Alto Ingredients, Inc. Q3 FY2025 earnings call

• Strong market conditions and strategic realignment led to improvements in all segments, with gross profit up $18M, net income up $17M, and adjusted EBITDA up $9M.
• Increased renewable fuel export sales, strong demand for liquid CO2, and cost reductions contributed to improvements.
• Prioritizing projects based on cost, timing, and ROI to drive incremental profitability. Goals include lowering carbon intensity and increasing CO2 utilization.
• Expect to earn $0.10 per gallon at Columbia plant for 2025 from Section 45Z tax credits, and $0.20 per gallon at Columbia and $0.10 per gallon at Pekin in 2026 with updated ILUC. Started forward selling 45Z tax credits.
• CO2 utilization improved with acquisition of Alto Carbonic and initial CapEx at Columbia. Updates on Pekin campus including export certifications and dock repairs, and evaluation of Magic Valley facility.

Net sales for Q3 2025 were $241 million, $11 million lower than the prior year due to fewer gallons sold (89 million vs. 97 million in Q3 2024). Gross profit was $23.5 million, an increase of $17.5 million compared to the prior year. Adjusted EBITDA improved $9.2 million to $21.4 million in Q3 2025. The Western Production segment's gross profit increased, with Alto Carbonic contributing nearly $2 million this quarter. For the 9 months ended September 30, the Western Production segment's gross profit increased to $2.9 million, up $17.5 million compared to the first 9 months of 2024. Revenue contribution details: Net sales down due to volume change, gross profit up driven by factors like unrealized derivatives, fuel ethanol exports, and improved essential ingredients return.

• Expect $0.10 per gallon at Columbia plant for 2025 from Section 45Z tax credits.
• With updated ILUC in 2026, expect $0.20 per gallon at Columbia and $0.10 per gallon at Pekin. Started forward selling 45Z tax credits for 2026-2029.
• CapEx lower than historical averages, with year-to-date repairs and maintenance in line with estimates. Borrowing availability increased as of September 30, 2025.

• Factors like ethanol crush margin beyond control. Regulatory constraints on carbon capture project at Pekin. Insurance coverage uncertainty for dock repairs. Market dynamics affecting Magic Valley facility's potential restart.

Q: Thoughts on initiatives to increase 45Z capture, investment impact, and Magic Valley's potential restart?

A: Some items are relatively sure things, but details not shared yet. Magic Valley could resume operations if long-term sustainable, considering demand and customer relationships.

Q: Color on export sales, European exports, and dock costs?

A: Export sales locked in with good spread over crush. European exports include high-quality products and renewable fuel, not all production qualifies. Dock repairs: Working with insurance, building second dock to mitigate business interruption, costs partially covered by insurance expected.