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Green Plains' CEO Discusses Q4 2011 Results - Earnings Call Transcript

As you can see from our results, we have achieved our goal of a $50 million annual run rate on non-ethanol operating income. We indicated as a result in the fourth quarter would be better than the third and the company delivered on this as well. Part of this was driven by our Agri business segment, which saw a 76% increase in operating income in the fourth quarter of 2011 versus 2010. This segment delivered a strong full year result as well more than doubling its operating income from 2011.

The growth in Agri business operating income can be attributed mainly to increasing our storage capacity to $39 million bushels over the last three years. We still believe we can continue to grow this business. We have very good assets and great location and this business has been built from scratch to now operate in four states and handle more than 2 million tons of a combination of wheat, corn and soybeans. Our Tennessee asset performed exceptionally well this year. We were able to capitalize on the weak carries in this off wheat market earlier in the year and captured the last part of the corn inverses at Tennessee that has one of the earliest harvest cycles. This year was especially made for these assets.

Our investment in corn oil production continues to provide excellent returns generating another $9 million in operating income in the fourth quarter. We produce $27 million of operating income for all of 2011 from corn oil production but it really wasn’t until the third quarter before all the plants were up and running with the extraction equipment. For 2011 our ethanol production segment products a record 722 million gallons of ethanol an increase of 33% over 2010. We were successful in generating slightly better ethanol production margins in the fourth quarter of 2011 compared to the third quarter.

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