Good morning, and thank you for joining REX American Resources Q3 2025 conference call. With me on our call today are Stuart Rose, REX Executive Chairman, and Zafar Rizvi, REX Chief Executive Officer.

We'll get to our presentation and comments momentarily, as well as your questions. First, I will review the safe harbor disclosure.

In addition to historical facts or statements of current conditions, today's conference call contains forward-looking statements that involve risks and uncertainties within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the company's current expectations and beliefs, but are not guarantees of future performance.

As such, actual results may vary materially from expectations. The risks and uncertainties associated with the forward-looking statements are described in today's news announcement and in the company's filings with the Securities and Exchange Commission, including the company's reports on Form 10-K and 10-Q.

REX American Resources assumes no obligation to publicly update or revise any forward-looking statements. I'd now like to turn the call over to our Executive Chairman, Stuart Rose.

Good morning, and thank you again to everyone for joining us. During the third quarter of 2025, REX American Resources continued to demonstrate the strength and operational expertise that has defined our company for over four decades.

I'm pleased to report that we are making progress on operational milestones we set out to accomplish, and continue to position REX for sustained, long-term growth. Our third quarter results reflect our focus on solidifying our core business of ethanol production.

Our strong results during the quarter benefited from supportive ethanol industry dynamics, especially export volumes and strong crush spreads. Our One Earth Energy facility expansion to 200 million gallons per year is continuing and is on track for completion in 2026.

This expansion will significantly enhance our production capabilities and operational efficiency, contributing meaningfully to future performance. Additionally, we have begun examining potential benefits we can derive in the near term from 45Z tax credits.

We are actively engaged with groups to assess our operations and assign a carbon intensity score to our production operations, which we expect to be below the threshold to begin earning credits. The third quarter demonstrated once again that REX's focus on operational excellence, strategic investments, and disciplined capital allocation continues to deliver superior results.

Our net income per share of 71 cents represents strong performance, reflecting our team's exceptional execution in managing input costs and timely execution leading to strong margins. Our continuing strong financial results have allowed us to maintain our strong balance sheet, including approximately $335 million in cash, cash equivalents, and short-term investments, even after the to-date spend of approximately $156 million on our capital projects for plant expansion and carbon capture at One Earth Energy.

As we have consistently emphasized, our success stems from having great facilities, Corn Belt locations, and most importantly, we feel the most skilled and dedicated team in the industry. Their attention to detail and market awareness continues to set REX apart from our competitors.

I want to thank our entire team for their outstanding efforts this quarter and their unwavering commitment to excellence. Now I turn the call over to our CEO, Zafar Rizvi, to discuss our operational achievements and strategic initiatives in greater detail.

Thank you, Stuart. The expansion of ethanol production at the One Earth facility continues to progress steadily and remains on track for completion and in operation in 2026.

Alongside this project, we are advancing our evaluation of our carbon intensity score and expect favorable outcome as we incorporate assessment from multiple independent experts. Regarding the near-term benefits available under the 45Z program, we continue to position the company to capitalize on these opportunities while we wait final guidance from the Treasury Department.

For our carbon capture and sequestration initiative, the EPA currently estimate that our Class VI injection well permit application will be finalized in June 2026. REX remains in active, constructive communication with the EPA throughout this process.

As of the end of the third quarter, we have invested approximately $155.8 million in our carbon capture and ethanol expansion projects. We remain within our revised combined budget range of $220 million to $230 million for both initiatives.

I will now turn the call over to Doug Bruggeman to review our financial results. Doug?

Thanks, Zafar. During the third quarter of fiscal 2025, our ethanol sales volumes reached 78.4 million gallons compared to 75.5 million gallons Q3 2024.

The average selling price for ethanol was $1.73 per gallon during the quarter versus $1.83 in the prior year. Dried distillers grain sales volumes were approximately 160,000 tons for Q3, with an average selling price of $139.93 per ton compared to 170,000 tons and $147.14 per ton in the prior year.

Modified distillers grain volumes totaled approximately 21,000 tons with an average selling price of $57.03 per ton. Corn oil sales volumes were approximately 27.4 million pounds during the quarter with an average selling price of 60 cents per pound.

This volume was up from the prior year's sales by approximately 17% and an increase in average selling price of approximately 36%, leading to an approximately 60% increase in sales revenue for corn oil. Gross profit for the third quarter was $36.1 million compared to $39.7 million in Q3 2024.

This primarily reflects lower prices for ethanol and distillers grains. SG&A expenses were approximately $8.2 million for the quarter compared to $8.4 million in Q3 2024.

Interest and other income totaled $3.2 million for the quarter compared to $4.6 million in quarter three 2024, reflecting lower rates and lower investments. Income before tax and non-controlling interest was approximately $35.5 million compared to $39.5 million in Q3 2024.

Net income attributable to REX shareholders was $23.4 million or 71 cents per diluted share compared to $24.5 million or 69 cents per diluted share in Q3 2024. We ended the third quarter with cash, cash equivalents, and short-term investments of $335.5 million.

REX continues to maintain its strong financial position with no bank debt. I'll now turn things back over to Zafar.

Thanks, Doug. Our 3Ps—profit, position, and policy—continue to guide our strategy and execution.

This was evident throughout the third quarter. Profit: We have now delivered 21 consecutive quarters of profitability, reflecting the hard work, discipline, and operational excellence demonstrated by our team every day.

Position: We believe we are strategically positioning the company for long-term organic growth, reduced carbon intensity, and enhanced value creation. Advancing our carbon sequestration project and core ethanol business will further strengthen our competitive position heading into 2026 and beyond.

We also continued active engagement with the EPA regarding our Class VI well permit application. Policy: We leveraging the near-term opportunities provided by the 45Z tax credit program to enhance earnings.

We expect these benefits to increase as our ethanol production expansion and carbon sequestration facilities comes online and additional gallons qualify under the program. The third quarter was exceptionally strong across all key performance measures.

Our core ethanol business benefited significantly from sustained, robust export demand and reliable corn supplies. Last quarter, US ethanol exports were running approximately 10% ahead of the 2024 pace.

By August, the momentum had strengthened, with exports 14% higher than the first eight months of 2024, according to the Renewable Fuels Association. We continue to expect 2025 to set a new record for US ethanol exports.

Looking ahead, the USDA project that corn production in South Dakota and Illinois for the 2025-2026 harvest season will be among the highest result in recent years. This will continue to favor our business, driving lower input prices.

We are excited about the opportunities ahead as we close out the year and prepare for a successful 2026. We expect the fourth quarter to generate a higher net profit than last year's profitable fourth quarter.

As we move into 2026, our strong balance sheet, no debt, and expanding business opportunities position us well for another year of growth and improved performance. Now I would like to open things up for questions.

Operator?

Hi, good morning, and thanks for your time, and looks like a great quarter. I just wanted a couple questions for you.

Kind of curious on your thoughts on key hurdles and timing as you look forward to the 45Z tax credit program, and if you can give us any incremental color on when we can expect some more updates on that. Zafar?

Yes, Chris. As the Treasury has not issued the guideline so far.

We certainly waiting for the guideline. Then also there is requirement for the prevailing wages and all those information, calculation of CI score.

We just want to make sure we have all the facts together, and we are reviewing these facts with different experts. Once we have all those numbers back, next quarter, hopefully we will be able to explain that how much tax credit we will be receiving.

At this time, we are not willing to really give any numbers.

Sure. Okay.

Thanks. Then if you step back and think about just some of the fundamentals of the industry, I'd be curious your view on the impact of tariffs and then crack spreads as you look forward into 2026.

I know it's hard to forecast, but just curious on your view.

I think in the beginning certainly it was a huge impact because we were concerned about Mexico and Canada export. Mexico is the largest importer of DDG, and Canada is the largest importer of ethanol.

Hopefully those relations stay the same. I think that will be great.

Certainly on the other side, we can see that Europe and several other countries are beginning to buy ethanol due to pressure from the tariff or negotiation and others. That's why we can see that January to August is approximately 1.4 billion compared to last year 1.2 billion.

Certainly there is positive impact on export of ethanol at this time. On the other hand, I think we see soybean and soybean oils are not shipped abroad or China is not buying.

There is some impact on the corn oil prices, which has dropped a little bit, and also there's some concern about the DDG export. Those are the weak side.

We certainly is very happy to see that ethanol export is increasing, and we believe that will continue to increase in 2026. Also we are very pleased with the corn production in Illinois and South Dakota that seems to be all-time high, and we believe that will be positive impact on our cost of production moving forward.

Me too. My family has a farm in Iowa, and it's been a good year.

As you think through the carbon sequestration project that you're looking at, how's the permitting process going with the pipeline? I don't want to put you on the spot, but is there any key hurdles that are ahead that you could see through with the Illinois state government?

I think basically, as there was moratorium through July 1st pipeline. We understand the ICC, Illinois Commerce Commission, is working on pipelines, all of those requirements, and they already had couple of public hearings.

We believe they are certainly working on it. At this time, we really has no clear-cut guideline when they will start taking the application.

July 1st is the last day, we certainly will be able to apply after that if not the earlier. Okay.

You probably also know that we have all the easements for our 6-mile pipeline. That pipeline was really 6-mile pipeline.

We build it because we just wanted to be away from the Mahomet Aquifer, and that's the only reason. Otherwise, we really didn't need that pipeline.

Oh, okay. Thank you for the update, and looks like a great quarter.

I appreciate your time.

Thanks, Chris.

Our next question comes from Mason Born with AWH Capital. Please proceed with your question.

Hi guys, thanks for the questions. Just a couple from me.

Stuart, I guess in your prepared remarks, you mentioned recognizing benefits under 45Z, and it sounds like you're not yet and still sort of assessing where that score is to start and then where it can go from there. Is it fair to say that you believe you're going to be positively generating credits before the indirect land use change occurs at January 1st, and then that would be an incremental step after that, or is it still too early to say?

As Zafar mentioned, we are working diligently on trying to obtain credits this year. We don't know what the regulations are yet.

They have not published them. We will be prepared.

Actually the land use change is correct, but they have not come out with what qualifies as a carbon intensity score yet. We cannot guarantee any credits for this year.

We're working on it diligently. Zafar's team, I don't know how many people he has working on it, including outside people, but a lot.

We hope, and I emphasize hope, to achieve credits this year, but we have no way of knowing whether we will or will not at this time.

That's something you could recognize retroactively, is that your assumption?

That's our hope. Yes.

Yes, that's our hope.

Then second for me, I know it's early on this as well, but ADM recently entered into an agreement with Google on some of their excess capacity. I know you guys are planning to have plenty of excess capacity in your carbon capture wells, even on one alone, but potentially on all three if you have them operating.

Just wondered if you could provide any thoughts there on your thinking there and any timeline around obviously I assume you get yours operational online first, but just any thoughts on potential for partnerships or what that could look like.

Zafar, you want to answer that?

I think, Mason, we are really trying to concentrate on the well number one first. Certainly for the well number two or three, even for the well number one, we will have enough capacity to have the carbon sequestration from the third party.

We have been in contact with several people, and several people has reached out to us recently and even in the past. We don't want to make some commitment or contract up to the time we have received Class VI permit and we have put the pipeline.

All of those facts are taken care of it. After that, we believe that we will be able to get those contract in future.

At this time, we have really not negotiating with anyone because we're not there where we are supposed to be at this stage.

Great. Thank you.

Mason, let me add that one answer you ask about the land use. Yes, our recent calculation, which we are looking at it, there is land use in this one, and the next 2026, there's not going to be land use.

We believe that we are already at the score without land use, we will be able to qualify with it. We have to still do a lot of calculation to make sure the prevailing wages and other lot of factors, and Treasury guideline is clear.

I can tell you that even some of those accountant who's reviewing our data and information, they're not even sure is that a gross ethanol or is net ethanol. That mean is denatured ethanol or undenatured ethanol will qualify.

There is several different ways we are doing all those calculation to make sure that the numbers are correct before we start talking about how many millions of dollar of et ceteras we are going to get that tax credit.

That's helpful, and we appreciate your conservatism. Thank you for the details.

Thank you. Our quarter was very good, and we expect next quarter ethanol to outperform last year's fourth quarter.

We're continuing to make further progress, as we just talked about, on capturing 45Z credits. It's a tribute to all our employees, starting with our CEO, Zafar Rizvi, who is recognized by many as, if not the, one of the top CEOs in the ethanol industry, and including all of our employees, who we consider the best in the industry.

I want to thank everyone for listening, and we look forward to talking to you after next quarter. Thank you.

Bye.