What changed in this filing

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Item 1. Financial Statements

2022-08-02 compared with 2022-05-03 · 396 added, 172 removed, 623 unchanged (48% of the section changed)

4 unchanged sentences

(in thousands, except share amounts)

2022 December 31,

Current assets

3 unchanged sentences

Accounts receivable, net of allowances of $ 204 and $ 682 , respectively

158,363 119,961

Income taxes receivable 1,067 911

Inventories 315,040 267,838

Prepaid expenses and other 20,634 16,483

1 unchanged sentence

Total current assets 1,159,696 1,117,749

Property and equipment, net of accumulated depreciation

‎ and amortization of $ 584,957 and $ 567,027 , respectively

Property and equipment, net of accumulated depreciation and amortization of $ 602,752 and $ 567,027 , respectively

980,917 893,517

Operating lease right-of-use assets 66,681 64,042

LIABILITIES AND STOCKHOLDERS'

Other assets 88,714 84,447

Total assets $ 2,296,008 $ 2,159,755

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

11 unchanged sentences

Commitments and contingencies (Note 13)

Stockholders'

Stockholders' equity

Common stock, $ 0.001 par value;

150,000,000 shares authorized;

‎ 62,066,201 and 61,840,434 shares issued, and 53,821,745

‎ and 53,595,978 shares outstanding, respectively

62,086,595 and 61,840,434 shares issued, and 53,842,139 and 53,595,978 shares outstanding, respectively

Additional paid-in capital 1,069,921 1,069,573

2 unchanged sentences

Treasury stock, 8,244,456 shares

Total Green Plains stockholders'

( 91,626 ) ( 91,626 )

Total Green Plains stockholders' equity 931,173 950,500

Noncontrolling interests 150,556 151,519

Total stockholders'

Total liabilities and stockholders'

Total stockholders' equity 1,081,729 1,102,019

Total liabilities and stockholders' equity $ 2,296,008 $ 2,159,755

See accompanying notes to the consolidated financial statements.

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Product revenues $ 1,009,935 $ 721,786 $ 1,786,625 $ 1,273,766

5 unchanged sentences

Selling, general and administrative expenses 30,113 23,383 60,976 46,901

Gain on sale of assets, net

Loss (gain) on sale of assets, net — 3,825 — ( 33,068 )

Depreciation and amortization expenses 20,967 20,532 41,366 41,213

4 unchanged sentences

Interest expense ( 7,800 ) ( 19,058 ) ( 16,606 ) ( 50,737 )

Total other expense

Loss before income taxes and income (loss) from equity method investees

Other, net 28,165 ( 1,250 ) 28,576 ( 1,240 )

Total other income (expense) 21,171 ( 19,867 ) 12,847 ( 51,506 )

Income (loss) before income taxes and income (loss) from equity method investees 55,012 11,166 ( 1,214 ) 10,874

Income tax benefit (expense) ( 2,895 ) 4,783 ( 1,742 ) 2,921

Income (loss) from equity method investees 603 168 ( 196 ) 343

Net income (loss) 52,720 16,117 ( 3,152 ) 14,138

Net income attributable to noncontrolling interests 6,322 6,374 11,924 10,940

Net loss attributable to Green Plains

Net income (loss) attributable to Green Plains $ 46,398 $ 9,743 $ ( 15,076 ) $ 3,198

Earnings per share:

Net loss attributable to Green Plains - basic and diluted

Net income (loss) attributable to Green Plains - basic $ 0.87 $ 0.21 $ ( 0.28 ) $ 0.08

Net income (loss) attributable to Green Plains - diluted $ 0.73 $ 0.20 $ ( 0.28 ) $ 0.07

Weighted average shares outstanding:

Basic and diluted

Basic 53,033 45,425 52,960 41,581

Diluted 66,895 58,171 52,960 42,675

See accompanying notes to the consolidated financial statements.

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Net income (loss) $ 52,720 $ 16,117 $ ( 3,152 ) $ 14,138

Other comprehensive income (loss), net of tax:

Unrealized gains (losses) on derivatives arising during the period, net of tax benefit (expense) of $ 3,579 , ($ 1,616 ), $ 1,658 and ($ 89 ), respectively

Reclassification of realized losses (gains) on derivatives, net of tax expense of $ 701 and $ 434 , respectively

( 10,535 ) 5,131 ( 5,149 ) 282

Reclassification of realized losses on derivatives, net of tax benefit of ($ 878 ), ($ 1,246 ), ($ 177 ) and ($ 812 ), respectively

2,515 3,961 550 2,584

Total other comprehensive income (loss), net of tax ( 8,020 ) 9,092 ( 4,599 ) 2,866

Comprehensive loss

Comprehensive income (loss) 44,700 25,209 ( 7,751 ) 17,004

Comprehensive income attributable to noncontrolling interests 6,322 6,374 11,924 10,940

Comprehensive loss attributable to Green Plains

Comprehensive income (loss) attributable to Green Plains $ 38,378 $ 18,835 $ ( 19,675 ) $ 6,064

See accompanying notes to the consolidated financial statements.

3 unchanged sentences

(unaudited and in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Net income (loss) $ ( 3,152 ) $ 14,138

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

Depreciation and amortization 41,366 41,213

5 unchanged sentences

Loss (income) from equity method investees 196 ( 343 )

Other 1,128 ( 217 )

Changes in operating assets and liabilities before effects of business combinations and dispositions:

Accounts receivable ( 41,162 ) ( 22,022 )

Inventories ( 47,202 ) ( 15,910 )

Derivative financial instruments ( 33,020 ) ( 14,331 )

2 unchanged sentences

Current income taxes ( 45 ) ( 428 )

Other ( 3,325 ) 3,591

Net cash used in operating activities ( 106,641 ) ( 30,212 )

3 unchanged sentences

Proceeds from the sale of marketable securities 99,917 —

Net cash provided by investing activities

Other investing activities ( 6,976 ) ( 4,000 )

Net cash provided by (used in) investing activities ( 35,342 ) 9,947

Cash flows from financing activities:

19 unchanged sentences

Continued from the previous page

Three Months Ended

Six Months Ended

Reconciliation of total cash, cash equivalents and restricted cash:

2 unchanged sentences

Total cash, cash equivalents and restricted cash $ 579,279 $ 615,373

Non-cash financing activities:

Exchange of 4.00 % convertible notes due 2024

Exchange of common stock held in treasury stock for 4.00 % convertible notes due 2024

Supplemental investing activities:

3 unchanged sentences

Supplemental disclosures of cash flow:

Cash refunded for income taxes, net

Cash paid for interest of continuing operations

Cash paid for income taxes, net $ 305 $ 576

Cash paid for interest $ 14,803 $ 16,675

Capital expenditures in accounts payable $ 6,707 $ 19,110

10 unchanged sentences

Unconsolidated entities are included in the financial statements on an equity basis.

As of March 31, 2022, the company owns a 48.9 % limited partner interest and a 2.0 % general partner interest in Green Plains Partners LP.

As of June 30, 2022, the company owns a 48.9 % limited partner interest and a 2.0 % general partner interest in Green Plains Partners LP.

Public investors own the remaining 49.1 % limited partner interest in the partnership.

4 unchanged sentences

The assets of the partnership cannot be used by the company for general corporate purposes.

The partnership’s consolidated total assets as of March 31, 2022 and December 31, 2021, excluding intercompany balances, are $ 98.7 million and $ 100.3 million, respectively, and primarily consist of property and equipment, operating lease right-of-use assets and goodwill.

The partnership’s consolidated total liabilities as of March 31, 2022 and December 31, 2021, excluding intercompany balances, are $ 112.5 million and $ 111.4 million, respectively, which primarily consist of long-term debt as discussed in Note 8 – Debt and operating lease liabilities.

The partnership’s consolidated total assets as of June 30, 2022 and December 31, 2021, excluding intercompany balances, are $ 100.1 million and $ 100.3 million, respectively, and primarily consist of property and equipment, operating lease right-of-use assets and goodwill.

The partnership’s consolidated total liabilities as of June 30, 2022 and December 31, 2021, excluding intercompany balances, are $ 113.4 million and $ 111.4 million, respectively, which primarily consist of long-term debt as discussed in Note 8 – Debt and operating lease liabilities.

The liabilities recognized as a result of consolidating the partnership do not represent additional claims on the company’s general assets.

26 unchanged sentences

Sales, value add, and other taxes the company collects concurrent with revenue-producing activities are excluded from revenue.

Sales of ethanol, distillers grains, Ultra-High Protein, corn oil, natural gas and other commodities by the company’s marketing business are recognized when obligations under the terms of a contract with a customer are satisfied.

Sales of ethanol, distillers grains, corn oil, natural gas and other commodities by the company’s marketing business are recognized when obligations under the terms of a contract with a customer are satisfied.

Generally, this occurs with the transfer of control of products or services.

50 unchanged sentences

When it becomes probable a forecasted transaction will not occur, the cash flow hedge treatment is discontinued, which affects earnings.

These derivative

financial instruments are recognized in current assets or current liabilities at fair value.

These derivative financial instruments are recognized in current assets or current liabilities at fair value.

At times, the company hedges its exposure to changes in inventory values and designates qualifying derivatives as fair value hedges.

6 unchanged sentences

The following tables disaggregate revenue by major source (in thousands):

Three Months Ended March 31, 2022

Ethanol Production

Agribusiness & Energy Services

Three Months Ended June 30, 2022

Ethanol Production Agribusiness & Energy

Services Partnership Eliminations Total

Revenues from contracts with customers under ASC 606:

Ethanol $ — $ — $ — $ — $ —

Distillers grains 9,401 — — — 9,401

Corn oil — — — — —

Service revenues 1,547 — 912 — 2,459

Other 5,729 1,661 — — 7,390

Intersegment revenues — 234 2,053 ( 2,287 ) —

1 unchanged sentence

Revenues from contracts accounted for as derivatives under ASC 815 (1) :

Ethanol 644,641 138,032 — — 782,673

Distillers grains 143,435 8,173 — — 151,608

Corn oil 51,956 1,551 — — 53,507

Other 4,457 899 — — 5,356

Intersegment revenues — 7,009 — ( 7,009 ) —

1 unchanged sentence

Leasing revenues under ASC 842 (2) :

— — 16,689 ( 16,689 ) —

Total Revenues $ 861,166 $ 157,559 $ 19,654 $ ( 25,985 ) $ 1,012,394

Three Months Ended March 31, 2021

Ethanol Production

Agribusiness & Energy Services

Six Months Ended June 30, 2022

Ethanol Production Agribusiness & Energy

Services Partnership Eliminations Total

Revenues from contracts with customers under ASC 606:

Ethanol $ — $ — $ — $ — $ —

Distillers grains 16,763 — — — 16,763

Corn oil — — — — —

Service revenues 5,287 — 1,917 — 7,204

Other 15,350 2,949 — — 18,299

Intersegment revenues — 234 3,938 ( 4,172 ) —

1 unchanged sentence

Revenues from contracts accounted for as derivatives under ASC 815 (1) :

Ethanol 1,116,563 233,692 — — 1,350,255

Distillers grains 241,947 23,299 — — 265,246

Corn oil 92,845 3,957 — — 96,802

Other 9,964 29,296 — — 39,260

Intersegment revenues — 12,844 — ( 12,844 ) —

1 unchanged sentence

Leasing revenues under ASC 842 (2) :

— — 32,899 ( 32,899 ) —

Total Revenues $ 1,498,719 $ 306,271 $ 38,754 $ ( 49,915 ) $ 1,793,829

(1) Revenues from contracts accounted for as derivatives represent physically settled derivative sales that are outside the scope of ASC 606, where the company recognizes revenue when control of the inventory is transferred within the meaning of ASC 606 as required by ASC 610-20, Gains and Losses from Derecognition of Nonfinancial Assets .

Three Months Ended June 30, 2021

Ethanol Production Agribusiness & Energy

Services Partnership Eliminations Total

Revenues from contracts with customers under ASC 606:

Ethanol $ — $ — $ — $ — $ —

Distillers grains 4,425 — — — 4,425

Corn oil — — — — —

Service revenues 1,462 — 1,159 — 2,621

Other 12,367 2,217 — — 14,584

Intersegment revenues — — 2,172 ( 2,172 ) —

Total revenues from contracts with customers 18,254 2,217 3,331 ( 2,172 ) 21,630

Revenues from contracts accounted for as derivatives under ASC 815 (1) :

Ethanol 413,592 138,931 — — 552,523

Distillers grains 95,465 9,015 — — 104,480

Corn oil 25,349 7,775 — — 33,124

Grain — 10,798 — — 10,798

Other 2,613 ( 761 ) — — 1,852

Intersegment revenues — 5,512 — ( 5,512 ) —

Total revenues from contracts accounted for as derivatives 537,019 171,270 — ( 5,512 ) 702,777

Leasing revenues under ASC 842 (2) :

— — 16,370 ( 16,359 ) 11

Total Revenues $ 555,273 $ 173,487 $ 19,701 $ ( 24,043 ) $ 724,418

Six Months Ended June 30, 2021

Ethanol Production Agribusiness & Energy

Services Partnership Eliminations Total

Revenues from contracts with customers under ASC 606:

Ethanol $ — $ — $ — $ — $ —

Distillers grains 8,038 — — — 8,038

Corn oil — — — — —

Service revenues 2,025 — 2,216 — 4,241

Other 16,429 3,043 — — 19,472

Intersegment revenues — — 4,178 ( 4,178 ) —

Total revenues from contracts with customers 26,492 3,043 6,394 ( 4,178 ) 31,751

Revenues from contracts accounted for as derivatives under ASC 815 (1) :

Ethanol 703,177 214,843 — — 918,020

Distillers grains 191,159 18,254 — — 209,413

Corn oil 39,889 12,586 — — 52,475

Grain — 22,968 — — 22,968

Other 18,278 25,102 — — 43,380

Intersegment revenues — 10,635 — ( 10,635 ) —

Total revenues from contracts accounted for as derivatives 952,503 304,388 — ( 10,635 ) 1,246,256

Leasing revenues under ASC 842 (2) :

— — 33,713 ( 33,662 ) 51

Total Revenues $ 978,995 $ 307,431 $ 40,107 $ ( 48,475 ) $ 1,278,058

(1) Revenues from contracts accounted for as derivatives represent physically settled derivative sales that are outside the scope of ASC 606.

(2) Leasing revenues do not represent revenues recognized from contracts with customers under ASC 606, and are accounted for under ASC 842, Leases .

Major Customers

For the three months ended March 31, 2022, no single customer’s revenue was over 10% of total revenues.

Revenues from Customer A represented approximately 13 % of total revenues for the three months ended March 31, 2021.

Revenues from Customer A represented 14 % and 12 % of total revenues for the three and six months ended June 30, 2022, respectively, and revenues from Customer B represented 12 % and 10 % of total revenues for the three and six months ended June 30, 2022, respectively, recorded within the ethanol production segment.

No single customer’s revenue was over 10% of total revenues for the three and six months ended June 30, 2021.

Disposition of Ord Ethanol Plant

2 unchanged sentences

The divested assets were reported within the company’s ethanol production, agribusiness and energy services and partnership segments.

The company recorded a pretax gain on the sale of the Ord plant of $ 36.9 million within corporate activities during the three months ended March 31, 2021.

The company recorded a pretax gain on the sale of the Ord plant of $ 35.9 million within corporate activities during the six months ended June 30, 2021.

FAIR VALUE DISCLOSURES

10 unchanged sentences

The company’s assets and liabilities by level are as follows (in thousands):

Fair Value Measurements at March 31, 2022

Fair Value Measurements at June 30, 2022

Quoted Prices in

1 unchanged sentence

Identical Assets

Significant Other

(Level 1) Significant Other

Observable Inputs

(Level 2) Total

Cash and cash equivalents $ 508,151 $ — $ 508,151

1 unchanged sentence

Inventories carried at market — 58,185 58,185

Unrealized gains on derivatives

Derivative financial instruments - assets — 40,474 40,474

Other assets 110 54 164

Total assets measured at fair value $ 579,389 $ 98,713 $ 678,102

Accounts payable (1)

$ — $ 8,356 $ 8,356

Accrued and other liabilities (2)

Unrealized losses on derivatives

— 3,021 3,021

Derivative financial instruments - liabilities — 49,959 49,959

Other liabilities (2)

— 6,553 6,553

Total liabilities measured at fair value $ — $ 67,889 $ 67,889

3 unchanged sentences

Identical Assets

Significant Other

(Level 1) Significant Other

Observable Inputs

(Level 2) Total

Cash and cash equivalents $ 426,220 $ — $ 426,220

1 unchanged sentence

Inventories carried at market — 72,320 72,320

Unrealized gains on derivatives

Derivative financial instruments - assets — 26,738 26,738

Other assets 111 8 119

Total assets measured at fair value $ 561,070 $ 99,066 $ 660,136

Accounts payable (1)

$ — $ 12,617 $ 12,617

Accrued and other liabilities (2)

Unrealized losses on derivatives

— 3,260 3,260

Derivative financial instruments - liabilities — 26,117 26,117

Other liabilities (2)

— 7,788 7,788

Total liabilities measured at fair value $ — $ 49,782 $ 49,782

(1) Accounts payable is generally stated at historical amounts with the exception of $ 5.5 million and $ 12.6 million at March 31, 2022 and December 31, 2021, respectively, related to certain delivered inventory for which the payable fluctuates based on changes in commodity prices.

(1) Accounts payable is generally stated at historical amounts with the exception of $ 8.4 million and $ 12.6 million at June 30, 2022 and December 31, 2021, respectively, related to certain delivered inventory for which the payable fluctuates based on changes in commodity prices.

These payables are hybrid financial instruments for which the company has elected the fair value option.

(2) As of both March 31, 2022 and December 31, 2021, respectively, accrued and other liabilities includes $ 3.3 million and $ 3.3 million and other liabilities includes $ 7.8 million and $ 7.6 million of consideration related to potential earn-out payments recorded at fair value.

As of March 31, 2022, the fair value of the company’s debt was approximately $ 1,023.5 million compared with a book value of $ 903.8 million.

(2) As of June 30, 2022 and December 31, 2021, respectively, accrued and other liabilities includes $ 3.0 million and $ 3.3 million and other liabilities includes $ 6.5 million and $ 7.6 million of consideration related to potential earn-out payments recorded at fair value.

As of June 30, 2022, the fair value of the company’s debt was approximately $ 984.4 million compared with a book value of $ 902.6 million.

At December 31, 2021, the fair value of the company’s debt was approximately $ 891.1 million compared with a book value of $ 722.7 million.

The company estimated the fair value of its outstanding debt using Level 2 inputs.

The company believes the fair values of its marketable securities approximated book value, which was $ 24.9 million and $ 124.9 million at March 31, 2022 and December 31, 2021, respectively.

The company believes the fair values of its accounts receivable approximated book value, which was $ 142.0 million and $ 120.0 million at March 31, 2022 and December 31, 2021, respectively.

The company believes the fair values of its marketable securities approximated book value, which was $ 25.0 million and $ 124.9 million at June 30, 2022 and December 31, 2021, respectively.

The company believes the fair values of its accounts receivable approximated book value, which was $ 158.4 million and $ 120.0 million at June 30, 2022 and December 31, 2021, respectively.

Although the company currently does not have any recurring Level 3 financial measurements, the fair values of tangible and intangible assets and goodwill acquired represent Level 3 measurements which were derived using a combination of the income approach, market approach and cost approach for the specific assets or liabilities being valued.

11 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Ethanol production:

11 unchanged sentences

Intersegment eliminations ( 25,985 ) ( 24,043 ) ( 49,915 ) ( 48,475 )

Total Revenues

$ 1,012,394 $ 724,418 $ 1,793,829 $ 1,278,058

Refer to Note 2 - Revenue , for further disaggregation of revenue by operating segment.

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Cost of goods sold:

2 unchanged sentences

Intersegment eliminations ( 27,163 ) ( 24,429 ) ( 50,653 ) ( 46,795 )

$ 921,314 $ 639,408 $ 1,693,823 $ 1,148,641

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Gross margin:

Ethanol production $ 56,345 $ 61,617 $ 32,338 $ 69,814

Agribusiness and energy services 13,903 3,306 28,176 21,176

Partnership 19,654 19,701 38,754 40,107

Intersegment eliminations 1,178 386 738 ( 1,680 )

$ 91,080 $ 85,010 $ 100,006 $ 129,417

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Operating income (loss):

1 unchanged sentence

Agribusiness and energy services 10,281 ( 851 ) 20,689 12,495

Partnership 12,104 11,916 23,913 24,787

Intersegment eliminations 1,178 386 738 ( 1,680 )

Corporate activities (1)

(1) Operating loss for ethanol production includes an inventory lower of cost or net realizable value adjustment charge of $ 13.2 million for the three months ended March 31, 2022.

(2) Corporate activities for the three months ended March 31, 2021 include a $ 36.9 million gain on sale of assets .

( 17,228 ) ( 13,961 ) ( 35,749 ) 13,555

$ 33,841 $ 31,033 $ ( 14,061 ) $ 62,380

(1) Corporate activities for the three and six months ended June 30, 2021 include a $ 3.8 million loss on sale of assets and a $ 33.1 million gain on sale of assets, respectively.

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Depreciation and amortization:

1 unchanged sentence

Agribusiness and energy services 470 595 934 1,202

Partnership 823 795 1,721 1,682

Corporate activities 560 659 1,165 1,318

$ 20,967 $ 20,532 $ 41,366 $ 41,213

The following table sets forth total assets by operating segment (in thousands):

March 31, 2022

December 31, 2021

June 30, 2022 December 31, 2021

Total assets (1) :

1 unchanged sentence

Agribusiness and energy services 593,413 487,164

Partnership 100,106 100,349

Corporate assets 488,944 524,206

Intersegment eliminations ( 8,025 ) ( 53,115 )

$ 2,296,008 $ 2,159,755

(1) Asset balances by segment exclude intercompany balances.

Inventories are carried at the lower of cost or net realizable value, except fair-value hedged inventories.

As of March 31, 2022, the company recorded a $ 13.2 million lower of cost or net realized value inventory adjustment reflected in cost of goods sold within the ethanol production segment.

There was no lower of cost or market inventory adjustment as of December 31, 2021.

There was no lower of cost or market inventory adjustment as of June 30, 2022 and December 31, 2021.

The components of inventories are as follows (in thousands):

March 31, 2022

December 31, 2021

June 30, 2022 December 31, 2021

Finished goods $ 138,806 $ 91,448

3 unchanged sentences

Supplies and parts 37,274 33,683

$ 315,040 $ 267,838

DERIVATIVE FINANCIAL INSTRUMENTS

At March 31, 2022, the company’s consolidated balance sheet reflected unrealized losses of $ 8.9 million, net of tax, in accumulated other comprehensive loss.

At June 30, 2022, the company’s consolidated balance sheet reflected unrealized losses of $ 16.9 million, net of tax, in accumulated other comprehensive loss.

The company expects these items will be reclassified as operating income (loss) over the next 12 months as a result of hedged transactions that are forecasted to occur.

2 unchanged sentences

The fair values of the company’s derivative financial instruments and the line items on the consolidated balance sheets where they are reported are as follows (in thousands):

Asset Derivatives'

Liability Derivatives'

Derivative financial instruments

Asset Derivatives'

Fair Value Liability Derivatives'

2022 December 31,

2021 June 30,

2022 December 31,

Derivative financial instruments - forwards $ 40,474 (1)

$ 26,738 $ 49,959

Other assets 54 8 — —

Other liabilities — — 71 196

(1) At March 31, 2022, derivative financial instruments, as reflected on the balance sheet, includes net unrealized gains on exchange traded futures and options contracts of $ 1.9 million, which included $ 0.9 million of net unrealized losses on derivative financial instruments designated as cash flow hedging instruments.

(2) At March 31, 2022, derivative financial instruments, as reflected on the balance sheet, includes net unrealized losses on exchange traded futures and options contracts of $ 30.4 million.

(3) At December 31, 2021, derivative financial instruments, as reflected on the balance sheet, includes net unrealized losses on exchange traded futures and options contracts of $ 17.1 million, which include $ 1.3 million of net unrealized losses on derivative financial instruments designated as cash flow hedging instruments.

Total $ 40,528 $ 26,746 $ 50,030 $ 26,313

(1) At June 30, 2022, derivative financial instruments, as reflected on the balance sheet, includes net unrealized gains on exchange traded futures and options contracts of $ 19.9 million, which included $ 11.6 million of net unrealized losses on derivative financial instruments designated as cash flow hedging instruments, $ 14.8 million of unrealized gains on derivative financial instruments designated as fair value hedging instruments, and the balance representing economic hedges.

(2) At December 31, 2021, derivative financial instruments, as reflected on the balance sheet, includes net unrealized losses on exchange traded futures and options contracts of $ 17.1 million, which include $ 1.3 million of net unrealized losses on derivative financial instruments designated as cash flow hedging instruments, $ 0.5 million of unrealized losses on derivative financial instruments designated as fair value hedging instruments, and the balance representing economic hedges.

Refer to Note 4 - Fair Value Disclosures , which contains fair value information related to derivative financial instruments.

3 unchanged sentences

Location of Gain (Loss) Reclassified from Accumulated Other

Three Months Ended

Comprehensive Income into Income

Comprehensive Income into Income Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Revenues $ ( 1,111 ) $ ( 23,692 ) $ ( 1,739 ) $ ( 38,880 )

Cost of goods sold ( 2,282 ) 18,485 1,012 35,484

Net gain (loss) recognized in income (loss) before income taxes

Net loss recognized in income (loss) before income taxes $ ( 3,393 ) $ ( 5,207 ) $ ( 727 ) $ ( 3,396 )

Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives

Gain (Loss) Recognized in Other Comprehensive Income on

Three Months Ended

Derivatives Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Commodity contracts $ ( 14,114 ) $ 6,747 $ ( 6,807 ) $ 371

A portion of the company’s derivative instruments are considered economic hedges and as such are not designated as hedging instruments.

The company uses exchange-traded futures and options con t racts to manage its net position of product inventories and forward cash purchase and sal e s contracts to reduce price risk caused by market fluctuations.

including exchange traded c ontracts and forward commodity purchase or sale contracts, and inventories of certain agricultural products, which include amounts acquired under deferred pricing contracts, are stated at fair value.

The company uses exchange-traded futures and options contracts to manage its net position of product inventories and forward cash purchase and sales contracts to reduce price risk caused by market fluctuations.

Derivatives, including exchange traded contracts and forward commodity purchase or sale contracts, and inventories of certain agricultural products, which include amounts acquired under deferred pricing contracts, are stated at fair value.

Inventories are not considered a derivative, rather they are carried at the lower of cost or market.

3 unchanged sentences

Derivatives Not Designated as

Location of Gain (Loss) Recognized in Income

Three Months Ended

Hedging Instruments

on Derivatives

Commodity contracts

Costs of goods sold

Hedging Instruments Location of Gain (Loss) Recognized in Income

on Derivatives Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Exchange traded futures and options Revenues $ 2,714 $ ( 14,622 ) $ ( 31 ) $ ( 56,536 )

Forwards Revenues 6,880 3,521 4,267 4,641

Exchange trade futures and options Costs of goods sold 27,355 ( 3,996 ) ( 40,208 ) 7,041

Forwards Costs of goods sold ( 37,458 ) 6,987 ( 18,297 ) 4,513

Net gain (loss) recognized in income (loss) before income taxes $ ( 509 ) $ ( 8,110 ) $ ( 54,269 ) $ ( 40,341 )

The following amounts were recorded on the consolidated balance sheets related to cumulative basis adjustments for the fair value hedged items (in thousands):

March 31, 2022

December 31, 2021

Line Item in the Consolidated Balance Sheet in Which the Hedged Item is Included

Carrying Amount of the Hedged Assets

Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets

Carrying Amount of the Hedged Assets

Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets

June 30, 2022 December 31, 2021

Line Item in the Consolidated Balance Sheet in Which the Hedged Item is Included Carrying Amount of the Hedged Assets Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets Carrying Amount of the Hedged Assets Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets

Inventories $ 58,185 $ 3,118 $ 72,320 $ 6,291

Effect of Cash Flow and Fair Value Hedge Accounting on the Statements of Operations

Location and Amount of Gain (Loss) Recognized in Income on Cash Flow and Fair Value Hedging Relationships for the Three Months Ended March 31,

Location and Amount of Gain (Loss) Recognized in Income on Cash Flow and Fair Value Hedging Relationships for the Three Months Ended June 30,

Revenue Cost of

Goods Sold Revenue Cost of

Gain (loss) on cash flow hedging relationships:

Commodity contracts:

Amount of gain (loss) reclassified from accumulated other comprehensive income into income

Amount of gain (loss) on exchange traded futures reclassified from accumulated other comprehensive income into income $ ( 1,111 ) $ ( 2,282 ) $ ( 23,692 ) $ 18,485

Gain (loss) on fair value hedging relationships:

Commodity contracts:

Derivatives designated as hedging instruments

Fair-value hedged inventories — ( 8,550 ) — 10,406

Exchange traded futures designated as hedging instruments — 12,533 — ( 7,244 )

Total amounts of income and expense line items presented in the statement of operations in which the effects of cash flow or fair value hedges are recorded $ ( 1,111 ) $ 1,701 $ ( 23,692 ) $ 21,647

There were no gains or losses from discontinuing cash flow or fair value hedge treatment during the three months ended March 31, 2022 and 2021.

The open commodity derivative positions as of March 31, 2022, are as follows (in thousands):

Location and Amount of Gain (Loss) Recognized in Income on Cash Flow and Fair Value Hedging Relationships for the Six Months Ended June 30,

Revenue Cost of

Goods Sold Revenue Cost of

Gain (loss) on cash flow hedging relationships:

Commodity contracts:

Amount of gain (loss) on exchange traded futures reclassified from accumulated other comprehensive income into income $ ( 1,739 ) $ 1,012 $ ( 38,880 ) $ 35,484

Gain (loss) on fair value hedging relationships:

Commodity contracts:

Fair-value hedged inventories — 9,836 — 18,373

Exchange traded futures designated as hedging instruments — ( 4,711 ) — ( 14,352 )

Total amounts of income and expense line items presented in the statement of operations in which the effects of cash flow or fair value hedges are recorded $ ( 1,739 ) $ 6,137 $ ( 38,880 ) $ 39,505

There were no gains or losses from discontinuing cash flow or fair value hedge treatment during the three and six months ended June 30, 2022 and 2021.

The notional volume of open commodity derivative positions as of June 30, 2022, are as follows (in thousands):

Exchange Traded (1)

Non-Exchange Traded (2)

‎ Instruments

Distillers Grains

(1) Exchange traded futures and options are presented on a net long and (short) position basis.

Instruments Net Long &

(Short) Long (Short) Unit of

Measure Commodity

Futures ( 40,390 ) Bushels Corn

Futures 6,930 (3)

Futures ( 4,475 ) (4)

Futures ( 62,118 ) Gallons Ethanol

Futures ( 23,058 ) (3)

Gallons Ethanol

Futures 3,143 MmBTU Natural Gas

Futures 7,680 (3)

MmBTU Natural Gas

Futures ( 4,555 ) (4)

MmBTU Natural Gas

Forwards 43,502 ( 18 ) Bushels Corn

Forwards — ( 285,395 ) Gallons Ethanol

Forwards 136 ( 395 ) Tons Distillers Grains

Forwards — ( 83,308 ) Pounds Corn Oil

Forwards 27,116 ( 87 ) MmBTU Natural Gas

(1) Notional volume of exchange traded futures and options are presented on a net long and (short) position basis.

Options are presented on a delta-adjusted basis.

(2) Non-exchange traded forwards are presented on a gross long and (short) position basis including both fixed-price and basis contracts.

(3) Futures used for fair value hedges.

(2) Notional volume of non-exchange traded forward physical contracts are presented on a gross long and (short) position basis including both fixed-price and basis contracts, for which only the basis portion of the contract price is fixed.

(3) Notional volume of exchange traded futures used for cash flow hedges.

(4) Notional volume of exchange traded futures used for fair value hedges.

Energy trading contracts that do not involve physical delivery are presented net in revenues on the consolidated statements of operations.

Included in revenues are net gains of $ 0.8 million and $ 0.4 million for the three months ended March 31, 2022 and 2021, respectively, on energy trading contracts.

Included in revenues are net gains of $ 0.4 million and $ 1.2 million for the three and six months ended June 30, 2022, respectively, and net gains of $ 24 thousand and $ 0.5 million for the three and six months ended June 30, 2021, respectively, on energy trading contracts.

The components of long-term debt are as follows (in thousands):

March 31, 2022

December 31, 2021

June 30, 2022 December 31, 2021

2.25 % convertible notes due 2027 (1)

$ 230,000 $ 230,000

4.00 % convertible notes due 2024 (2)

64,000 64,000

4.125 % convertible notes due 2022 (3)

34,316 34,316

Green Plains SPE LLC:

$ 125.0 million junior secured mezzanine notes due 2026 (4)

125,000 125,000

Green Plains Wood River and Green Plains Shenandoah:

$ 75.0 million delayed draw loan agreement (5)

75,000 30,000

Green Plains Partners:

$ 60.0 million term loan (6) (7)

58,969 60,000

Other 15,313 15,531

Total book value of long-term debt 602,598 558,847

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Total long-term debt $ 495,027 $ 514,006

(1) Includes $ 6.2 million and $ 6.5 million of unamortized debt issuance costs as of March 31, 2022 and December 31, 2021, respectively.

(2) Includes $ 1.1 million and $ 1.2 million of unamortized debt issuance costs as of March 31, 2022 and December 31, 2021, respectively.

(3) Includes $ 0.1 million of unamortized debt issuance costs as of both March 31, 2022 and December 31, 2021, respectively.

(4) Includes $ 0.8 million and $ 0.9 million of unamortized debt issuance costs as of March 31, 2022 and December 31, 2021, respectively.

(5) On September 3, 2020, Green Plains Wood River and Green Plains Shenandoah, wholly-owned subsidiaries of the company, entered into a $ 75.0 million delayed draw loan agreement.

Includes $ 0.3 million of unamortized debt issuance costs as of both March 31, 2022 and December 31, 2021, respectively .

(6) The Green Plains Partners credit facility was amended on July 20, 2021, to $ 60.0 million and includes $ 0.5 million of unamortized debt issuance costs as of both March 31, 2022 and December 31, 2021, respectively .

(1) Includes $ 5.9 million and $ 6.5 million of unamortized debt issuance costs as of June 30, 2022 and December 31, 2021, respectively.

(2) Includes $ 1.0 million and $ 1.2 million of unamortized debt issuance costs as of June 30, 2022 and December 31, 2021, respectively.

Subsequent to June 30, 2022, the 2024 notes were converted into shares of common stock of the Company.

(3) Includes $ 31 thousand and 0.1 million of unamortized debt issuance costs as of June 30, 2022 and December 31, 2021, respectively.

(4) Includes $ 0.8 million and $ 0.9 million of unamortized debt issuance costs as of June 30, 2022 and December 31, 2021, respectively.

(5) Includes $ 0.3 million of unamortized debt issuance costs as of both June 30, 2022 and December 31, 2021, respectively.

(6) Includes $ 0.5 million of unamortized debt issuance costs as of both June 30, 2022 and December 31, 2021, respectively.

(7) On February 11, 2022, the term loan was modified to allow Green Plains Partners and its affiliates to repurchase outstanding notes.

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The components of short-term notes payable and other borrowings are as follows (in thousands):

March 31, 2022

December 31, 2021

June 30, 2022 December 31, 2021

Green Plains Finance Company, Green Plains Grain and Green Plains Trade:

$ 350.0 million revolver

$ 280,000 $ —

Green Plains Commodity Management:

$ 40.0 million hedge line

10,913 16,210

Green Plains Trade:

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$ 100.0 million revolver

$ 50.0 million inventory financing

$ 308,405 $ 173,418

Corporate Activities

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The 2.25 % notes are convertible, at the option of the holders, into consideration consisting of, at the company’s election, cash, shares of the company’s common stock, or a combination of cash and stock (and cash in lieu of fractional shares).

However, before September 15, 2026, the 2.25 % notes will not be convertible unless certain conditions are satisfied.

However, before September 15, 2026, the 2.25 % notes will not be convertible unless certain conditions

are satisfied.

The initial conversion rate is 31.6206 shares of the company’s common stock per $1,000 principal amount of 2.25 % notes (equivalent to an initial conversion price of approximately $ 31.62 per share of the company’s common stock), representing an approximately 37.5 % premium over the offering price of the company’s common stock.

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The 4.00 % notes are senior, unsecured obligations of the company, with interest payable on January 1 and July 1 of each year, beginning January 1, 2020, at a rate of 4.00 % per annum.

The 4.00 % notes will mature on July 1, 2024 , unless earlier converted, redeemed or repurchased.

The 4.00 % notes will be convertible, at the option of the holders, into consideration consisting of, at the company’s election, cash, shares of the company’s common stock, or a combination of cash and shares of the company’s common stock until the close of business on the scheduled trading day immediately preceding the maturity date.

However, before January 1, 2024, the 4.00 % notes will not be convertible unless certain conditions are satisfied.

The initial conversion rate is 64.1540 shares of common stock per $1,000 of principal, which is equal to a conversion price of approximately $ 15.59 per share.

The conversion rate will be subject to adjustment upon the occurrence of certain events, including but not limited to;

the event of a stock dividend or stock split;

the issuance of additional rights, options and warrants;

the event of a cash dividend or distribution;

or a tender or exchange offering.

In addition, the company may be obligated to increase the conversion rate for any conversion that occurs in connection with certain corporate events, including the company’s calling the 4.00 % notes for redemption.

On and after July 1, 2022, and prior to the maturity date, the company may redeem all, but not less than all, of the 4.00 % notes for cash if the sale price of the company’s common stock equals or exceeds 140 % of the applicable conversion price for a specified time period ending on the trading day immediately prior to the date the company delivers notice of the redemption.

The redemption price will equal 100 % of the principal amount of the 4.00 % notes to be redeemed, plus any

accrued and unpaid interest to, but excluding, the redemption date.

In addition, upon the occurrence of a fundamental change, holders of the 4.00 % notes will have the right, at their option, to require the company to repurchase the 4.00 % notes in cash at a price equal to 100 % of the principal amount of the 4.00 % notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

During May 2021, the company entered into a privately negotiated agreement with certain noteholders of the company’s 4.00 % notes.

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Pursuant to the guidance within ASC 470, Debt , the company recorded a loss of $ 9.5 million which was recorded as a charge to interest expense in the consolidated financial statements during the three months ended June 30, 2021, of which $ 1.2 million related to unamortized debt issuance costs.

On May 25, 2022, the company gave notice calling for the redemption of its outstanding 4.00 % convertible notes, totaling an aggregate principal amount of $ 64.0 million.

The conversion rate was 66.4178 shares of common stock per $1,000 of principal.

From July 1, 2022 through July 8, 2022, the remaining $ 64.0 million of the 4.00 % convertible notes were converted into approximately 4.3 million shares of common stock.

In August 2016, the company issued $ 170.0 million of 4.125 % convertible senior notes due in 2022, or the 4.125 % notes.

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The redemption price will equal 100 % of the principal plus any accrued and unpaid interest.

Holders of the 4.125 % notes have the option to require the company to repurchase the 4.125 % notes in cash at a price equal to 100 % of the principal plus accrued and unpaid interest when there is a fundamental change, such as change in control.

Holders of the 4.125 % notes have the option to require the company to repurchase the 4.125 % notes in cash at a price equal to 100 % of the principal plus accrued and unpaid

interest when there is a fundamental change, such as change in control.

If an event of default occurs, it could result in the 4.125 % notes being declared due and payable.

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the collateral coverage ratio of the Borrowers shall not be less than 1.20 to 1.00;

and the debt to capitalization ratio of the company shall

not be greater than 0.60 to 1.00.

and the debt to capitalization ratio of the company shall not be greater than 0.60 to 1.00.

The Facility also includes customary events of default, including without limitation, failure to make required payments of principal or interest, material incorrect representations and warranties, breach of covenants, events of bankruptcy and other certain matters.

The Facility is secured by the working capital assets of the Borrowers and is guaranteed by the company.

Green Plains Grain has entered into a $ 50.0 million short-term inventory financing agreement with a financial institution.

The company has accounted for the agreement as short-term notes, rather than revenues, and has elected the fair value option to offset fluctuations in market prices of the inventory.

This agreement is subject to negotiated variable interest rates, which equaled 4.66 % as of June 30, 2022.

The company had $ 17.5 million short-term notes payable related to the inventory financing agreement as of June 30, 2022.

Green Plains Commodity Management has an uncommitted $ 40.0 million revolving credit facility which matures April 30, 2023, to finance margins related to its hedging programs.

Advances are subject to variable interest rates equal to SOFR plus 1.75 %.

The company had $ 5.2 million short-term notes payable related to this credit facility as of March 31, 2022.

The company had $ 10.9 million short-term notes payable related to this credit facility as of June 30, 2022.

Ethanol Production Segment

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The Junior Notes accrue interest at an annual rate of 11.75 %.

However, subject to the satisfaction of certain conditions, the Green Plains SPE LLC may elect to pay an amount in cash equal to interest accruing at a rate of 6.00% per annum plus an amount equal to interest accruing at a rate of 6.75% per annum to be paid in kind.

However, subject to the satisfaction of certain conditions, the

Green Plains SPE LLC may elect to pay an amount in cash equal to interest accruing at a rate of 6.00 % per annum plus an amount equal to interest accruing at a rate of 6.75 % per annum to be paid in kind.

The entire outstanding principal balance, plus any accrued and unpaid interest is due upon maturity.

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The Junior Notes have an unsecured parent guarantee from the company and have certain limitations on distributions, dividends or loans to the company unless there will not exist any event of default.

Funds associated with the Junior Notes are administered by a trustee and are included in the balance of restricted cash as of March 31, 2022.

Funds associated with the Junior Notes are administered by a trustee and are included in the balance of restricted cash as of June 30, 2022.

On September 3, 2020, Green Plains Wood River and Green Plains Shenandoah, wholly-owned subsidiaries of the company, entered into a delayed draw loan agreement with MetLife Real Estate Lending LLC.

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however, the partnership has the option to prepay $ 1.5 million per quarter beginning twelve months after the closing date.

On February 11, 2022, the amended term loan was modified to allow Green Plains Partners and its

affiliates to repurchase outstanding notes.

On February 11, 2022, the amended term loan was modified to allow Green Plains Partners and its affiliates to repurchase outstanding notes.

On the same day, the partnership purchased $ 1.0 million of the outstanding notes from accounts and funds managed by BlackRock and subsequently retired the notes.

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The maximum consolidated leverage ratio required, as of the end of any fiscal quarter, is no more than 2.50 x.

The minimum debt service coverage ratio required, as of the end of any fiscal quarter, is no less 1.10 x.

The minimum debt service coverage ratio required, as of the end of any fiscal quarter, is no less than 1.10 x.

The consolidated leverage ratio is calculated by dividing total funded indebtedness by the sum of the four preceding fiscal quarters’ consolidated EBITDA.

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Covenant Compliance

The company was in compliance with its debt covenants as of March 31, 2022.

The company was in compliance with its debt covenants as of June 30, 2022.

Restricted Net Assets

At March 31, 2022, there were approximately $ 108.8 million of net assets at the company’s subsidiaries that could not be transferred to the parent company in the form of dividends, loans or advances due to restrictions contained in the credit facilities of these subsidiaries.

At June 30, 2022, there were approximately $ 109.5 million of net assets at the company’s subsidiaries that could not be transferred to the parent company in the form of dividends, loans or advances due to restrictions contained in the credit facilities of these subsidiaries.

STOCK-BASED COMPENSATION

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Restricted Stock Awards and Deferred Stock Units

The non-vested stock award and deferred stock unit activity for the three months ended March 31, 2022, is as follows:

The non-vested stock award and deferred stock unit activity for the six months ended June 30, 2022, is as follows:

Deferred Stock

Units Weighted-

Average Grant-

‎ Date Fair Value

Weighted-Average

‎ Vesting Term

Date Fair Value Weighted-Average

Non-Vested at December 31, 2021 793,337 $ 14.64

Non-Vested at March 31, 2022

Granted 288,130 30.15

Forfeited ( 5,954 ) 20.12

Vested ( 275,440 ) 15.69

Non-Vested at June 30, 2022 800,073 $ 19.82 2.2

Performance Shares

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The performance shares were granted at a target of 100 %, but each performance share was reduced or increased depending on results for the performance period for the company’s average return on net assets, and the company’s total shareholder return relative to that of the company’s performance peer group.

On February 19, 2022, based on the criteria discussed above, the 149,933 2019 performance shares vested at 75 %, which resulted in the issuance of 112,450 shares of common stock.

The non-vested performance share award activity for the three months ended March 31, 2022, is as follows:

On February 19,

2022, based on the criteria discussed above, the 149,933 2019 performance shares vested at 75 %, which resulted in the issuance of 112,450 shares of common stock.

The non-vested performance share award activity for the six months ended June 30, 2022, is as follows:

Shares Weighted-

Average Grant-

‎ Date Fair Value

Weighted-Average

‎ Vesting Term

Date Fair Value Weighted-Average

Non-Vested at December 31, 2021 486,155 $ 13.93

Non-Vested at March 31, 2022

Granted 146,589 29.47

Vested ( 149,933 ) 15.31

Non-Vested at June 30, 2022 482,811 $ 18.22 2.3

Green Plains Partners

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The partnership measures unit-based compensation related to equity awards in its consolidated financial statements over the requisite service period on a straight-line basis.

There was no change in the number of non-vested unit-based awards for the three months ended March 31, 2022.

There was no change in the number of non-vested unit-based awards for the six months ended June 30, 2022.

Stock-Based and Unit Based Compensation Expense

Compensation costs for stock-b ased and unit-based payment plans were $ 1.9 million and $ 0.9 million for the three months ended March 31, 2022 and 2021, respectively.

At March 31, 2022, there was $ 19.2 million of unrecognized compensation costs from stock-based and unit-based compensation related to non-vested awards.

Compensation costs for stock-based and unit-based payment plans were $ 2.4 million and $ 4.3 million for the three and six months ended June 30, 2022, respectively, and $ 1.1 million and $ 2.0 million for the three and six months ended June 30, 2021, respectively.

At June 30, 2022, there was $ 17.9 million of unrecognized compensation costs from stock-based and unit-based compensation related to non-vested awards.

This compensation is expected to be recognized over a weighted-average period of approximately 2.2 years.

The potential tax benefit related to stock-based payment is approximately 21.4 % of these expe nses .

The potential tax benefit related to stock-based payment is approximately 21.6 % of these expenses.

EARNINGS PER SHARE

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Three Months Ended

EPS - basic and diluted:

Net loss attributable to Green Plains

Weighted average shares outstanding - basic and diluted

EPS - basic and diluted:

June 30, Six Months Ended

2022 2021 2022 2021

Net income (loss) attributable to Green Plains $ 46,398 $ 9,743 $ ( 15,076 ) $ 3,198

Weighted average shares outstanding - basic 53,033 45,425 52,960 41,581

EPS - basic $ 0.87 $ 0.21 $ ( 0.28 ) $ 0.08

EPS - diluted:

Net income (loss) attributable to Green Plains $ 46,398 $ 9,743 $ ( 15,076 ) $ 3,198

Interest and amortization on convertible debt, net of tax effect:

4.125 % convertible notes due 2022

4.00 % convertible notes due 2024

2.25 % convertible notes due 2027

1,261 1,216 — —

Net income (loss) attributable to Green Plains - diluted $ 48,569 $ 11,536 $ ( 15,076 ) $ 3,198

Weighted average shares outstanding - basic 53,033 45,425 52,960 41,581

Effect of dilutive convertible debt:

4.125 % convertible notes due 2022

4.00 % convertible notes due 2024

4,106 4,106 — —

2.25 % convertible notes due 2027

7,273 7,273 — —

Effect of dilutive warrants 757 669 — 345

Effect of dilutive stock-based compensation awards 500 698 — 749

Weighted average shares outstanding - diluted 66,895 58,171 52,960 42,675

EPS - diluted $ 0.73 $ 0.20 $ ( 0.28 ) $ 0.07

Anti-dilutive weighted-average convertible debt, warrants and stock-based compensation (1)

— 1,226 13,853 10,233

(1) The effect related to the company’s convertible debt, warrants and certain stock-based compensation awards has been excluded from diluted EPS for the periods presented as the inclusion of these shares would have been antidilutive.

For the three months ended June 30, 2021, the company excluded the impact of the 4.125 % convertible notes due in 2022, and associated interest and amortization, as inclusion would be anti-dilutive.

For the six months ended June 30, 2021, the company excluded the impact of the 4.125 % convertible notes due in 2022, 4.00 % convertible notes due in 2024 and the 2.25 % convertible notes due in 2027, and associated interest and amortization, as inclusion would be anti-dilutive.

STOCKHOLDERS’ EQUITY

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On May 18, 2021, the company completed a privately negotiated exchange agreement with certain noteholders of the company’s 4.00 % notes, pursuant to which the noteholders agreed to exchange $ 51.0 million in aggregate principal for 3,568,705 shares of the company’s common stock at an implied price of $ 26.80 .

Components of stockholders’ equity for the three months ended March 31, 2022 and 2021 are as follows (in thousands):

Treasury Stock

Stockholders'

Components of stockholders’ equity for the three and six months ended June 30, 2022 and 2021 are as follows (in thousands):

Common Stock Additional

Capital Retained

(Deficit) Accum.

(Loss) Treasury Stock Total

Stockholders'

Interests Total

Stockholders'

Shares Amount Shares Amount

Balance, December 31, 2021 61,840 $ 62 $ 1,069,573 $ ( 15,199 ) $ ( 12,310 ) 8,244 $ ( 91,626 ) $ 950,500 $ 151,519 $ 1,102,019

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Balance, March 31, 2022 62,066 $ 62 $ 1,067,651 $ ( 76,673 ) $ ( 8,889 ) 8,244 $ ( 91,626 ) $ 890,525 $ 152,082 $ 1,042,607

Treasury Stock

Stockholders'

Net income — — — 46,398 — — — 46,398 6,322 52,720

Distributions declared — — — — — — — — ( 8,098 ) ( 8,098 )

Other comprehensive income (loss) before reclassification — — — — ( 10,535 ) — — ( 10,535 ) — ( 10,535 )

Amounts reclassified from accumulated other comprehensive income (loss) — — — — 2,515 — — 2,515 — 2,515

Other comprehensive income (loss), net of tax — — — — ( 8,020 ) — — ( 8,020 ) — ( 8,020 )

Investment in subsidiary — — — — — — — — 190 190

Stock-based compensation 21 — 2,270 — — — — 2,270 60 2,330

Balance, June 30, 2022 62,087 $ 62 $ 1,069,921 $ ( 30,275 ) $ ( 16,909 ) 8,244 $ ( 91,626 ) $ 931,173 $ 150,556 $ 1,081,729

Common Stock Additional

Capital Retained

(Deficit) Accum.

(Loss) Treasury Stock Total

Stockholders'

Interests Total

Stockholders'

Shares Amount Shares Amount

Balance, December 31, 2020 47,471 $ 47 $ 691,393 $ 50,793 $ ( 2,172 ) 11,813 $ ( 131,287 ) $ 608,774 $ 129,812 $ 738,586

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Issuance of common stock for cash at $ 23.00 per share, net of fees

8,752 9 191,125 — — — — 191,134 — 191,134

Stock-based compensation 230 — ( 3,000 ) — — — — ( 3,000 ) 79 ( 2,921 )

Balance, March 31, 2021 56,453 $ 56 $ 882,949 $ 44,248 $ ( 8,398 ) 11,813 $ ( 131,287 ) $ 787,568 $ 132,961 $ 920,529

Net income (loss) — $ — $ — $ 9,743 $ — — $ — $ 9,743 $ 6,374 $ 16,117

Distributions declared — $ — $ — $ — $ — — $ — $ — $ ( 1,395 ) $ ( 1,395 )

Other comprehensive income (loss) before reclassification — $ — $ — $ — $ 5,131 — $ — $ 5,131 $ — $ 5,131

Amounts reclassified from accumulated other comprehensive income (loss) — $ — $ — $ — $ 3,961 — $ — $ 3,961 $ — $ 3,961

Other comprehensive income (loss), net of tax — $ — $ — $ — $ 9,092 — $ — $ 9,092 $ — $ 9,092

Exchange of 4.00 % convertible notes due 2024

— $ — $ 17,679 $ — $ — ( 3,569 ) $ 39,661 $ 57,340 $ — $ 57,340

Acquisition of FQT — $ — $ — $ — $ — — $ — $ — $ 1,861 $ 1,861

Warrant liability — $ — $ — $ — $ — — $ — $ — $ 1,278 $ 1,278

Stock-based compensation ( 20 ) $ 4 $ 324 $ — $ — — $ — $ 328 $ 80 $ 408

Balance, June 30, 2021 56,433 $ 60 $ 900,952 $ 53,991 $ 694 8,244 $ ( 91,626 ) $ 864,071 $ 141,159 $ 1,005,230

Amounts reclassified from accumulated other comprehensive income are as follows (in thousands):

Three Months Ended

Statements of

June 30, Six Months Ended

June 30, Statements of

Classification

2022 2021 2022 2021

Gains (losses) on cash flow hedges:

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Commodity derivatives ( 2,282 ) 18,485 1,012 35,484 (2)

Total gains on cash flow hedges

Income tax expense

Amounts reclassified from accumulated other comprehensive income (loss)

Total losses on cash flow hedges ( 3,393 ) ( 5,207 ) ( 727 ) ( 3,396 ) (3)

Income tax benefit 878 1,246 177 812 (4)

Amounts reclassified from accumulated other comprehensive loss $ ( 2,515 ) $ ( 3,961 ) $ ( 550 ) $ ( 2,584 )

(2) Costs of goods sold

(3) Loss before income taxes and income (loss) from equity method investees

(3) Income (loss) before income taxes and income (loss) from equity method investees

(4) Income tax benefit (expense)

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As a result, the consolidated financial statements do not reflect income taxes on pre-tax income or loss attributable to the noncontrolling interest in the partnership.

The company recorded income tax benefit of $ 1.2 million for the three months ended March 31, 2022, compared with income tax expense of $ 1.9 million for the same period in 2021.

The increase in income tax benefit was primarily due to the release of a valuation allowance against decreases in certain deferred tax assets for the three months ended March 31, 2022 compared to income tax expense recorded for the three months ended March 31, 2021, to reflect the recording of a valuation allowance against increases in certain deferred tax assets.

The amount of unrecognized tax benefits for uncertain tax positions was $ 51.4 million as of March 31, 2022 and December 31, 2021.

The company recorded income tax expense of $ 2.9 million for the three months ended June 30, 2022, compared with income tax benefit of $ 4.8 million for the same period in 2021.

The increase in the amount of tax expense recorded for the three months ended June 30, 2022 was primarily due to an increase in the valuation allowance recorded against deferred tax assets related to gains (losses) on derivatives included in accumulated other comprehensive income.

The effective tax rate can be affected by variances in the estimates and amounts of taxable income among the various states, entities and activity types, realization of tax credits, adjustments from resolution of tax matters under review, valuation allowances and the company’s assessment of its liability for uncertain tax positions.

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Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Lease expense

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Variable lease expense (1)

226 522 405 591

Total lease expense $ 5,616 $ 5,430 $ 10,793 $ 10,433

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Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Cash paid for amounts included in the measurement of lease liabilities:

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Supplemental balance sheet information related to operating leases is as follows:

March 31, 2022

December 31, 2021

Weighted average remaining lease term

June 30, 2022 December 31, 2021

Weighted average remaining lease term 5.3 years 5.5 years

Weighted average discount rate 4.04 % 4.16 %

Aggregate minimum lease payments under the operating lease agreements for the remainder of 2022 and in future years are as follows (in thousands):

Year Ending December 31,

Year Ending December 31, Amount

2022 $ 10,455

Thereafter 14,834

Present value discount ( 8,891 )

6 unchanged sentences

Commodities, Storage and Transportation

As of March 31, 2022, the company had contracted future purchases of grain, natural gas, and distillers grains, valued at approximately $ 532.4 million and future commitments for storage and transportation, valued at approximately $ 31.4 million.

As of June 30, 2022, the company had contracted future purchases of grain, natural gas, and distillers grains, valued at approximately $ 511.9 million and future commitments for storage and transportation, valued at approximately $ 25.6 million.

Government Assistance

During the three months ended June 30, 2022, the company received a relief grant from the USDA related to the Biofuel Producer Program authorized as part of the CARES Act to offset market losses as a result of the COVID-19 pandemic.

The total cash grant received of $ 27.7 million was recorded as other income and the company has no further reporting or other obligations related to the receipt of this grant.

The company is currently involved in litigation that has arisen during the ordinary course of business, but does not believe any pending litigation will have a material adverse effect on its financial position, results of operations or cash flows.

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