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Segments
 12 Months Ended
Dec. 31, 2024
Segments [Abstract]  
SEGMENTS
4.SEGMENTS.

 

The Company reports its financial and operating performance in three segments: (1) Pekin Campus production, which includes the production and sale of alcohols and essential ingredients produced at the Company’s Pekin, Illinois campus, (2) marketing and distribution, which includes marketing and merchant trading for Company-produced alcohols and essential ingredients on an aggregated basis, and sales of fuel-grade ethanol sourced from third parties, and (3) Western production, which includes the production and sale of fuel-grade ethanol and essential ingredients, including liquid CO2, produced at the Company’s two western production facilities and its liquid CO2 plant on an aggregated basis, none of which are individually so significant to be considered a separately reportable segment.

 

The Company manages and assesses the performance of its reportable segments by its gross profit (loss). As part of the Executive Committee’s review of segment-level performance, each member of the Executive Committee reviews the gross profit of the Company’s reportable segments and provides expertise and analysis from their respective areas which drive the evaluation of the performance of the Company’s reportable segments and allocation of resources to those segments. Even though the CEO has the authority to override the other members for strategic or other reasons, key decisions are made jointly by the Executive Committee.

 

Included in income (loss) before provision for income taxes are management fees charged by Alto Ingredients to each of the segments. The Pekin Campus production segment incurred $7,200,000, $5,280,000 and $5,046,000 in management fees for the years ended December 31, 2024, 2023 and 2022, respectively. The marketing and distribution segment incurred $5,400,000, $3,960,000 and $3,840,000 in management fees for the years ended December 31, 2024, 2023 and 2022, respectively. The Western production segment incurred $3,600,000, $2,640,000 and $2,400,000 in management fees for the years ended December 31, 2024, 2023 and 2022, respectively. Corporate and other includes the results of Eagle Alcohol and selling, general and administrative expenses, consisting primarily of corporate employee compensation, professional fees and overhead costs not directly related to a specific operating segment.

 

During the normal course of business, the segments do business with each other. The preponderance of this activity occurs when the Company’s marketing and distribution segment markets alcohol produced by the production segments for a marketing fee, as discussed in Note 3. These intersegment activities are considered arms’-length transactions. Consequently, although these transactions impact segment performance, they do not impact the Company’s consolidated results since all revenues and corresponding costs are eliminated upon consolidation.

 

For the years ended December 31, 2024, 2023 and 2022, capital expenditures incurred by the Pekin Campus segment were approximately $6.8 million, $17.7 million and $25.7 million, and capital expenditures incurred by the Western production segment were approximately $4.3 million, $11.8 million and $12.3 million, respectively.

The following tables set forth certain financial data for the Company’s operating segments (in thousands):

 

   Years Ended December 31, 
Net Sales  2024   2023   2022 
Pekin Campus production, recorded as gross:            
Alcohol sales  $415,710   $502,217   $521,273 
Essential ingredient sales   169,308    217,702    225,871 
Intersegment sales   1,243    1,427    1,212 
Total Pekin Campus sales   586,261    721,346    748,356 
                
Marketing and distribution:               
Alcohol sales, gross  $216,295   $262,587   $227,626 
Alcohol sales, net   229    365    1,225 
Intersegment sales   10,833    11,654    12,459 
Total marketing and distribution sales   227,357    274,606    241,310 
                
Western Production, recorded as gross:               
Alcohol sales  $115,389   $166,971   $253,605 
Essential ingredient sales   36,953    57,264    90,209 
Intersegment sales   (122)   134    22 
Total Western production sales   152,220    224,369    343,836 
                
Corporate and other   11,374    15,834    15,812 
Intersegment eliminations   (11,954)   (13,215)   (13,693)
Net sales as reported  $965,258   $1,222,940   $1,335,621 
                
Cost of goods sold:            
Pekin Campus production  $563,033   $710,088   $772,755 
Marketing and distribution   213,023    259,234    229,288 
Western production   172,209    230,445    353,775 
Corporate and other   12,285    12,122    12,167 
Intersegment eliminations   (5,014)   (4,602)   (4,814)
Cost of goods sold as reported  $955,536   $1,207,287   $1,363,171 
             
Gross profit (loss):            
Pekin Campus production  $23,228   $11,258   $(24,399)
Marketing and distribution   14,334    15,372    12,022 
Western production   (19,989)   (6,076)   (9,939)
Corporate and other   (911)   3,712    3,645 
Intersegment eliminations   (6,940)   (8,613)   (8,879)
   $9,722   $15,653   $(27,550)
Income (loss) before provision for income taxes:               
Pekin Campus production  $6,308   $(1,560)  $(27,376)
Marketing and distribution   5,261    7,644    3,748 
Western production   (51,086)   (13,506)   (7,209)
Corporate and other   (19,294)   (20,486)   (8,835)
   $(58,811)  $(27,908)  $(39,672)
Asset impairments:               
Western production  $21,389   $
—
   $
—
 
Corporate and other   3,401    6,544    
—
 
   $24,790   $6,544   $
—
 
Depreciation and amortization expense:               
Pekin Campus production  $21,017   $19,789   $19,136 
Western production   2,409    2,381    5,085 
Corporate and other   982    910    874 
   $24,408   $23,080   $25,095 
Interest expense, net of capitalized interest:            
Pekin Campus production  $1,765   $(207)  $(381)
Marketing and distribution   389    822    1,658 
Western production   2,829    1,164    (339)
Corporate and other   2,661    5,646    889 
   $7,644   $7,425   $1,827 

The following table sets forth the Company’s total assets by operating segment (in thousands): 

 

   December 31, 
   2024   2023 
Total assets:        
Pekin Campus production  $223,934    251,048 
Marketing and distribution   102,895    101,196 
Western production   44,992    57,533 
Corporate and other   29,617    44,464 
   $401,438   $454,241