What changed in this filing

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Item 1. Financial Statements

2025-05-09 compared with 2024-11-08 · 215 added, 272 removed, 356 unchanged (58% of the section changed)

3 unchanged sentences

(in thousands)

September 30,

Current Assets:

1 unchanged sentence

Restricted cash

Accounts receivable, net (net of allowance for credit losses of $ 50 and $ 85 , respectively)

Accounts receivable (net of allowance for credit losses of $ 38 and $ 23 , respectively)

Derivative instruments

7 unchanged sentences

* Amounts derived from the audited

consolidated financial statements for the year ended December 31, 2023.

See accompanying notes to consolidated

financial statements.

financial statements for the year ended December 31, 2024.

See accompanying notes to consolidated financial

ALTO INGREDIENTS, INC.

1 unchanged sentence

(in thousands, except par value)

September 30,

LIABILITIES AND STOCKHOLDERS’ EQUITY

6 unchanged sentences

Total current liabilities

Long-term debt, net

Long-term debt

Operating leases, net of current portion

6 unchanged sentences

1,684 shares authorized;

no shares issued and outstanding as of September 30, 2024 and December 31, 2023;

no shares issued and outstanding as of March 31, 2025 and December 31, 2024;

1,581 shares authorized;

927 shares issued and outstanding as of September 30, 2024 and December 31, 2023;

liquidation preference of $ 18,075 as of September 30, 2024

927 shares issued and outstanding as of March 31, 2025 and December 31, 2024;

liquidation preference of $18,075 as of March 31, 2025

Common stock, $ 0.001 par value;

300,000 shares authorized;

76,625 and 75,703 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

76,497 and 76,565 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

Non-voting common stock, $ 0.001 par value;

3,553 shares authorized;

1 share issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

1 share issued and outstanding as of March 31, 2025 and December 31, 2024

Additional paid-in capital

3 unchanged sentences

Total Liabilities and Stockholders’ Equity

* Amounts derived from the audited

consolidated financial statements for the year ended December 31, 2023.

See accompanying notes to consolidated

financial statements.

* Amounts derived from the

audited financial statements for the year ended December 31, 2024.

See accompanying notes to consolidated financial

ALTO INGREDIENTS, INC.

2 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Cost of goods sold

Selling, general and administrative expenses

Gain on sale of assets

Asset impairments

Loss from operations

Interest expense, net

Income from cash grant

Other income, net

2 unchanged sentences

Preferred stock dividends

Net loss available to common stockholders

Net loss attributable to common stockholders

Net loss per share, basic and diluted

Weighted-average shares outstanding, basic and diluted

See accompanying notes to consolidated

financial statements.

See accompanying notes to consolidated financial

ALTO INGREDIENTS, INC.

1 unchanged sentence

(unaudited, in thousands)

Nine Months Ended

September 30,

Three Months Ended

Operating Activities:

Adjustments to reconcile net loss to Net cash provided by operating activities:

Depreciation and amortization

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

Depreciation and amortization of intangibles

Gains on derivative instruments

Gain on sale of assets

Asset impairments

Stock-based compensation

Non-cash compensation

Inventory valuation

Amortization of deferred financing fees

1 unchanged sentence

Credit loss (recovery)

Changes in operating assets and liabilities:

Changes in operating assets and liabilities, net of business acquisition:

Accounts receivable

1 unchanged sentence

Accounts payable and accrued liabilities

Net cash provided by operating activities

Net cash (used in) provided by operating activities

Investing Activities:

Additions to property and equipment

Proceeds from sale of assets

Purchase of Kodiak Carbonic, net of cash acquired

Deferred purchase price payments for Eagle Alcohol

1 unchanged sentence

Financing Activities:

Net (payments on) proceeds from Kinergy’s line of credit

Stock repurchases

Net proceeds from Kinergy’s line of credit

Preferred stock dividends paid

Net cash (used in) provided by financing activities

Net change in cash, cash equivalents and restricted cash

Net cash provided by financing activities

Net decrease in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of period

6 unchanged sentences

Interest paid

Proceeds from sale of assets – note receivable

ROU Assets obtained in exchange for new lease obligations

Capitalized interest

See accompanying notes to consolidated

financial statements.

Interest expense capitalized

See accompanying notes to consolidated financial

ALTO INGREDIENTS, INC.

10 unchanged sentences

$ ( 836,157 )

Stock-based compensation

Restricted stock cancellations and tax, net of issuances to employees and directors

Preferred stock dividends

Balances, June 30, 2024

$ ( 779,375 )

Stock-based compensation

Restricted stock cancellations and tax, net of issuances to employees and directors

Preferred stock dividends

Balances, September 30, 2024

$ ( 782,135 )

Balances, January 1, 2024

2 unchanged sentences

Restricted stock issued to employees and directors, net of cancellations and tax

Stock repurchases

Preferred stock dividends

1 unchanged sentence

$ ( 775,953 )

Stock-based compensation

Restricted stock issued to employees and directors, net of cancellations and tax

Stock repurchases

Preferred stock dividends

Balances, June 30, 2023

$ ( 740,841 )

Stock-based compensation

Restricted stock issued to employees and directors, net of cancellations and tax

Preferred stock dividends

Balances, September 30, 2023

$ ( 744,649 )

See accompanying notes to

consolidated financial statements.

accompanying notes to consolidated financial statements.

ALTO INGREDIENTS, INC.

3 unchanged sentences

– The consolidated financial statements include, for all periods presented, the accounts of Alto Ingredients, Inc., a Delaware corporation

and its direct and indirect wholly-owned subsidiaries (collectively, the “Company”), including Kinergy Marketing LLC, an Oregon

limited liability company (“Kinergy”), Alto Nutrients, LLC, a California limited liability company, Eagle Alcohol Company,

LLC, a Delaware limited liability company (“Eagle Alcohol”), Alto Op Co., a Delaware corporation, Alto Pekin, LLC, a Delaware

limited liability company, and Alto ICP, LLC, a Delaware limited liability company, and the Company’s production facilities in Oregon

(“Alto Ingredients”), and its direct and indirect wholly-owned subsidiaries (collectively, the “Company”), including

Kinergy Marketing LLC, an Oregon limited liability company (“Kinergy”), Alto Nutrients, LLC, a California limited liability

company (“Alto Nutrients”), Alto Op Co., a Delaware corporation, Alto Pekin, LLC, a Delaware limited liability company (“Alto

Pekin”) and Alto ICP, LLC, a Delaware limited liability company (“ICP”), and the Company’s production facilities

in Oregon and Idaho.

As discussed in Note 2, on January 1, 2025, the

Company’s wholly-owned subsidiary, Alto Carbonic, LLC (“Alto Carbonic”), acquired Kodiak Carbonic, LLC, a beverage-grade

liquid CO 2 processor, for $ 7.6 million.

Alto Carbonic’s facility is co-located at the Company’s Columbia ethanol

The Company began reporting the results of Alto Carbonic in the Company’s Western Production segment on January 1, 2025.

The Company produces and distributes

renewable fuel, essential ingredients and specialty alcohols.

The Company also specializes in break bulk distribution of specialty alcohols

produced by the Company and third parties.

The Company’s production facilities in Pekin, Illinois are located in the heart of the

The Company’s two production facilities in Oregon and Idaho are located in close proximity to both feed and renewable

fuel customers.

renewable fuels, essential ingredients and specialty alcohols.

The Company also markets fuel-grade ethanol produced by third parties.

The Company’s production facilities in Pekin, Illinois are located in the heart of the Corn Belt.

The Company’s two production

facilities in Oregon and Idaho are located in close proximity to both feed and fuel-grade ethanol customers.

The Company has a combined alcohol

2 unchanged sentences

feed and pet foods.

In addition, the Company markets and distributes renewable fuel produced by third parties.

The Company focuses on five

Health, Home & Beauty ;

In addition, the Company markets and distributes fuel-grade ethanol produced by third parties.

The Company focuses on Health,

Home & Beauty ;

Food & Beverage ;

1 unchanged sentence

Essential Ingredients ;

Renewable Fuels .

Products for the Health, Home & Beauty market include specialty alcohols used in mouthwash, cosmetics, pharmaceuticals,

hand sanitizers, disinfectants and cleaners.

Products for the Food & Beverage markets include grain neutral spirits used in alcoholic

beverages and vinegar as well as corn germ used for corn oils.

Products for Industry & Agriculture markets include alcohols and other

products for paint applications and fertilizers.

Products for Essential Ingredients markets include dried yeast, corn protein meal, corn

protein feed, corn germ, and distillers grains and liquid feed used in commercial animal feed and pet foods.

Products for Renewable Fuels

markets include fuel-grade ethanol and distillers corn oil used as a feedstock for renewable diesel and biodiesel fuels.

As of September 30, 2024, all

of the Company’s production facilities were operating.

In January 2024, the Company temporarily hot-idled its Magic Valley facility

to minimize losses from negative regional crush margins and to expedite the installation of additional equipment needed to achieve the

intended production rate, quality and consistency from the corn oil and high protein system at the facility.

The Company restarted its

Magic Valley facility in July 2024.

As market conditions change, the Company may increase, decrease or idle production at one or more

operating facilities or resume operations at any idled facility.

and Renewable Fuels

Products for the Health, Home & Beauty market include specialty alcohols used in mouthwash, cosmetics, pharmaceuticals, hand

sanitizers, disinfectants and cleaners.

Products for the Food & Beverage markets include grain neutral spirits used in alcoholic beverages

and vinegar as well as corn germ used for corn oils.

Products for Industry & Agriculture markets include alcohols and other products

for paint applications and fertilizers.

Products for Essential Ingredients markets include dried yeast, corn protein meal, corn protein

feed, corn germ, and distillers grains and liquid feed used in commercial animal feed and pet foods.

Products for Renewable Fuels markets

include fuel-grade ethanol and distillers corn oil used as a feedstock for renewable diesel and biodiesel fuels.

The Company’s production

facilities, other than its Magic Valley plant, were operating for all periods presented subject to scheduled and unscheduled downtimes

to address facility repair and maintenance.

In January 2024, the Company temporarily hot-idled its Magic Valley facility to minimize losses

from negative regional crush margins and to expedite the installation of additional equipment to achieve the intended production rate,

quality and consistency from the Company’s corn oil and high protein system at the facility.

The Company restarted its Magic Valley

facility in July 2024 and by October 2024, the facility consistently achieved average ethanol production rates at full capacity, the protein

content yield from the plant reached 50 % or greater, and the Company was able to expand its corn oil yields.

Increases in regional corn

basis and declining market prices for protein and corn oil resulted in overall margin compression, outweighing the economic benefits of

these plant improvements.

As a consequence, the Company cold-idled its Magic Valley facility on December 31, 2024 to minimize financial

The Company continues to provide terminal services at the plant and intends to resume operations at the facility when the economic

environment in the region sustainably improves.

Basis of Presentation – Interim

12 unchanged sentences

Accounts Receivable and Allowance for Credit

Losses – Trade accounts receivable are presented at original invoice amount, net of the allowance for credit losses.

Company sells specialty alcohols to large consumer product companies, sells renewable fuel to gasoline refining and distribution companies,

Losses – Trade accounts receivable is presented at original invoice amount, net of the allowance for credit losses.

Company sells specialty alcohols to large consumer product companies, sells fuel-grade ethanol to gasoline refining and distribution companies,

sells essential ingredients such as dried yeast for human and pet food and to animal feed customers, including distillers grains to export

markets, sells those same and other feed products to dairy operators and animal feedlots and sells corn oil to poultry and biodiesel customers,

in each case generally without requiring collateral.

markets, sells those same and other feed co-products to dairy operators and animal feedlots and sells corn oil to poultry, renewable diesel and biodiesel

customers, in each case generally without requiring collateral.

The carrying amount of accounts receivable is

3 unchanged sentences

Of the accounts receivable balance, approximately

$ 46,887,000 and $ 51,315,000 at September 30, 2024 and December 31, 2023, respectively, were used as collateral under Kinergy’s operating

$ 52,108,000 and $ 44,750,000 at March 31, 2025 and December 31, 2024, respectively, were used as collateral under Kinergy’s operating

line of credit.

The allowance for credit losses was $ 50,000 and $ 85,000 as of September 30, 2024 and December 31, 2023, respectively.

The Company recorded a credit reserve of $ 24,000 and credit loss recovery of $ 8,000 for the three months ended September 30, 2024 and

2023, respectively.

The Company recorded a credit loss recovery of $ 23,000 and a credit loss recovery of $ 54,000 for the nine months ended

September 30, 2024 and 2023, respectively.

The allowance for credit losses was $ 38,000 and $ 23,000 as of March 31, 2025 and December 31, 2024, respectively.

Company recorded bad debt expense of $ 15,000 and bad debt recoveries $ 27,000 for the three months ended March 31, 2025 and 2024, respectively.

The Company does not have any off-balance sheet credit exposure related to its customers.

Share Repurchase Program –

On September 12, 2022, the Company announced a share repurchase program under which it may repurchase up to $ 50 million of its common

stock with an initial purchase authorization of $ 10 million.

The Company’s lender has further limited the Company’s purchase

authorization to $ 5 million.

Amounts in excess of the purchase authorization of $ 5 million will require additional lender consent and

amounts in excess of the initial purchase authorization of $ 10 million will require additional board and preferred stockholder authorization.

The share repurchase program does not have an expiration date, does not require the repurchase of any particular amount of shares, and

may be implemented, modified, suspended or discontinued in whole or in part at any time and without further notice.

As repurchases are

made, the Company will retire the shares, resulting in a reduction of issued and outstanding shares.

For the nine months ended September

30, 2023, the Company repurchased an aggregate of 1,249,000 shares for $ 2,683,000 in cash.

The Company did not repurchase any shares during

the three months ended September 30, 2024 and 2023 and for the nine months ended September 30, 2024.

As of September 30, 2024, total repurchases

under the program since its inception equaled 2,036,000 shares for approximately $ 5,000,000 in cash.

Financial Instruments – The

2 unchanged sentences

The Company believes

the carrying value of its long-term debt instruments are not considered materially different than fair value because they were recently

Income from Cash Grant –

In 2022, the Company applied for the USDA’s Biofuel Producer Program (“BPP”).

The program was created as part of the

CARES Act in 2020, which allocated $ 700,000,000 to support biofuel producers who experienced market losses due to the pandemic.

grant is not required to be repaid.

Since these funds are provided to subsidize historical losses of the Company, and are not required

to be repaid, the Company accounted for the proceeds by analogy to International Accounting Standards 20, Accounting for Government

Grants and Disclosure of Government Assistance , and reported the amount as income from cash grant in the accompanying consolidated

statements of operations.

The Company received $ 2,812,000 in cash from the BPP during the three and nine months ended September 30, 2023.

The Company did not receive any such funds in the three and nine months ended September 30, 2024.

the carrying value of its long-term debt instruments are not considered materially different than fair value.

Estimates and Assumptions –

7 unchanged sentences

Actual results and outcomes may materially differ from management’s estimates and assumptions.

The Company reports its financial and operating

performance in three segments:

(1) Pekin Campus production, which includes the production and sale of alcohols and essential ingredients

produced at the Company’s Pekin, Illinois campus (2) marketing and distribution, which includes marketing and merchant trading for

Company-produced alcohols and essential ingredients on an aggregated basis, and sales of fuel-grade ethanol sourced from third parties,

and (3) Western production, which includes the production and sale of fuel-grade ethanol and essential ingredients produced at the Company’s

two western production facilities on an aggregated basis, neither of which are individually so significant to be considered a separately

reportable segment.

ACQUISITION OF KODIAK CARBONIC.

On January 1, 2025, Alto Carbonic purchased 100 %

of the equity interests in Kodiak Carbonic, LLC, a beverage-grade liquid CO 2 processor, for $ 7.6 million in cash.

Alto Carbonic’s

facility is co-located at the Company’s Columbia ethanol plant.

The acquisition will provide the Company further vertical integration

and access to new markets in the liquid CO 2 market out of its Columbia plant.

Kodiak Carbonic’s unaudited net sales for

the three months ended March 31, 2025 and 2024 were $ 2.1 million and $ 1.3 million and its unaudited net income was $ 1.5 million and $ 0.4

million, respectively.

The following table presents the Company’s unaudited pro forma combined financial information assuming the

acquisition occurred on January 1, 2024 (dollars in thousands except per share amounts):

Three Months Ended

Revenues – pro forma

Net loss attributable to common stockholders – pro forma

Basic and diluted net loss per share – pro forma

The following preliminary allocation of the estimated

purchase price assumes, with the exception of property and equipment and intangibles, that carrying values approximate fair value.

of uncollectible accounts receivable are not considered material due to the short-term nature and customer collection history.

The preliminary

estimate of working capital, property and equipment and intangibles are under review by management and are subject to change.

these assumptions, the preliminary purchase price allocation is as follows (in thousands):

Cash and equivalents

Accounts receivable

Total current assets

Property and equipment

Total tangible assets

Current liabilities

Total liabilities

Net tangible assets acquired

Customer relationships

Total Purchase Price

For the identifiable intangible assets, the Company

has estimated 9 years for useful lives for customer relationships.

For the three months ended March 31, 2025, the Company recorded amortization

of these intangibles of $102,000.

Any changes to the initial estimates of the fair value of the acquired assets and assumed liabilities

will be recorded as adjustments to those assets and liabilities and residual amounts will be allocated to goodwill if net assets acquired

are less than the purchase price.

The Company did not incur any material acquisition costs.

A segment is a component of an enterprise whose

operating results are regularly reviewed by the enterprise’s chief operating decision maker (“CODM”) to make decisions

about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.

The Company’s CODM is the Company’s executive committee, which is led by the Company’s Chief Executive Officer (“CEO”)

and includes its Chief Financial Officer, Chief Operating Officer, Chief Commercial Officer and Chief Legal Officer (“Executive

The Company manages and assesses the performance of its reportable segments by its gross profit (loss).

the Executive Committee’s review of segment-level performance, each member of the Executive Committee reviews the gross profit of

the Company’s reportable segments and provides expertise and analysis from their respective areas which drive the evaluation of

the performance of the Company’s reportable segments and allocation of resources to those segments.

Even though the CEO has the

authority to override the other members for strategic or other reasons, key decisions are made jointly by the Executive Committee.

The Company reports financial and operating performance

in three reportable segments (1) Pekin production, which includes the entire campus in Pekin, Illinois (“Pekin Campus”), (2)

marketing and distribution, which includes marketing and merchant trading for Company-produced specialty alcohols, fuel-grade ethanol

and essential ingredients, and sales of fuel-grade ethanol sourced from third parties, and (3) Western production, which includes the

Company’s two western production facilities and, beginning for the three months ended March 31, 2025, its liquid CO 2

plant on an aggregated basis (“Western production”).

The following tables set forth certain financial

1 unchanged sentence

Three Months Ended

September 30,

Nine Months Ended

September 30,

Pekin Campus, recorded as gross:

Pekin Campus production, recorded as gross:

Alcohol sales

16 unchanged sentences

Cost of goods sold:

Pekin Campus production

Marketing and distribution

4 unchanged sentences

Gross profit (loss):

Pekin Campus production

Marketing and distribution

2 unchanged sentences

Intersegment eliminations

Gross profit as reported

Loss before provision for income taxes:

Gross loss as reported

Gain (loss) before provision for income taxes :

Pekin Campus production

Marketing and distribution

1 unchanged sentence

Corporate and other

Depreciation and amortization:

Depreciation and amortization expense:

Pekin Campus production

Western production

1 unchanged sentence

Interest expense, net of capitalized interest:

Pekin Campus production

Marketing and distribution

3 unchanged sentences

total assets by operating segment (in thousands):

September 30,

Total assets:

Pekin Campus production

Marketing and distribution

4 unchanged sentences

determined on a first-in, first-out basis.

Inventory is net of a valuation adjustment of $ 203,000 and $ 2,201,000 as of September 30, 2024

Inventory is net of a valuation allowance of $ 1,170,000 and $ 2,050,000 as of March 31, 2025

and December 31, 2024, respectively.

Inventory balances consisted of the following (in thousands):

September 30,

Finished goods

9 unchanged sentences

Flow Hedges – The Company uses derivative instruments to protect cash flows from fluctuations caused by volatility in commodity

prices for periods of up to eighteen months to protect gross profit margins from potentially adverse effects of market and price volatility

on alcohol sales and purchase commitments where the prices are set at a future date and/or if the contracts specify a floating or index-based

In addition, the Company hedges anticipated sales of alcohol to minimize its exposure to the potentially adverse effects of price

These derivatives may be designated and documented as cash flow hedges and effectiveness is evaluated by assessing the probability

of the anticipated transactions and regressing commodity futures prices against the Company’s purchase and sales prices.

Ineffectiveness,

which is defined as the degree to which the derivative does not offset the underlying exposure, is recognized immediately in cost of goods

For the three and nine months ended September 30, 2024 and 2023, the Company did not designate any of its derivatives as cash flow

prices for periods of up to twelve months in order to protect gross profit margins from potentially adverse effects of market and price

volatility on alcohol sales and purchase commitments where the prices are set at a future date and/or if the contracts specify a floating

or index-based price.

In addition, the Company hedges anticipated sales of alcohol to minimize its exposure to the potentially adverse

effects of price volatility.

These derivatives may be designated and documented as cash flow hedges and effectiveness is evaluated by

assessing the probability of the anticipated transactions and regressing commodity futures prices against the Company’s purchase

and sales prices.

Ineffectiveness, which is defined as the degree to which the derivative does not offset the underlying exposure, is

recognized immediately in cost of goods sold.

For the three months ended March 31, 2025 and 2024, the Company did not designate any of

its derivatives as cash flow hedges.

Commodity Risk – Non-Designated Hedges

5 unchanged sentences

The Company recognized

net losses of $ 2,566,000 and net losses $ 2,711,000 as the change in the fair value of these contracts for the three months ended September

30, 2024 and 2023, respectively.

The Company recognized net gains of $ 9,002,000 and $ 2,463,000 as the change in the fair value of these

contracts for the nine months ended September 30, 2024 and 2023, respectively.

Non-Designated Derivative Instruments

– The classification and amounts of the Company’s derivatives not designated as hedging instruments, and related cash collateral

balances, are as follows (in thousands):

As of September 30, 2024

net gains of $ 1,773,000 and $ 3,338,000 as the change in the fair value of these contracts for the three months ended March 31, 2025 and

2024, respectively.

Non – Designated Derivative

Instruments – The classification and amounts of the Company’s derivatives not designated as hedging instruments,

and related cash collateral balances, are as follows (in thousands):

As of March 31, 2025

Type of Instrument

Balance Sheet

Balance Sheet Location

Cash collateral balance

5 unchanged sentences

Type of Instrument

Balance Sheet

Balance Sheet Location

Cash collateral balance

8 unchanged sentences

The classification and amounts of the Company’s

realized and unrealized gains and losses for its derivatives not designated as hedging instruments are as follows (in thousands):

realized gains for its derivatives not designated as hedging instruments are as follows (in thousands):

Realized Gains

For the Three Months Ended

September 30,

Type of Instrument

2 unchanged sentences

Cost of goods sold

Realized Gains

For the Nine Months Ended

September 30,

Type of Instrument

Statements of Operations Location

Commodity contracts

Cost of goods sold

Unrealized Losses

Unrealized Gains

For the Three Months Ended

September 30,

Type of Instrument

2 unchanged sentences

Cost of goods sold

Unrealized Gains (Losses)

For the Nine Months Ended

September 30,

Type of Instrument

Statements of Operations Location

Commodity contracts

Cost of goods sold

Long-term borrowings are summarized as follows

(in thousands):

September 30,

Kinergy line of credit

5 unchanged sentences

Excess Availability – As of

September 30, 2024, Kinergy had $ 27.2 million in unused borrowing availability under its line of credit with Wells Fargo Bank and the

Company had $ 65.0 million that may be available for capital improvement projects under its term loan with Orion Infrastructure Capital,

subject to certain conditions.

At September 30, 2024, the interest rates for the Kinergy line of credit and the Orion term loan were 6.43 %

and 10.00 %, respectively.

March 31, 2025, Kinergy had $ 11.7 million in unused borrowing availability under its line of credit and the Company had $ 65.0 million

that may be available for capital improvement projects under its Orion term loan, subject to certain conditions.

COMMITMENTS AND CONTINGENCIES.

Sales Commitments – At September

Sales Commitments – At March

31, 2025, the Company had entered into sales contracts with its major customers to sell certain quantities of alcohol and essential ingredients.

The Company had open alcohol indexed-price contracts for 70,128,000 gallons as of September 30, 2024 and open fixed-price alcohol sales

contracts totaling $ 112,966,000 as of September 30, 2024.

The Company had open indexed-price alcohol sales contracts for 92,716,000 gallons as of March 31, 2025 and open fixed-price alcohol sales

contracts totaling $ 170,436,000 as of March 31, 2025.

The Company had open fixed-price sales contracts for essential ingredients totaling

$ 6,797,000 and open indexed-price sales contracts of essential ingredients for 44,000 tons as of September 30, 2024.

$ 9,085,000 and open indexed-price sales contracts of essential ingredients for 19,000 tons as of March 31, 2025.

These sales contracts

are scheduled to be completed throughout 2024 and 2025.

are scheduled to be completed throughout 2025.

Purchase Commitments – At

September 30, 2024, the Company had indexed-price purchase contracts to purchase 14,468,000 gallons of alcohol and fixed-price purchase

contracts to purchase $ 1,517,000 of alcohol from its suppliers.

The Company had fixed-price purchase contracts to purchase $ 23,996,000

of corn from its suppliers as of September 30, 2024.

The Company had indexed-price purchase contracts for natural gas totaling 5,592,000

MMBTU as of September 30, 2024.

March 31, 2025, the Company had indexed-price purchase contracts to purchase 11,766,000 gallons of alcohol and fixed-price purchase contracts

to purchase $ 278,000 of alcohol from its suppliers.

The Company had fixed-price purchase contracts to purchase $ 46,233,000 of corn from

its suppliers as of March 31, 2025.

The Company had indexed-price contracts to purchase 6,743,000 MMBTU of natural gas as of March 31,

The Company also had future commitments for certain capital projects totaling $ 10,790,000 .

These purchase

commitments are scheduled to be satisfied throughout 2024 and 2025.

These purchase commitments are scheduled

to be satisfied throughout 2025.

Litigation – General –

10 unchanged sentences

will have a material impact on the Company’s financial condition or results of operations.

PENSION AND RETIREMENT BENEFIT PLANS.

PENSION PLANS.

The Company sponsors a defined

12 unchanged sentences

with a fair value of plan assets of $ 20.1 million.

The underfunded amount of $ 0.1 million is recorded on the Company’s consolidated

balance sheet in other liabilities.

For the three months ended September

30, 2024, the Retirement Plan’s net periodic expense was $ 13,000 , comprised of $ 222,000 in interest cost and $ 67,000 in service

cost, partially offset by $ 276,000 of expected return on plan assets.

For the nine months ended September 30, 2024, the Retirement Plan’s

net periodic expense was $ 39,000 , comprised of $ 666,000 in interest cost and $ 201,000 in service cost, partially offset by $ 828,000 of

expected return on plan assets.

For the three months ended September 30, 2023, the Retirement Plan’s net periodic expense was $ 39,000 ,

comprised of $ 225,000 in interest cost and $ 62,000 in service cost, partially offset by $ 248,000 of expected return on plan assets.

the nine months ended September 30, 2023, the Retirement Plan’s net periodic expense was $ 117,000 , comprised of $ 675,000 in interest

The overfunded amount of $ 2.6 million is recorded on the Company’s consolidated

balance sheet in other assets.

For the three months ended March 31, 2025, the Retirement Plan’s net periodic benefit was $ 22,000 ,

comprised of $ 313,000 in expected return on plan assets, partially offset by $ 234,000 in interest cost and $ 57,000 in service cost.

the three months ended March 31, 2024, the Retirement Plan’s net periodic expense was $ 13,000 , comprised of $ 222,000 in interest

cost and $ 67,000 in service cost, partially offset by $ 276,000 of expected return on plan assets.

10 unchanged sentences

The Company’s funding policy is to make the minimum annual contribution required by applicable regulations.

For the three months ended September

30, 2024, the Postretirement Plan’s net periodic expense was $ 54,000 , comprised of $ 49,000 in interest cost and $ 5,000 in service

For the nine months ended September 30, 2024, the Postretirement Plan’s net periodic expense was $ 162,000 , comprised of $ 147,000

in interest cost and $ 15,000 in service cost.

For the three months ended September 30, 2023, the Postretirement Plan’s net periodic

expense was $ 36,000 , comprised of $ 46,000 of interest cost and $ 3,000 of service cost, partially offset by $ 13,000 in amortization of

For the nine months ended September 30, 2023, the Postretirement Plan’s net periodic expense was $ 108,000 , comprised of $ 138,000

of interest cost and $ 9,000 of service cost, partially offset by $ 39,000 in amortization of gains.

For the three months

ended March 31, 2025, the Postretirement Plan’s net periodic expense was $ 25,000 , comprised of $ 48,000 of interest cost and $ 4,000

of service cost, partially offset by $ 27,000 in amortization of net gains.

For the three months ended March 31, 2024, the Postretirement

Plan’s net periodic expense was $ 54,000 , comprised of $ 49,000 of interest cost and $ 5,000 of service cost.

FAIR VALUE MEASUREMENTS.

20 unchanged sentences

on quoted prices on the commodity exchanges and are designated as Level 1 inputs.

Long-Lived Assets – Long-lived

assets consist of the Company’s estimated fair value associated with its Magic Valley facility.

See Note 1 for additional information.

The fair value of the long-lived assets are based on present value of estimated future cash flows and are designated as Level 3 inputs.

The following table summarizes recurring and nonrecurring

fair value measurements by level at September 30, 2024 (in thousands):

Derivative instruments

fair value measurements by level at March 31, 2025 (in thousands):

Derivative financial instruments

The following table summarizes recurring and nonrecurring

fair value measurements by level at December 31, 2024 (in thousands):

Derivative instruments

Derivative financial instruments

Long-lived assets – Magic Valley

Defined benefit plan assets(1) (pooled separate accounts):

2 unchanged sentences

Fixed Income(5)

Derivative instruments

Derivative financial instruments

(1) Included in other assets in the consolidated balance sheets.

19 unchanged sentences

earnings per share (in thousands, except per share data):

Three Months Ended September 30, 2024

Shares Denominator

Per-Share Amount

Preferred stock dividends

Basic and diluted loss per share:

Loss available to common stockholders

Three Months Ended September 30, 2023

Shares Denominator

Per-Share Amount

Preferred stock dividends

Basic and diluted loss per share:

Loss available to common stockholders

Nine Months Ended September 30, 2024

Shares Denominator

Per-Share Amount

Three Months Ended March 31, 2025

Preferred stock dividends

Basic and diluted loss per share:

Loss available to common stockholders

Nine Months Ended September 30, 2023

Shares Denominator

Per-Share Amount

Net loss attributable to common stockholders

Three Months Ended March 31, 2024

Preferred stock dividends

Basic and diluted loss per share:

Loss available to common stockholders

There were an additional aggregate potentially

dilutive weighted-average shares of 981,000 from convertible securities outstanding for the three and nine months ended September 30,

2024 and September 30, 2023.

These securities were not considered in calculating diluted net income (loss) per share for the three and

nine months ended September 30, 2024 and the three and nine months ended September 30, 2023, as their effect would have been anti-dilutive.

SUBSEQUENT EVENT.

On November 5, 2024, the Company entered

into a CO 2 Transportation and Sequestration Agreement (“TSA”) with Vault 44.01 to provide transportation,

injection and sequestration into the Mt.

Simon sandstone formation in Illinois of CO 2 produced at the Company’s

Pekin Campus.

Under the TSA, Vault 44.01 will also manage the EPA permit approval process from submission to ultimate approval.

Net loss attributable to common stockholders

There were additional aggregate potentially

dilutive weighted-average shares of 981,000 from convertible securities outstanding for the three months ended March 31, 2025 and 2024.

These securities were not considered in calculating diluted net loss per share for the three months ended March 31, 2025 and 2024, as

their effect would have been anti-dilutive.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements