Alto Ingredients, Inc.
For the period ended Jun 30, 2025. Filed Aug 8, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 8, 2025
ALTO$3.74+1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-09.
0001213900-25-041532
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0001213900-25-073660
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
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A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (43)
Current report
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Current report
Although our net loss worsened to $11.0 million in the second quarter, primarily due to the non-cash effects of hedging activities, our Adjusted EBITDA improved by nearly $6.0 million compared to the same period in 2024, reflecting the successful execution of our initiatives to increase efficiency and productivity. The quarter-over-quarter improvement in our Adjusted EBITDA reflects the benefit of multiple initiatives. We improved our operating model company-wide by rightsizing our corporate overhead to a level that aligns with our current business footprint and we are on track to exceed our goal of saving approximately $8.0 million on an annualized basis from this initiative. We will continue to evaluate our options to improve operational efficiency and throughput, focus on growth in profitable market segments, and identify additional cost-saving opportunities that, while smaller in amount than from our recent corporate reorganization, should in the aggregate meaningfully affect our long-term profitability.
Current report
In the second quarter, the annual uptick in demand from the summer driving season helped lift ethanol prices and improve crush spreads. While it is difficult to predict market fluctuations, we have seen additional spread improvement in the third quarter, with market crush averaging 30 cents per gallon for July, and we remain optimistic for positive margins through the remainder of the summer.
Current report
Our Western assets turned profitable, improving gross profit by $5.6 million compared to the prior year’s quarter, driven by our CO 2 facility acquisition at the beginning of 2025 and other improvements at our Columbia ethanol plant, collectively improving gross profit by $3.0 million, as well as our decision to cold-idle our Magic Valley facility due to adverse market conditions in the region, which improved gross profit by $2.6 million. We continue to use our Magic Valley facility primarily as a terminal.
Current report
Our marketing and distribution business also improved, reflecting the integration of our bulk volume customers from our Eagle Alcohol business, a fostering of third-party ethanol marketing relationships that met profitability criteria, and our transition away from business that offered limited returns.
Current report
Our Pekin Campus was negatively impacted by quarter-over-quarter changes in derivatives and the continued impact of damage sustained to our loadout dock in April. However, we partially offset these effects by leveraging our operational flexibility by increasing sales of higher-margin International Sustainability and Carbon Certification, or ISCC, products exported to Europe.
Current report
Given our success with these efforts, we continue to focus on shorter-term projects with more immediate returns to support our path to profitability. We intend to prioritize projects by anticipated cost, timing and return on investment. Projects under consideration include improvements to lower our carbon intensity and capture more of the Section 45Z benefits available under the Inflation Reduction Act of 2022, expansion of our CO 2 utilization at our Pekin Campus and at our Colombia facility, building on our success from our Alto Carbonic acquisition, and projects to improve our prospects to monetize our Western assets. In addition, as we did in the first and second quarters, we will continue projects to improve efficiency and productivity.
Current report
Working with our bankers, we continue to make progress on our plan to optimize and monetize our Western assets. We are also evaluating strategic alternatives and interest for our Pekin Campus and for the company as a whole.
Current report
Illinois Senate Bill 1723, which prohibits CO 2 sequestration directly through the Mahomet aquifer, as contemplated in our Class VI permit application with the EPA for our carbon capture and storage, or CCS, project, was signed into law on August 1, 2025. We are developing alternatives with Vault 44.01, our CCS partner, and evaluating other promising, non-sequestration options to optimize the value of our CO 2 production.
Current report
The damage sustained by our Pekin Campus loadout dock in April due to rapidly rising river levels impacted production, logistics and overall economics for most of the second quarter. Since our last update in May, we have made progress recovering from this setback. We were able to respond quickly to take interim steps with third-party river transload vendors which, while more costly, helped minimize business interruption. In addition, we worked with our insurance carrier to confirm coverage for both property damage and business interruption. Finally, we are reviewing remediation plans with our carrier to ensure the best path forward. While we expect work to extend into next year, we intend to commence the remediation project ahead of the Midwest winter.
Current report
The One Big Beautiful Bill Act made positive updates to the Section 45Z regulations, including extending tax credits through the end of 2029 as well as additional spending on farm programs, that benefit the renewable fuels industry and improve our earnings profile and the intrinsic value of our production facilities. The act also increased focus on domestic renewable fuel production and introduced new eligibility restrictions, particularly around foreign involvement. For example, only fuel derived from feedstocks grown or produced in North America is eligible for the Section 45Z tax credit. Initially, two of our plants, our Columbia plant and our Pekin dry mill, will participate in applying for Section 45Z tax credits. An additional benefit of the act is its disincentivizing exports from most dry mills, creating an opportunity for our Pekin Campus wet mill and ICP distillery to place more of our products into European markets at a premium to domestic market prices. We intend to pursue additional options to capitalize on the Section 45Z tax credits, including through improvements to our Colombia plant to increase our anticipated credit from 10 cents per gallon for 2025, based on our current carbon intensity scores, to up to 20 cents per gallon in 2026. We expect our Pekin Campus dry mill to qualify for 10 cents per gallon starting in 2026. These credit amounts, based on nameplate production capacities and carbon intensity scores, equal up to approximately $4.0 million in 2025 and $8.0 million in 2026 for which our Colombia plant may be eligible and up to $6.0 million in 2026 for which our Pekin Campus dry mill may be eligible. We plan to make improvements to our plants to increase credit amounts across all eligible facilities. One potential improvement is through low-carbon corn, which, while more expensive, may be economically beneficial to source that particular feedstock to reduce our carbon footprint.
Current report
Through the two other plants at our Pekin Campus, we will continue to produce higher quality alcohol and also take advantage of ISCC export market premiums for renewable fuel as the new rules incentivize domestic ethanol sales from Section 45Z eligible dry mills.
Current report
The One Big Beautiful Bill Act also seeks to positively impact farm programs by boosting sector profitability, reducing financial volatility, enhancing asset values and strengthening the overall industry safety net with the intent to improve operational stability and long-term farm enterprise value. Also contained in the act is an increase in USDA commodity reference prices and base acres. Corn will increase from $3.70 per bushel to $4.10 per bushel and soybeans will increase from $8.40 per bushel to $10.00 per bushel. Lastly, an additional 30 million base acres may now enroll in farm programs. As a result, farmers will need new and expanded markets to absorb the additional production. We believe these developments bode well for the future of higher ethanol blends and new uses of American-grown feedstocks, making the U.S. an even more attractive origin for international sourcing of ethanol and other renewable fuel products.
Current report
The EPA extended E15 blending waivers nationally for the duration of the summer, offering continued support for near-term domestic ethanol blending. In California, regulatory momentum continues to build for E15 blending but full-scale implementation is still pending further administrative review and regulatory updates.
Current report
In the second quarter, we finalized our Scope 1 and 2 greenhouse gas verifications and submitted our 2025 EcoVadis scorecard.
Current report
Three Months ended June 30, 2025 as compared to the Three Months ended June 30, 2024
Current report
The decrease in our consolidated net sales for the three months ended June 30, 2025 as compared to the same period in 2024 is primarily attributable to lower average sales prices per gallon for both specialty alcohol and renewable fuel as well as lower average sales prices of essential ingredients due to a lower commodity price environment. In addition, we had lower sales of renewable fuel, specialty alcohol and essential ingredients due to the cold-idling of our Magic Valley plant at the end of 2024 and logistical constraints at our Pekin Campus due to a damaged loading dock starting in April 2025.
Current report
Net sales of alcohol from our Pekin Campus production segment declined by $6.5 million, or 6%, to $94.2 million for the three months ended June 30, 2025 as compared to $100.7 million for the same period in 2024. Our total volume of production gallons sold decreased by 2.7 million gallons, or 5%, to 48.1 million gallons for the three months ended June 30, 2025 as compared to 50.8 million gallons for the same period in 2024. The decrease of $0.03, or 2%, in the segment’s average sales price per gallon for the three months ended June 30, 2025 as compared to the same period in 2024 reduced our net sales from the segment by $1.4 million. With the segment’s average sales price per gallon of $1.95 for the three months ended June 30, 2025, we generated $5.1 million less in net sales from the 2.7 million fewer gallons of alcohol sold in the three months ended June 30, 2025 as compared to the same period in 2024.
Current report
Net sales of essential ingredients from our Pekin Campus production segment improved by $0.2 million, or less than 1%, to $39.6 million for the three months ended June 30, 2025 as compared to $39.4 million for the same period in 2024. Our total volume of essential ingredients sold remained stable at 210,000 tons for the three months ended June 30, 2025 and 2024. The increase of $0.92, or less than 1%, in the segment’s average sales price per ton for the three months ended June 30, 2025 as compared to the same period in 2024 increased our net sales from the segment by $0.2 million.
Current report
Net sales of alcohol from our Western production segment declined by $0.9 million, or 5%, to $16.6 million for the three months ended June 30, 2025 as compared to $17.5 million for the same period in 2024. Our total volume of alcohol sold decreased by 0.7 million gallons, or 8%, to 8.3 million gallons for the three months ended June 30, 2025 as compared to 9.0 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $2.00 for the three months ended June 30, 2025, we realized $1.4 million less in net sales from the 0.7 million fewer gallons of alcohol sold in the three months ended June 30, 2025 as compared to the same period in 2024. The increase of $0.06, or 3%, in the segment’s average sales price per gallon for the three months ended June 30, 2025 as compared to the same period in 2024 increased our net sales from the segment by $0.5 million.
Current report
Net sales of essential ingredients from our Western production segment increased by $2.3 million, or 39%, to $8.2 million for the three months ended June 30, 2025 as compared to $5.9 million for the same period in 2024. Our total volume of essential ingredients sold decreased 1,400 tons, or 2%, to 78,400 tons for the three months ended June 30, 2025 from 79,800 tons for the same period in 2024. The increase of $30.67, or 41%, in our average sales price per ton for the three months ended June 30, 2025 as compared to the same period in 2024 increased our net sales of essential ingredients from the segment by $2.5 million. With the segment’s average sales price per ton of $105.23 for the three months ended June 30, 2025, we generated $0.2 million less in net sales from the 1,400 fewer tons of essential ingredients sold in the three months ended June 30, 2025 as compared to the same period in 2024.
Current report
Our consolidated gross profit (loss) declined to a gross loss of $1.9 million for the three months ended June 30, 2025 from gross profit of $7.6 million for the same period in 2024, representing a gross margin of negative 0.9% and positive 3.2% for the three months ended June 30, 2025 and 2024, respectively.
Current report
Our consolidated gross profit declined due to lower sales and lower gross margins driven by a few key factors. Our period-over-period change in unrealized non-cash derivatives was negative $13.2 million and our realized derivative gain was $7.6 million, resulting in a net unfavorable change of $5.6 million compared to the same period in 2024.
Current report
Although crush margins continued to improve during the second quarter, market crush was on average 10 cents per gallon lower than for the same period in 2024, totaling $5.5 million of lower crush margin for the second quarter of 2025.
Current report
In addition, high quality alcohol premiums were 15 cents per gallon less in the second quarter than for the same period in 2024 due to increased competition during the annual contracting process. This premium differential translated to $3.0 million in margin, which we were able to offset by shifting higher volumes into more profitable ISCC export markets, demonstrating the benefits of our strategy to diversify production to take advantage of market opportunities. Our essential ingredients return at our Pekin Campus declined to 44.2% but without affecting profitability as we offset the impact with our effective hedging strategy.
Current report
The total adverse impact to gross profit of our loading dock outage was $2.7 million for the second quarter. We are working with our insurance carrier to recover losses in excess of our deductibles.
Current report
Our marketing and distribution segment’s gross profit, net of intercompany activity, increased by $1.0 million to a gross profit of $1.5 million for the three months ended June 30, 2025 as compared to a gross profit of $0.5 million for the same period in 2024. Of this improvement, $1.3 million is attributable to higher margins from sales of third-party renewable fuel, partially offset by $0.3 million attributable to lower sales volumes.
Current report
Our Western production segment’s gross profit, net of intercompany activity, increased by $5.3 million to a gross profit of $1.6 million for the three months ended June 30, 2025 as compared to a gross loss of $3.7 million for the same period in 2024. Of this improvement, $5.4 million is attributable to higher renewable fuel margins, partially offset by $0.1 million attributable to lower sales volumes.
Current report
Gross profit from corporate and other increased by $0.2 million to a breakeven gross profit for the three months ended June 30, 2025 as compared to a gross loss of $0.2 million for the same period in 2024, all of which were from Eagle Alcohol’s business.
Current report
Six Months ended June 30, 2025 as compared to the Six Months ended June 30, 2024
Current report
Net Sales
Current report
Net sales of alcohol from our Pekin Campus production segment declined by $7.6 million, or 4%, to $201.4 million for the six months ended June 30, 2025 as compared to $209.0 million for the same period in 2024. Our total volume of production gallons sold decreased by 3.2 million gallons, or 3%, to 104.7 million gallons for the six months ended June 30, 2025 as compared to 107.9 million gallons for the same period in 2024. The decrease of $0.02, or 1%, in the segment’s average sales price per gallon for the six months ended June 30, 2025 as compared to the same period in 2024 reduced our net sales from the segment by $1.8 million. With the segment’s average sales price per gallon of $1.92 for the six months ended June 30, 2025, we generated $5.8 million less in net sales from the 3.2 million fewer gallons of alcohol sold in the six months ended June 30, 2025 as compared to the same period in 2024.
Current report
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $17.5 million, or 14%, to $107.2 million for the six months ended June 30, 2025 as compared to $124.7 million for the same period in 2024.
Current report
Our volume of third-party renewable fuel sold reported gross by the segment decreased by 10.0 million gallons, or 16%, to 54.1 million gallons for the six months ended June 30, 2025 as compared to 64.1 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $1.98 for the six months ended June 30, 2025, we realized $19.8 million less in net sales from the 10.0 million fewer gallons of third-party renewable fuel sold gross in the six months ended June 30, 2025 as compared to the same period in 2024. The $0.04 per gallon, or 2%, increase in the segment’s average sales price per gallon for the six months ended June 30, 2025 as compared to the same period in 2024 resulted in a $2.3 million increase in our net sales from third-party renewable fuel sold by the segment.
Current report
Net sales of alcohol from our Western production segment declined by $4.9 million, or 13%, to $32.8 million for the six months ended June 30, 2025 as compared to $37.7 million for the same period in 2024. Our total volume of alcohol sold decreased by 3.6 million gallons, or 18%, to 16.6 million gallons for the six months ended June 30, 2025 as compared to 20.2 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $1.98 for the six months ended June 30, 2025, we generated $7.1 million less in net sales from the 3.6 million fewer gallons of alcohol sold in the six months ended June 30, 2025 as compared to the same period in 2024. The increase of $0.12, or 7%, in the segment’s average sales price per gallon for the six months ended June 30, 2025 as compared to the same period in 2024 increased our net sales from the segment by $2.2 million.
Current report
Net sales of essential ingredients from our Western production segment increased by $2.3 million, or 17%, to $16.1 million for the six months ended June 30, 2025 as compared to $13.8 million for the same period in 2024. Our total volume of essential ingredients sold decreased 29,300 tons, or 16%, to 151,300 tons for the six months ended June 30, 2025 from 180,600 tons for the same period in 2024. The increase of $29.85, or 39%, in our average sales price per ton for the six months ended June 30, 2025 as compared to the same period in 2024 increased our net sales of essential ingredients from the segment by $5.4 million. With the segment’s average sales price per ton of $106.13 for the six months ended June 30, 2025, we generated $3.1 million less in net sales from the 29,300 fewer tons of essential ingredients sold in the six months ended June 30, 2025 as compared to the same period in 2024.
Current report
Net sales of alcohol from corporate and other declined by $2.5 million, or 43%, to $3.3 million for the six months ended June 30, 2025 as compared to $5.8 million for the same period in 2024. These sales are from Eagle Alcohol’s business.
Current report
Our consolidated gross profit declined to a gross loss of $3.7 million for the six months ended June 30, 2025 from gross profit of $5.2 million for the same period in 2024, representing a gross margin of negative 0.8% and positive 1.1% for the six months ended June 30, 2025 and 2024, respectively.
Current report
Our Pekin Campus production segment’s gross profit, net of intercompany activity, declined by $23.5 million to a gross loss of $7.8 million for the six months ended June 30, 2025 as compared to gross profit of $15.7 million for the same period in 2024. Of this decline, $23.8 million is attributable to lower alcohol sales margins, partially offset by $0.3 million attributable to lower sales volumes.
Current report
Our SG&A expenses declined for the three and six months ended June 30, 2025 as compared to the same periods in 2024. The period over period decreases in SG&A expenses are primarily due to a $1.1 million reduction in acquisition-related expenses for our acquisition of Eagle Alcohol, a $0.9 million decrease in compensation expenses from our efforts to rationalize our business and right size our staffing to better align with our current operational footprint and a $0.9 million reduction in non-cash stock compensation. We are now exceeding our target annualized overhead savings of $8.0 million. We also took additional steps to further lower our future costs, including, for example, negotiating lower property taxes, improving terms with suppliers, reducing reliance on outside services and other changes which we expect, in aggregate, will make a meaningful difference to our future profitability.
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Removed paragraphs (28)
Previous report
Our first quarter results for 2025 improved compared to the same period in 2024, as reflected in part by better gross margin and Adjusted EBITDA. Adjusted EBITDA improved to negative $4.4 million for the first quarter from negative $7.1 million for the same period in 2024. Adjusted EBITDA is defined and reconciled against consolidated net loss below. These results include a savings of $4.8 million due to the cold-idling of our Magic Valley plant at the end of the fourth quarter. These results also reflect our operational uptime and our carbon optimization initiative, which was driven by our acquisition on January 1, 2025 of a beverage-grade liquid CO 2 processing plant adjacent to our Columbia facility. The combined ownership of our Columbia assets contributed $2.9 million of improvement to our Adjusted EBITDA for the first quarter and has enabled synergies, allowing for reduced management and staffing costs while enhancing operational coordination and overall productivity across the combined site. We continue to optimize these assets, which should facilitate additional benefits, such as longer-term feed sales commitments and expanded premium liquid CO 2 sales. As anticipated, this acquisition improved our Columbia facility’s economics and increased its asset valuation.
Previous report
During the first quarter, we continued our efforts to rationalize our business and right size our staffing to better align with our current operational footprint. During the fourth quarter and into the first quarter, we reduced headcount by a total of 16%. As a result, we expect to save approximately $8 million annually, with the financial benefit starting in the second quarter. We have completed our planned reorganization but will continue to evaluate opportunities to reduce expenses. We are prioritizing quick-return projects, including water and energy optimization, that would reduce utility costs and lower our carbon footprint.
Previous report
Our Pekin Campus’s results for the first quarter illustrate our ability to quickly shift production to capitalize on favorable market trends. For example, to diversify our revenue streams, we earned International Sustainability and Carbon Certification, or ISCC, in the third quarter and in the fourth quarter began exporting qualified renewable fuel to European markets. This certification has enabled us to access higher margin sales compared to domestic markets. During the first quarter, we experienced solid demand for ISCC certified renewable fuel priced at a premium to domestic fuel-grade ethanol. In the first quarter, we also grew ISCC sales as a percentage of our total renewable fuel volume sold from our Pekin Campus. As a result, ISCC sales partially offset some domestic market challenges.
Previous report
Premiums on domestic high quality alcohol for the first quarter were generally lower than in the same period in 2024 due to increased competition in the marketplace. In addition, prices for essential ingredients declined as a result of higher industry supply from increased soy crush to support renewable diesel fuel demand.
Previous report
In late March and early April, we completed our scheduled seasonal outages at our Pekin Campus facilities. The repairs and maintenance successfully achieved our goal of sustaining the improved plant utilization rates set last year following our biennial outage in the second quarter of 2024. Unfortunately, in early April, during a period of rapidly rising river levels, our Pekin Campus loadout dock was damaged, negatively impacting production, logistics and overall Pekin Campus economics. In response, we implemented temporary solutions and we are now back to full operation. We are assessing our long-term remediation options and we are also working with our insurance carrier to mitigate the financial impact of the damage and the interruption to our business.
Previous report
Thus far in 2025, we have experienced typical seasonal market patterns with spreads between corn and ethanol prices comparable year over year. These crush margins improved sequentially each month during the first quarter and have further improved in April as a result of lower production rates associated with industry-wide scheduled springtime plant outages. Despite these improvements, margin expansion remains largely restrained due to high industry inventory levels with production outpacing demand. Absent a meaningful reduction in ethanol supply or a relative increase in demand, substantial crush spread improvements may be constrained. Although we remain optimistic that margins will continue to improve with higher demand during the summer driving season, we have concerns over tariffs and restrictions on Chinese vessels, introducing greater uncertainty around the export market. While these factors are largely beyond our control, we will continue our efforts to minimize their impact on our business. Nevertheless, as noted above, we have experienced solid exports in the first quarter from our ISCC sales into European markets.
Previous report
The Environmental Protection Agency, or EPA, issued a recent E15 fuel waiver allowing higher blending rates for an extended period through May 20 th. Although this is a temporary waiver, we expect the EPA to issue new waivers to permit E15 blending through summer. We are also optimistic that pending national legislation will pass later this year resulting in long-sought after permanent year-round E15 adoption nationwide. In addition, there is growing support for E15 adoption in California. The California Assembly recently passed a bill aimed at accelerating the approval process for E15 fuel blends. Moreover, California’s Governor Newsom has directed the California Air Resources Board to expedite its review, citing potential benefits such as lower gas prices and reduced emissions. According to the latest Energy Information Administration reports, California’s 13.4 billion gallons of annual fuel consumption represents 11.6% of national volume. A five-percentage point increase in ethanol blending from 10% to 15% in California alone could result in an additional 670 million gallons sold annually. Further, national adoption of year-round E15 blending could boost ethanol demand by an estimated 5 to 7 billion gallons. Since the U.S. has approximately 18 billion gallons of ethanol production capacity and domestic demand is approximately 14.4 billion gallons, the national adoption of year-round E15 blending combined with strong exports would utilize, over time, much of the excess production capacity and produce greater margin stability. Beyond supply and demand considerations, we also believe that year-round E15 adoption would have positive economic and environmental impacts, such as reducing greenhouse gas emissions, supporting farmers and lowering fuel costs for consumers.
Previous report
Senate Bill 1723 in Illinois is under consideration to prevent CO 2 sequestration activity that overlies, underlies or passes through a sole-source aquifer. This would include the Mahomet Aquifer, which underlies multiple counties across Illinois including an area currently contemplated for storage in our Class VI permit application for our CCS initiative. Together with our CCS partner, Vault 44.01, and other potentially affected parties, we are working with elected officials to address concerns to minimize or eliminate the potential legal impact of this legislation on our CCS initiative. We are also developing alternatives to ensure that we optimize the value of our CO 2 production despite the outcome of this legislation, including the potential relocation of our proposed CO 2 storage location. In addition, we are working with leaders in Illinois on Senate Bill 41, named the Clean Transportation Standard Act, to develop clean ground transportation standards to reduce the lifecycle carbon intensity of fuels that are similar to the standards adopted on the West Coast.
Previous report
We continue to execute our long-term plan to diversify revenue and mitigate the volatility of commodities. We have leveraged our plant flexibility and our efforts are working. New initiatives in beverage-grade CO 2 and ISCC qualified renewable fuel have been economically beneficial. Additionally, our efficiency measures have reduced our expense run rate going forward. Although the regulatory environment remains dynamic, there are encouraging developments, including the increasing state and potential national adoption of year-round E15 blending. Also, as noted above, the Illinois Clean Transportation Standard Act presents exciting possibilities that could further support industry growth and innovation. Our team will continue to proactively evaluate alternatives for new revenue streams and value, leverage our flexible and unique plant assets, and work to drive long-term shareholder value on a sustainable, consistent basis.
Previous report
Net Sales, Cost of Goods Sold and Gross Loss
Previous report
Pekin Campus Production Segment
Previous report
Net sales of alcohol from our Pekin Campus production segment declined by $1.2 million, or 1%, to $107.2 million for the three months ended March 31, 2025 as compared to $108.4 million for the same period in 2024. Our total volume of production gallons sold decreased by 0.7 million gallons, or 1%, to 56.5 million gallons for the three months ended March 31, 2025 as compared to 57.2 million gallons for the same period in 2024. The segment’s average sales price per gallon remained flat for the three months ended March 31, 2025 as compared to the same period in 2024. With the segment’s average sales price per gallon of $1.90 for the three months ended March 31, 2025, we generated $1.2 million less in net sales from the 0.7 million fewer gallons of alcohol sold in the three months ended March 31, 2025 as compared to the same period in 2024.
Previous report
Western Production Segment
Previous report
Net sales of alcohol from our Western production segment declined by $4.0 million, or 20%, to $16.2 million for the three months ended March 31, 2025 as compared to $20.2 million for the same period in 2024. Our total volume of alcohol sold decreased by 2.9 million gallons, or 26%, to 8.3 million gallons for the three months ended March 31, 2025 as compared to 11.2 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $1.95 for the three months ended March 31, 2025, we generated $5.6 million less in net sales from the 2.9 million fewer gallons of alcohol sold in the three months ended March 31, 2025 as compared to the same period in 2024. However, the increase of $0.15, or 8%, in the segment’s average sales price per gallon for the three months ended March 31, 2025 as compared to the same period in 2024 increased our net sales from the segment by $1.6 million.
Previous report
Net sales of essential ingredients from our Western production segment remained flat at $7.8 million for the three months ended March 31, 2025 and 2024. Our total volume of essential ingredients sold decreased by 27,900 tons, or 28%, to 72,900 tons for the three months ended March 31, 2025 from 100,800 tons for the same period in 2024. With the segment’s average sales price per ton of $107.11 for the three months ended March 31, 2025, we generated $2.9 million less in net sales from the 27,900 fewer tons of essential ingredients sold in the three months ended March 31, 2025 as compared to the same period in 2024. However, the increase of $29.47, or 38%, in our average sales price per ton for the three months ended March 31, 2025 as compared to the same period in 2024 improved our net sales of essential ingredients from the segment by $2.9 million.
Previous report
Corporate and other
Previous report
Cost of Goods Sold and Gross Loss
Previous report
Pekin Campus Production Segment
Previous report
Western Production Segment
Previous report
Corporate and other
Previous report
Our SG&A expenses decreased $0.7 million for the three months ended March 31, 2025 as compared to the same period in 2024. The reduction in SG&A expenses primarily reflects the conclusion of our acquisition-related expenses for our acquisition of Eagle Alcohol.
Previous report
Interest Expense, net
Previous report
The following table presents our interest expense, net, in dollars and as a percentage of net sales (in thousands, except percentages):
Previous report
Our interest expense, net, increased for the three months ended March 31, 2025 as compared to the same period in 2024, primarily due to higher average debt balances and higher average interest rates compared to the prior year period.
Previous report
The slight decrease in net loss attributable to common stockholders is primarily due to lower SG&A expenses and lower net sales at negative margins as well as the other factors affecting gross profit discussed above, partially offset by lower premiums for high quality alcohol, lower unrealized gains on derivatives and higher interest expense, as also discussed above.
Previous report
Quantitative Year-End Liquidity Status
Previous report
We used $7.8 million in cash during the quarter for the acquisition of Kodiak Carbonic and other capital expenditures.
Previous report
In connection with our acquisition of Eagle Alcohol, contingent payments of up to $2.7 million in cash and 948,932 shares of common stock are contractually scheduled for the first half of 2025, all of which were accrued for in 2024.
Reworded paragraphs (28)
Previous wording
All of our production facilities, other than our Magic Valley plant, were operating for all of 2024, subject to scheduled and unscheduled downtimes to address facility repair and maintenance.
Current wording
All of our production facilities, other than our Magic Valley plant in Idaho, were operating for all of 2024 and 2025, subject to scheduled and unscheduled downtimes to address facility repair and maintenance.
Previous wording
In January 2024, we temporarily hot-idled our 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 our corn oil and high protein system at the facility. We restarted our 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 we were able to expand our 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 our plant improvements. As a consequence, we cold-idled our Magic Valley facility on December 31, 2024 to minimize financial losses. We continue to provide terminal services at the plant and intend to resume operations at the facility when the economic environment in the region sustainably improves. We believe that the cold-idling of our Magic Valley facility will have a positive impact on our overall financial results in 2025 compared to 2024.
Current wording
In January 2024, we temporarily hot-idled our Magic Valley facility to minimize losses from negative regional crush margins – that is, revenue from ethanol minus the cost of corn, also referred to as market crush – and to expedite the installation of additional equipment to achieve the intended production rate, quality and consistency from our corn oil and high protein system at the facility. We restarted our 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 we were able to expand our 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 our plant improvements. As a consequence, we cold-idled our Magic Valley facility on December 31, 2024 to minimize financial losses. We continue to provide terminal services at the plant and intend to resume operations at the facility when the economic environment in the region sustainably improves. The cold-idling of our Magic Valley facility has had a positive impact on our overall financial results in 2025 compared to 2024.
Previous wording
Current Initiatives and Outlook
Current wording
Financial Review, Current Initiatives and Outlook
Previous wording
Our consolidated gross loss improved to a gross loss of $1.8 million for the three months ended March 31, 2025 from a gross loss of $2.4 million for the same period in 2024, representing a gross margin of negative 0.8% and 1.0% for the three months ended March 31, 2025 and 2024, respectively. Our gross loss and gross margin improved due to multiple factors, including the cold-idling of our Magic Valley facility, which reduced cost of goods sold by $10.0 million including cost savings of $4.8 million, over $1.0 million in lower repairs and maintenance expenses, premium liquid CO 2 sales from our newly acquired Alto Carbonic processing facility and other synergistic benefits totaling $2.9 million at our Columbia facility, and a $1.4 million benefit from ISCC certified renewable fuel exports priced at a premium to domestic fuel-grade ethanol, all of which were partially offset by $4.6 million in lower premiums for high quality alcohol, $3.8 million associated with lower returns on our essential ingredients, predominately from our Pekin Campus, and $1.6 million less in unrealized gains on derivatives compared to the prior year’s quarter. For the first quarter, we recorded $7.0 million in repairs and maintenance expense, in line with our full-year 2025 estimate of $32 million.
Current wording
Year to date, we have recorded $16 million in repairs and maintenance expense, in line with our 2025 estimate of $32 million.
Previous wording
We define EBITDA as unaudited consolidated net income (loss) before interest expense, interest income, provision for income taxes and depreciation and amortization expense. We define Adjusted EBITDA as unaudited consolidated net income (loss) before interest expense, interest income, unrealized derivative gains and losses, acquisition-related expense, asset impairments, provision for income taxes and depreciation and amortization expense.
Current wording
We define EBITDA as unaudited consolidated net income (loss) before interest expense, interest income, provision for income taxes and depreciation and amortization expense. We define Adjusted EBITDA as unaudited consolidated net income (loss) before interest expense, interest income, unrealized derivative gains and losses, acquisition-related income and expense, asset impairments, provision for income taxes and depreciation and amortization expense.
Previous wording
Certain performance metrics that we believe are important indicators of our results of operations:
Current wording
Certain performance metrics that we believe are important indicators of our results of operations include the following:
Previous wording
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $5.4 million, or 10%, to $49.1 million for the three months ended March 31, 2025 as compared to $54.5 million for the same period in 2024.
Current wording
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $12.0 million, or 17%, to $58.2 million for the three months ended June 30, 2025 as compared to $70.2 million for the same period in 2024.
Previous wording
Our volume of third-party alcohol sold reported gross by the segment declined by 5.3 million gallons, or 18%, to 24.4 million gallons for the three months ended March 31, 2025 as compared to 29.7 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $2.01 for the three months ended March 31, 2025, we generated $10.6 million less in net sales from the 5.3 million fewer gallons of third-party alcohol sold gross in the three months ended March 31, 2025 as compared to the same period in 2024.
Current wording
Our volume of third-party alcohol sold reported gross by the segment decreased by 4.7 million gallons, or 14%, to 29.7 million gallons for the three months ended June 30, 2025 as compared to 34.4 million gallons for the same period in 2024. With the segment’s average sales price per gallon of $1.96 for the three months ended June 30, 2025, we realized $2.8 million less in net sales from the 4.7 million fewer gallons of third-party alcohol sold gross in the three months ended June 30, 2025 as compared to the same period in 2024.
Previous wording
The $0.18 per gallon, or 10%, increase in the segment’s average sales price per gallon for the three months ended March 31, 2025 as compared to the same period in 2024 resulted in a $5.2 million increase in our net sales from third-party fuel-grade ethanol sold by the segment.
Current wording
The $0.08 per gallon, or 4%, decrease in the segment’s average sales price per gallon for the three months ended June 30, 2025 as compared to the same period in 2024 resulted in a $9.2 million decline in our net sales from third-party renewable fuel sold by the segment.
Previous wording
Net sales of alcohol from corporate and other declined by $1.4 million, or 47%, to $1.6 million for the three months ended March 31, 2025 as compared to $3.0 million for the same period in 2024. These sales are from Eagle Alcohol’s business.
Current wording
Net sales of alcohol from corporate and other declined by $1.1 million, or 40%, to $1.7 million for the three months ended June 30, 2025 as compared to $2.8 million for the same period in 2024. These sales are from Eagle Alcohol’s business.
Previous wording
Our Pekin Campus production segment’s gross profit, net of intercompany activity, declined by $7.3 million to a gross loss of $2.2 million for the three months ended March 31, 2025 as compared to a gross profit of $5.1 million for the same period in 2024. All of this decline is attributable to lower ethanol margins.
Current wording
Our Pekin Campus production segment’s gross profit, net of intercompany activity, declined by $16.0 million to a gross loss of $5.1 million for the three months ended June 30, 2025 as compared to gross profit of $10.9 million for the same period in 2024. Of this decline, $16.3 million is attributable to lower alcohol sales margins, partially offset by $0.3 million attributable to lower sales volumes at negative margins.
Previous wording
The decrease in our consolidated net sales for the three months ended March 31, 2025 as compared to the same period in 2024 is attributable to fewer total gallons sold as well as lower volumes and lower average sales prices of essential ingredients due to a lower commodity price environment, partially offset by an increase in our average sales prices per gallon for both specialty alcohols and renewable fuel.
Current wording
The decrease in our consolidated net sales for the six months ended June 30, 2025 as compared to the same period in 2024 is primarily attributable to lower sales of renewable fuel and essential ingredients, partially offset by higher average sales prices per gallon from both our western production and marketing and distribution segments.
Previous wording
Net sales of essential ingredients from our Pekin Campus production segment declined by $2.1 million, or 4%, to $44.6 million for the three months ended March 31, 2025 as compared to $46.7 million for the same period in 2024. Our total volume of essential ingredients sold increased by 25,300 tons, or 12%, to 237,900 tons for the three months ended March 31, 2025 from 212,600 tons for the same period in 2024. The decrease of $32.15, or 15%, in the segment’s average sales price per ton for the three months ended March 31, 2025 as compared to the same period in 2024 reduced our net sales from the segment by $6.8 million. With the segment’s average sales price per ton of $187.55 for the three months ended March 31, 2025, we generated $4.7 million more in net sales from the 25,300 additional tons of essential ingredients sold in the three months ended March 31, 2025 as compared to the same period in 2024.
Current wording
Net sales of essential ingredients from our Pekin Campus production segment declined by $1.9 million, or 2%, to $84.2 million for the six months ended June 30, 2025 as compared to $86.1 million for the same period in 2024. Our total volume of essential ingredients sold increased by 25,300 tons, or 6%, to 447,900 tons for the six months ended June 30, 2025 from 422,600 tons for the same period in 2024. The decrease of $15.74, or 8%, in the segment’s average sales price per ton for the six months ended June 30, 2025 as compared to the same period in 2024 reduced our net sales from the segment by $6.6 million. With the segment’s average sales price per ton of $187.95 for the six months ended June 30, 2025, we generated $4.7 million in additional net sales from the 25,300 additional tons of essential ingredients sold in the six months ended June 30, 2025 as compared to the same period in 2024.
Previous wording
Our marketing and distribution segment’s gross profit, net of intercompany activity, improved by $1.1 million to a gross profit of $1.7 million for the three months ended March 31, 2025 as compared to a gross profit of $0.6 million for the same period in 2024. Of this improvement, $1.5 million is attributable to higher margins from sales of third-party fuel-grade ethanol, partially offset by $0.4 million attributable to lower sales volumes for the three months ended March 31, 2025 as compared to the same period in 2024.
Current wording
Our marketing and distribution segment’s gross profit, net of intercompany activity, improved by $2.4 million to a gross profit of $3.8 million for the six months ended June 30, 2025 as compared to a gross profit of $1.4 million for the same period in 2024. Of this improvement $3.1 million is attributable primarily to higher margins from sales of third-party renewable fuel, partially offset by $0.7 million from lower sales volumes for the six months ended June 30, 2025 as compared to the same period in 2024.
Previous wording
Our Western production segment’s gross profit, net of intercompany activity, improved by $7.1 million to a gross loss of $1.3 million for the three months ended March 31, 2025 as compared to a gross loss of $8.4 million for the same period in 2024. Of this improvement, $6.7 million is attributable to improved renewable fuel margins and $0.4 million is attributable to lower sales volumes at negative margins of both renewable fuel and essential ingredients, both of which are primarily due to the cold-idling of our Magic Valley facility.
Current wording
Our Western production segment’s gross profit, net of intercompany activity, improved by $12.4 million to a gross profit of $0.4 million for the six months ended June 30, 2025 as compared to a gross loss of $12.0 million for the same period in 2024. Of this improvement, $12.5 million is attributable to higher renewable fuel margins and increased CO 2 sales, partially offset by $0.1 million attributable to lower sales volumes.
Previous wording
Gross profit from corporate and other declined by $0.4 million to a gross loss of less than $0.1 million for the three months ended March 31, 2025 as compared to a gross profit of $0.3 million for the same period in 2024, all of which were from Eagle Alcohol’s business.
Current wording
Gross profit from corporate and other declined by $0.2 million to a gross loss of $0.1 million for the six months ended June 30, 2025 as compared to gross profit of $0.1 million for the same period in 2024, all of which were from Eagle Alcohol’s business.
Previous wording
During the three months ended March 31, 2025, we funded our operations primarily from cash on hand and proceeds from Kinergy’s operating line of credit. In addition to funding our operations, our capital resources were used to purchase Kodiak Carbonic and for capital expenditures. As of March 31, 2025, we had $27.2 million in cash, cash equivalents and restricted cash, $11.7 million available for borrowing under Kinergy’s operating line of credit and $65.0 million that may be available for capital improvement projects under our Orion term loan, subject to certain conditions. We believe we have sufficient liquidity to meet our anticipated working capital, debt service and other liquidity needs for at least the next twelve months from the date of this report.
Current wording
During the six months ended June 30, 2025, we funded our operations primarily from cash on hand and proceeds from Kinergy’s operating line of credit. In addition to funding our operations, our capital resources were used to purchase Kodiak Carbonic, make our final payments relating to our acquisition of Eagle Alcohol and for capital expenditures. As of June 30, 2025, we had $30.5 million in cash, cash equivalents and restricted cash, $4.8 million available for borrowing under Kinergy’s operating line of credit and $65.0 million that may be available for capital improvement projects under our Orion term loan, subject to certain conditions. As of June 30, 2025, our derivative net asset position was $1.7 million. We believe we have sufficient liquidity to meet our anticipated working capital, debt service and other liquidity needs for at least the next twelve months from the date of this report.
Previous wording
At March 31, 2025, we had approximately $55.6 million of net assets at our subsidiaries that were not available to be transferred to Alto Ingredients, Inc. in the form of dividends, distributions, loans or advances due to restrictions contained in our subsidiaries’ credit facilities.
Current wording
At June 30, 2025, we had approximately $49.5 million of net assets at our subsidiaries that were not available to be transferred to Alto Ingredients, Inc. in the form of dividends, distributions, loans or advances due to restrictions contained in our subsidiaries’ credit facilities.
Previous wording
Working capital improved to $100.3 million at March 31, 2025 from $95.3 million at December 31, 2024 as a result of a decrease of $4.7 million in current liabilities and an increase of $0.3 million in current assets.
Current wording
Working capital improved to $107.2 million at June 30, 2025 from $95.3 million at December 31, 2024 as a result of a decrease of $15.3 million in current liabilities, partially offset by a decrease of $3.4 million in current assets.
Previous wording
Current assets increased primarily due to an increase in accounts receivable, inventories, other current assets and derivative instruments, partially offset by a decrease in cash and cash equivalents and restricted cash.
Current wording
Current assets decreased primarily due to a decrease in cash and cash equivalents and restricted cash, partially offset by an increase in inventories from December 31, 2024.
Previous wording
Our current liabilities decreased primarily due to lower accounts payable and accrued liabilities as a result of timing of payments, and a decrease in derivative liabilities from changes in commodity prices for open contracts.
Current wording
Our current liabilities decreased primarily due to lower accounts payable and accrued liabilities as a result of the timing of payments, and a decrease in other current liabilities as we paid the remaining purchase price for our acquisition of Eagle Alcohol.
Previous wording
Our cash, cash equivalents and restricted cash declined by $9.0 million due to $18.2 million in cash used in our operating activities and $7.8 million used in our investing activities, partially offset by $17.0 million in cash provided by our financing activities.
Current wording
Our cash, cash equivalents and restricted cash declined by $5.7 million due to $19.1 million in cash used in our operating activities and $10.5 million in cash used in our investing activities, partially offset by $23.9 million in cash provided by our financing activities.
Previous wording
We used $18.2 million of cash in our operations for the three months ended March 31, 2025 as compared to $1.4 million of cash provided by our operations for the same period in 2024. Significant factors that contributed to the change in cash provided by our operating activities include:
Current wording
We used $19.1 million of cash in our operations for the six months ended June 30, 2025 as compared to $12.3 million for the same period in 2024. Significant factors that contributed to the change in cash provided by our operating activities include:
Previous wording
Cash provided by our financing activities was $17.0 million for the three months ended March 31, 2025, which reflects net proceeds of $17.3 million from Kinergy’s operating line of credit, partially offset by $0.3 million in preferred stock dividends paid.
Current wording
Cash provided by our financing activities was $23.9 million for the six months ended June 30, 2025, which reflects net proceeds of $24.5 million from Kinergy’s operating line of credit, partially offset by $0.6 million in preferred stock dividends paid.
Previous wording
Alto Ingredients, Inc. has guaranteed all of Kinergy’s obligations under the credit facility. As of March 31, 2025, Kinergy had an outstanding balance of $57.0 million and $11.7 million of unused borrowing availability under the credit facility.
Current wording
Alto Ingredients, Inc. has guaranteed all of Kinergy’s obligations under the credit facility. As of June 30, 2025, Kinergy had an outstanding balance of $64.2 million and $4.8 million of unused borrowing availability under the credit facility.
Previous wording
On November 7, 2022, we entered into a credit agreement with certain funds managed by Orion Infrastructure Capital, or Lenders, under which the Lenders extended a senior secured credit facility in the amount of up to $125.0 million, or Term Loan. The Term Loan is secured by a first priority lien on certain of our assets and a second priority lien on certain assets of Kinergy and Alto Nutrients. Interest accrues on the unpaid principal amount of the Term Loan at a fixed rate of 10% per annum. The Term Loan matures on November 7, 2028, or earlier upon acceleration.
Current wording
On November 7, 2022, we entered into a credit agreement with certain funds managed by Orion Infrastructure Capital, or Lenders, under which the Lenders extended a senior secured credit facility in the amount of up to $125.0 million, or Term Loan. The Term Loan matures on November 7, 2028, or earlier upon acceleration. The Term Loan is secured by a first priority lien on certain of our assets and a second priority lien on certain assets of Kinergy and Alto Nutrients. Interest accrues on the unpaid principal amount of the Term Loan at a fixed rate of 10% per annum.
Previous wording
We must prepay amounts outstanding under the Term Loan on a semi-annual basis on each June 30 th and December 31 st in an amount equal to a percentage of our excess cash flow based on a specified leverage ratio, as follows: (i) if our leverage ratio is greater than or equal to 3.0x, then the mandatory prepayment amount will equal 100% of our excess cash flow, (ii) if our leverage ratio is less than 3.0x and greater than or equal to 1.5x, then the mandatory prepayment amount will equal 50% of our excess cash flow, and (iii) if our leverage ratio is less than 1.5x, then the mandatory prepayment amount will equal 25% of our excess cash flow. No prepayment was made or required to be made for the three months ended March 31, 2025 and 2024.
Current wording
We must prepay amounts outstanding under the Term Loan on a semi-annual basis on each June 30 th and December 31 st in an amount equal to a percentage of our excess cash flow based on a specified leverage ratio, as follows: (i) if our leverage ratio is greater than or equal to 3.0x, then the mandatory prepayment amount will equal 100% of our excess cash flow, (ii) if our leverage ratio is less than 3.0x and greater than or equal to 1.5x, then the mandatory prepayment amount will equal 50% of our excess cash flow, and (iii) if our leverage ratio is less than 1.5x, then the mandatory prepayment amount will equal 25% of our excess cash flow. No prepayment was made or required to be made for the three and six months ended June 30, 2025 and 2024.
Previous wording
As of March 31, 2025, we had future commitments for certain capital projects totaling $10.8 million. These commitments are scheduled to be satisfied in 2025.
Current wording
As of June 30, 2025, we had future commitments for certain capital projects totaling $11.5 million. These commitments are scheduled to be satisfied through 2025.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Net Sales, Cost of Goods Sold and Gross Profit (Loss)
Current report — wording carried from elsewhere
Cost of Goods Sold and Gross Profit (Loss)
Current report — wording carried from elsewhere
Cost of Goods Sold and Gross Profit (Loss)