Green Plains Partners LP

Good morning and welcome to the Green Plains Inc. fourth quarter and full year 2023 earnings conference call. Following the company's prepared remarks, instructions will be provided for Q&A. At this time, all participants are in listen-only mode. I will now turn the call over to your host, Phil Boggs, Executive Vice President, Investor Relations. Mr. Boggs, please go ahead.

Thank you and good morning, everyone. Welcome to Green Plains Inc.' 's fourth quarter and full year 2023 earnings call. Participants on today's call are Todd Becker, President and Chief Executive Officer, Jim Stark, Chief Financial Officer, and several other members of Green Plains Senior Leadership Team. There is a slide presentation available and you can find it on the investor page under the events and presentations link on our website. During this call, we will be making forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could materially differ because of factors discussed in today's press release and the comments made during this conference call in the risk factors section of our Form 10-K, Form 10-Q, and other reports and filings with the Securities and Exchange Commission. We do not undertake any duty to update any forward-looking statement. Now I'd like to turn the call over to Todd Becker.

Thanks, Phil, and good morning, everyone, and thanks for joining our call today. We reported a solid quarter this morning with $44.7 million of EBITDA and a plant utilization rate of 95%. In addition, this was our highest quarter yet of ultra-high protein production, along with our highest ever corn oil yields, but we still have further to go and more to unlock. Our team continues to execute on maximizing the opportunity across our entire platform, and we believe there is additional upside on our portfolio of assets that we aim to achieve as we move through 2024. This quarter and the start of 2024 had many events that has led us to this point where our structure has been simplified and we are ready to bear the fruits of our labor on the path we laid out a few years ago and feel highly confident in our ability to achieve our goals. Before I dive into the quarter, we also announced a strategic review this morning. As you can see in the 8K we filed, we have entered into a cooperation agreement with Ancora. Our board believes our company is undervalued and we will embark on a strategic review to best determine how to maximize our value for all shareholders as we aim to achieve new milestones over the coming months, which I will talk about later in the call. These are, as you know, far-reaching processes, and we will explore all paths to value realization. We will have nothing further to announce or discuss regarding this strategic review at this time. Moving on to the results, we were largely open and unhedged in the fourth quarter, which started out quite strong, as we talked about, and then rapidly tailed off as the quarter progressed. Market fundamentals remained weak in the start of the year with higher stocks numbers and production has remained stubbornly high with the exception of some weather-related slowdowns. Although this cold snap tempered this weakness, it may have been the recipe we needed to change the 2024 outlook back to a more normal environment and more positive. As we get into spring maintenance and summer driving season, we anticipate that the base margin could strengthen as it has historically with our strong run rates and simplified structure We are well positioned for this opportunity. Our team has done a great job bringing consistency back to our operating metrics, but we still have opportunities to further improve efficiencies and bring our operating costs per gallon down as inflation is tempering across our plant stack. Plants across the industry are getting older, which we believe and we've been articulating for the last year. More and more, we believe, others in the industry are experiencing as run rates seem unable to sustain the peak at 1.1 million barrels per day. We believe this represents a great opportunity to drive additional margin to the bottom line. We are really excited for our protein production in 2024, and the fourth quarter was another good quarter of production with 66,000 tons of sales and a bit of a build on inventory because we produced 60% protein at a commercial scale in Wood River, and we have now just started to shift some early adopters. some volumes. I will get more into that after Jim's comments, but great progress is being made. Looking forward, we are excited for the opportunity to add to these volumes with our JV at Thoroughton Ethanol beginning commissioning as we speak and set to start protein production in the next couple of months. This will be the world's largest fluid-quipped MSC system, and we are eager to apply our learnings from prior startups to this partnership. The conversion of 735 million gallons of capacity, including the Thurlson JV to ultra-high protein has set us up well to service a global demand base whose demands have not waned or wavered one bit. Our renewable corn oil production saw another impressive quarter with the highest yield for our platform yet. We benefited from pricing some of our fourth quarter early before veg oil prices came under further pressure as well. Start-ups have been slower than expected from the new R&D capacity coming online, but we still expect them to start or ramp production over the next quarter or two. Liquidity in the fourth quarter improved again as our platform ran consistently and we were able to capture the available margins. In early January, we completed the acquisition of Green Plains Partners. In all, we issued 4.7 million shares of Green Plains stock and $29 million in cash, which included the $2 per unit in cash plus the unpaid distribution in exchange for the outstanding public units of the partnership. We will also look at the assets in this portfolio to determine the right mix and opportunity to strengthen the story and balance sheet and drive value to our shareholders. And now I'll hand the call over to Jim to provide an update on the overall financial results. I'll come back on the call to do a deeper dive on 60Pro, the start of our Dextrose facility, and Shell project, as well as the exciting carbon opportunity shaping up in Nebraska.