Alto Ingredients, Inc.
For the period ended Jun 30, 2026. Filed Aug 7, 2026.
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, 2026 · Filed Aug 7, 2026
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 2026-03-31; filed 2026-05-08.
0001213900-26-053870
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-07.
0001213900-26-086336
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.
Compared 104 previous paragraphs and 115 current paragraphs.
53 unchanged; 26 reworded; 36 added; 25 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 27 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (36)
Current report
The second quarter represents our fourth consecutive quarter of positive gross profit, income from operations, net income and Adjusted EBITDA. We have been consistently profitable during this period even without the contributions from Section 45Z clean fuel production tax credits. Our results demonstrate the strength of our diversified operating model, which gives us the flexibility to shift production toward the most attractive end-markets and capture premium-value opportunities. We remain focused on disciplined execution of our strategic plan and unlocking additional value across our asset portfolio.
Current report
Our trailing 12-month results are also a testament to our efforts to drive profitability, maximize the value of our asset base, and make smart decisions around capital allocations, including purchasing our Alto Carbonic business and investing in projects to optimize our dry mill and reduce the carbon intensity of our production.
Current report
For the second quarter, our results also reflect strong domestic demand and improved essential ingredient values compared to the same period last year.
Current report
The second quarter’s market crush margins improved significantly to $0.33 per gallon from $0.11 per gallon in the same period last year. This increase was driven by robust export demand, strong domestic blending activity, and tighter ethanol inventories following industry-wide spring maintenance outages. As a result, ethanol prices improved during the quarter, supported by strong Renewable Volume Obligation, or RVO, blending requirements. Meanwhile, favorable crop conditions and larger projected grain supplies contributed to lower corn costs, boosting margins. Second quarter crush margins were not only significantly higher than those in the same period last year but were also strong by historical standards. Third quarter margins thus far, which in the past have marked the annual peak, continue to be healthy and profitable.
Current report
While European demand remained robust, ongoing geopolitical disruptions in the Middle East negatively impacted renewable fuel export economics from the United States during the second quarter. Higher freight costs and reduced certainty of vessel availability to transport renewable fuel from the Gulf Coast compressed the U.S.-to-Europe trade arbitrage, increasing the competitiveness of Brazilian exports to Europe. As a result, we reduced our renewable fuel export volumes compared to the second quarter of last year but still generated higher overall revenue from export volumes for the quarter due to higher premiums to domestic renewable fuel compared to the second quarter of last year.
Current report
Given the strength of domestic ethanol markets, we successfully optimized our product mix toward fuel-grade ethanol sales in U.S. markets. This outcome underscores the benefits of our diversified commercial platform, which enabled us to adapt and capture the value of a strong domestic crush-margin environment.
Current report
During the second quarter, we also continued to improve utilization, reliability and throughput, with the goal of increasing total volume for 2026 over 2025. At our Pekin campus, we completed the planned outage of our dry mill along with a debottlenecking project to increase annual production capacity by approximately 8%, or 5 million gallons. This outcome illustrates our dedication to projects with highly attractive returns on investment. By increasing production capacity at our dry mill, our most efficient facility, we are positioned to capture additional gross margin and to qualify for additional Section 45Z clean fuel production tax credits. After a successful restart of our dry mill, we are now ramping up to our new production capacity and expect to realize the full benefit of this additional capacity in the fourth quarter. We also performed our routine spring outage at our ICP facility during the second quarter. We remain on track to finish the repairs on our Pekin campus’ existing dock and complete the installation of a second alcohol loadout by year end, improving our logistics and loading capacity.
Current report
At our Columbia facility, we began work to add a third CO2 storage tank and expect the tank to be operational in the fourth quarter. This expanded storage capacity will allow us to further capitalize on the growing demand for premium CO2 in the Pacific Northwest. We continue advancing multiple pathways to further monetize CO2 production, including opportunities for utilization and sequestration. Our strategy emphasizes low-capital, high-return projects while preserving flexibility as regulatory and commercial markets continue to evolve. We intend to move quickly by pursuing partnerships with stakeholders that already have compression capabilities, allowing us to accelerate commercialization.
Current report
Capital expenditures for the second quarter were $10.6 million for a total of $11.5 million year to date. We are on track to meet our annual capital expenditure budget of $25 million.
Current report
We are focused on increasing our Section 45Z clean fuel production tax credits by producing higher volumes of qualifying fuel. We also continue to explore opportunities to lower our carbon scores without significant capital investment by working with our farmer partners to encourage them to lower the carbon intensity of their corn. We remain on track to qualify 90 million gallons, or more, of combined production this year, supporting an expected minimum of $15 million in income from Section 45Z clean fuel production tax credits, net of monetization costs.
Current report
We remain encouraged by the growing momentum to adopt year-round E15 blending. As an example, the Renewable Fuels Association recently reported that about 72% of U.S. voters support year-round E15 blending, the highest level recorded since polling began in 2016. We believe that the ongoing geopolitical disruptions in the Middle East create conditions that drive domestic support for implementing year-round E15 blending. Nationally, support continues to build around the promise of E15 to reduce fuel costs, strengthen energy security and increase demand for domestically produced renewable fuels. Meanwhile, several Midwestern states have moved forward with permanent year-round E15 blending, providing an important blueprint for broader adoption nationwide.
Current report
California is also making progress toward E15 blending following the passage of Assembly Bill 30. While final implementation steps remain, we believe the state’s transition toward E15 blending represents a meaningful long-term demand opportunity given California’s position as one of the largest gasoline markets in the country. Taken together, expanding adoption of E15 at both the federal and state levels has the potential to drive significant incremental demand for ethanol, improve industry capacity utilization, and support a more favorable margin environment over time.
Current report
Three Months ended June 30, 2026 as compared to the Three Months ended June 30, 2025
Current report
The increase in our consolidated net sales for the three months ended June 30, 2026 as compared to the same period in 2025 is primarily attributable to higher average sales prices per gallon across all of our business segments as well as higher average sales prices of essential ingredients due to a stronger commodity price environment. Net sales also improved due to higher total volumes sold of alcohols and essential ingredients.
Current report
Net sales of alcohol from our Pekin Campus production segment increased by $20.2 million, or 21%, to $114.4 million for the three months ended June 30, 2026 as compared to $94.2 million for the same period in 2025. Our total volume of production gallons sold increased by 6.5 million gallons, or 14%, to 54.6 million gallons for the three months ended June 30, 2026 as compared to 48.1 million gallons for the same period in 2025. The increase of $0.14, or 7%, in the segment’s average sales price per gallon for the three months ended June 30, 2026 as compared to the same period in 2025 improved our net sales from the segment by $6.6 million. With the segment’s average sales price per gallon of $2.09 for the three months ended June 30, 2026, we generated $13.6 million more in net sales from the 6.5 million additional gallons of alcohol sold in the three months ended June 30, 2026 as compared to the same period in 2025.
Current report
Net sales of essential ingredients from our Pekin Campus production segment improved by $5.5 million, or 14%, to $45.1 million for the three months ended June 30, 2026 as compared to $39.6 million for the same period in 2025. The increase of $26.73, or 14%, in the segment’s average sales price per ton for the three months ended June 30, 2026 as compared to the same period in 2025 increased our net sales from the segment by $5.6 million. Our total volume of essential ingredients sold slightly decreased to 209,500 tons for the three months ended June 30, 2026 as compared to 210,000 tons for the same period in 2025, which resulted in $0.1 million less in net sales compared to 2025.
Current report
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $3.5 million, or 6%, to $54.7 million for the three months ended June 30, 2026 as compared to $58.2 million for the same period in 2025. Our volume of third-party alcohol sold reported gross by the segment decreased by 5.7 million gallons, or 19%, to 24.0 million gallons for the three months ended June 30, 2026 as compared to 29.7 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.27 for the three months ended June 30, 2026, we realized $12.9 million less in net sales from the 5.7 million fewer gallons of third-party alcohol sold gross in the three months ended June 30, 2026 as compared to the same period in 2025. The $0.31 per gallon, or 16%, increase in the segment’s average sales price per gallon for the three months ended June 30, 2026 as compared to the same period in 2025 resulted in a $9.4 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 increased by $4.2 million, or 25%, to $20.8 million for the three months ended June 30, 2026 as compared to $16.6 million for the same period in 2025. Our total volume of alcohol sold increased by 1.1 million gallons, or 13%, to 9.4 million gallons for the three months ended June 30, 2026 as compared to 8.3 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.20 for the three months ended June 30, 2026, we realized $2.5 million in additional net sales from the 1.1 million additional gallons of alcohol sold in the three months ended June 30, 2026 as compared to the same period in 2025. The increase of $0.20, or 10%, in the segment’s average sales price per gallon for the three months ended June 30, 2026 as compared to the same period in 2025 increased our net sales from the segment by $1.7 million.
Current report
Net sales of essential ingredients from our Western production segment increased by $0.6 million, or 7%, to $8.8 million for the three months ended June 30, 2026 as compared to $8.2 million for the same period in 2025. Our total volume of essential ingredients sold increased by 4,600 tons, or 6%, to 83,000 tons for the three months ended June 30, 2026 from 78,400 tons for the same period in 2025. The increase of $1.31, or 1%, in our average sales price per ton for the three months ended June 30, 2026 as compared to the same period in 2025 increased our net sales of essential ingredients from the segment by $0.1 million. With the segment’s average sales price per ton of $106.54 for the three months ended June 30, 2026, we generated $0.5 million in additional net sales from the 4,600 additional tons of essential ingredients sold in the three months ended June 30, 2026 as compared to the same period in 2025.
Current report
Our consolidated gross profit improved due to higher sales and margins primarily driven by a few key factors. Our average sales prices per gallon improved across all of our business segments, reaching a combined average sales price of $2.15 per gallon, an over 10% increase compared to the second quarter of 2025. In addition, we benefitted from favorable overall production input costs, largely due to a lower cost of corn, which, together with higher average sales prices, significantly improved market crush margins to $0.33 cents per gallon for the second quarter of 2026 from $0.11 cents per gallon for the same period last year, driven by robust export demand, strong domestic blending activity, and tighter ethanol inventories following industry-wide spring maintenance outages. In addition, with RVOs for 2026 set, strong demand for corn oil and germ as a feedstock for biodiesel and renewable diesel drove essential ingredient prices higher. Our essential ingredients return improved to 51.6% for the three months ended June 30, 2026 compared to 45.2% for the same period in 2025. Improved crush margins contributed approximately $17 million of incremental gross profit for the second quarter, partially offset by $2 million of higher repairs and maintenance expenses arising from our Pekin dry mill and ICP facility spring outages and continued work at our Alto Carbonic facility to ensure we were prepared to reliably support the increased demand for our premium CO 2 during the seasonally strong summer months.
Current report
Our Pekin Campus production segment’s gross profit, net of intercompany activity, increased by $17.4 million to a gross profit of $12.4 million for the three months ended June 30, 2026 as compared to gross loss of $5.0 million for the same period in 2025. Of this increase, $15.9 million is attributable to improved alcohol sales margins and $1.5 million is attributable to higher sales volumes.
Current report
Our marketing and distribution segment’s gross profit, net of intercompany activity, decreased by $0.1 million to a gross profit of $1.4 million for the three months ended June 30, 2026 as compared to a gross profit of $1.5 million for the same period in 2025. Of this decline, $0.2 million is attributable to higher margins from sales of third-party renewable fuel, 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 $0.4 million to a gross profit of $2.0 million for the three months ended June 30, 2026 as compared to a gross profit of $1.6 million for the same period in 2025. Of this improvement, $0.2 million is attributable to higher renewable fuel margins and $0.2 million is attributable to higher sales volumes.
Current report
Gross profit from corporate and other increased by $0.9 million for the three months ended June 30, 2026, from a breakeven gross profit for the three months ended June 30, 2025, all of which were from Eagle Alcohol’s business.
Current report
Six Months ended June 30, 2026 as compared to the Six Months ended June 30, 2025
Current report
Net Sales
Current report
Net sales of alcohol from our Pekin Campus production segment increased by $20.9 million, or 10%, to $222.3 million for the six months ended June 30, 2026 as compared to $201.4 million for the same period in 2025. Our total volume of production gallons sold increased by 3.8 million gallons, or 4%, to 108.5 million gallons for the six months ended June 30, 2026 as compared to 104.7 million gallons for the same period in 2025. The increase of $0.13, or 7%, in the segment’s average sales price per gallon for the six months ended June 30, 2026 as compared to the same period in 2025 increased our net sales from the segment by $13.1 million. With the segment’s average sales price per gallon of $2.05 for the six months ended June 30, 2026, we generated $7.8 million in additional net sales from the 3.8 million additional gallons of alcohol sold in the six months ended June 30, 2026 as compared to the same period in 2025.
Current report
Net sales of essential ingredients from our Pekin Campus production segment increased by $4.9 million, or 6%, to $89.1 million for the six months ended June 30, 2026 as compared to $84.2 million for the same period in 2025. Our total volume of essential ingredients sold decreased by 20,900 tons, or 5%, to 427,000 tons for the six months ended June 30, 2026 from 447,900 tons for the same period in 2025. The increase of $20.63, or 11%, in the segment’s average sales price per ton for the six months ended June 30, 2026 as compared to the same period in 2025 increased our net sales from the segment by $9.2 million. With the segment’s average sales price per ton of $208.58 for the six months ended June 30, 2026, we generated $4.3 million in fewer net sales from the 20,900 fewer tons of essential ingredients sold in the six months ended June 30, 2026 as compared to the same period in 2025.
Current report
Net sales of alcohol from our Western production segment increased by $4.7 million, or 14%, to $37.5 million for the six months ended June 30, 2026 as compared to $32.8 million for the same period in 2025. Our total volume of alcohol sold increased by 1.0 million gallons, or 6%, to 17.6 million gallons for the six months ended June 30, 2026 as compared to 16.6 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.13 for the six months ended June 30, 2026, we generated $2.1 million in additional net sales from the 1.0 million additional gallons of alcohol sold in the six months ended June 30, 2026 as compared to the same period in 2025. The increase of $0.15, or 8%, in the segment’s average sales price per gallon for the six months ended June 30, 2026 as compared to the same period in 2025 improved our net sales from the segment by $2.6 million.
Current report
Net sales of alcohol from corporate and other increased by $0.1 million, or 3%, to $3.4 million for the six months ended June 30, 2026 as compared to $3.3 million for the same period in 2025. These sales are from Eagle Alcohol’s business.
Current report
Our consolidated gross profit improved to a gross profit of $25.9 million for the six months ended June 30, 2026 from a gross loss of $3.7 million for the same period in 2025, representing a positive gross margin of 5.5% for the six months ended June 30, 2026 as compared to a negative gross margin of 0.8% for the same period in 2025.
Current report
Our consolidated gross profit improved due to higher sales and margins primarily driven by the same factors that improved our second quarter results, as discussed above. Our average sales prices per gallon improved across all of our business segments, reaching a combined average sales price of $2.08 per gallon, an over 7% increase compared to the same period in 2025. In addition, we benefitted from favorable overall production input costs, largely due to a lower cost of corn, which, together with higher average sales prices, significantly improved market crush margins compared to the same period last year. In addition, our essential ingredients return improved to 52.5% for the six months ended June 30, 2026 as compared to 46.7% for the same period in 2025.
Current report
Our Western production segment’s gross profit, net of intercompany activity, improved by $1.4 million to a gross profit of $1.4 million for the six months ended June 30, 2026 as compared to a breakeven gross profit for the same period in 2025, related to higher margins on ethanol sales.
Current report
Our SG&A expenses increased for the three and six months ended June 30, 2026 as compared to the same periods in 2025. The period over period increases in SG&A expenses are primarily due to an $0.8 million accrual for performance compensation as well as an $0.8 million one-time gain in 2025 related to the final payment for our acquisition of Eagle Alcohol that did not recur in 2026. Excluding those two notable items, SG&A expenses were comparable over the 2026 and 2025 periods despite higher net sales in the current year, reflecting the benefits of last year’s initiatives to right-size our staffing levels and cut costs.
Current report
The increase in our net income attributable to common stockholders for the three and six months ended June 30, 2026 as compared to the same periods in 2025 is primarily due to improved margins, as discussed above, Section 45Z clean fuel production tax credits, and reduced interest expense due to lower debt balances. For the three and six month periods in 2026, we had no tax provision as we expect to use a portion of our net operating losses to offset income for the year.
Current report
Quantitative Period-End Liquidity Status
Removed paragraphs (25)
Previous report
The first quarter is a seasonally weak period for us and for the ethanol industry, reflecting the build-up of inventories and lower demand following the winter months. In contrast, our first quarter 2026 results were strong relative to our historical performance for this period. We generated profitability on both an adjusted EBITDA and net income basis, supported by higher crush margins, an improved product mix that emphasized higher-value renewable fuel export sales and incremental earnings from transferrable Section 45Z clean fuel production tax credits. Importantly, even without the contribution from Section 45Z tax credits, our operations were profitable in the quarter. We believe these results demonstrate the benefits of our strategic realignment, operational improvements, and continued success in capturing premiums over domestic renewable fuel.
Previous report
We remain focused on maximizing value from our diversified portfolio of assets and on pursuing multiple revenue opportunities in response to market demand. Our priorities are to improve utilization and reliability across our platform, execute our 2026 optimization and capital projects on time and within budget, and advance our commercial strategy, including expanding the value we capture from Section 45Z tax credits and optimally monetizing the value of our biogenic CO 2 production across our facilities to lower our carbon footprint.
Previous report
During the first quarter of 2026, unusually cold weather in the first half of the quarter disrupted river logistics and led us to curtail production at our Pekin Campus. We used this unplanned downtime to accelerate a portion of our planned wet mill biennial outage work that had originally been scheduled for the second quarter. This will allow us to recapture some of the lost production later in the year when crush margins are typically stronger and help us stay on track toward our goal of increasing total 2026 alcohol volumes and prioritizing product mix that delivers premiums to domestic renewable fuel.
Previous report
We also executed a planned outage at our Columbia facility during what is typically a seasonally slower quarter for liquid CO 2 sales. Combined with an outage taken in December 2025, this work addressed certain deferred process-related activities intended to improve production performance and plant reliability for the remainder of 2026. These efforts are designed to help ensure our Columbia plant can run at optimal rates to support the growing needs of our CO 2 offtake customers during the higher-demand summer months and to enable us to qualify additional gallons for Section 45Z tax credits. We are planning a normal outage at our ICP facility in the second quarter, consistent with 2025.
Previous report
At our Pekin Campus, we began both the repairs on our original loading dock and the construction of a second loadout dock. As previously discussed, the second dock is intended to provide redundancy and enhance our logistical capabilities. We are currently on track to complete both projects by the end of 2026. Once the original dock is restored and the second dock is in service, we expect to reduce bottlenecks and increase loadout capacity.
Previous report
We also commenced a project to increase throughput and storage capacity at our Columbia liquid CO 2 processing facility by adding a third storage tank. We believe this project will position us to further capitalize on favorable liquid CO 2 market conditions, particularly the growing demand in the Pacific Northwest and limited supply of premium liquid CO 2 in the region. Combined with the process improvements described above, this investment is intended to enhance our ability to serve existing customers, support incremental volumes and monetize more of the CO 2 produced at our Columbia plant.
Previous report
At our Pekin dry mill, which is our most efficient ethanol plant, we are moving the planned outage from the third quarter into June. During this downtime, we expect to complete a debottlenecking project designed to increase annual production capacity by approximately 8%, or about 5 million gallons. We expect to fully realize the benefits of these improved production rates in the fourth quarter of 2026. If successful, this project should provide incremental margin and allow us to qualify additional volumes for Section 45Z tax credits.
Previous report
In addition to the capital projects already underway or planned for 2026, we continue to evaluate large-scale CO 2 utilization and sequestration opportunities at our Pekin Campus. These potential projects are intended to lower our facilities’ carbon intensity scores and provide additional earnings opportunities through Section 45Z tax credits and higher-value liquid CO 2 sales.
Previous report
With respect to Section 45Z transferable tax credits for 2026, we expect to qualify approximately 90 million gallons of combined annual production at our Columbia and Pekin dry mill facilities at $0.20 per gallon, which would result in approximately $15 million of net proceeds after estimated monetization costs. For the first quarter of 2026, we recorded $3.9 million in Section 45Z credit earnings. The sale of all of our 2025 Section 45Z credits is underway at values consistent with previously recorded estimates, and we currently expect to complete that transaction in the second quarter of 2026. We are working to qualify additional gallons and further reduce our carbon intensity scores in order to capture more of the Section 45Z benefits in future periods.
Previous report
As we manage liquidity and continue to focus on our priorities, we remain disciplined in our capital allocation. We expect to spend approximately $25 million on capital expenditures in 2026, primarily on maintenance and optimization projects with the highest projected returns. Capital expenditures in the first quarter of 2026 were approximately $1 million, with the majority of spending planned over the remaining three quarters as our 2026 projects progress. We also repaid $16.6 million of term debt in the first quarter, as planned, and ended the quarter with $38.4 million outstanding on our term loan. With a lower debt balance, interest expense decreased compared to the prior-year quarter, reflecting our focus on minimizing idle cash, maintaining ample borrowing availability and reducing our interest burden.
Previous report
We are closely monitoring macroeconomic and geopolitical developments, including unrest in the Middle East, which can indirectly affect our business through energy and commodity price volatility, as well as freight and export logistics. We seek to actively manage these exposures through our commercial strategy, hedging activities and operational flexibility. We are also encouraged by continued progress on E15. In California, Assembly Bill 30 has provided a pathway for year-round E15 sales, and we are monitoring the state’s implementation process. At the federal level, momentum in Congress for legislation allowing year-round E15 continues to build. We view expanded E15 access as an important demand-side complement to production incentives such as Section 45Z because it can help ensure the market is able to absorb additional low-carbon renewable fuel gallons over time. Without corresponding demand growth, production incentives alone could contribute to industry overproduction and margin pressure.
Previous report
Overall, we believe our first quarter 2026 results demonstrate that our operating model—focusing on improving margins through higher-value revenue opportunities and disciplined cost management—is working. With multiple product streams, we have the flexibility to respond quickly as markets shift and we are continuing to strengthen our ability to perform through commodity cycles. We intend to continue executing on our 2026 optimization and capital projects, improving utilization and reliability across our asset base, and advancing our commercial strategy, including expanding the value we capture from Section 45Z credits and further monetizing our biogenic CO 2 production across our facilities. We remain committed to further enhancing shareholder value over both the near- and longer-term.
Previous report
Pekin Campus Production Segment
Previous report
Net sales of alcohol from our Pekin Campus production segment increased by $0.7 million, or 1%, to $108.0 million for the three months ended March 31, 2026 as compared to $107.3 million for the same period in 2025. The segment’s average sales price per gallon increased by $0.10, or 5%, to $2.00 for the three months ended March 31, 2026 from $1.90 for the same period in 2025. Our total volume of production gallons sold decreased by 2.6 million gallons, or 5%, to 53.9 million gallons for the three months ended March 31, 2026 as compared to 56.5 million gallons for the same period in 2025. The increase of $0.10, or 5%, in the segment’s average sales price per gallon for the three months ended March 31, 2026 as compared to the same period in 2025 increased our net sales from the segment by $5.9 million. With the segment’s average sales price per gallon of $2.00 for the three months ended March 31, 2026, we generated $5.2 million in fewer net sales from the 2.6 million fewer gallons of alcohol sold in the three months ended March 31, 2026 as compared to the same period in 2025.
Previous report
Net sales of essential ingredients from our Pekin Campus production segment declined by $0.6 million, or 1%, to $44.0 million for the three months ended March 31, 2026 as compared to $44.6 million for the same period in 2025. Our total volume of essential ingredients sold decreased by 20,400 tons, or 9%, to 217,500 tons for the three months ended March 31, 2026 from 237,900 tons for the same period in 2025. The increase of $14.72, or 8%, in the segment’s average sales price per ton for the three months ended March 31, 2026 as compared to the same period in 2025 increased our net sales from the segment by $3.5 million. With the segment’s average sales price per ton of $202.27 for the three months ended March 31, 2026, we generated $4.1 million less in net sales from the 20,400 fewer tons of essential ingredients sold in the three months ended March 31, 2026 as compared to the same period in 2025.
Previous report
Western Production Segment
Previous report
Net sales of alcohol from our Western production segment increased by $0.5 million, or 3%, to $16.7 million for the three months ended March 31, 2026 as compared to $16.2 million for the same period in 2025. Our total volume of alcohol sold decreased by 0.1 million gallons, or 1%, to 8.2 million gallons for the three months ended March 31, 2026 as compared to 8.3 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.03 for the three months ended March 31, 2026, we generated $0.2 million less in net sales from the 0.1 million fewer gallons of alcohol sold in the three months ended March 31, 2026 as compared to the same period in 2025.The increase of $0.08, or 4%, in the segment’s average sales price per gallon for the three months ended March 31, 2026 as compared to the same period in 2025 increased our net sales from the segment by $0.7 million.
Previous report
Corporate and other
Previous report
Pekin Campus Production Segment
Previous report
Western Production Segment
Previous report
Our Western production segment’s gross profit, net of intercompany activity, remained flat at a gross loss of $1.3 million for the three months ended March 31, 2026 and 2025.
Previous report
Corporate and other
Previous report
Our SG&A expenses declined by $0.5 million for the three months ended March 31, 2026 as compared to the same period in 2025. The decline in SG&A expenses primarily reflects reduced compensation expenses and professional fees.
Previous report
The significant improvement in net income (loss) attributable to common stockholders is primarily due to higher margins, income from transferable tax credits, lower SG&A expenses and lower interest expense as well as the other factors affecting gross profit discussed above.
Previous report
Quantitative Year-End Liquidity Status
Reworded paragraphs (26)
Previous wording
The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and notes to condensed consolidated financial statements included elsewhere in this report. This report and our condensed consolidated financial statements and notes to condensed consolidated financial statements contain forward-looking statements, which generally include the plans and objectives of management for future operations, including plans and objectives relating to our future economic performance and our current beliefs regarding revenues we might generate and profits we might earn if we are successful in implementing our business and growth strategies. The forward-looking statements and associated risks may include, relate to or be qualified by other important factors, including:
Current wording
The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and notes to condensed consolidated financial statements included elsewhere in this report. This report and our condensed consolidated financial statements and notes to condensed consolidated financial statements contain forward-looking statements, which generally include the plans and objectives of management for future operations, including plans and objectives relating to our future economic performance and our current beliefs regarding revenues we might generate and profits we might earn if we are successful in implementing our business and growth strategies, and statements of the assumptions underlying or relating to any of the foregoing. The forward-looking statements and associated risks may include, relate to or be qualified by other important factors, including:
Previous wording
Current Initiatives and Outlook
Current wording
Financial Review, Current Initiatives and Outlook
Previous wording
We define Adjusted EBITDA as unaudited consolidated net income or loss before interest expense, interest income, unrealized derivative gains and losses, excess insurance proceeds, acquisition-related expense or recoveries, provision or benefit for income taxes, asset impairments, and depreciation and amortization expense.
Current wording
We define Adjusted EBITDA as unaudited consolidated net income or loss before interest expense, interest income, unrealized derivative gains and losses, excess insurance proceeds, acquisition-related income or expense, provision or benefit for income taxes, asset impairments, and depreciation and amortization expense.
Previous wording
Our discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses for each period. We believe that of our critical accounting estimates, defined as those estimates that we believe are the most important to the portrayal of our financial condition and results of operations and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain: impairment of long-lived assets and valuation allowance for deferred taxes. These critical accounting estimates are more fully described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2025.
Current wording
Our discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses for each period. We believe that our critical accounting estimates, defined as those estimates that we believe are the most important to the portrayal of our financial condition and results of operations and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain, are: impairment of long-lived assets and valuation allowance for deferred taxes. These critical accounting estimates are more fully described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to our critical accounting estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2025.
Previous wording
Net sales of alcohol from corporate and other declined by $0.2 million, or 13%, to $1.4 million for the three months ended March 31, 2026 as compared to $1.6 million for the same period in 2025. These sales are from Eagle Alcohol’s business.
Current wording
Net sales of alcohol from corporate and other increased by $0.2 million, or 12%, to $1.9 million for the three months ended June 30, 2026 as compared to $1.7 million for the same period in 2025. These sales are from Eagle Alcohol’s business.
Previous wording
Our consolidated gross profit improved to $9.2 million for the three months ended March 31, 2026 from a gross loss of $1.8 million for the same period in 2025, representing a gross margin of 4.1% and a negative gross margin of 0.8% for the three months ended March 31, 2026 and 2025, respectively. Higher gross margin for the first quarter of 2026 was primarily driven by improved crush margins, including from a product mix that emphasized higher-value renewable fuel export sales, and unrealized gains on our derivative instruments.
Current wording
Our consolidated gross profit (loss) improved to a gross profit of $16.6 million for the three months ended June 30, 2026 from a gross loss of $1.9 million for the same period in 2025, representing a positive gross margin of 6.8% for the three months ended June 30, 2026 as compared to a negative gross margin of 0.9% for the same period in 2025.
Previous wording
The decrease in our consolidated net sales for the three months ended March 31, 2026 as compared to the same period in 2025 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 increase in our consolidated net sales for the six months ended June 30, 2026 as compared to the same period in 2025 is primarily attributable to higher average sales prices per gallon across all of our business segments as well as higher average sales prices of essential ingredients due to a stronger commodity price environment, partially offset by a slight decrease in volumes sold.
Previous wording
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $1.7 million, or 3%, to $47.3 million for the three months ended March 31, 2026 as compared to $49.0 million for the same period in 2025.
Current wording
Net sales of alcohol from our marketing and distribution segment, excluding intersegment sales, declined by $5.2 million, or 5%, to $102.0 million for the six months ended June 30, 2026 as compared to $107.2 million for the same period in 2025.
Previous wording
Our volume of third-party alcohol sold reported gross by the segment declined by 0.9 million gallons, or 4%, to 23.5 million gallons for the three months ended March 31, 2026 as compared to 24.4 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.01 for the three months ended March 31, 2026, we generated $1.7 million less in net sales from the 0.9 million fewer gallons of third-party alcohol sold gross in the three months ended March 31, 2026 as compared to the same period in 2025.
Current wording
Our volume of third-party renewable fuel sold reported gross by the segment decreased by 6.6 million gallons, or 12%, to 47.5 million gallons for the six months ended June 30, 2026 as compared to 54.1 million gallons for the same period in 2025. With the segment’s average sales price per gallon of $2.14 for the six months ended June 30, 2026, we realized $14.1 million less in net sales from the 6.6 million fewer gallons of third-party renewable fuel sold gross in the six months ended June 30, 2026 as compared to the same period in 2025. The $0.16 per gallon, or 8%, increase in the segment’s average sales price per gallon for the six months ended June 30, 2026 as compared to the same period in 2025 resulted in a $8.9 million increase in our net sales from third-party renewable fuel sold by the segment.
Previous wording
Net sales of essential ingredients from our Western production segment declined by $0.5 million, or 6%, to $7.3 million for the three months ended March 31, 2026 as compared to $7.8 million for the same period in 2025. Our total volume of essential ingredients sold increased by 1,600 tons, or 2%, to 74,500 tons for the three months ended March 31, 2026 from 72,900 tons for the same period in 2025. With the segment’s average sales price per ton of $97.72 for the three months ended March 31, 2026, we generated $0.2 million in increased net sales from the 1,600 additional tons of essential ingredients sold in the three months ended March 31, 2026 as compared to the same period in 2025. However, the decrease of $9.39, or 9%, in our average sales price per ton for the three months ended March 31, 2026 as compared to the same period in 2025 reduced our net sales of essential ingredients from the segment by $0.7 million.
Current wording
Net sales of essential ingredients from our Western production segment remained flat at $16.1 million for the six months ended June 30, 2026 as compared to the same period in 2025. Our total volume of essential ingredients sold increased by 6,200 tons, or 4%, to 157,500 tons for the six months ended June 30, 2026 from 151,300 tons for the same period in 2025. With the segment’s average sales price per ton of $102.37 for the six months ended June 30, 2026, we generated $0.6 million in additional net sales from the 6,200 additional tons of essential ingredients sold in the six months ended June 30, 2026 as compared to the same period in 2025. The decrease of $3.77, or 4%, in our average sales price per ton for the six months ended June 30, 2026 as compared to the same period in 2025 reduced our net sales of essential ingredients from the segment by $0.6 million.
Previous wording
Information reconciling forward-looking Adjusted EBITDA to forward-looking consolidated net income (loss) would require a forward-looking statement of consolidated net income (loss) prepared in accordance with GAAP, which is unavailable to us without unreasonable effort. We are not able to provide a quantitative reconciliation of forward-looking Adjusted EBITDA to forward-looking consolidated net income (loss) because certain items required for reconciliation are uncertain, outside of our control and/or cannot reasonably be predicted, such as net sales, cost of goods sold, unrealized derivative gains and losses, asset impairments and provision (benefit) for income taxes, which we view as the most material components of consolidated net income (loss) that are not presently estimable.
Current wording
Cost of Goods Sold and Gross Profit (Loss)
Previous wording
Our Pekin Campus production segment’s gross profit, net of intercompany activity, improved by $11.2 million to a gross profit of $9.0 million for the three months ended March 31, 2026 as compared to a gross loss of $2.2 million for the same period in 2025. Of this improvement, $11.7 million is attributable to higher margins, partially offset by $0.5 attributable to lower sales volumes for the three months ended March 31, 2026 as compared to the same period in 2025.
Current wording
Our Pekin Campus production segment’s gross profit, net of intercompany activity, improved by $27.9 million to a gross profit of $20.0 million for the six months ended June 30, 2026 as compared to a gross loss of $7.9 million for the same period in 2025. Of this improvement, $27.2 million is attributable to higher alcohol sales margins and $0.7 million is attributable to higher sales volumes.
Previous wording
Our marketing and distribution segment’s gross profit, net of intercompany activity, decreased by $0.7 million to a gross profit of $1.1 million for the three months ended March 31, 2026 as compared to a gross profit of $1.8 million for the same period in 2025. Of this decrease, $0.6 million is attributable to slightly lower margins from sales of third-party fuel-grade ethanol and $0.1 million is attributable to lower sales volumes for the three months ended March 31, 2026 as compared to the same period in 2025.
Current wording
Our marketing and distribution segment’s gross profit, net of intercompany activity, declined by $1.2 million to a gross profit of $3.0 million for the six months ended June 30, 2026 as compared to a gross profit of $4.2 million for the same period in 2025. Of this decline, $0.8 million is attributable primarily to lower margins from sales of third-party renewable fuel and $0.4 million is attributable to lower sales volumes for the six months ended June 30, 2026 as compared to the same period in 2025.
Previous wording
Gross profit from corporate and other improved by $0.5 million to a gross profit of $0.4 million for the three months ended March 31, 2026 as compared to a gross loss of $0.1 million for the same period in 2025, all of which were from Eagle Alcohol’s business.
Current wording
Gross profit from corporate and other improved by $1.4 million to a gross profit of $1.3 million for the six months ended June 30, 2026 as compared to gross loss of $0.1 million for the same period in 2025, all of which were from Eagle Alcohol’s business.
Previous wording
During the three months ended March 31, 2026, our operations generated positive cash flow, and we supplemented our liquidity with cash on hand and net proceeds from Kinergy’s operating line of credit. In addition to funding our operations, our capital resources were used to make principal payments on our term debt. As of March 31, 2026, we had $21.6 million in cash, cash equivalents and restricted cash, $29.3 million of unused borrowing availability under Kinergy’s operating line of credit and $65.0 million that may be available for capital improvement projects under our Orion term loan. 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, 2026, we generated positive cash flow from our operations, and we supplemented our liquidity with net proceeds from Kinergy’s operating line of credit. In addition to funding our operations, we used our capital resources to make principal payments on our term debt, including an $8.5 million payment for the second quarter, ending the quarter with $29.9 million in term debt outstanding. Year to date, we have made a total of $25.1 million in principal payments on our term debt. As of June 30, 2026, we had $24.0 million in cash, cash equivalents and restricted cash, $41.3 million of unused borrowing availability under Kinergy’s operating line of credit and $65.0 million that may be available for capital improvement projects under our Orion term loan. 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, 2026, we had approximately $59.1 million in 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, 2026, we had approximately $68.5 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 $116.9 million at March 31, 2026 from $96.8 million at December 31, 2025 as a result of a decrease of $17.4 million in current liabilities and an increase of $2.6 million in current assets.
Current wording
Working capital improved to $110.4 million at June 30, 2026 from $96.8 million at December 31, 2025 as a result of a decrease of $8.7 million in current liabilities and an increase of $4.9 million in current assets.
Previous wording
Current assets increased primarily due to an increase in accounts receivable, transferable tax credits and derivative instruments, partially offset by a decrease in cash and cash equivalents and restricted cash and inventories.
Current wording
Current assets increased primarily due to an increase in accounts receivable, transferable tax credits and derivative instruments, partially offset by a decrease in inventories.
Previous wording
Our current liabilities decreased primarily due to lower current portion of long-term debt and derivative instruments, partially offset by increases in accounts payable and accrued liabilities as a result of timing of payments.
Current wording
Our current liabilities decreased primarily due to lower current portion of long-term debt and derivative instruments, partially offset by increases in accounts payable as a result of timing of payments.
Previous wording
Our cash, cash equivalents and restricted cash declined by $4.0 million due to $7.3 million in cash used in our financing activities and $0.9 million used in our investing activities, partially offset by $4.2 million in cash provided by our operating activities.
Current wording
Our cash, cash equivalents and restricted cash declined by $1.7 million due to $22.9 million in cash used in our financing activities and $11.5 million used in our investing activities, nearly offset by $32.7 million in cash provided by our operating activities.
Previous wording
We generated $4.2 million of cash from our operations for the three months ended March 31, 2026 as compared to $18.2 million of cash used in our operations for the same period in 2025. Significant factors that contributed to the change in cash provided by our operating activities include:
Current wording
We generated $32.7 million of cash from our operations for the six months ended June 30, 2026 as compared to $19.1 million of cash used in our operations for the same period in 2025. Significant factors that contributed to the change in cash provided by our operating activities include:
Previous wording
We used $0.9 million in cash during the three months ended March 31, 2026 for capital expenditures.
Current wording
We used $11.5 million in cash during the six months ended June 30, 2026 for capital expenditures.
Previous wording
Cash used in our financing activities was $7.3 million for the three months ended March 31, 2026, which reflects $16.6 million in principal payments on our term debt and $0.3 million in preferred stock dividends paid, partially offset by $9.6 million in proceeds from Kinergy’s operating line of credit.
Current wording
Cash used in our financing activities was $22.9 million for the six months ended June 30, 2026, which reflects $25.1 million in principal payments on our term debt, $2.2 million for employee taxes paid for stock vesting in lieu of shares and $0.6 million in preferred stock dividends paid, partially offset by $5.0 million in net proceeds from Kinergy’s operating line of credit.
Previous wording
Alto Ingredients, Inc. has guaranteed all of Kinergy’s obligations under the credit facility. As of March 31, 2026, Kinergy had an outstanding balance of $39.2 million and $29.3 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, 2026, Kinergy had an outstanding balance of $34.6 million and $41.3 million of unused borrowing availability under the credit facility.
Previous wording
As of March 31, 2026 and December 31, 2025, the principal amount outstanding under the Term Loan was $38.4 million and $55.0 million, respectively.
Current wording
As of June 30, 2026 and December 31, 2025, the principal amount outstanding under the Term Loan was $29.9 million and $55.0 million, respectively.
Previous wording
As of March 31, 2026, we had future commitments for certain capital projects totaling $18.4 million. These commitments are scheduled to be satisfied in 2026.
Current wording
As of June 30, 2026, we had future commitments for certain capital projects totaling $12.0 million. These commitments are scheduled to be satisfied through 2026.