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Personnel costs, which include employee salaries, incentives and benefits, are the largest single category of expenditures in
selling, general and administrative expenses. We refer to selling, general and administrative expenses that are not allocable to
a segment as corporate activities.
Other Income (Expense).
Other income (expense) includes interest earned, interest expense, amortization of debt
financing costs and other non-operating items.
Results of Operations –
Comparability
The following summarizes various events that affect the comparability of our operating results for the past three years:
July 2009
Green Plains Central City and Green Plains Ord were acquired
April 2010
Green Plains Grain Company TN assets were acquired
October 2010
Green Plains acquired the Lakota and Riga ethanol plants
October 2010
Green Plains Commodities LLC began corn oil extraction
March 2011
Green Plains Otter Tail was acquired
June 2011
Green Plains Grain Company acquired Hopkins, Missouri grain elevator
July 2011
Green Plains acquired remaining 49% noncontrolling interests in BlendStar
January 2012
Green Plains Grain Company acquired St. Edward, Nebraska grain elevator
The year ended December 31, 2010 includes a full year of operations at our Central City and Ord ethanol plants,
approximately eight months of operations at our Tennessee agribusiness operations, and two months of operations, including
corn oil extraction, at our Lakota and Riga ethanol plants. The year ended December 31, 2011 includes a full year of
operations at our Tennessee agribusiness operations and our Lakota and Riga ethanol plants, approximately nine months of
operations at our Otter Tail ethanol plant, and the deployment of corn oil extraction technology at all remaining ethanol
plants.
Segment Results
Our operations fall within the following four segments: (1) production of ethanol and related distillers grains,
collectively referred to as ethanol production, (2) corn oil production, (3) grain warehousing and marketing, as well as sales
and related services of agronomy and petroleum products, collectively referred to as agribusiness, and (4) marketing and
distribution of Company-produced and third-party ethanol, distillers grains and corn oil, collectively referred to as marketing
and distribution. Selling, general and administrative expenses, primarily consisting of compensation of corporate employees,
professional fees and overhead costs not directly related to a specific operating segment, are reflected in the table below as
corporate activities. When the Company’s management evaluates segment performance, they review the information
provided below, as well as segment earnings before interest, income taxes, noncontrolling interest, depreciation and
amortization.
During the normal course of business, our operating segments enter into transactions with one another. For example, our
ethanol production and corn oil production segments sell ethanol, distillers grains and corn oil to our marketing and
distribution segment and our agribusiness segment sells grain to our ethanol production segment. These intersegment
activities are recorded by each segment at prices approximating market and treated as if they are third-party transactions.
Consequently, these transactions impact segment performance. However, intersegment revenues and corresponding costs are
eliminated in consolidation, and do not impact our consolidated results.