REX American Resources Corporation (REX) Income Statement

The erratic revenue trajectory, with periods of sharp contraction followed by recovery, underscores the company's pure-play commodity exposure. The recent acceleration to 17.9% growth in 2026Q2 appears to be a favorable pricing environment rather than a structural shift, as historical quarters show similar volatility. This pattern suggests that forecasting REX's revenue requires monitoring the ethanol crush spread and corn oil prices more than traditional demand drivers.

The dramatic margin recovery from the 9.0% trough suggests that REX's profitability is highly sensitive to the crush spread, with corn feedstock costs representing the dominant variable. The current 28.5% gross margin is well above the peer average, indicating superior operational efficiency or more favorable regional basis. However, this level of profitability may not be sustainable if corn prices rebound, highlighting the cyclical nature of the business.

The substantial operating leverage indicates that REX's cost structure is predominantly variable, allowing profitability to expand rapidly when margins improve. SG&A expenses have remained relatively controlled, ranging from $5.9M to $15.6M, which suggests management is maintaining discipline even during periods of strong performance. This leverage profile means that small improvements in the crush spread can lead to outsized earnings gains, but also implies vulnerability during margin compression.

The high proportion of COGS to revenue is characteristic of the ethanol industry, where corn prices dictate profitability. The improvement in the COGS ratio from 91% in 2025Q1 to 71.5% in 2026Q2 suggests that REX has benefited from either lower corn prices or higher ethanol prices, or a combination of both. SG&A expenses have remained relatively stable as a percentage of revenue, indicating that management is not adding overhead during periods of strong performance, which preserves operating leverage.