Company Quick10K Filing
Renewable Energy Group
Price14.51 EPS-3
Shares39 P/E-6
MCap565 P/FCF-8
Net Debt45 EBIT-92
TEV611 TEV/EBIT-7
TTM 2019-09-30, in MM, except price, ratios
10-Q 2021-03-31 Filed 2021-05-04
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8-K 2020-11-05
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8-K 2019-12-20
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8-K 2018-11-06
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8-K 2018-03-14
8-K 2018-03-08
8-K 2018-02-09

REGI 10Q Quarterly Report

Part I. Financial Information
Item 1. Condensed Consolidated Financial Information
Note 1 - Basis of Presentation and Nature of The Business
Note 2 - Summary of Significant Accounting Policies
Note 3 - Marketable Securities
Note 4 - Inventories
Note 5 - Other Assets
Note 6 - Intangible Assets
Note 7 - Debt and Subsequent Events
Note 8 - Derivative Instruments
Note 9 - Fair Value Measurement
Note 10 - Net Income per Share
Note 11 - Reportable Segments and Geographic Information
Note 12 - Commitments and Contingencies
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 regi2021q1ex311.htm
EX-31.2 regi2021q1ex312.htm
EX-32.1 regi2021q1ex321.htm
EX-32.2 regi2021q1ex322.htm

Renewable Energy Group Earnings 2021-03-31

Balance SheetIncome StatementCash Flow
1.51.20.90.60.30.02012201420172020
Assets, Equity
0.70.50.40.20.1-0.12012201420172020
Rev, G Profit, Net Income
0.40.30.20.0-0.1-0.22012201420172020
Ops, Inv, Fin

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549   
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 001-35397
RENEWABLE ENERGY GROUP, INC.
(Exact name of registrant as specified in its charter)
   
Delaware   26-4785427
(State of other jurisdiction of
incorporation or organization)
   (I.R.S. Employer
Identification No.)
      
416 South Bell AvenueAmesIowa50010
(Address of principal executive offices)   (Zip code)
(515) 239-8000
(Registrant’s telephone number, including area code)    

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $.0001 per shareREGIThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
   
Large accelerated filerx   Accelerated filer
Non-accelerated filer   Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨ 



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No   x

As of April 30, 2021, the registrant had 47,662,492 shares of Common Stock outstanding.



TABLE OF CONTENTS
Page
PART I
ITEM 1.
ITEM 2.
ITEM 3.
ITEM 4.
PART II
ITEM 1.
ITEM 1A.
ITEM 2.
ITEM 3.
ITEM 4.
ITEM 5.
ITEM 6.

3


FORWARD LOOKING STATEMENTS
This quarterly report on Form 10-Q contains, in addition to historical information, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this report, including statements regarding our future results of operations and financial position, strategy and plans, and our expectations of future operations, are forward-looking statements. The words "believe," "may," "will," "would," "might," "could," "estimate," "continue," "anticipate," "design," "intend," "plan," "seek," "potential," "expect" and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, strategy, short-term and long-term business operations and objectives, and financial needs. Forward-looking statements include, but are not limited to, statements about:
our business plans and strategies, including, but not limited to, our downstream objectives and undertakings and the proposed capacity expansion of our Geismar, Louisiana biorefinery, including financing such expansion;
our financial performance, including expectations regarding revenues, cost of revenues and operating expenses;
changes in governmental programs, policymaking and requirements or encouraged use of biofuels, including RFS2 in the United States, renewable fuel policies in Canada and Europe, and state level programs such as California's Low Carbon Fuel Standard;
the availability, future price and volatility of feedstocks and other inputs;
the expansion of our distribution network and transportation costs;
the future price and volatility of petroleum;
our liquidity and working capital requirements;
our leasing practices;
anticipated trends and challenges in our business and competition in the markets in which we operate;
our ability to successfully implement our acquisition strategy and integration strategy;
our ability to protect proprietary technology and trade secrets;
our risk management activities;
the industry’s capacity, production and imports;
product performance, in cold weather or otherwise;
seasonal fluctuations in our business;
our current products as well as products we are developing;
our ability to retain and recruit key personnel;
our current and future indebtedness and our compliance, or failure to comply, with restrictive and financial covenants in our various debt agreements and any additional indebtedness required for the proposed capacity expansion of our Geismar, Louisiana biorefinery;
our security repurchase programs and our marketable securities;
critical accounting policies and estimates, the impact or anticipated impact of recent accounting pronouncements, guidance or changes in accounting principles and future recognition of impairments for the fair value of assets, including goodwill, financial instruments, intangible assets and other assets acquired;
operating risks and the impact of disruptions to our business including, but not limited to, closures at our plant located in Geismar, Louisiana and the COVID-19 pandemic; and
assumptions underlying or relating to any of the foregoing.
These statements reflect current views with respect to future events and are based on assumptions and subject to risks and uncertainties. We note that a variety of factors, including but not limited to those Risk Factors discussed in Item 1A of Part II, could cause actual results and experience to differ materially from the anticipated results or expectations expressed in our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

Forward-looking statements contained in this report present management’s views only as of the date of this report. We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our 10-Q and 8-K reports filed with the Securities and Exchange Commission after the date hereof.
4


PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL INFORMATION
RENEWABLE ENERGY GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except share and per share amounts)
   March 31,
2021
December 31,
2020
ASSETS      
CURRENT ASSETS:      
Cash and cash equivalents$335,789 $84,441 
Marketable securities129,047 149,521 
Accounts receivable (net of allowance for doubtful accounts of $1,175 and $1,631, respectively)
129,547 143,475 
Inventories290,013 209,361 
Prepaid expenses and other assets77,757 67,657 
Restricted cash3,746 3,777 
Total current assets965,899 658,232 
Long-term marketable securities142,023 120,022 
Property, plant and equipment, net594,895 594,796 
Right of use assets36,479 28,840 
Goodwill16,080 16,080 
Intangible assets, net10,326 10,708 
Other assets 39,174 32,720 
TOTAL ASSETS$1,804,876 $1,461,398 
LIABILITIES AND EQUITY      
CURRENT LIABILITIES:      
Current maturities of long-term debt$28,814 $50,088 
Current maturities of operating lease obligations16,061 14,581 
Accounts payable 110,858 132,938 
Accrued expenses and other liabilities29,406 34,875 
Deferred revenue9,224 13,488 
Total current liabilities194,363 245,970 
Deferred income taxes6,443 6,607 
Long-term debt (net of debt issuance costs of $1,020 and $1,731, respectively)
15,113 15,158 
Long-term operating lease obligations21,104 15,223 
Other liabilities3,932 4,485 
Total liabilities240,955 287,443 
COMMITMENTS AND CONTINGENCIES
EQUITY:      
Common stock ($0.0001 par value; 300,000,000 shares authorized; 47,539,744 and 39,334,839 shares outstanding, respectively)
6 5 
Common stock—additional paid-in-capital733,011 392,247 
Retained earnings930,433 891,211 
Accumulated other comprehensive income(350)1,160 
Treasury stock (8,548,742 and 10,591,074 shares outstanding, respectively)
(99,179)(110,668)
Total equity 1,563,921 1,173,955 
TOTAL LIABILITIES AND EQUITY$1,804,876 $1,461,398 
See notes to condensed consolidated financial statements.
1


RENEWABLE ENERGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except share and per share amounts)
Three months ended
   March 31, 2021March 31, 2020
REVENUES:      
Bio-based diesel sales$479,495 $406,398 
Bio-based diesel government incentives60,249 66,447 
   539,744 472,845 
Other revenue 112 
   539,744 472,957 
      
COSTS OF GOODS SOLD465,942 367,396 
GROSS PROFIT73,802 105,561 
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES31,177 27,485 
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT822  
INCOME FROM OPERATIONS41,803 78,076 
OTHER INCOME (EXPENSE), NET:      
Gain (loss) on debt extinguishment(1,922)1,172 
Interest income1,312  
Other income (expense)779 (304)
Interest expense(1,117)(2,946)
   (948)(2,078)
INCOME BEFORE INCOME TAXES40,855 75,998 
INCOME TAX EXPENSE(1,633)(1,331)
NET INCOME$39,222 $74,667 
LESS—EFFECT OF PARTICIPATING SHARE-BASED AWARDS639 1,509 
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS$38,583 $73,158 
Basic net income per share available to common stockholders:      
Net income per share $0.95 $1.88 
Diluted net income per share available to common stockholders:
Net income per share$0.88 $1.67 
Weighted-average shares used to compute basic net income per share available to common stockholders:      
Basic40,425,593 38,979,057 
Weighted-average shares used to compute diluted net income per share available to common stockholders:
Diluted43,661,568 43,692,155 
See notes to condensed consolidated financial statements.
2


RENEWABLE ENERGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited)
(in thousands)
Three months ended
March 31, 2021March 31, 2020
Net income$39,222 $74,667 
Unrealized losses on marketable securities, net of taxes of $(11) and $, respectively
(173) 
Foreign currency translation adjustments(1,337)(551)
Other comprehensive loss(1,510)(551)
Comprehensive income$37,712 $74,116 
See notes to condensed consolidated financial statements.

3


RENEWABLE ENERGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(unaudited)
(in thousands, except share amounts)
   Company Stockholders’ Equity
   Common
Stock
Shares
Common
Stock
Common Stock -
Additional
Paid-in
Capital
Retained
Earnings
Accumulated Other Comprehensive LossTreasury
Stock
Total
BALANCE, January 1, 202038,967,079 $5 $438,591 $768,398 $(1,994)$(105,488)$1,099,512 
Conversion of restricted stock units to common stock (net of 25,134 shares of treasury stock purchased)
38,144 — — — — (578)(578)
Settlement of stock appreciation rights in common stock (net of 14,438 shares of treasury stock purchased)
16,704 — (5)— — (240)(245)
Convertible debt extinguishment impact (net of tax impact of $1,013)
— — (17,829)— — — (17,829)
Stock compensation expense— — 1,367 — — — 1,367 
Other comprehensive loss— — — — (551)— (551)
Net Income— — — 74,667 — — 74,667 
BALANCE, March 31, 202039,021,927 $5 $422,124 $843,065 $(2,545)$(106,306)$1,156,343 
   Company Stockholders’ Equity
   Common
Stock
Shares
Common
Stock
Common Stock -
Additional
Paid-in
Capital
Retained
Earnings
Accumulated Other Comprehensive Income (Loss)Treasury
Stock
Total
BALANCE, January 1, 202139,334,839 $5 $392,247 $891,211 $1,160 $(110,668)$1,173,955 
Conversion of restricted stock units to common stock (net of 150,906 shares of treasury stock purchased)
254,396 — — — — (10,026)(10,026)
Settlement of stock appreciation rights in common stock (net of 2,598 shares of treasury stock purchased)
4,673 — (176)— — (1,431)(1,607)
Equity issuance (net of issuance costs of $19,970)
5,750,000 1 365,279 — — — 365,280 
Settlement of 2036 convertible senior notes conversions (net of tax impact of $1,143)
2,195,836 — (26,183)— — 22,946 (3,237)
Stock compensation expense— — 1,844 — — — 1,844 
Other comprehensive loss— — — — (1,510)— (1,510)
Net income— — — 39,222 — — 39,222 
BALANCE, March 31, 202147,539,744 $6 $733,011 $930,433 $(350)$(99,179)$1,563,921 

See notes to condensed consolidated financial statements.
4


RENEWABLE ENERGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Three months ended
   March 31, 2021March 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:      
Net income$39,222 $74,667 
Adjustments to reconcile net income to net cash flows from operating activities:      
Depreciation expense10,915 8,934 
Amortization expense of assets and liabilities, net4,701 4,660 
Accretion of convertible note discount179 256 
Amortization of marketable securities659  
(Gain) loss on debt extinguishment1,922 (1,172)
Provision for doubtful accounts21 456 
Impairment of property, plant and equipment822  
Stock compensation expense1,844 1,367 
Deferred tax expense1,000 1,034 
Other operating activities49 161 
Changes in assets and liabilities:      
Accounts receivable, net13,770 104,598 
Inventories(80,664)(44,881)
Prepaid expenses and other assets(16,241)(28,273)
Accounts payable(24,865)3,400 
Accrued expenses and other liabilities(5,908)(17,803)
Operating lease obligations(4,158)(4,107)
Deferred revenue(4,264)2,102 
Cash provided by (used in) operating activities(60,996)105,399 
CASH FLOWS FROM INVESTING ACTIVITIES:      
Cash paid for marketable securities(93,092) 
Cash received from maturities of marketable securities90,722  
Cash paid for purchase of property, plant and equipment(10,487)(9,030)
Other investing activities(1,500) 
Cash used in investing activities(14,357)(9,030)
CASH FLOWS FROM FINANCING ACTIVITIES:      
Net borrowings on revolving line of credit 82,756 
Cash paid on notes payable(27,159)(40,141)
Cash received from equity offering385,250  
Cash paid for equity offering costs(19,565) 
Cash paid for conversion of restricted stock units and stock appreciation rights(11,633)(823)
Cash provided from financing activities326,893 41,792 
NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH251,540 138,161 
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, Beginning of period88,218 53,436 
Effect of exchange rate changes on cash(223)(47)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, End of period$339,535 $191,550 

(continued)
5



RENEWABLE ENERGY GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Three months ended
March 31, 2021March 31, 2020
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION:      
Cash paid for income taxes$913 $ 
Cash paid for interest$606 $885 
Leased assets obtained in exchange for new operating lease liabilities$11,293 $903 
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:      
Amounts included in period-end accounts payable for:      
Purchases of property, plant and equipment$5,701 $6,739 
Equity issuance costs$405 $ 
(concluded)
   
See notes to condensed consolidated financial statements.


6


RENEWABLE ENERGY GROUP, INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For The Three Months Ended March 31, 2021 and 2020
(unaudited)
(in thousands, except share and per share amounts)
NOTE 1 — BASIS OF PRESENTATION AND NATURE OF THE BUSINESS
The condensed consolidated financial statements have been prepared by Renewable Energy Group, Inc. and its subsidiaries (the "Company" or "REG"), pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted as permitted by such rules and regulations. All adjustments, consisting of normal recurring adjustments, have been included. Management believes that the disclosures are adequate to present fairly the financial position, results of operations and cash flows at the dates and for the periods presented. It is suggested that these interim financial statements be read in conjunction with the consolidated financial statements and the notes thereto appearing in the Company’s latest annual report on Form 10-K filed on March 1, 2021. Results for interim periods are not necessarily indicative of those to be expected for the fiscal year.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and related disclosures. Actual results could differ from those estimates.
The Company owns and operates a network of twelve bio-based diesel production facilities, with ten locations in North America and two locations in Europe, and an aggregate nameplate production capacity of 505 million gallons per year ("mmgy"). Ten of these plants are “multi-feedstock capable”, which allows them to use a broad range of low carbon feedstocks, such as distillers corn oil, used cooking oil and inedible animal fats in addition to vegetable oils, such as soybean oil, and canola oil.
The bio-based diesel industry and the Company’s business have benefited from certain federal and state government programs. The federal biodiesel mixture excise tax credit (the "BTC") was retroactively reinstated on December 20, 2019 for the years 2018 and 2019. The BTC has also been extended through December 31, 2022. The modification of federal and state government programs could adversely affect the financial results of the Company.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies should be read in conjunction with a summary of the significant accounting policies the Company has disclosed in its Annual Report on Form 10-K for the year ended December 31, 2020.

Restricted Cash
The Company segregates certain cash balances as restricted cash that represent those funds required to be set aside by a contractual agreement. The Company classifies restricted cash between current and non-current assets based on the length of time of the restricted use.
As of March 31, 2021 and 2020, current restricted cash was $3,746 and $3,000, respectively, representing pledges for outstanding letters of credit issued to support our operations. See the table below for reconciliation of "Cash, Cash Equivalents and Restricted Cash" in the Condensed Consolidated Statements of Cash Flows:
March 31, 2021March 31, 2020
Cash and cash equivalents$335,789 $188,550 
Restricted cash3,746 3,000 
Total cash, cash equivalents and restricted cash in the Condensed Statements of Cash Flows$339,535 $191,550 

7


Marketable Securities
The Company's marketable securities are classified as available-for-sale and are reported at fair value, with unrealized gains and losses, net of tax, recorded in accumulated other comprehensive income (loss). The Company classifies its marketable securities as either current or long-term based on each instrument's underlying contractual maturity date. Realized gains or losses and declines in value judged to be other-than-temporary, if any, on available-for-sale securities are reported in other income, net. The Company evaluates such investments periodically for possible other-than-temporary impairment. A decline of fair value below amortized costs of debt securities is considered an other-than-temporary impairment if the Company has the intent to sell the security or if it is more likely than not that the Company will be required to sell the security before recovery of the entire amortized cost basis. In those instances, an impairment charge equal to the difference between the fair value and the amortized cost basis is recognized in earnings. Regardless of the Company's intent or requirement to sell a debt security, an impairment is considered other-than-temporary if the Company does not expect to recover the entire amortized cost basis; in those instances, a credit loss equal to the difference between the present value of the cash flows expected to be allocated based on credit risk and the amortized cost basis of the debt security is recognized in earnings. The Company has no current requirement or intent to sell a material portion of marketable securities as of March 31, 2021. The Company expects to recover up to (or beyond) the initial cost of investment for securities held. In computing realized gains and losses on available-for-sale securities, the Company determines cost based on amounts paid, including direct costs such as commissions to acquire the security, using the specific identification method.
Renewable Identification Numbers ("RINs")
When the Company produces and sells a gallon of bio-based diesel for use in the United States, 1.5 to 1.7 RINs per gallon are generated. RINs are used to track compliance with the Renewable Fuel Standard ("RFS2"), using the EPA moderated transaction system. RFS2 allows the Company to attach between zero and 2.5 RINs to any gallon of bio-based diesel. As a result, a portion of the selling price for a gallon of bio-based diesel sold in the U.S. is generally attributable to RFS2 compliance. However, RINs that the Company generates are a form of government incentive and not a result of the physical attributes of the bio-based diesel production. Therefore, no cost is allocated to the RIN when it is generated, regardless of whether the RIN is transferred with the bio-based diesel produced or held by the Company pending attachment to other bio-based diesel production sales. Additionally, RINs, once obtained through the production and sale of gallons of bio-based diesel, may be separated by the acquirer and sold separately.
In addition, the Company also obtains RINs from third parties who have separated the RINs from gallons of bio-based diesel. From time to time, the Company holds varying amounts of these separated RINs for resale. RINs obtained from third parties are initially recorded at their cost and are subsequently revalued at the lower of cost or net realizable value as of the last day of each accounting period. The resulting adjustments are reflected in costs of goods sold for the period. The value of these RINs is reflected in “Prepaid expenses and other assets” on the Condensed Consolidated Balance Sheets. The cost of goods sold related to the sale of these RINs is determined using the average cost method, while market prices are determined by RIN values, as reported by the Oil Price Information Service ("OPIS").

Low Carbon Fuel Standard
The Company generates Low Carbon Fuel Standard ("LCFS") credits for its low carbon fuels or blendstocks when its qualified low carbon fuels are transported into an LCFS market and sold for qualifying purposes. LCFS credits are used to track compliance with the LCFS. As a result, a portion of the selling price for a gallon of bio-based diesel sold into an LCFS market is also attributable to LCFS compliance. However, LCFS credits that the Company generates are a form of government incentive and not a result of the physical attributes of the bio-based diesel production. Therefore, no cost is allocated to the LCFS credit when it is generated, regardless of whether the LCFS credit is transferred with the bio-based diesel produced or held by the Company.
In addition, the Company also obtains LCFS credits from third-party trading activities. From time to time, the Company holds varying amounts of these third-party LCFS credits for resale. LCFS credits obtained from third parties are initially recorded at their cost and are subsequently revalued at the lower of cost or net realizable value as of the last day of each accounting period, and the resulting adjustments are reflected in costs of goods sold for the period. The value of LCFS credits obtained from third parties is reflected in “Prepaid expenses and other assets” on the Condensed Consolidated Balance Sheet. The cost of goods sold related to the sale of these LCFS credits is determined using the average cost method, while market prices are determined by LCFS values, as reported by the OPIS. At March 31, 2021 and December 31, 2020, the Company held no LCFS credits purchased from third parties.
The Company records assets acquired and liabilities assumed through the exchange of non-monetary assets based on the fair value of the assets and liabilities acquired or the fair value of the consideration exchanged, whichever is more readily determinable.
8


Convertible Debt
In June 2016, the Company issued $152,000 aggregate principal amount of 4% convertible senior notes due in 2036 (the "2036 Convertible Senior Notes"). See "Note 7 - Debt and Subsequent Events" for a further description of the 2036 Convertible Senior Notes and information regarding our April 2021 notice of redemption of all such notes. During the three months ended March 31, 2021, the Company received notices of conversion related to the 2036 Convertible Senior Notes in total principal amount of $27,075. The Company elected to settle the principal balance of $27,075 in cash and settle the conversion premium by issuing 2,195,836 of common shares from treasury stock, resulting in a loss on debt extinguishment, of $1,922. During the three months ended March 31, 2020, the Company used $25,949 to repurchase $11,008 principal amount of the 2036 Convertible Senior Notes, reflecting conversion premium, after tax impact, of $17,829 as a reduction of Additional Paid-in Capital and gains on debt extinguishment of $1,172 as reflected in the Condensed Consolidated Statements of Operations.
Security Repurchase Programs
In January 2019 and February 2020, the Company's Board of Directors approved repurchase programs of up to $75,000 and $100,000, respectively, of the Company's convertible notes and/or shares of common stock (the "2019 Program" and "2020 Program", respectively). Under these programs, the Company may repurchase convertible notes or shares from time to time in open market transactions, privately negotiated transactions or by other means. The timing and amount of repurchase transactions under each program are determined by the Company's management based on its evaluation of market conditions, share price, convertible note price, legal requirements and other factors.
The table below sets out the information regarding the activities under the 2019 and 2020 Programs during the three months ended March 31, 2020:
Three months ended March 31, 2020
Principal amount in 000'sJanuary 2019 Program
2036 Convertible Senior Notes Repurchases$11,008 $25,949 
The 2019 Program was fully utilized as of September 30, 2020. The remaining amount of the 2020 Program was $91,914 as of March 31, 2021.
Equity Offering
On March 19, 2021, the Company completed an equity offering pursuant to which it sold 5,750,000 shares of common stock to various underwriters at a price of $67.00 per share before underwriting discounts and commissions. The proceeds that the Company received from the financing activity were $385,250 before underwriting discounts and commissions, fees, and other out-of-pocket costs of $19,970. The net proceeds from the transaction were $365,280.
Revenue Recognition
The Company generally has a single performance obligation in its arrangements with customers. The Company believes for most of its contracts with customers, control is transferred at a point in time, typically upon delivery to the customers. When the Company performs shipping and handling activities after the transfer of control to the customers (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued for when the related revenue is recognized. Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from revenues. The Company generally expenses sales commissions when incurred because the amortization period would have been less than one year. The Company records these costs within selling, general and administrative expenses.
The following is a description of principal activities from which we generate revenue. Revenues from contracts with customers are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services.
sales of biodiesel and renewable diesel produced at our facilities, including RINs and LCFS credits;
resale of biodiesel, renewable diesel and petroleum acquired from third parties, along with the sale of renewable diesel and petroleum-based products further blended with biodiesel produced at our wholly owned facilities or acquired from third parties;
sales of separated RINs and LCFS credits;
sales of raw materials, glycerin and other co-products of the bio-based diesel production process;
other revenue, including bio-based diesel facility management and operational services; and
9


incentive payments from federal and state governments, including the BTC, and from the USDA Advanced Biofuel Program.

Disaggregation of revenue:
All revenue recognized in the income statement, except for Bio-based diesel Government Incentives, is considered to be revenue from contracts with customers. The following table depicts the disaggregation of revenue according to product line and segment:
Reportable Segments
Three months ended March 31, 2021Bio-based
Diesel
ServicesCorporate
and other
Intersegment
Revenues
Consolidated
Total
Bio-based diesel sales$348,974 $ $ $(1,027)$347,947 
Petroleum diesel sales  40,509  40,509 
LCFS credit sales38,311    38,311 
Separated RIN sales29,601    29,601 
Co-product sales11,684    11,684 
Raw material sales1,679    1,679 
Other bio-based diesel revenue9,764    9,764 
Other revenues 17,352  (17,352) 
Total revenues from contracts with customers$440,013 $17,352 $40,509 $(18,379)$479,495 
Bio-based diesel government incentives60,249    60,249 
Total revenues$500,262 $17,352 $40,509 $(18,379)$539,744 
Three months ended March 31, 2020Bio-based DieselServicesCorporate and otherIntersegment RevenuesConsolidated Total
Bio-based diesel sales$306,552 $ $ $(25,680)$280,872 
Petroleum diesel sales  44,336  44,336 
LCFS credit sales34,034    34,034 
Separated RIN sales15,520    15,520 
Co-product sales12,044    12,044 
Raw material sales10,954    10,954 
Other bio-based diesel revenue8,638    8,638 
Other revenues 19,533  (19,421)112 
Total revenues from contracts with customers$387,742 $19,533 $44,336 $(45,101)$406,510 
Bio-based diesel government incentives66,447    66,447 
Total revenues$454,189 $19,533 $44,336 $(45,101)$472,957 

Contract balances:

The following table provides information about receivables and contract liabilities from contracts with customers:
March 31, 2021December 31, 2020
Trade accounts receivable from customers$81,029 $74,774 
Short-term contract liabilities (deferred revenue)$(603)$(946)
Short-term contract liabilities (accounts payable)$(699)$(914)

10


The Company receives payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities include payments received in advance of performance under the contract, and are realized with the associated revenue recognized under the contract. Significant changes to the contract liabilities during the three months ended March 31, 2021 and 2020 are as follows:
January 1, 2021Cash receipts
(Payments)
Less: Impact on
Revenue
March 31, 2021
Deferred revenue$946 $12,963 $13,306 $603 
Payables to customers related to BTC914  215 699 
 $1,860 $12,963 $13,521 $1,302 
January 1, 2020Cash receipts
(Payments)
Less: Impact on
Revenue
March 31, 2020
Deferred revenue$631 $9,067 $9,333 $365 
Payables to customers related to BTC255,193   255,193 
 $255,824