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(2) Management uses earnings before interest , income taxes, noncont rolling interests, depreciat ion and amort izat ion, or EBITDA, to compare the financial
performance of our business segments and to internally manage those segments. Management believes that EBITDA provides useful informat ion to investors as
a measure of comparison with peer and other companies. EBITDA should not be considered an alternat ive to, or more meaningful than, net income or cash flow
as determined in accordance with generally accepted account ing principles. EBITDA calculat ions may vary from company to company. Accordingly, our
computat ion of EBITDA may not be comparable with a similarly t it led measure of another company. The following sets forth the reconciliat ion of net income
to EBITDA for the periods indicated (in thousands):
(1)
The October 15, 2008 merger with VBV, LLC was accounted for as a reverse acquisit ion. Although VBVwas considered the acquiring ent ity for account ing
purposes, the merger was st ructured so that VBV became our wholly-owned subsidiary. As a result , our assets and liabilit ies as of October 15, 2008, the date of the
merger closing, were incorporated into VBV’s balance sheet based on the fair values of the net assets, which equaled the considerat ion paid in the merger. U.S.
generally accepted account ing principles, or GAAP, also requires an allocat ion of the acquisit ion considerat ion to individual assets and liabilit ies including tangible
assets, financial assets, separately-recognized intangible assets and goodwill. Pursuant to reverse merger account ing rules, our consolidated financial statements
and results of operat ions for the nine-month t ransit ion period ended December 31, 2008, the year ended March 31, 2008 and the period from September 29,
2006 (date of incept ion) to March 31, 2007 reflect the historical financial results of VBV and its subsidiaries for these periods, along with the acquired fair value
of our assets and liabilit ies as of October 15, 2008 and our financial results since October 15, 2008.
Year Ended
December 31,
2011
Year Ended
December 31,
2010
Year Ended
December 31,
2009
Nine-Month
Transition
PeriodEnded
December 31,
2008
Year Ended
March 31,
2008
Net income (loss) attributable to Green Plains
38,418
$
48,012
$
19,790
$
(6,897)
$
(3,520)
$
Interest expense
36,645
26,144
18,827
4,119
-
Depreciation and amortization
50,076
37,355
28,635
4,531
20
Net income (loss) attributable to noncontrolling interests
(205)
150
364
(1,152)
(480)
Income taxes
23,686
17,889
91
-
-
EBITDA
148,620
$
129,550
$
67,707
$
601
$
(3,980)
$
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
General
The following discussion and analysis provides information which management believes is relevant to an assessment and
understanding of our consolidated financial condition and results of operations. This discussion should be read in conjunction
with the consolidated financial statements included herewith and notes to the consolidated financial statements thereto and
the risk factors contained herein.
Overview
We were formed in June 2004, incurring development costs until our first two plants were completed. Our plant in
Shenandoah, Iowa commenced operations in August 2007 and our plant in Superior, Iowa commenced operations in July
2008. To complement and enhance our ethanol production facilities, in April 2008, we acquired Great Lakes Cooperative, a
full-service farm cooperative in northwestern Iowa and southwestern Minnesota. As a result of our October 2008 merger with
VBV LLC, we acquired two additional ethanol plants, located in Bluffton, Indiana and Obion, Tennessee, that commenced
operations in September 2008 and November 2008, respectively. In January 2009, we acquired a majority interest in
BlendStar which operates nine blending or terminaling facilities with approximately 625 mmgy of total throughput capacity
in seven states in the south central United States. In July 2009, we acquired two limited liability companies that owned
ethanol plants in Central City and Ord, Nebraska that added operating capacity totaling 150 mmgy. In April 2010, we
acquired five grain elevators with federally licensed grain storage capacity of 11.7 million bushels, all located in western
Tennessee, within 50 miles of our Obion ethanol plant. In October 2010, we acquired Global Ethanol, LLC, adding two
ethanol plants with a combined annual production capacity of approximately 160 million gallons. In March 2011, we
acquired an ethanol plant near Fergus Falls, Minnesota with an annual production capacity of approximately 60 million
gallons. In June 2011, we acquired 2.0 million bushels of grain storage capacity located in Hopkins, Missouri, which is
approximately 45 miles from our Shenandoah, Iowa ethanol plant. In July 2011, we acquired all remaining noncontrolling
interests in BlendStar. In January 2012, we acquired 1.9 million bushels of grain storage capacity located in St. Edward,
Nebraska, which is approximately 40 miles from our Central City, Nebraska ethanol plant.