2015 Annual Meeting Presentation

9TH ANNUAL
MEMBERSHIP MEETING
MARCH 19, 2015
CAUTIONARY STATEMENT REGARDING FORWARD
LOOKING INFORMATION
This presentation contains financial information for the first quarter of the fiscal
year ending September 31, 2014 which have not been audited and have been
derived from our unaudited books and records only. This means that the
financial results for the period have not been independently reviewed by a
certified public accountant and there is no assurance from a qualified,
independent, third party that the assumptions and other information underlying
the financial results is reasonable. Further, this presentation contains forward
looking statements that can, in some cases, be identified by the use of words
such as "may," "will," "should," "anticipate," "believe," "expect," "plan," "future,"
"intend," "could," "estimate," "predict," "hope," "potential," "continue," or the
negative of these terms or other similar expressions. These statements are only
our predictions and involve numerous assumptions, risks and uncertainties,
including those referenced in our fiscal 2014 Form 10-K, 10-Q and other
filings with the SEC which are specifically incorporated by reference herein. Our
actual results or actions could and likely will differ materially from those
anticipated in the forward looking statements.
AGENDA
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Welcome
Introductions
Recognition of Quorum
Secretary Report
Call Meeting to Order
Voting
Business Presentation
Election Results
Meeting Adjourn
RED TRAIL ENERGY, LLC
◊ Chairman – Sid Mauch
◊ Governors
◊ Mike Appert, Vice Chairman / Chairman of Risk
Management Committee
◊ Ambrose Hoff, Secretary
◊ Ron Aberle, Chairman of Audit Committee
◊ Frank Kirschenheiter
◊ Anthony Mock
◊ Bill Price
◊ Chief Executive Officer – Gerald Bachmeier
◊ Chief Financial Officer – Jodi Johnson
INTRODUCTIONS
◊ Inspector of Election and SEC Legal Counsel –
Brown Winick
▫ Joe Leo
◊ Independent Auditor – Eide Bailly
▫ Dave Glennon
▫ Ryan Beste
◊ Qualified Matching Service Manager – FNC Ag
Stock, LLC
▫ Jayson Menke
◊ Twin Rivers Trading
▫ Jason Schwab
RECOGNITION OF QUORUM
Quorum is constituted as of the Record Date, when
40,148,160 Class A Membership Units were outstanding.
The presence of members holding a majority of the total
outstanding membership units constitutes a quorum. We
need 20,074,080 Membership Units represented at the
meeting to constitute a quorum. If you submitted a
properly executed proxy, then you are considered part of
the quorum even if you are not physically attending the
meeting.
SECRETARY REPORT
RTE BALLOT
◊ Proposal #1 – Election of Governors
▫ Mike Appert
▫ William Price
VOTING
MANAGEMENT UPDATE
Chief Executive Officer
Gerald Bachmeier
RTE EMPLOYEE INTRODUCTIONS
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Ryan Wiege
Bill Schimetz
Dustin Willett
Mike Samuelson
Tyler Mock
Kent Glasser
Chris Kline
Stacy Wagner
Dana Wahus
2014 YEAR IN REVIEW
Production Results:
Ethanol Sold (gallons)
Dried Distillers Grains Sold (tons)
Modified Dried Distillers Grains Sold (tons)
51,533,962
105,896
54,202
Corn Oil Sold (pounds)
10,197,970
Corn Ground (bushels)
18,487,062
Production Yield
2.79
CEO REPORT
CFO REPORT
INCOME STATEMENTS
Fiscal year ended
September 30, 2014
Fiscal year ended
September 30, 2013
Revenues
$139,122,644
$154,790,603
Cost of goods sold
$106,047,180
$151,588,287
Gross profit (loss)
$33,075,464
$3,202,316
$2,200,809
$2,145,733
Operating income (loss)
$30,874,655
$1,056,583
Interest & other income
$330,025
$518,639
Interest expense
($614,346)
($941,059)
Net income (loss)
$30,590,334
$634,163
General & admin expenses
BALANCE SHEETS
(AS OF SEPTEMBER 30)
2014
2013
Total Assets
$95,658,429
$71,740,861
Total Liabilities
$24,404,425
$29,069,740
Members’ Equity
$71,254,004
$42,671,121
Debt to equity ratio
.34
.68
Book value per unit
$1.77
$1.06
INCOME STATEMENTS
(THREE MONTHS ENDED DECEMBER 31)
2014
2013
Revenues
$29,612,851
$33,785,964
Cost of goods sold
$27,781,580
$29,163,305
Gross profit (loss)
$1,831,271
$4,622,659
$544,767
$471,087
Operating income (loss)
$1,286,504
$4,151,572
Interest & other income
$25,143
$84,739
Interest expense
($137,727)
($168,591)
Net income (loss)
$1,173,920
$4,067,720
General & admin expenses
BALANCE SHEETS
December 31,
2014
September 30,
2014
Total Assets
$94,201,999
$95,658,429
Total Liabilities
$21,774,076
$24,404,425
Members’ Equity
$72,427,923
$71,254,004
Debt to equity ratio
.30
.34
Book value per unit
$1.80
$1.77
JASON SCHWAB
TWIN RIVERS TRADING
AND AG CONSULTING
December Corn
100
0
300
243.00
261.75
198.75
350.00
400
195.00
171.50
144.50
150.50
110.50
87.25
45.50
81.00
64.25
87.75
71.00
94.00
70.50
200
131.25
96.75
66.50
66.50
500
71.25
52.00
81.00
cents / bu
509.25
December Corn Price Ranges
From January of Contract Year to Expiration
600
Average Range
Since 1990: 140.05
Since 2005: 227.15
200
100
0
133.75
375.00
625.50
700
247.00
313.00
500
451.00
811.75
Average Range
Since 1990: 258.65
Since 2005: 388.825
315.50
360.25
301.00
255.50
162.50
120.50
149.00
169.75
176.00
173.00
165.25
116.75
172.25
400
301.00
300
181.50
800
126.50
900
133.00
130.00
cents / bu
November Soybeans Price Ranges
From January of Contract Year to Expiration
1000
600
US Dollar Index
May Sugar
The Bottom Line:
• Farmers and ethanol plants face a challenging
margin environment.
• Managing Risk is the key to survival.
• Volatility is not going away, it is likely to get worse.
• “Risk of Ruin” is very real, so be careful.
LOOKING AHEAD
LOAN COVENANTS WITH FIRST
NATIONAL BANK OF OMAHA
◊ RTE’s debt with FNBO was refinanced in
February 2015 with the following covenants:
◊ Monthly financial statements
◊ Minimum working capital of $5,000,000
◊ Maximum capital expenditures $1,500,000
◊ Maximum distribution of 50% of net income
without bank approval
◊ Debt service coverage ratio of no less than
1.15:1.00
Q&A
NEWSLETTER
◊ You can receive your newsletter electronically
◊ Sign up at the registration table
ADDRESSES
◊ Please update your address and phone number at the
registration table. Our goal is to keep the shareholder
records as accurate as possible.
◊ Also, please let us know if you are a snowbird.
ELECTION RESULTS
ELECTION RESULTS
◊ Proposal #1 – Election of Governors
▫ Election of Mike Appert
▫ For – 24,794,829
▫ Election of William Price
▫ For – 17,574,016
ADJOURNMENT OF
MEETING
THANK YOU FOR COMING!