Company: REX
Filing Date: 2025-06-04
Form Type: 10-Q
Source: 0000930413-25-001941
Chunk: 101

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-06-04
Form: 10-Q
Item: Part I, Item 2
Chunk 101
---
 operating the
refined coal facility immediately after the acquisition. Using licensed technology, our plant applied two separate chemicals to
convert feedstock coal into refined coal, which was sold to the end user of the refined coal. The refined coal operating results
were subsidized by federal production tax credits through November 18, 2021, subject to meeting qualified emissions reductions
as governed by Section 45 of the IRC. We ceased operating the facility on November 18, 2021 and subsequently sold the facility.
The approximately $58.2 million of federal production tax credits received through the ownership of this facility remain under
IRS audit.

Critical Accounting Policies and Estimates 

During the three months ended April 30,
2025, we did not change any of our critical accounting policies as disclosed in our 2024 Annual Report on Form 10-K as filed with
the Securities and Exchange Commission on March 28, 2025.

27

Fiscal Year

All references in this report to a particular
fiscal year are to REX’s fiscal year ended January 31. The Company refers to its fiscal year by reference to the year immediately
preceding the January 31 fiscal year end date. For example, “fiscal year 2025” means the period February 1, 2025 to
January 31, 2026. The Company includes the results of operations of One Earth in its Consolidated Statements of Operations on
a delayed basis of one month as One Earth has a fiscal year end of December 31.

Results of Operations

Trends and Uncertainties 

Renewable Fuel Standard II, established
in October 2010, has been an important factor in the growth of ethanol usage in the United States. In recent years, there has
been much uncertainty in the enforcement of RFS II. When it was originally established, RFS II required the volume of “conventional”
or corn derived ethanol to be blended with gasoline to increase each year until it reached 15.0 billion gallons in 2015 and required
that it remain at that level through 2022. There are no established congressional target volumes beginning in 2023. The EPA has
the authority to waive the biofuel mandate, in whole or in part, if there is inadequate domestic renewable fuel supply or the
requirement severely harms the domestic economy or environment. In addition, under RFS II, a small refiner that processes less
than 75,000 barrels of oil per day can petition the EPA for