Alto Ingredients, Inc. reported a challenging financial performance for the third quarter and the first nine months of 2024, with significant declines in net sales and profitability compared to the same periods in 2023. For the three months ended September 30, 2024, net sales totaled $251.8 million, a decrease of 20.8% from $318.1 million in Q3 2023. For the nine months ended September 30, 2024, net sales were $728.9 million, down 23.2% from $949.3 million in the prior year. The decline in sales was attributed to lower average sales prices for specialty alcohols and renewable fuel, as well as reduced sales from the hot-idling of the Magic Valley plant and a wet mill outage.

Despite the drop in sales, the company achieved a gross profit of $6.0 million for Q3 2024, an increase of 43.2% from $4.2 million in Q3 2023. This improvement was driven by productivity enhancements and a favorable shift in the sales mix towards higher-margin products at the Pekin Campus, which reported a gross profit of $7.0 million, up from $1.1 million in the same quarter last year. However, the Western production segment experienced a gross loss of $2.1 million, compared to a gross profit of $1.7 million in Q3 2023, primarily due to production downtime and higher upgrade costs.

The company reported a consolidated net loss of $2.4 million for Q3 2024, an improvement from a net loss of $3.5 million in Q3 2023. However, for the nine months ended September 30, 2024, the net loss increased to $17.3 million, compared to a loss of $9.1 million in the same period in 2023. Factors contributing to the net loss included increased repairs and maintenance expenses and higher upfront project costs for the Carbon Capture and Storage (CCS) project.

Alto Ingredients' cash and cash equivalents increased to $33.6 million as of September 30, 2024, from $30.0 million at the end of 2023. The company also reported total current assets of $145.2 million, down from $168.8 million at year-end 2023, while total liabilities decreased to $153.5 million from $174.7 million. The working capital ratio improved to 3.22, up from 2.59 at the end of 2023.

Strategically, the company is focusing on enhancing its production capabilities and expanding its corn storage capacity at the Pekin Campus. The Magic Valley facility, which was temporarily hot-idled in January 2024, resumed operations in July 2024 but may be idled again if economic conditions do not improve. Additionally, Alto Ingredients entered into a CO2 Transportation and Sequestration Agreement with Vault 44.01 on November 5, 2024, as part of its ongoing CCS project.