What changed in this filing

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Item 1. Business

2025-03-31 compared with 2024-03-14 · 43 added, 29 removed, 372 unchanged (16% of the section changed)

7 unchanged sentences

We have declared normal quarterly cash dividends of $0.06 per share on our common stock for the calendar year 2025.

Additionally, during the first quarter of 2024, we declared a special cash dividend of $2.50 per share on our common stock payable on April 9, 2024, to the holders of record of all the issued and outstanding shares of common stock as of the close of business on March 26, 2024.

Additionally, we paid a special cash dividend of $2.50 per share on our common stock on April 9, 2024, to the holders of record of all the issued and outstanding shares of common stock as of the close of business on March 26, 2024.

Our business is managed in two segments:

3 unchanged sentences

We have actively worked to develop our chemicals business with new customers in more diversified growth markets.

As part of that focus on growth, we have introduced procedural updates to our operation to allow re-entry to the pharma intermediates market.

This capability has been validated by third party audits.

As part of that focus on growth, we have introduced procedural updates to our operation to allow our re-entry to the pharma intermediates market.

This capability has been confirmed by third party audits.

Our chemicals business is based on a solid reputation as a technology-driven, highly reliable, and globally competitive chemicals producer.

We retain a strong emphasis on operational excellence, cost control, and efficiency improvements to enable us to compete in the worldwide chemical industry.

With respect to our biofuels segment, our plant demonstrated capacity of approximately 59 million gallons per year (“MMgy”) during 2023.

With respect to our biofuels segment, our plant's demonstrated capacity is approximately 59 million gallons (“MMgy”).

We produced 45 and 59 million gallons during 2024 and 2023, respectively.

This scale and the design of our plant in Batesville allows us to process a wide variety of feedstocks and continuously achieve high biodiesel yields.

Combined with the synergies of operating a shared chemical manufacturing facility, this has allowed us to be consistently successful in a highly competitive market.

Combined with the synergies of running a shared chemical manufacturing facility, this has allowed us to be consistently successful in a highly competitive market.

Narrative Description of Our Business

8 unchanged sentences

Land and infrastructure are available to support expansion and business growth.

For the year ended December 31, 2023, approximately 78% of our revenue was derived from biofuels, 18% from manufacturing specialty chemicals for specific customers (“custom manufacturing”), and 4% of revenues from multi-customer specialty chemicals (“performance chemicals”).

For the year ended December 31, 2024, approxima tely 67% of our rev enue was derived from biofuels, 29% from manufacturing specialty chemicals for specific customers (“custom manufacturing”), and 4% of revenues from multi-customer specialty chemicals (“performance chemicals”).

Our biofuels business segment primarily involves the production and sale of biodiesel and petrodiesel blends.

54 unchanged sentences

The biomass-based diesel mandate rose annually and reached 2.43 billion gallons per year in 2021.

On June 21, 2023, USEPA finalized a package of actions setting biofuel volumes for the Renewable Fuel Standard (RFS) program for years 2023, 2024, and 2025.

On June 21, 2023, USEPA finalized a package of actions setting biofuel volumes for the Renewable Fuel Standard (RFS) program for the years 2023, 2024, and 2025.

The following table shows the finalized volume requirements by the USEPA with a steady growth rate in biomass-based diesel.

Renewable Fuel Volumes (billion RINs)*

Renewable Fuel Volumes (billion Renewable Identification Number ("RINs")*

Cellulosic biofuel

4 unchanged sentences

See https://www.epa.gov/renewable-fuel-standard-program/final-renewable-fuels-standards-rule-2023-2024-and-2025.

EPA has not yet set the volume requirements for 2026 which were due by statute on or prior to October 31,2024.

Federal Blenders’ and Producers’ Credits

1 unchanged sentence

The most important of these is the one dollar per gallon Blenders' Tax Credit (“BTC”) applicable to all biodiesel.

This credit has lapsed and been reinstated numerous times over the last decade.

The Inflation Reduction Act of 2022 extended the credit through December 31, 2024 and established a new Clean Fuel Production Credit (“CFPC”) effective January 1, 2025.

The CFPC consolidates and replaces several fuel related credits currently scheduled to expire at the end of 2024, including credits for the production of biodiesel, agri-biodiesel, renewable diesel, second-generation biofuel, sustainable aviation fuel, alternative fuels, and alternative fuels mixtures.

The Inflation Reduction Act of 2022 extended this credit through December 31, 2024.

In August 2022, a new Clean Fuel Production Credit (“CFPC”) was made effective January 1, 2025.

The CFPC consolidated and replaced several fuel related credits that were scheduled to expire at the end of 2024, including credits for the production of biodiesel, agri-biodiesel, renewable diesel, second-generation biofuel, sustainable aviation fuel, alternative fuels, and alternative fuels mixtures.

In contrast to these expiring provisions, which subsidize specific types of low-greenhouse gas (“GHG”) emission fuels, the CFPC is technology neutral and is intended to subsidize the production of any transportation fuel with zero or low GHG emissions.

2 unchanged sentences

For producers not meeting prevailing wage and registered apprenticeship requirements, the maximum credit is 20 cents per gallon of nonaviation fuel and 35 cents per gallon of aviation fuel.

Like the BTC, the small agri-biodiesel credit which provides for an annual tax incentive in the amount of $0.10 per gallon on the first 15 million gallons of qualified agri-biodiesel produced was also extended to December 31, 2024 by the Inflation Reduction Act of 2022 and has not been reinstated with the CFPC.

FutureFuel was approved for the CFPC in December 2024.

There has yet to be definitive guidance on how the CFPC will be interpreted and how it may impact the other market variables that ultimately determine operating margin.

On January 10, 2025, the IRS issued Notice 2025-10 with the purpose of providing initial guidance and solicited comment from the public with a deadline of April 10, 2025, and was to serve as an announcement of forthcoming proposed regulations.

It did not include any reliance language and did not constitute final or binding guidance.

On January 15, 2025, the IRS issued Notice 2025-11 which provided emission rate guidance in support of Notice 2025-10.

We commented on both Notices seeking immediate clarity.

Like the BTC, the small agri-biodiesel credit which provides for an annual tax incentive in the amount of $0.10 per gallon on the first 15 million gallons of qualified agri-biodiesel produced was also extended to December 31, 2024, by the Inflation Reduction Act of 2022 and was not reinstated with the CFPC.

State Incentives

Our review of state statutes reveals that virtually all states provide user or producer incentives for biodiesel, several states provide both types of incentives, and more than 35 states provide incentives to biodiesel producers to build facilities in their states, typically offering tax credits, grants, and other financial incentives.

We are also registered in fuel programs in the states of California and Oregon, which incentivize the use of low carbon fuels specific to biomass-based diesel.

Arkansas does not offer any producer incentives, but does offer investment incentives.

We are registered in fuel programs in the states of California and Oregon, which incentivize the use of low carbon fuels specific to biomass-based diesel.

We will continue to assess these and other state incentives and determine if we qualify.

11 unchanged sentences

2 is essentially the specifications in effect before the amendment.

1 provides for a maximum total monoglyceride content and a maximum cold soak filterability time and, in theory, would be used where the cloud point of No.

1 provides for a maximum total monoglyceride content and a maximum cold soak filterability time and, in theory, would be used where the cloud point of Grade No.

2 biodiesel does not provide adequate assurance of quality.

1 unchanged sentence

The Company continues to operate under the most recently published version of ASTM D6751, Standard Specifications for Biodiesel Fuel Blend Stock (B100) for Middle Distillate Fuels.

All biodiesel made in our continuous process meets the more stringent specifications for No.

All biodiesel made in our continuous process meets the more stringent specifications for Grade No.

biodiesel industry created the BQ-9000 program to address quality issues that arose during the early years of the industry.

13 unchanged sentences

refiners, blenders, and importers.

Renewable Identification Numbers (“RINs”) are the mechanism for ensuring that the prescribed levels of blending are reached.

RINs are the mechanism for ensuring that the prescribed levels of blending are reached.

As ethanol and biodiesel is produced or imported, the producer or importer has the responsibility to report the activity in the USEPA’s Moderated Transaction System (“EMTS”) where a series of numbers (i.e., a RIN) is assigned to their product.

20 unchanged sentences

Biodiesel Production Capacity

According to Biodiesel Magazine 2024 Winter Edition, the United States had a total combined annual operational capacity of 2,221 million gallons from 64 biodiesel plants.

Operational plant capacity decreased more than 550 million gallons from 2020 as the renewable diesel market expanded (see Competition ) and feedstock prices increased.

Nevertheless, the biodiesel industry has been resilient throughout this period with production levels in the first nine months of 2023 similar to those of 2021 and 2022 (Source:

https://www.eia.gov/totalenergy/data/browser/index.php?tbl=T10.04A#/?f=M&start=200101&end=202309&charted=20-6.) Even so, we believe that the biodiesel industry will continue to be highly competitive given the excess capacity and increased competition for feedstocks.

According to the U.S.

Energy Information Administration (“EIA”), biodiesel production capacity decreased to 1,995 million gallons per year from 2,083 million gallons and renewable diesel and other biofuels increased to 4,580 million gallons from 3,897 million gallons in November 2024 as compared to November 2023, respectively.

With the capacity growth of renewable diesel and other biofuels, the biodiesel industry has continued to show resilience.

https://www.eia.gov/biofuels/update/)

Both biodiesel and renewable diesel have been impacted by the lack of clarity from the U.S.

Treasury Department with respect to the CPFC on the delay of the Renewable Fuel Obligation (“RVO”) for 2026.

The USEPA reports that actual production in January 2025 was significantly lower as compared to January 2024 for both biodiesel (68.7 million gallons versus 160.6 million gallons, respectively) and renewable diesel (175.9 million gallons versus 200.9 million gallons, respectively).

However, sustainable aviation fuel (“SAF”) production increased during the same time frame (16.4 million gallons versus 9.7 million gallons, respectively).

https://www.epa.gov/fuels-registration-reporting-and-compliance-help/spreadsheet-rin-generation-and-renewable-fuel-0)

Even given these challenges, we believe that biodiesel will continue to be a highly competitive, sustainable, renewable fuel as long as the approved RFS pathways continue to be eligible for tax credits.

Customers and Markets

4 unchanged sentences

Through the utilization of liquid bulk storage facilities and barge loading capabilities, we are positioned to market biodiesel throughout the United States predominately for transportation.

For the year ended December 31, 2023, two customers represented approximately 44% of biofuel revenue (35% of total revenue).

For the year ended December 31, 2022, two customers represented approximately 34% of biofuel revenue (27% of total revenue).

For the year ended December 31, 2021, three customers represented approximately 52% of biofuel revenue (41% of total revenue).

For the years ended December 31, 2024, 2023, and 2022, two customers represented approximately 37 % of biofuel revenue (25 % of total revenue), 44% of biofuel revenue (35% of total revenue), and 34% of biofuel revenue (27% of total revenue), respectively.

Significant customers for the years ended December 31, 2024, 2023, and 2022 varied from year to year, and were comprised of five customers.

2 unchanged sentences

(i) biofuels are a commodity with a large potential customer base; (ii) we believe that we could readily sell biofuels to other customers; (iii) the prices we receive from these customers are based upon then-market rates; and (iv) our sales to the customers are not under fixed terms, and the customers have no obligation to purchase any minimum quantities except as stipulated by short term purchase orders.

Renewable diesel continues to be a rapidly growing and competing biofuel with biodiesel.

Renewable diesel continues to be a rapidly growing biofuel competing with biodiesel.

The Company uses a conventional process of transesterification of feedstocks fats, vegetable oils, or waste cooking oils to make biodiesel.

4 unchanged sentences

In 2023, renewable diesel capacity and production surpassed that of conventional biodiesel.

The forecasted increases in renewable diesel capacity will require an increase in the supply chain to meet that demand.

The increases forecasted for renewable diesel capacity will require an increase in the supply chain to meet that demand.

This was also the case in 2018, and new capacity was constructed to meet demand.

As well as being driven by the benefits of the RFS and those of the Californian Low Carbon Fuel Standard (LCFS), renewable diesel production is also attractive to US Oil companies as it allows them to repurpose refinery hydro-processing equipment close to existing hydrogen supply facilities that would otherwise be redundant or uneconomical.

As well as being driven by the benefits of the RFS and those of the Californian Low Carbon Fuel Standard (“LCFS”), renewable diesel production is also attractive to U.S.

oil companies as it allows them to repurpose refinery hydro-processing equipment close to existing hydrogen supply facilities that would otherwise be redundant or uneconomical.

In addition to renewable diesel, SAF in the US has grown to a capacity of 16.4 million gallons.

The future of biodiesel will be driven by feedstock availability;

48 unchanged sentences

Our plant’s custom manufacturing product portfolio includes products that are used in the coatings, chemical intermediates, industrial and consumer cleaning, oil and gas, dyes, and specialty polymers industries.

Historically, our custom manufacturing product portfolio was highly concentrated on two significant legacy products, namely a laundry detergent additive for a leading consumer products company and a proprietary row crop herbicide.

The year 2021 marked the first full year that these legacy products were no longer sold.

Historically, but ending in 2021, our custom manufacturing product portfolio was highly concentrated on two significant legacy products, namely a laundry detergent additive for a leading consumer products company and a proprietary row crop herbicide.

Our current custom manufacturing product portfolio is more diversified into multiple markets including agrochemicals, oilfield chemicals, industrial intermediates, and fabric care markets.

25 unchanged sentences

Specialty chemicals are generally high unit value products sold in bulk, or low-volume packaged form, and for which distribution is a relatively minor component of cost.

Most products are sold FOB the Batesville site for distribution globally.

Most products are sold free on board (“FOB”) from the Batesville site for distribution globally.

Similarly, raw materials for these products are comparatively higher-value components that are sourced globally.

126 unchanged sentences

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-K

Item 1. Business