Renewable Energy (REGI) 30 Apr 202020 Q1 Earnings call transcript

Greetings and welcome to the Renewable Energy Group First Quarter 2020 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Todd Robinson, Treasurer for Renewable Energy Group. Thank you, sir.

You may begin.

Jessie. you, Thank and conference everyone, our quarter first Good welcome earnings call. XXXX afternoon, to today and Stone. With CJ our is me President our Financial Warner; Chief Chief Officer, Chad and Officer, Executive

before Let a to me the few items CJ. cover call I housekeeping over turn

which would website everyone that like on replay be at webcast regi.com. is this Relations Investor includes our website advance remind automatically will beginning at we deck, available this accompanying later available A you is the to the section to I as appear call webcast the being need an but First, The manually webcast, prompt and with of our will you. slide afternoon. will slides

release you slide section in, the Relations of downloaded of deck our those website. along dialing the earnings in Investor be For press can with the

and Turning of are involve file would X. the in statements. discussed to described on in differences. factors XX-Q, on call. that contain The such you based not uncertainties conference no are or subsequent forward-looking Form statements. Several These difficult statements SEC. These which risks, XX-K could those expectations. are information contribute undertakes We and These statements quarterly our those speak of such only company the revised information this the in predict, advise forward-looking to on and the other company’s with a some contained Risk any Form new of differ call that publicly could as materially detail statements cause report obligation on forward-looking update results date will of Factors this statements The sections performance. annual and reports to on to Slide like factors or actual to of from guarantee forward-looking are assumptions

these help of a accompanying measure. appendix Please measures core the Today’s release will to discussion the assess measures. deck the performance operating GAAP for our reconciliation most see slide non-GAAP the to metrics investors the business. the of comparable We believe press includes financial also or non-GAAP

the Let net end XXXX. that XXXX and our their or XXXX me our also reinstatement to XXXX The in near Because our Biodiesel the the associated of allocation year, place BTC, items know, line an GAAP quarter quarter XXXX. by fourth Excise more and benefit of put to and when this sold. reflect for Credit, results results. the net in the related will the our and the reinstated both XXXX. also last he period Mixture of on through XXXX retroactively were benefit which detail EBITDA XXXX for for financial adjusted reflected operations, was retroactive credit years is to point of out, as the reviews It statements was credit in you financial other Tax of in provide XXXX Chad gallons reflected

With that, CJ and CEO, Warner. our CJ? let me turn the President call over to

prices the considerable Thank EBITDA will I the the and provide COVID-XX you, delivered from Todd OPEC fuel turmoil pleased oil this quarter. result pandemic to for afternoon both like I’m this REG by rift the from We that later. market despite free saying demand some onset I’d that report exacerbated to falling good later behind of details humbled strong the destruction. and within driven by first start and and realized adjusted everyone.

maintained REG performance at of a we level, high very factors. through combination a From

as to now certainty to an enabled which effective continued diesel to to improvement; underlying and business, management; second, fourth, the production operate the approach BTC. enjoy product essential and risk our was relative performance operations we ongoing flexible selection continue Biodiesel us respect with placement; and strong renewable and First, feedstock robustly. third, confirmed

circumstances. communities also people the in resilience other our otherwise safety, REG’s essential employed well know purchases which We of many operating was stakeholders. strong that as agriculture our important feedstock our critical shareholders under purpose as coupled and the to contribute with we teamwork, sense to financially support operate. is We through profitably delivery persistence and of to culture our and

produce nation’s transportation our essential an network. and sustainable products also We for

All stymied successful of not performance they’re these believe our We commitment stakeholders. we our are of reflects if social all when we’re that contributions profitable and are. our realized financial to

on discuss that address let the circle operations Since to and top me COVID is results. back and then crisis mind, first of

along. You can refer to Slide X to follow

COVID-XX our the the action all know, communities definitive business and equation protect the all essentially our and newly REG to begin situation virus planning changed we employees, the business. basis measured ERT should the contingencies, for high in globally. for COVID alert a From our on As has near-term. spread We to or and the businesses in possible monitoring formed partners, activated Emergency taken Team crisis outset, Response has January

In sanitation This our distancing, quarantine extra work gone updates ERT including unfolded, of and provide across refineries, in the virus. on, as XX granted and of In our tracking situational orchestrating of proactive support We As action. and to to order employees and issues hours practices operations our guides Europe company anxiety, health distancing. has of travel seamlessly. an and remote as warranted. we our family We employees practices moved in as or services with of such crisis the our all all to as encourage the daily deal to company. quarantine regional well measures. pandemic time has related better and our best we PPE order adopted social accordance for taking precautionary off implemented leaders with paid when needed of CDC reduce in all with the fully extra sanitation, the distribution restrictions critical decisive social Ames guidelines offices, Early office-based all in related They mid-March. our

several Overall, well far health workers, including to date. well. I’m increased health team Our health carefully requirements and stepped carry executed turnaround health complex, zero in practices, Louisiana. turnaround exceptionally applying a checks out circumstances across was sanitation in April. A especially separation and for related performed Geismar of that issues pleased and PPE we so the normal the run successfully the outbreak enabled thus daily work but is under in up context us measures. virus The safety with have company, entire issues to continues this business extremely planned COVID to This to essential no had or report control

in We all to quarter. in to maintained operations states. refineries the able place even of continue during were be full We run shelter and our

that is plant Okeechobee only the shelter in by was Florida during state’s facility the in limited our Our down fermentation that place. was temporarily virus

slowing all economy. down the We destruction demand seen come have that’s from the

a the of believe we’re commercial transportation XX% year. from cleaner XX% but resilient approximately primary we gasoline a the is down position we the relatively fuel the approximately is this, the fuel, by affected of producer produce. are and as jet demand to EIA, use of According beginning down fuels in We given demand

demand effect trucks diesel by drop being Markit stable with first was With QX. stabilizing, now projects contrast, diesel supplies essential engines. In relatively of that quarter were market generally that XX% the as around diesel the will during end IHS by rushed to demand

that demand generally demand remains to diesel biodiesel seeing diesel and reduction demand with no as petroleum are strong little correlating renewable with far. We for thus demand

the X. with the at in end same $X substantially crisis course the prices the a year less BXXX In ULSD shown volatile the at ULSD the hold. the diesel were the under as first quarter from crude Notably to of correlation in over terms gallon you of $X of as of fell product beginning slide. quarter as quarter, on substantially can took dropped than pricing, over Slide the see on

COVID has the Moving our also crisis from our feedstock to market. impacted the inputs, outputs

you carbon REG’s of is As cost, low mix feedstock. predominantly know, feedstock comprised low

our are these of restaurant reduction have a used in the of oil. significantly. market closures in XX% Based resulted All being cooking intelligence, curtailed on availability

ethanol This In addition, need an of plants supply by of corn now or to closures Furthermore, animal demand the shrinking as estimated are estimated gasoline among plant related of XX% for XX% by operations led things the this distillers’ as blending. other ethanol reducing supply week. rendering severely an shutdowns, of today. route fats at reducing the oil has the multiple is reduced COVID

Now this with of the Slide net available the as on been the the shown of has course soybean soybean hand, The in feedstocks more and dropping on of over quarter. X. soybean pricing effect levels oil extremely volatile other that have feedstock making increased, is increasing quarter, all crush second other

oil Our feedstock quarter. first DCO the flexibility lower cost of towards use and into quarter us soybean us to to second allowed allowed most through the preferentially the end the quarter and the advantaged and more of has switch to then first UCO

the price. oil pricing and this diesel and the HOBO the happened quarter chart product have larger to more in a shown reflects Slide margin X X. relatively second prices as quarter. provide X will on to helping remained on the together as over narrowed which RIN falling are prices sharply than first the compression spread in Slide rapidly – late soybean have due much relatively costs Pulling additional this quarter, feedstock supportive Because effect

business. Turning aspects our of controllable to other

pleased and improvements. our for met had quarter am mix, underlying our feedstock Beyond great I managing we say, to objective a

Let me highlight a couple of them.

First, renewable diesel.

to renewable prices in been in sales Norwegian the sold they profit we Renewable grow continued there. at and has every our is outstanding operate in tasked U.S. diesel and to Renewable gallon strategy. use Similarly, directly QX higher preferentially of first in Norway customers present, substantially nameplate team Geismar for did year-over-year. on X% diesel with so fulfill an element up quarter. Our optimizing ran long the to job. than are the quarter term downstream continuing directed volume diesel capacity efficiently. over we of demand by was it to XXX% sell of key We end a production moving

can sales volumes XXX% see fleet margins nicely, and also be blending have of to up over continue the compared which been first increasing Quarterly X, captures volumes drive Slide to quarter as strong. Fleet on XXXX, and we’re strong. proprietary with you

both hard pushing diesel diesel. and biodiesel petroleum into blending renewable increase to We’re

and increased for our biodiesel economics XX. not for XX% progress Our diesel to This volumes Slide of into shown is but outstanding only renewable important contribution. as also blended the environmental is on

in key performance especially very encouraged environment. in I’m initiatives, our difficult by extraordinarily this these

on financial Now details our performance XX. Slide some I’ll Chad highlights. overviewed will for give and as on XX but I’ll now provide touch shortly,

economic This environment solid the our liquidity proceeds, the sheet BTC is positions particularly with position valuable of financial ourselves receipt our the strong. balance we First, in. are find given very is and

risk the strong. a and our times health as performance significant feedstock made I will improvements is profitability purpose underlying just of of strong contribution our minute. our and more just demonstrating more three management in Risk factors safe behind detail utilization discuss regime. Adjusted nameplate quarter that and operations in Other the product application with Chad placement this selection $XX in XXXX. EBITDA of adjusted Second, robust strategy QX approach. gain XX%, this our safety or incidents management zero a detailed, include support flexible and EBITDA with performance of a regulatory certain of million,

Now allocation let’s plans. move and capital to growth briefly

discipline a As growth our in including allocation we is drive made on outlined to maintain substantial with focus quarter, bonds. repurchases accordance expansion, convertible of From continue our last framework. progress renewable paying our at and we We’ve distill down debt, to diesel growth effort our progress perspective, main capital pace.

primary our focus. Downstream other strategic margin capture is

As the progress offering earlier, the into carbon demand higher good diesel increased in reducing improve BTC enhance for making biodiesel and by our blending, diesel further of renewable and percentages overtime. I We biodiesel. both full petroleum dollar plan blended proprietary to much which highlighted we’re selling captures

quarter, on see display produced. our can tons first gallons able COX fuel from we of As Slide XXX X XX, metric the of were in the million million you to

Now to our for the detail more in quarter. turn review financial Chad to I’ll the call Chad? over performance

Thank you, CJ, afternoon everyone. and good

want on I my quarter, into comparisons. comments get everyone I to Before the on align

and for the adjusted in XXXX. non-GAAP BTC change Todd underlying in through apples-to-apples BTC real the of first the provide mentioned XXXX we the comparison extended for will performance. analysis XXXX. better creates retroactively As the allocation an understand This you Accordingly, XXXX to to reinstated the of enable economic and December, an the was of quarter numbers to

product elimination quarterly non-GAAP lower GAAP in diesel The average down Slide Northeast, The to sold sold diesel gallons caused Europe Slide the of was a margin and third-party gallons volumes biodiesel decrease sold associated XX the winter Boston renewable year which of margin selling of increased. New mix. our due our unusually for to higher was warm in an on of biorefinery, reduce result and by volume while July. decreased petroleum blended reduced and we is lower last closed gallons the Volume XX Total in petroleum revenue price. Refer in highlights. gallon diesel and with focus and for both

Looking gallons in up at produced renewable both production, and were biodiesel diesel.

on. management the further CJ Now touched let gain address that me risk

all you the declined significantly in across energy the complex know, quarter. As prices

decline risk our place, million. soybean saw of we resulted in in Additionally, changes management management oil the With these well. $XX gain strategy as pricing risk quarter in a

The was volatility of magnitude of outside norm. very the the much

management business. a XX% remainder As of our and historic effective. business first was and associated strategy matter with approximately fact, proved for future risk Note it the that quarter was

see, as margins in the as prices can first gain protecting offset decline you the As our risk quarter intended. designed, management

gains Going bonus down This exceeded our EBITDA to a due to was an estimated in SG&A QX quarter; our on and percent XXXX first part management a than guidance the XXXX. of of gain the no less the and was $XX GAAP first both to bonus we as in net compared quarter, basis latter million P&L. recall and accrual solid absolute was million. revenue. the reflected Adjusted low to in provided of from income our primarily risk actual QX results, tax usual higher management X%. for due accrual $XX of risk rate guidance volatility when extreme we as

tax large our low forward, rates NOL due balance. to Going should our remain

trailing earned. a XX back refer capital, believe Slide than are return million. $XXX Please our quarter which XX-month a that XX-month on net for in of to Note our refer EBITDA is way one to Slide for trailing trailing to performance time. it the view figures was adjusted XX-month XX%. allocate term the Please XX longer analysis period invested better to BTC a at to adjusted is We these which

As CJ balance sheet have liquidity and described, strong we a positions.

As BTC we XX, our for million Year-to-date, principal see the is of business. IRS Slides BTC XX and the all end for due down XXXX $XX.X our current to and XXXX the quarter XXXX amounts principle from collecting you claims is million at in outstanding also on can and we’ve the of collected addition, in balance and from the in bonds repurchased have XXXX convertible for convertible bonds, $XX.X which million, $XX.X we’re repurchases. the

We authorization remaining approved of million for repurchases. have Board $XXX additional our

our excess We down term In April, we also $XX.X paid off credit January. debt invested and in in paid cash. line million we

X.X%. Our capital total debt and the weighted quarter our first to rate was the of at X.X%, end interest was average

than $XXX and a for million cash position we net $XXX with Further, of of our today, we we we’re sit debt. have here, in available on have As more liquidity. cash line over million marketable securities credit

approach the With interest rates strategy, at our generational lows, we may consider new management. while debt to conservative growth support sheet balance to maintaining

intend As capital always, we maintain our prudent to allocation.

As I and have of million recall, for first authorization, million – budgeted expenditures the have quarter. capital we repurchase have we XXXX in approved the mentioned, for $X invested that Board the we $XX

projects overall to is our reminder, of target capital. growth a invested capital with As on rate XX% returns. projects and These and a return an for internal repurchases must maximize retirement return XX% debt compete

to back CJ? to call discuss turn the I’ll CJ outlook. Now the

one lifetimes to It’s outlook. the periods to we’re of in does need reflected say and uncertain this Chad. in most safe all our that working our of probably Thanks, be

summarized We and have and several believe any Slide already these market down out. up the how we XX. will of currents predict covered both moment, uncertainties, At can’t what major the pan costs we the of relevant and are forces I’ve on

track and the along that out them all impact forces our will business. here with laying so can consider are you We us

are Many covered diesel upside I having to demand. refineries is diesel is cut potential but now, challenged, haven’t and Gasoline could shown this five-year in area, is far collapse for in on limiting One some yet, currently become and averages the like the refineries. there are above XX, picture to back jet the and The supply overall utilization, Slide would demands. throughput inventories here. as gasoline of because

be having and gasoline low spread, have gasoline contrast, five-year on which the current cut production, could refineries slightly crack achieve. depending product degree back petroleum in refineries a to on precipitously. actually dropped basis switching overall the With supply inventories diesel on the are diesel average constrained of can Because

likely XX. in you utilization million. we in Diesel can supportive to prices. XXX Slide cracks of Any sold move supportive, With expect are to shown all costs to mind, refining would fairly further of as let’s XX. Slide be as in million gallon that XXX in see EBITDA the range and guidance, In adjusted million $XX on range the in second to quarter, $XX of the diesel

through Second recognized quarter the of of million month guidance first last the includes $X gain risk management from week.

included value gains that the QX first period, quarters first second consider both understand risk the were to it’s protecting some in quarter business, gains for and our together. of best management because creation our this to Also

million We the are EBITDA first half. of to $XXX at in $XXX million adjusted looking

in As noted guidance assumptions any actual changes on could inform our the Slide affect XX, used results. to

by farther Looking the are of far guidance ahead, volume low end. the widening year This environment. uncertainty the our range for we reflects reducing current greater the

to like turn the call I’d Q&A call. for to of segment operator our Jessie? Now over the the

Thank you.

now session. be Thank question-and-answer you. Instructions] [Operator the will conducting We

the proceed Our with line question Please your comes of Craig Capital Irwin from Partners. first ROTH question. with

congratulations Good result. a and evening, on strong

priorities But different fit take markets go construction possibly you debt you’re over that couple for for years? What in How at next you the give cash? wanted opportunities those a of converts. guess use First a of end I little, the quarter, ask guess you cash about The I million still maybe of plus right? little is maybe between considering, BTC, rates. the $XXX or low historically cash, I million at the million the there, you’re used in to cash. into $XXX given do and here mention $XXX looking thing, And generate that from back did buying the are

of allocation gains. strategic between framework So our the it combination the our lines capital and really, Craig, falls along

between allocation considering restructuring for debt and capital does that growth. ensuring returns framework call the we’re buybacks, So

them on areas balancing the close in of we and terms diesel renewable keeping eye growth choices, hard and So forward are growth a of of we’re that all develop it. definitely working strategic and to And expansion. downstream in

of and even in lots things more I good choices, making before. interesting market the think it’s current So fact, dynamic, with than

Okay.

Excellent. Okay.

in years right? rights some to I than So hear permits diligence, didn’t had place, Obviously, there Harbor had already but then greater rights and Everybody neighboring wants diesel, we your the green the that our when right an property, announcement. remember interesting port today, Grays facility do very capacity you deep-water a one on there. make much for you for ago

the Day – capital you ago Can you correct, I years if also site, I’m we announcement, a you’re be diesel barge. if Once you there, think an as I at some it I be Lights And correctly, process? River have at the commitment you make on showed where remember expedited believe looking you Analyst do think couple again, years? Seneca, of some at bought maybe approximate goals was, I next I color door. Second you And decision us land for have give next believe if would far as where an so over the green timeline? was

Yes. Craig. questions, Those great are all

and an on is great we’re progress this and area, making So focused in.

Some to want of some to things – of that proprietary. an you we few a trying I share. haven’t because things I can we’re announcement made tell hold

XXX gallon that. time, has keeping this ISBL we’re great choices progress a in First a last continue very some year the excited with selection. on have working do design been process and about And project down. the for We pace, and gratifying talked engineering we a for not And location. is really about making at slowed million outstanding for plant has what we the

on looking it not it. versus when, say on progress. just can slowing good An the will ISBL prior the green design, can’t be project. We what we We really forthcoming. were because announcement is progress we with are at making but apple down we And work working are exactly

progress rest keep moving So continuing you are pace, to we work. the without to But able as continuing will we’re continue updated commercial forward we sensitivity. to at sacrificing assured

about ask there. factors gating to just And Great.

financing be probable we permits at or gating to would the or as So would lead environmental that permits looking announcement? construction factors maybe a

not a to we’re that gating be at seems factor. significant looking permitting The

you can Although, say never never.

keeping focus we’re as property. options, great And and moving easements forward. Partnership also well. other is great on that So progress for financing on the of course, is making one as the

not those as of are we’re a all you some of can when which we’re this does one why have project which things but I’m balancing So sure disclosing building quite appreciate things much, magnitude. you’re sensitivity, all as commercial those

Great. Thank you for that.

line of questions my for adjusted EBITDA. the is next So along guidance

so rolled $XX off hedge book to you guess of your call go your first oil massive in you, a commodity did guess the this hedging second quarter. bit than million you sort have kind available I of most So guess to little hedges number Can don’t just that talk to quarter, from that a adjusted underlying We was from going $XX cash people the million, gain maybe commodities. the can hedging. XQ? as say heating given flow the you in us your benefit more that hedge the takes I $XX million functional understand XX% number? $XX see, on in to million you I little $X guess of a come $XX I’m down about did in and You pinches you walk this well, But forward. being bit expect remarks number through puts million that prepared million that we

start Craig, quarter wanted this Chad. first. with to is just first Yes, I

quarter. dropped business I the there, of first hint future that management a million for did with north risk rest was of So gain Meaning we little XX% in basically of saying, it, the was business. in $XX associated

XX days especially commodity don’t out sold and we volatile far in cycles. get We’re too typically long,

end through of since generated little some as then risk gains April a management and we of how guidance, So and lot go that I of last provide volatile basically can imagine know a what energy preparing discreetly is the then week, April. beginning bit And to say additional off kind the of complex would second forecasting we to quarter the you started is, of the impact.

that a risk on position that that and reflects forecasting into and built some we’re guidance we sitting gain we that’s regularly management know our we provide. already track So

the that situation’s much we going to prices. go Excellent. be So that for you sooner And you look that the a I then market the you people your is rebound regimen everybody rather of be later. Okay. country hedge COVID likely be pretty than hedge oil diesel, price, more on optimistic next I on you that follow sort over to owns quarters? the when guess gasoline a we a would And are bullish tanker prices? ultra-low oil buying hopefully right? bullish us, most have of means in low-sulfur strict losses, expose at future diesel in would this because do book the that and in we heating to prices, finally naked it couple behind do should see guess diesel if this oil, world, to sulfur Or they’re

Yes, go ahead, CJ.

anyone from Yes. be expects level a the I’ll the rate to standpoint significant I’m the that the change something don’t recovery when difference. just precipitous as from to very going that it’s to a let but to is you’re sometimes that’s about management just thinking makes of want actually a high because say that, think risk I big – crisis. And details, speak Chad I

going and if we’re hit to critical the a that approach terms us perfectly recovery And was we because it’s way, recovery, It’s and hedging a not even from just you, is in the slower drop. so us protected really all the balanced same watching believe it’s in of precipitous a slower. little strategy with coming. very And

would that, we I add producing risk the and physical And Craig, Yes. are managing. to commodity

these things. We’re actually moving

not trading contracts. We’re financial just

So we conservative on a risk one our be position commodities or and going are a position. forward to approach have our trading. other, is If really to money goal when you we within trade the view, by margins their not of and really, committee. cash so do the risk higher we to Yes, feel where make is think the allowed protect our Their of limit we goal management. way take our low-end desk, we can governed can

when And and can just energy followed we in were a so it this But worked of lucky a bit drop to we we management little do designed. prices historic our that. strategy T, risk had as we

stray want too it as fact, further of And we even down last go because don’t to could week. far, so a witnessed as matter

is kind the yes, conservative can do try So by risk our to optimize, answer But we of we I management extent guess, and a short take to policy. protecting governed have we’re forward risk we committee. to a we cash don’t margins. to views limited but But stick –

kind the versus And if that I $XX high may, that million, last lower to then will What end at Okay. land EBITDA guidance adjusted you the low the items of range? have specific what million range we question, watch $XX would your of are cause high range the of end can versus the for performance?

one is but well standpoint, factor controllable it. about be our it’s of from Yes. of is a Craig, thinking demand And going part things one, performance outlined, pretty the is them. much margin, the big of a I particularly course, factor that underlying like to

us the recovering sold. energy a Yes. I’ll for of add would RIN appreciating prices for helpful complex helpful. future gallons be is

value equation And point Those well. more those would is between would in like supplying scenario recovery higher opening those plants, would encourage that packing to other make we’re of seeing restaurants a and highlighted, that rebalance help ethanol plants types up of as of CJ feedstocks things things, the meat currently available. and volume them feedstocks the are are the Some higher the limited, with And driver. the more I and volumes.

not your there’s expect don’t related factored clarify infection. risk a to it. no outage, potential COVID plant in and you you into something for in Great. your to element And just guidance there, exposure guide That’s staff because COVID

directly. say wouldn’t I

demand the what drop. at looked to for have We projections are diesel

those down so lines volume for for to versus And reason. more any needing COVID-related we’ve along looked shut

Congratulations Great. questions. results. my for the Thanks again really taking on impressive

you. Thank

line with Mike proceed question. your Webber from comes Webber Our Please the Research. next of question with

afternoon, Good Good. you? How Good. guys. are

given mentioned, couple just kind Just on answer insights of thus specifically kind kind of any you one oil around times or the the recent, a been of one far I I’m cooking just and of looking about permanent asked or questions the at feedstocks. might sizable guess must have I’m indications shifts of kind much different of or where follow-up second what what of semi-permanent? commodities. the how some of just and now gave – you a of already, are be guys have And on curious, – what last could your thinking you do waste be unprecedented shifts shifts it we’re the number but you think of

insights – you of think long-term the looking different How of more So and today, what of bit kind for at that how a just trying looking basis? to have, up on forward – could bit mix least do XXXX? XXXX a just remainder end kind about about out

Yes.

throw there. a things out few I’ll So

Although, in to friends liable my I to be I experts, think to inclined agriculturally particular some that but the quickly. of recover better would fairly of defer area tallow

I oil on actually think of a of strongly to as short that’s kind workers pretty that’s pretty we going thing term fast definitely And generating reasonably that’s related food terms crisis, when fast was and came probably a the of back temp cooking bit well. result. it Used a themselves. in it’s think COVID because come

wanting to are restaurants. So, but to get people back

well. confident pretty to story. as to come was another oil corn about The feel going where that we it So distiller’s that’s back is

to going industry ethanol The got hit to carefully. We’re all really really watch have hard.

be them now. to supportive right a it’s wanting difficult time all of we’re understanding and so And

watch to restarts. happens have ethanol so what with And we’ll

ago, And and I’ll folks, restaurants the this supply of and international stuff bought a till I Chinese reporter, I real used cooking it remind a rapidly supply our the these weeks, meat happened I’ll like oil talking people within really, that packing backed quarter a backed only have half last couple recently. would and down used pretty we early and of warning have cooking in about the of was weeks spate three out a of cooking been ago mean oil. started or the the coming last we closed then things fear used – concern has were of that warning, closing that we’ve were month and about really been have got July, China so closing. open quickly. plants to chains Ethanol open. the Thankful And add. say. oil incidents All

about a So ago. worried longer on that risk we’re that brought specific we quarter no

just that’s and an element So about consider. to think

that kind leading indicators of watching in we’re the storm. closely, of of and I eye those think So the are we’re

I it’s there’s interconnections think, a of the agricultural because fascinating number world, world. And a tremendous in

if there’ll And corn is feed, usage other feedstocks. levels are then corn then going which available And animal there ethanol for of go down, be sources goes somewhere So else. then other changes crush. other of to usage

out turns there and circular of be a kind it’s to usually, balance. So

you keep so at have interconnections. And to eye the all an just

Got you. That’s helpful.

California but are you and/or carry harbor now inbounds utilized, this of kinds just summer. curious, you interesting of storage know, of know now and follow-up, know, capacity kind you of business, a you’re the guys cracks of that but I different maybe of but guess guess kind I your I not CJ, storage core curious, the I’m legalized and actually the we’re around tangential inventories hedging all, dynamic I’m hedges getting comments tangential as not those think your seeing number Just on on, us, guess actively how I on commentary for something the your notion guys don’t I around any opportunities? how to I everything to positioned focused getting right last through some I don’t have of is kind – based I some trades? – of know are inbounds number much is of earlier there of a are they you bloated you’re BXX on. one in a be actual too storage of just a around sectors. some kind typically different but

Yes, question. great that’s a

we’ve So in REG, pretty and industry our doing that actually with in gotten familiar with seasonality. automatically

we than it producing So capable rates to of winter months. months tend summer then sell in in we’re and store the higher the

this us that, added year is no to So actually exception gives an which opportunity.

Okay, time guys. great. I the appreciate

you. Thank

question. proceed Please with question Our H.C. your Amit next from with Wainwright. comes Dayal

evening, Thank you. guys. Good

of for Just a couple questions me.

QX lower? side, cash On QX, much and the you saw and already this. cost yes, costs don’t But cash how than apologize expect if highlighted lower the we maybe in know QX, should if operating operating to I what you’ve be

from if is costs operating you a our there’s view that think, separate It’s I substantial feedstock interesting. change. not

bit but substantial total a travel not will, a have percentage going lower our probably of expenditures. little everyone to We’re real as that is

think really haven’t we to to seen going change So it’s cause that radically.

our We But Chad, do we to change to work. see and are coming you don’t that? we a we’re seeing that given quarter. drive surprising anything quarter of we for cost reason lot between monthly we third the and have when second remote a add – the reviews, performance not do are have financial radical to in under and that’s activity too

Yes, I’ll we down. we see Generally just tend the see that. – down, go add follow prices feedstock energy it when complex generally to to

oil volume oil, some right some oil But time. things and been with trending the immediate in higher this fats got feedstock, of animal corn You’ve cooking has down. in used distiller point the unique soybean

tend as going into leading more the oil And down a and the going CJ going available, mentioned, soybean available oil to oil. there’s to balanced and rest the of relative feedstock keep palm feedstocks there down of when be so oil cooking to And less then be tends soybean complex indicators in price. Those position. them it’s worldwide to are pressure the used

it’s very offsetting So abundant. that’s and an opportunity

you’ve demand Markets say, to guys Thank Got saturated? California. the pretty – are a much have prices seeing? little it. How at good for like and you do the favorable getting Or keep It prices to room overall you bit we Norway they’ve been the are markets like business. that. into and those looks been seeing pricing more supplying they supportive

is desire there’s intensity which the diesel those as have then and lack But that, of demand do of not the of We especially And no carbon very renewable continued because in the diesel to both for renewable and in any biodiesel. of coming had a cap are reduction relative seeing available slowdown, blends slowdown purchase, no future. sort and to we’re of of sort draw options interesting. seeing and

me. one for maybe last Just

situation, you you be more you to emerge sort back you solid like of you companies more combining terms you aren’t will share guys yours. and In whose look what the in COVID share how do of to this will in taking bit as think the end Any sort market other as market balance from up relative sheets this market? once of settled feel go you a on, all normal little view the has of levels,

Yes.

that had BTC had I buy back up to and were period through those suspended begin feedstock. There folks the time. for check. right industry really a people some to that and think you’re a of long been out needed for the operations challenging funds been waiting It a number going of point time still

the fuel. demand continue. have for short-lived and think yes, our but and to So they’ll some diesel with finding any think ramp and newer on, of have as up, we’re renewable financing we’ll I mentioned, CJ don’t that for that deeper to expect going I And that we markets problem

And diesel so biodiesel. that the we’re renewable improving maximizing and then higher mix fuel the growth downstream sales we’re go on blended and or blends profitability with front optimizing, while of growing both and seeing into we

those of fronts optimistic in scenario. on So our opportunity recovery I’m growth the

Thank you so much. That’s all I Appreciate it. have.

you. Thank

Thanks, Amit.

Thank you.

from Our proceed question. Hamed Financial. BWS Please Khorsand with with next comes question your

Hi.

when slowdown manage if really in Are you, of ask to seeing the market? are sold guiding production demand. the produced? there’s you to you’re you to want margin? that Are manage no gallons down you Why trying I off First trying

Yes. Hi, Hamed.

to produce renewable will it’s up just as – finished volume. we We focused down along much it we continue the reduction cranking hard Biodiesel as think the no So turnaround, diesel be definitely and petroleum Geismar with we on depending diesel. on working so in going the on we’ll specifically to the probably renewable locale, trend can. diesel demand is

and EPA activity the Okay. actions as And then, the are mandate? just you seeing from adverse far blend as with the

what mean blend. I the with I’m not understand sure you

mix some How seeing before allowed to you’re if that? affect and or Given does that the any COVID-XX at as pollution much having to you adversely being as with refiners not any up rules. keep all, if and

Yes.

at So discussion. all this point it’s

of you not they hurting, could that points although have it add refining to although salient the happening blend. are one because uncertainties, it’s the So to definitely really is

fuel. lot a a they In if sell have to fact, they less blend less lot

is And working And it there. decision cause important, government which think to good hurting the terms so helping help a some to of And figure industries, as of hearing the approach. actually – really what by sectors not effect we’re making. another is is out of hard really actually that we probably really one how and in isn’t all

problem. about possible solve the of it as that’s would is grant that said, holistic because anything really of to authority So I But And And be happen. outside waivers. can course of actually there discussion a doesn’t place. in lot a EPAs law

So ideas view prevail. our will that is different

And better so your about keep beneficial. demand can do How on before market market’s if having talking you as is around given using example? were your finally increased that another business of an you the you How than that competitive doing a How Norway Norway soybean competition? front, do for take divert well? performance moat advantage one you

the quality having about really and it’s customers, they where it. with want service, great Well, to diversification, customer when want connecting provide able being it, the your awareness quantity they and

what our really that’s does. team So sales

demand this? main really that’s stay to mean, question as of I Are able goes, the becomes as ahead now. you far right

of at And Nordics. really stab ago, a couple without diesel the gallon particularly that A exception. to was increasing California since pull into that of renewable years sense. just strong. had from then a best the take produced give It we and disappeared was I’ll you market. we’ve every Canada demand It

mix we And like international diesel first was so the of quarter, sales it in more last year sales XX% of probably to renewable increased the XX%. about

mix. to So sales it CJ’s gets

coming and my we’ve low California, fuel customers to to great I think in incentivized then is, that market. that we willing a got it of over market pay have market which premium love we carbon to mind a us So

pay someday and act days And more opportunities arbitrage so like our it’s a is kind And this of California choice. premier those great the to customer to things problem other have. willing is customer

increasing book for the finding opportunities way. just that. fronts sales all we’re balancing we’re But So and on that growing

Okay. Thank you.

Thank you.

Hamed. Thanks,

question next Our Alex comes Wong proceed question. Capital. your Instructions] [Operator from Please you. with with Thank Parsifal

Hi. I questions. a few have

which that collected end share BTC you also housekeeping wasn’t the be That items. count balance in of some the collect that much guys how sheet. the to actually captured April? more you First the What quarter? in was basic And at

April think collected it XX. of rest of and I the right at about we by the at March, So end $XXX end in million, of March came the

us net $XXX million tax sharing benefit that after take to be agreements. you would the care So by remaining with

sheet, on lot you of big if look BTC, of million balance the accounts really receivable. we first April. A you’ll was the $XXX half see collected So a that

million. On the $XX share $XX million, yes, count,

then to I And onto it. make sure… to in moving just gains Got wanted market mark QX.

basic outstanding. our That’s there. diluted million. $XX.X you shares The shortcutted I Sorry, shares would

$XX.X million, got it.

Okay.

to And convertibles. buy continued of course, we’ve

So of you’re dilution that’s the seeing. part

Understood.

just mark QX, to the how sure make about. I gains understand in On I to wanted think to market

today, of of be in – – And You about really in accounting. should which that XX% guidance. should associated that QX. $XX I But which little XX’s, have be mean high was with should That QX there. into you that would put kind of is QX, which guidance QX QX $XX-some-odd-million mean adding out a about if would QX with be EBITDA Is really in line your also right? million that guys really your booked you $XX means is over mentioned about hedge XX million

we that’s because of Yes, two just exactly first half for kind work why because precisely And suggested of of… of value creation together, sort at that’s them looking right. Alex,

that you a another oil show quarter-over-quarter who do to was from don’t QX well is about flat Exactly. could allow leveraged find versus actually what to going think in what’s say maybe you Can company I relatively you’d little EBITDA the that of in of on bit QX QX. it, you has flat, pretty to Because if sequentially some you be look – sort can which would impressive price thought at going to light basically world. be I talk really to expecting QX I

let and parameters Alex Chad all the it. into about. pipe really Yes, talked I’ll I it’s It’s really that

is remains things other planning management risk so of quite on, even And for and all, resilient. goes well. So it resilient a as been of help pricing how the that forward versus which But for able biodiesel has us. first many to demand bit robust is has diesel our been really there’s renewable little

optimize and to mix strategy We have And we do same that. a the to feedstock product have thing with mix. capability the

what talked margin how feedstock we’ve and things selection about our other we’re move and to around. all as product, around placing lot a moving of our realized helps us we’re with So the things that our manage where is

degree, some a some And a actually because way, then we in meanwhile, of flexible. can with through. something to is positive the volatility margin is So the we to underlying have ability deal to be starting come

slightly a bolsters the market in rest of direction. that the different if So even is things moving

So all very, those We’ve things have very helped running us. been well.

some So base good has have volumes. and that robust And customer we also. stable have served really we us well

have mean, I’ll just that. sector, diesel the And we’re add been I to a So we right? in Yes. market CJ selling resilient talking into as was about.

getting Midwest all across store pretty that were was were shelves the into moving the the trying for gently Once prices and that ensure stocked. diesel or demand residences see and If response season. you immediate – at shipping diesel those COVID things happened, ULSD And planting we’ve the to stocked can robust into Slide to engines virus were countryside we’re collapsing, biodiesel a into lot the people the keep the X, got resilient. you was to shelves of were to when look

well. that, Not So would I couldn’t to jet think resilient as and fuel. and forecasts say be was decline. to things to relative are down down And XX%. I demand expected burning diesel that resilient There clean to go been has XX% say gasoline diesel have continue continued relatively fuels to

out. it’s course, of I to. ability the switch possible nimble to to to some for play of then things useful. But point are those our between would continue still And So feedstocks proves this

sitting We’re of middle the just in one feedstock. not

many to that’s able useful. and We’re source different feedstocks

that So the it distiller over XX% think up mix corn was you’ll see oil I to. period – like previous compared was

lowest for taking feedstocks So premium the incentive with that into best example. approach to opportunistic cost an the California, over turning up of is one

factor. that So another is

time. have no Thank appears we you. It [Operator further at this questions Instructions]

for like pass comments. concluding to I’d the additional floor over to Warner Ms. So any back

enthusiasm And the in for our our through is U.S. closing I And the just decades. believe resilient our point think to survived and economy in has comes Great. that that like over large near-term out Thanks, long-term. other Q&A. difficulties I’d diminish Jessie. the that We challenges for our don’t business very investors,

because clean demand renewable here We that life. it’s the we so our social to to energy finally, for a resilient also is and And trend energy that stay. integral of way is that’s believe in believe sustainable, interest and

today, all in strong of we’re strong tailwinds confident those business the the drive ahead. face years our we see that in in will Even the headwinds

mention this take profitable upcoming we a appropriate prudently and creation actions events the necessary to for REG. will to Todd? now actions long-term. investor make will also manage And the investments before our Todd’s over the and robust crisis, going to drive but growth the close, during take value we business We

Thanks, CJ.

will Slide Montreal website. live As May on Bank of Virtual XX, Farm to the on present XX presentation noted Market we The of be Relations on will at webcast section our Conference. Investor the

We also meeting. clients if of the investor so the day. of the conferences host of to invitation will Bank Bank at Montreal, secure contact you’re please by a for throughout Attendance meetings representative your sales Montreal only interested,

REG slide Annual Slide will safety. the the noted Doors to participate. available who XX. XX, Annual A we and ask attendance concludes for you Thank advance you now as at to you all XX line COVID-XX Meeting, May disconnect. noted wants may situation, again. take at our on at is contact are This on our the registration. also at for COVID-XX place in the protocols X:XX to everyone’s considering call Meeting o’clock you our if as in Ames that cover Additionally, open for office anyone Due will conference on