Company: REX
Filing Date: 2025-06-04
Form Type: 10-Q
Source: 0000930413-25-001941
Chunk: 81

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-06-04
Form: 10-Q
Item: Part I, Item 8
Chunk 81
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2025, compared to the prior year first quarter. Corn accounted for approximately 74% ($106.3 million) of our cost
of sales during the first quarter of fiscal year 2025 compared to approximately 75% ($110.6 million) during the first quarter
of fiscal year 2024. Natural gas accounted for approximately 6% ($8.1 million) of our cost of sales during the first quarter of
fiscal year 2025 and 5% ($7.1 million) in the first quarter of fiscal year 2024.

As a result of the foregoing, gross profit
for the first quarter of fiscal year 2025 decreased approximately $0.1 million compared to the prior year first quarter.

We attempt to match quantities of ethanol,
distillers grains and distillers corn oil sales contracts with an appropriate quantity of corn purchase contracts over a given
time period when we can obtain a satisfactory margin resulting from the crush spread inherent in the contracts we have executed.
However, the market for future ethanol sales contracts generally lags the spot market with respect to ethanol price. Consequently,
we generally execute fixed price sales contracts for no more than four months into the future at any given time and we may lock
in our corn or ethanol price without having a corresponding locked in ethanol or corn price for short durations of time. As a
result of the relatively short period of time our contracts cover, we generally cannot predict the future movements in our realized
crush spread for more than four months. We utilize derivative financial instruments, primarily exchange traded commodity future
contracts and swap contracts, in conjunction with certain of our corn procurement activities and commodity marketing activities.

SG&A expenses were approximately $5.9
million for the first quarter of fiscal year 2025, compared to approximately $6.1 million of expenses for the first quarter of
fiscal year 2024. The decreases compared to the prior year first quarter are due primarily to a decrease in performance bonus
expense of $0.2 million and a decrease in stock compensation expense of $0.3 million subsequent to the completion of the restricted
stock units performance period on December 31, 2024. These decreases were partially offset by an increase in rail car lease expense
due to higher rates realized upon lease renewals.

During the first quarter of fiscal year
2025, we recognized income from our equity investment in Big River of approximately $1.0 million compared to income of approximately
$1.7 million for the first