Company: REX
Filing Date: 2025-12-04
Form Type: 10-Q
Source: 0000930413-25-003566
Chunk: 96

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-12-04
Form: 10-Q
Item: Part I, Item 8
Chunk 96
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 fiscal year 2024. Cost of sales increased 4% in the first nine months
of fiscal year 2025, compared to the first nine months of fiscal year 2024. Corn accounted for approximately 74% ($317.1 million)
of our cost of sales during the first nine months of fiscal year 2025 compared to approximately 76% ($312.2 million) during the
first nine months of fiscal year 2024. Natural gas accounted for approximately 5% ($20.0 million) of our cost of sales during the
first nine months of fiscal year 2025 and 4% ($15.6 million) in the first nine months of fiscal year 2024.

As a result of the foregoing, gross profit
for the third quarter of fiscal year 2025 decreased approximately $3.5 million compared to the prior year third quarter. Gross
profit for the first nine months of fiscal year 2025 decreased approximately $9.1 million compared to the first nine months of
fiscal year 2024.

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

34

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 $8.2
million for the third quarter of fiscal year 2025, compared to approximately $8.4 million of expenses for the third quarter of
fiscal year 2024. SG&A expenses were approximately $20.4 million for the first nine months of fiscal year 2025, compared to
approximately $21.0 million for the first nine months of fiscal year 2024. The decreases compared to the prior year were