The Andersons Posts Record Q3 EPS, Plans $915 Million Harvestone Deal

The Andersons, Inc. (NASDAQ: ANDE) reported record third-quarter earnings per share as stronger Renewables results, improved merchandising performance and operating efficiencies lifted profitability. The agricultural commodities company also outlined a $915 million acquisition of Harvestone Low Carbon Partners that would expand its ethanol production and carbon-capture capabilities.

For the three months ended September 30, 2026, diluted EPS rose to $1.36 from $0.59 a year earlier. Adjusted EPS increased to $1.38 from $0.84, while net income attributable to The Andersons more than doubled to $46.4 million from $20.1 million.

Sales and merchandising revenue increased to $2.83 billion from $2.68 billion, and gross profit rose to $182 million from $171 million. Pretax income nearly doubled to $50.7 million, while adjusted EBITDA advanced to $101.4 million from $78.3 million.

Through the first nine months of 2026, adjusted EPS reached $4.63, compared with $1.19 in the prior-year period. Adjusted EBITDA increased to $333.1 million from $200.7 million, reflecting higher earnings across both operating segments.

Renewables drives quarterly earnings

Renewables remained the largest contributor to profit. Segment revenue climbed to $984.8 million from $688.8 million, while pretax income attributable to The Andersons rose to $63 million from $37 million. Adjusted EBITDA increased to $77.6 million from $66.5 million.

The company attributed the performance to efficient plant operations, favorable co-product values, improved corn oil prices and higher renewable feedstock volumes. Results also included benefits from federal 45Z clean-fuel production tax credits.

Management said Renewables margins should remain supportive because of domestic and export demand. The company is deploying growth capital for plant enhancements and projects intended to lower carbon intensity.

Agribusiness revenue declined to $1.85 billion from $1.99 billion, but gross profit increased to $136.9 million from $126.9 million. Adjusted pretax income attributable to the company rose to $8.8 million from $2.5 million, and adjusted EBITDA increased to $40.4 million from $29.1 million.

A late start to the harvest weighed on grain-asset results, while increased market volatility supported merchandising performance. The segment also benefited from operating efficiencies.

The Andersons expects a large harvest opportunity in the eastern part of its network and market dislocation in the west, though management said the timing of margin opportunities will depend on market dynamics. The Port of Houston operation is online, with the company citing supportive soybean-meal export fundamentals. It is also working with producers to develop regenerative agriculture programs for 2027.

Harvestone acquisition to expand low-carbon platform

The proposed acquisition of Harvestone Low Carbon Partners would add three biorefineries with combined annual ethanol production capacity of 215 million gallons. The assets include Dakota Spirit AgEnergy and Blue Flint Ethanol in North Dakota, as well as Iroquois Bio-Energy in Indiana.

Harvestone’s facilities have existing or planned low-carbon production capabilities. On-site carbon capture and storage infrastructure has operated at Dakota Spirit since 2023, while CCS construction at Blue Flint is nearly complete and commercial operations are expected in 2027. CCS operations at Iroquois are expected to begin in 2028.

The assets have combined future carbon-sequestration capacity of approximately 597,000 metric tons. Harvestone sequestered 200,000 metric tons of carbon dioxide in 2025, according to the presentation.

The Andersons plans to pay total consideration of $915 million. Approximately half of that value is attributed to expected 45Z and 45Q tax credits, with the remainder tied to the base ethanol business and additional low-carbon opportunities.

Management anticipates the acquired operations will generate about $225 million to $250 million of EBITDA in each of the next three years. The transaction overview said the deal is expected to be immediately accretive to EPS and cash flow.

The company expects to fund the purchase with $300 million of revolving-credit borrowings and $615 million of long-term debt. Pro forma long-term debt to EBITDA is projected to remain below its target of 2.5 times. Before the transaction, the ratio stood at 1.3 times as of September 30.

Closing is anticipated in the fourth quarter of 2026 or the first quarter of 2027, subject to regulatory approvals and customary conditions.

Cash flow and investment

Cash from operations before working-capital changes, a non-GAAP measure, increased to $83.4 million in the quarter from $68.5 million. GAAP operating cash flow was negative $124.2 million, compared with positive $233.9 million a year earlier, as working-capital movements included higher inventories and changes in commodity derivatives.

The Andersons expects 2026 capital spending of approximately $225 million, including growth investments. The company said readily marketable inventories remained well above short-term borrowings, although short-term debt increased modestly amid market volatility.

Forward-looking results remain exposed to economic, weather and regulatory conditions, competition and geopolitical risks. The Harvestone transaction also remains contingent on approvals and closing conditions, while its projected benefits incorporate tax credits and carbon-capture projects that are operating or scheduled to enter service in future periods.