"Both our full year and fourth quarter earnings were heavily influenced by the results within our agricultural business units. The record full year and quarterly earnings in both our Grain & Ethanol and Plant Nutrient groups, reflects our solid position in this industry," said Chief Executive Officer Mike Anderson. "Our 2010 Rail Group results continue to be negatively impacted by the overall economy. The increase in utilization rate at the end of the year, however, was encouraging to see. We intend to continue to serve our customers and grow this company as we did in 2010 with the addition of O'Malley Grain, B4Grain, and our significant investment in the Iowa Northern Railroad."
The company's 2010 full year results were its second highest with earnings of $64.7 million, or $3.48 per diluted share, on $3.4 billion of revenues. In the prior year, the company earned $38.4 million, or $2.08 per diluted share, and total revenues were $3 billion.
The Grain & Ethanol Group's 2010 operating income was a record $81.4 million. This compares to operating income of $51.4 million in 2009. These results were led by the grain business, which achieved a best ever performance due primarily to strong space income.
The ethanol business and the investment in Lansing Trade Group also had solid performances. Total 2010 revenues for the Grain & Ethanol Group were $2.4 billion; this includes $928 million of grain and ethanol sales made in accordance with origination and marketing agreements between the company and its ethanol joint ventures.
In 2009, the group's total revenues were $2.2 billion and included $806 million of the previously mentioned sales. For the fourth-quarter, the group's operating income was a record $38.6 million, in contrast to $27.8 million earned during the same period in 2009.
The fourth-quarter increase in operating income was due to markedly improved results in both the grain business and Lansing Trade Group. The grain business benefited from significant space income and the net reversal of $6.7 million of reserves following the settlement of a long standing collection matter.
The ethanol business returned to profitability in the fourth quarter, but its results were significantly below the same period of the prior year. Total revenues for the fourth quarter were $913 million; in comparison, the group's revenues for the same period last year were $722 million.
The Plant Nutrient Group ended the year with record operating income of $30.1 million due primarily to an increase in volume of more than 30 percent. In 2009, the group had an operating income of $11.3 million. Revenues for 2010 and 2009 were $619 million and $491 million, respectively.
Revenues increased in 2010 due to the volume increase, which was partially offset by a modest decrease in the average selling price. For the fourth-quarter, the group's operating income was a record $8.9 million on $159 million of revenues. Last year the group had operating income of $1.7 million during the same three month period on revenues of $111 million. The significant improvement in the fourth quarter was due to material increases in both volume and gross margin. Volume was up almost 20% due to excellent fall application conditions and the continued re-stocking of the retail pipeline. Gross margin increased primarily due to price escalation.
The Rail Group had operating income of $0.1 million in 2010, an improvement over its $1 million loss in 2009. Gross profit from the leasing business was significantly lower than the prior year due mainly to lower average utilization and lease rates. The full year results include gains on sales of railcars and related leases of $5.5 million in 2010 and $1.7 million in 2009. The majority of the 2010 gains, or $4.3 million, related to the scrapping of railcars. The average utilization rate for 2010 was 73.6%, which was down from the prior year average of 78.1%.
However, the group ended the year with an improved utilization rate of 81.7%. Revenues of $95 million for 2010 were comparable to the $93 million reported in the prior year. The Rail Group had an operating loss of $1.1 million in the fourth quarter on revenues of $22 million. In 2009, the operating loss for the same three month period was $1.5 million on revenues of $21 million.
