range of co-products that add value throughout the agricultural supply chain.

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