REX American Resources (NYSE:REX) reported what executives described as the most profitable first quarter on a net income per share basis in the company’s history, supported by production tax credits, lower corn costs and continued execution on major growth projects.
On the company’s first quarter fiscal 2026 earnings call, Executive Chairman Stuart Rose said the quarter “continued to showcase REX’s operational excellence and strategic discipline,” adding that the company remains focused on shareholder value creation and capital allocation while advancing its carbon capture and ethanol expansion initiatives.
Profit More Than Doubles From Prior-Year Quarter
Chief Financial Officer Doug Bruggeman said REX generated net income attributable to shareholders of $18.5 million, or $0.56 per diluted share, in the first quarter of fiscal 2026. That compared with $8.7 million, or $0.26 per diluted share, in the first quarter of 2025.
The result marked the company’s 23rd consecutive profitable quarter, according to Bruggeman.
Income before taxes and non-controlling interest was approximately $26.1 million, up from $13.6 million in the prior-year period. Gross profit rose to $29.1 million from $14.3 million a year earlier. Bruggeman said the improvement primarily reflected the benefit of Section 45Z tax credits and reduced corn pricing.
REX recorded $7.5 million in 45Z production tax credit income during the quarter. Bruggeman said the company now reports that item as operating income from its consolidated plants following a change in accounting principles.
Selling, general and administrative expenses increased to approximately $9.7 million from $5.9 million in the first quarter of 2025. Bruggeman attributed the increase primarily to higher incentive compensation and the recording of unpaid stock bonuses from 2025 at fair value.
Equity in income of unconsolidated affiliates rose to $3.6 million from $1 million, including approximately $1.8 million of the increase related to 45Z tax credit income. Interest and other income totaled $3.2 million, down from $4.2 million in the year-earlier quarter.
Ethanol Volumes Edge Higher as Pricing Declines
REX’s ethanol sales volumes were 71.1 million gallons in the first quarter, compared with 70.9 million gallons in the first quarter of 2025. The average selling price for ethanol was $1.66 per gallon, down from $1.76 per gallon in the prior-year quarter.
Dried distillers grains sales volumes were approximately 155,000 tons, with an average selling price of $155.86 per ton, compared with $145.65 per ton a year earlier. Modified distillers grains volumes totaled approximately 13,427 tons, with an average selling price of $76.94 per ton.
Corn oil sales volumes were approximately 23.9 million pounds, with an average selling price of $0.54 per pound. That compared with $0.46 per pound in the first quarter of 2025.
CEO Zafar Rizvi said market fundamentals for the ethanol industry remain constructive, with stable domestic demand and strong export markets. Citing the Renewable Fuels Association, he said 2026 ethanol exports through March increased 20% compared with the same period last year.
Expansion and Carbon Capture Projects Continue
Rizvi said the company’s ethanol facility expansion at Gibson City, Illinois, remains on schedule and is expected to be completed by the end of 2026. He said the expansion is intended to strengthen production capabilities and position REX for long-term growth.
The company’s carbon capture and sequestration initiative also continues to move through the regulatory process. Rizvi said REX is working closely with the U.S. Environmental Protection Agency on its Class VI injection well permit application and is addressing regulatory requirements as the permitting process continues.
At the state level, Rizvi said the Illinois moratorium on carbon pipeline permitting is scheduled to expire on July 1, 2026. REX has maintained engagement with the Illinois Commerce Commission and plans to submit its application shortly after the moratorium expires, he said.
Rizvi added that the company is monitoring federal policy discussions related to carbon capture incentives under Section 45Z. REX began recognizing 45Z production tax credits in the fourth quarter of 2025 and booked the credit at $0.10 per gallon at its consolidated plants during the first quarter of 2026 as it continues to monitor regulations.
As of the end of the first quarter, REX’s total investment in the carbon capture and ethanol expansion projects was approximately $176.3 million. Rizvi said the company continues to operate within its combined project budget range of $220 million to $230 million, subject to potential adjustments related to inflation and other market factors as the projects advance.
Balance Sheet Remains Debt-Free
REX ended the quarter with cash equivalents and short-term investments of $364.3 million. Bruggeman said the reduction from the previous quarter primarily reflected ongoing capital investments in the company’s growth projects.
The company continues to operate with no bank debt. Rizvi said REX is funding its organic expansion initiatives through its balance sheet and will continue to evaluate the best use of its cash, including investments that complement its existing platform.
“As we move through the second quarter, we continue to see stable operating conditions and remain confident in our ability to deliver another profitable quarter for our shareholders,” Rizvi said.
No analysts asked questions during the question-and-answer portion of the call. In closing remarks, Rose said he remained optimistic about future growth in ethanol and tax credits, citing REX’s plants, locations and employees as key strengths.
About REX American Resources (NYSE:REX)
REX American Resources Corp. is a diversified agribusiness and renewable energy company headquartered in Kansas City, Missouri. Founded in 2005 through a reorganization of existing agricultural interests, the company focuses on two primary business segments: fuel ethanol production and specialty ingredient solutions. REX American Resources leverages its integrated operations to supply clean-burning fuel, animal feed co-products and sweetener ingredients to a broad customer base in North America and beyond.
In its alcohol fuels segment, the company operates an anhydrous ethanol production facility in Colwich, Kansas.
