REX American Resources Corporation (NYSE:REX) Q4 2019 Earnings Conference Call - Final Transcript
Mar 26, 2020 • 11:00 am ET
Thank you. [Operator Instructions] And our first question comes from the line of Pavel Molchanov with Raymond James. Please proceed with your question.
Hello, good morning. Thanks for taking the question. These are interesting times to say the least. Since everything seems to revolve around the pandemic these days, I thought I would ask about what several other ethanol companies have started to do, which is repurpose or at least partially begin to use their ethanol plants to supply industrial alcohol for the manufacturing of hand sanitizer as per the treasury's emergency authorization from last week. Do you have any interest in doing that at your facility?
Stuart A. Rose
Zafar, do you want to answer?
Zafar A. Rizvi
Yeah. Well I think -- let me say that we are looking into this, but we need to make sure we follow the FDA SOP, which clearly there's a guideline and we have to register with the FDA to make sure get the licence. We're also looking at some of the pharmacy founders who can produce this under their licence, but -- and also we have [Indecipherable] approximately 8,500 gallons to some other third-party to produce sanitizers for the hands. But at this stage, I think, certainly, there is some demand and we are looking into it, but as far as concerned, a lot of gallons will be utilized. I don't think that's going to be so many gallons of ethanol will be utilized because you can see we -- I mean, One Earth Energy, which we sold these gallons at this time. It's an 150 million-gallon plant and we just sold 8,500 gallons so far. So yes, we will be looking into it. But at this stage, we do not know how that business is going to be turned out.
Stuart A. Rose
We will do what we can if needed, if any -- and we are working on talking to hand sanitizers -- companies. But so far, just said anyone that thinks that's going to make any difference on the bottom line, I would caution them that it will be very, very minimal. We make millions and millions of gallons. We're taking about buying hundreds and thousands of gallons at most. There's no shortage of ethanol and people that will sell it. And the real problem is getting the bottles and getting the licences and all the stuffs Zafar just described it. And we are -- we want to do what we can to help and we do -- we will do, but don't expect that to hit many significant material change to our forecast, which we just went over.
Understood. One more on kind of COVID-related question. You guys, of course, are in Ohio, which is one of the states under lock-down and more and more we are seeing the lock-down and stay at home order at the state level. To your knowledge, are any of the ethanol production facilities, either the ones you operate or other plants, are any of them are forced to shut down because