Profile: The Andersons, Inc. (ANDE.O)

The Andersons, Inc. is an entrepreneurial company with diversified interests in the agriculture and transportation markets. The Company operates in five business segments. The Grain and Ethanol Group purchases and merchandises grain, operates grain elevator facilities located in Ohio, Michigan, Indiana and Illinois, and invests in and provides management and corn origination services to ethanol production facilities. The Rail Group sells, repairs, reconfigures, manages and leases railcars and locomotives. The Plant Nutrient Group manufactures and sells dry and liquid agricultural nutrients and distributes agricultural inputs, which include nutrients, chemicals, seed and supplies to dealers and farmers. The Turf and Specialty Group manufactures turf and ornamental plant fertilizer, and control products for lawn and garden use and professional golf and landscaping industries, as well as manufactures corncob-based products for use in various industries. The Retail Group operates retail stores, a specialty food market and a distribution center in Ohio. On May 1, 2008, the Company acquired Douglass Fertilizer & Chemical, Inc. In July 2009, the Company completed the acquisition of the Fertilizer Division of Hartung Brothers, Inc., as an addition to its Plant Nutrient Group.

Grain and Ethanol Group

The Grain & Ethanol Group operates grain elevators in Ohio, Michigan, Indiana and Illinois. The principal grains sold by the Company are yellow corn, yellow soybeans and soft red and white wheat. In addition to storage and merchandising, the Company performs trading, risk management and other services for its customers. As of December 31, 2008, the Company’s grain storage capacity was approximately 91.4 million bushels, which includes grain storage leased to two ethanol production facilities. The Company also develops and invests in three ethanol facilities located in Indiana, Michigan and Ohio. In addition to its equity investment, the Company operates the facilities under management contracts, provides grain origination, ethanol and distillers dried grains (DDG) marketing and risk management services to its joint ventures.

Grain merchandised by the Company is grown in the Midwestern portion of the United States (the eastern corn-belt) and is acquired from country elevators (grain elevators located in a rural area, served primarily by trucks (inbound and outbound) and rail (outbound)), dealers and producers. During the year ended December 31, 2008, approximately 92% of the grain bushels sold by the Company were purchased by United States grain processors and feeders, and approximately 8% were exported.

Rail Group

The Company’s Rail Group buys, sells, leases, rebuilds and repairs various types of used railcars and rail equipment. The Group also provides fleet management services to fleet owners and operates a custom steel fabrication business. Almost half of the railcar fleet is leased from financial lessors and sub-leased to end users. In addition, it also arranges non-recourse lease transactions under which it sells railcars or locomotives to a financial intermediary and assigns the related operating lease to the financial intermediary on a non-recourse basis. As of December 31, 2008, the Company managed 23,784 railcars and locomotives.

The Company has a diversified fleet of car types (boxcars, gondolas, covered and open top hoppers, tank cars and pressure differential cars) and locomotives, and also serves a diversified customer base. It also operates in the used car market by purchasing used cars and repairing and refurbishing them for specific markets and customers.

Plant Nutrient Group

The Company’s Plant Nutrient Group purchases, stores, formulates, manufactures and sells dry and liquid fertilizer to dealers and farmers; provides warehousing and services to manufacturers and customers; formulates liquid anti-icers and deicers for use on roads and runways, and distributes seeds and various farm supplies. The Company has several other products for use in industrial applications within the energy and paper industries. The fertilizer ingredients sold by the Company are nitrogen, phosphate and potash. On August 5, 2008, the Company acquired three pelleted lime facilities located in Ohio, Illinois and Nebraska.

The Company’s market area for its plant nutrient wholesale business includes agricultural states in the Midwest, North Atlantic and South. The Company’s facilities are located in Illinois, Indiana, Michigan and Ohio. Customers for the Company’s fertilizer products are principally retail dealers. The Plant Nutrient Group’s seven farm centers, located throughout Michigan, Indiana and Ohio, are located within the same regions as the Company’s other agricultural facilities. These farm centers offer agricultural fertilizer, chemicals, seeds, supplies and custom application of fertilizer to the farmer. As of December 31, 2008, storage capacity at the Company’s fertilizer facilities and farm centers was approximately 17 million cubic feet for dry fertilizers and approximately 41.9 million gallons for liquid fertilizer.

Turf and Specialty Group

The Turf and Specialty Group produces granular fertilizer products for the professional lawn care and golf course markets. It also produces private label fertilizer and corncob-based animal bedding and cat litter for the consumer markets. Professional turf products are sold both directly and through distributors to golf courses under The Andersons Golf Products label and lawn service applicators. The Company also sells consumer fertilizer and control products for do-it-yourself application, to mass merchandisers, small independent retailers and other lawn fertilizer manufacturers, and performs contract manufacturing of fertilizer and control products.

Retail Group

The Company’s Retail Group includes retail stores operated as The Andersons, which are located in the Columbus, Lima and Toledo, Ohio markets, and serve urban, suburban and rural customers. The retail concept is More for Your Home and the stores focus on providing product with offerings in home improvement and other mass merchandise categories, as well as specialty foods, wine and indoor and outdoor garden centers. Each store carries more than 80,000 different items, has 100,000 square feet or more of in-store display space plus 40,000 or more square feet of outdoor garden center space, and features do-it-yourself clinics, special promotions and varying merchandise displays. The majority of the Company’s non-perishable merchandise is received at a distribution center located in Maumee, Ohio. In April 2007, the Company opened a specialty food store operated as The Andersons Market, also in the Toledo, Ohio market area. This specialty food store concept has product offerings that feature produce, deli and bakery items, fresh meats, specialty and conventional dry goods and wine.