SDSYA's Q2 Profit Plunges 91% Amidst Revenue Drop

TL;DR

**SDSYA is getting crushed by commodity prices; sell now before it gets worse.**

AI Summary

SOUTH DAKOTA SOYBEAN PROCESSORS LLC (SDSYA) reported a significant decline in revenue and net income for the six months ended June 30, 2025. Total revenue decreased by $103.8 million, or 28.6%, to $259.2 million from $363.0 million in the prior year period. This was primarily driven by a $70.8 million reduction in soybean meal and hulls revenue and a $33.0 million decrease in soybean oil and oil byproducts revenue. Net income for the six-month period plummeted by $20.1 million, or 91.3%, to $1.9 million compared to $22.0 million in the same period of 2024. The company also saw a substantial drop in net income for the three months ended June 30, 2025, falling by $10.6 million to a net loss of $0.9 million from a net income of $9.7 million in Q2 2024. The decrease in revenue and net income reflects challenging market conditions for soybean processing. The company's strategic outlook will likely focus on managing commodity price volatility and optimizing operational efficiency to mitigate further declines.

Why It Matters

This sharp decline in SDSYA's profitability and revenue signals significant headwinds in the soybean processing sector, impacting investors through reduced returns and potentially lower unit values. Employees might face pressure on job security or compensation if the downturn persists. Customers could see shifts in pricing or supply as processors adjust to market dynamics. For the broader agricultural market, SDSYA's performance reflects broader trends in commodity prices and demand for soybean products, potentially influencing other players in the fats and oils industry. The competitive landscape will intensify as companies vie for market share in a contracting environment.

Risk Assessment

Risk Level: high — The company's net income for the six months ended June 30, 2025, decreased by a staggering 91.3% to $1.9 million from $22.0 million in the prior year. Furthermore, the second quarter of 2025 saw a net loss of $0.9 million, a $10.6 million swing from a $9.7 million net income in Q2 2024, indicating severe operational and market challenges.

Analyst Insight

Investors should consider divesting from SDSYA given the dramatic 91.3% drop in net income and the Q2 net loss. The significant revenue decline of 28.6% suggests a challenging market environment that may persist, making the stock a high-risk holding.

Financial Highlights

revenue

$259.2M

net Income

$1.9M

revenue Growth

-28.6%

Revenue Breakdown

Key Numbers

• $259.2M — Total Revenue (Down 28.6% from $363.0M in H1 2024)
• $1.9M — Net Income (H1) (Down 91.3% from $22.0M in H1 2024)
• -$0.9M — Net Income (Q2) (A net loss, compared to $9.7M net income in Q2 2024)
• 28.6% — Revenue Decrease (Percentage drop in total revenue for the six months ended June 30, 2025)
• 91.3% — Net Income Decrease (Percentage drop in net income for the six months ended June 30, 2025)

Key Players & Entities

• SOUTH DAKOTA SOYBEAN PROCESSORS LLC (company) — filer of the 10-Q
• SEC (regulator) — recipient of the 10-Q filing
• $103.8 million (dollar_amount) — decrease in total revenue for six months ended June 30, 2025
• $259.2 million (dollar_amount) — total revenue for six months ended June 30, 2025
• $363.0 million (dollar_amount) — total revenue for six months ended June 30, 2024
• $20.1 million (dollar_amount) — decrease in net income for six months ended June 30, 2025
• $1.9 million (dollar_amount) — net income for six months ended June 30, 2025
• $22.0 million (dollar_amount) — net income for six months ended June 30, 2024
• $0.9 million (dollar_amount) — net loss for the three months ended June 30, 2025
• $9.7 million (dollar_amount) — net income for the three months ended June 30, 2024

FAQ

Risk Factors

• Commodity Price Volatility [high — market]: The company's revenue and profitability are highly sensitive to fluctuations in soybean and soybean product prices. For the six months ended June 30, 2025, total revenue decreased by 28.6% ($103.8 million) due to significant drops in soybean meal/hulls and soybean oil/byproducts revenue. This highlights the direct impact of market price movements on financial performance.
• Operational Efficiency [medium — operational]: Maintaining operational efficiency is crucial for mitigating the impact of volatile commodity prices. The substantial decline in net income, including a net loss of $0.9 million in Q2 2025, suggests potential challenges in cost management or operational throughput relative to market conditions.
• Demand Fluctuations [medium — market]: Changes in global and domestic demand for soybean products can significantly affect sales volumes and prices. The reported revenue decline indicates that current market demand may not be sufficient to offset price pressures or that competitive factors are impacting sales.

Industry Context

The soybean processing industry is characterized by its reliance on agricultural commodity prices, which are subject to significant volatility due to weather, global supply and demand, and trade policies. Companies in this sector must manage fluctuating input costs and product prices to maintain profitability. Competition is often based on operational efficiency, scale, and access to raw materials.

Regulatory Implications

As a processor of agricultural commodities, SDSYA is subject to various regulations related to food safety, environmental standards, and trade. While this filing does not detail specific regulatory challenges, any changes in these areas could impact operational costs and market access.

What Investors Should Do

1. Monitor commodity price trends for soybeans, soybean meal, and soybean oil.
2. Analyze operational efficiency metrics and cost management strategies.
3. Assess the company's hedging strategies and risk management practices.

Key Dates

• 2025-06-30: End of Second Quarter and Six-Month Period — Reporting period for the significant decline in revenue and net income, including a net loss for Q2 2025.
• 2025-08-08: Filing Date of 10-Q — Public disclosure of the company's financial performance and condition for the period ending June 30, 2025.

Glossary

Soybean Meal and Hulls

Products derived from soybeans after the oil has been extracted, primarily used for animal feed. (A key revenue stream for SDSYA, which experienced a significant decline in revenue for this segment.)

Soybean Oil and Oil Byproducts

The oil extracted from soybeans, used in food products and industrial applications, along with related byproducts. (Another major revenue source for SDSYA, which also saw a substantial decrease in revenue.)

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC) that provides a comprehensive update on a company's financial performance. (This filing provides the detailed financial information and context for the current period's performance.)

Year-Over-Year Comparison

Compared to the prior year period, SOUTH DAKOTA SOYBEAN PROCESSORS LLC has experienced a significant downturn. Total revenue for the six months ended June 30, 2025, fell by 28.6% to $259.2 million, primarily due to reduced revenue from soybean meal/hulls and soybean oil/byproducts. Net income also saw a dramatic decrease of 91.3%, dropping to $1.9 million from $22.0 million in the same period last year. Furthermore, the company reported a net loss of $0.9 million for the second quarter of 2025, a stark contrast to the $9.7 million net income in Q2 2024, indicating deteriorating market conditions and profitability.

Key Financial Figures

• $85 m — reement, the Company could borrow up to $85 million, and advances on the revolving cr
• $254.0 million — draw term loan provides borrowing up to $254.0 million until March 31, 2026 to finance the con
• $4.50 million — ll make quarterly principal payments of $4.50 million plus interest beginning six months afte
• $1.0 million — pal payments will increase each year by $1.0 million on the anniversary date. The delayed-dr
• $122.2 million — not borrowed. There were approximately $122.2 million available to borrow on the delayed draw
• $40.0 million — oan provides for a maximum borrowing of $40.0 million. The revolving term loan matures on Dec
• $12.6 million — the Davison Regional Railroad Authority $12.6 million for purposes of making improvements to
• $987,500 — ts principal and interest payments of $987,500. These payments will continue through O

Filing Documents

• sdsp-20250630.htm (10-Q) — 674KB
• revolvingtermloanamendment.htm (EX-10.1) — 37KB
• exhibit31120250630.htm (EX-31.1) — 10KB
• exhibit31220250630.htm (EX-31.2) — 11KB
• exhibit32120250630.htm (EX-32.1) — 6KB
• exhibit32220250630.htm (EX-32.2) — 6KB
• sdsp-20250630_g1.jpg (GRAPHIC) — 12KB
• 0001163609-25-000023.txt ( ) — 4237KB
• sdsp-20250630.xsd (EX-101.SCH) — 29KB
• sdsp-20250630_cal.xml (EX-101.CAL) — 51KB
• sdsp-20250630_def.xml (EX-101.DEF) — 154KB
• sdsp-20250630_lab.xml (EX-101.LAB) — 413KB
• sdsp-20250630_pre.xml (EX-101.PRE) — 294KB
• sdsp-20250630_htm.xml (XML) — 502KB

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 17 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 22 Item 4.

Controls and Procedures

Controls and Procedures 22 Part II. OTHER INFORMATION 23 Item 1.

Legal Proceedings

Legal Proceedings 23 Item 1A.

Risk Factors

Risk Factors 23 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 23 Item 3. Defaults among Senior Securities 23 Item 4. Mine Safety Disclosures 23 Item 5. Other Information 23 Item 6. Exhibits 23

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements South Dakota Soybean Processors, LLC Condensed Consolidated Financial Statements June 30, 2025 and 2024 3 South Dakota Soybean Processors, LLC Condensed Consolidated Balance Sheets June 30, 2025 December 31, 2024 (Unaudited) Assets Current assets Cash and cash equivalents $ 7,178,677 $ 39,594,084 Trade accounts receivable 28,699,700 29,771,609 Inventories 64,927,990 45,078,676 Commodity derivative instruments 10,797,055 9,600,761 Prepaid expenses 1,784,820 2,976,524 Total current assets 113,388,242 127,021,654 Property and equipment 556,814,779 435,335,629 Less accumulated depreciation ( 79,254,112 ) ( 75,554,375 ) Total property and equipment, net 477,560,667 359,781,254 Other assets Investments 19,156,025 18,605,021 Right-of-use lease asset, net 34,030,851 35,829,689 Other assets 982,688 656,000 Total other assets 54,169,564 55,090,710 Total assets $ 645,118,473 $ 541,893,618 (continued on the following page) 4 South Dakota Soybean Processors, LLC Condensed Consolidated Balance Sheets (continued) June 30, 2025 December 31, 2024 (Unaudited) Liabilities and Members' Equity Current liabilities Excess of outstanding checks over bank balance $ 8,043,375 $ 12,972,629 Notes payable - seasonal loans 4,595,604 — Current maturities of long-term debt 6,500,000 9,000,000 Accounts payable 2,114,715 3,979,895 Accrued commodity purchases 36,242,090 54,412,561 Commodity derivative instruments 6,920,717 3,500,672 Current portion - operating leases 3,605,211 3,512,822 Accrued expenses 4,749,847 4,623,969 Contract liabilities 2,504,687 10,524,222 Total current liabilities 75,276,246 102,526,770 Long-term liabilities Long-term debt, net 197,321,022 57,673,180 Long-term operating lease liabilities 28,107,783 29,881,151 Other long-term liabilities 14,489,469 15,855,793 Total long-term liabilities 239,918,274 103,410,124 Commitments and contingencies (Notes 4, 5, 6, and 10) Members' equity ( 30

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View this 10-Q filing on SEC EDGAR