PEKIN, Ill. - Alto Ingredients, Inc. (NASDAQ: ALTO), a leading producer and distributor of renewable fuel and essential ingredients, disclosed its financial outcomes for the fourth quarter ended December 31, 2023.
The company reported a Q4 adjusted earnings per share (EPS) of -$0.26, which was below the analyst consensus of -$0.08. Revenue for the quarter was also lower than expected at $273.6 million, compared to the anticipated $292.96 million. Following the earnings and revenue miss, Alto Ingredients' shares fell by 3.1%.
The company's Q4 gross loss showed a significant improvement, with a $18.8 million increase over the same period last year. Adjusted EBITDA also saw a positive shift, improving by $19.0 million compared to Q4 of 2022.
In the full year 2023, Alto Ingredients achieved a gross profit of $15.7 million, a notable turnaround from the previous year's gross loss of $27.6 million, and improved adjusted EBITDA by $26.5 million over 2022.
President and CEO Bryon McGregor commented on the company's performance, stating, "During 2023, our investments to diversify revenue, improve capacity utilization rates, reduce costs, and expand operating margins contributed to our financial improvements and positioned Alto for stronger performance in 2024 and beyond."
McGregor also highlighted the favorable outlook for 2024, with expected crush margin improvements and positive spreads throughout most of the year.
Alto Ingredients has been actively engaging in a carbon capture and storage (CCS) program, having signed a letter of intent with Vault 44.01 for CO2 storage, which is anticipated to substantially reduce emissions from the ethanol production process.
Despite the challenges, McGregor remains optimistic about the company's long-term growth strategy and its ability to capitalize on profitable opportunities. The company's focus on financial prudence and agility in response to market dynamics is expected to continue driving progress and delivering value.
Investors reacted to the earnings miss with a negative sentiment, as reflected in the stock's decline. However, management's commitment to operational improvements and strategic initiatives such as the CCS program may provide a foundation for recovery and future growth.
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