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DATE

Wednesday, Aug. 5, 2026, at 5 p.m. ET

CALL PARTICIPANTS

• President and Chief Executive Officer - Bryon McGregor
• Chief Financial Officer - Robert R. Olander

TAKEAWAYS

• Net Sales -- $245.7 million, an increase of $27.3 million versus the prior year driven by higher average sales prices and increased volume.
• Adjusted EBITDA -- $23.7 million, representing a $23.9 million improvement from negative $200,000 in the prior year period.
• Net Income Attributable to Common Stockholders -- $11.4 million, or $0.15 per diluted share, compared to a net loss of $11.3 million in the second quarter of 2025.
• Gross Profit -- $16.6 million, an improvement of $18.6 million primarily driven by stronger industry crush margins.
• Total Alcohol Gallons Sold -- 88.5 million, an increase of 1.8 million gallons reflecting higher high-quality alcohol volumes.
• Average Sales Price -- $2.15 per gallon, a 10% increase versus the prior year supported by finalized 2026 Renewable Volume Obligation regulations.
• Market Crush Margins -- $0.33 per gallon, an increase from $0.11 per gallon in the prior year due to robust export demand and strong domestic blending activity.
• Essential Ingredients Return -- 51.6%, up from 45.2% in the prior year reflecting improved average sales prices.
• Section 45Z Tax Credit Earnings -- $5.1 million, including $4.0 million earned in the current quarter and $1.1 million in final adjustments from 2025 credit sales.
• Full-Year Section 45Z Income Guidance -- $15 million to $16 million, based on management's expectation to qualify 90 million gallons or more of combined production.
• Accrued Section 45Z Credits -- $7.9 million year to date, which the company intends to monetize through future sales.
• Net Cash from Operating Activities -- $28.5 million, reflecting positive net income and improved working capital management.
• Term Debt Repayments -- $8.5 million in principal payments during the quarter, bringing the year-to-date total to $25.1 million.
• Term Debt Outstanding -- $29.9 million at quarter end, as the company focused on reducing interest expense.
• Total Borrowing Availability -- $106 million, consisting of $41 million under the operating line of credit and $65 million under the term loan facility.
• Pekin Capacity Expansion -- 5 million gallon increase in annual production capacity, following the completion of a debottlenecking project at the dry mill facility.
• Capital Expenditures -- $10.6 million for the quarter, directed toward organic growth projects including CO2 storage and plant optimization.
• Annual Capital Expenditure Guidance -- $25 million, with $11.5 million spent through the first half of the year.
• Specialty Alcohol Gallons Sold -- 23.5 million gallons, an increase of 3.6 million gallons despite narrowing average premiums over ethanol.
• Renewable Fuel Export Revenue -- $800,000 increase, reflecting significantly higher premiums that offset a 2.2 million gallon decline in volume.
• Utility Costs -- $600,000 decrease, driven by lower expenses for natural gas and electricity.
• Repairs and Maintenance Expense -- $2.0 million increase, due to planned outages at the Pekin dry mill and ICP facilities.
• SG&A Expenses -- $8.0 million, an increase of $1.8 million primarily due to performance compensation accruals.

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RISKS

• McGregor stated, "ongoing geopolitical disruption in the Middle East negatively impacted export economics from The United States during the quarter," noting that higher freight costs and reduced vessel availability compressed the arbitrage between the U.S. and Europe.
• Olander noted that high-quality alcohol average premiums over ethanol narrowed during the quarter, though the company used derivative positions to limit the net decline to $0.02 per gallon.

SUMMARY

Management reported that Alto Ingredients, Inc. (ALTO +2.96%) achieved its fourth consecutive quarter of profitability, citing the benefits of a diversified product portfolio and a leaner cost structure. The company stated it is executing capital projects focused on capacity expansion, carbon dioxide optimization, and process efficiency improvements. According to management, the operating model is designed to generate positive adjusted EBITDA through commodity cycles while capturing upside during favorable market conditions. The company also established an at-the-market equity program to provide additional financial flexibility for organic growth opportunities and maintain a disciplined approach to capital allocation.

• CEO McGregor highlighted the efficiency of the Pekin dry mill, stating that the facility restart and capacity expansion will "drive profitability to the bottom line" with additional gallons eligible for Section 45Z credits.
• CFO Olander noted the company established a $50 million at-the-market equity program to serve as a "prudent and low cost tool to effectively access equity capital" for high-return organic opportunities.
• Management reported that Section 45Z credits could translate to "almost $0.30 per bushel" for participating farmers, encouraging the adoption of low-carbon intensity corn practices.
• CEO McGregor noted that 72% of U.S. voters favor year-round E15 blending, which management believes represents a "meaningful long term demand opportunity" as states like California make progress on adoption.
• The company is advancing its CO2 strategy at the Columbia facility by adding a third storage tank, which management expects to be operational in the fourth quarter.
• Management stated that dock repairs and the installation of a second alcohol load out are on track for completion by the end of the year to improve logistics and loading capacity.

INDUSTRY GLOSSARY

• 45Z: The Clean Fuel Production Credit under Section 45Z of the Internal Revenue Code, providing tax credits for low-carbon transportation fuels.
• ATM Program: An at-the-market equity program that allows a company to sell shares directly into the secondary market at prevailing prices.
• CI Score: Carbon Intensity score, a measure of the greenhouse gas emissions associated with the full life cycle of a fuel.
• Crush Margin: The difference between the value of the products produced (ethanol, corn oil, and distillers grains) and the cost of the raw material (corn).
• E15: A fuel blend containing 15% ethanol and 85% gasoline.
• RIN: Renewable Identification Number, a serial number assigned to a batch of biofuel for the purpose of tracking its production and use for regulatory compliance.
• RVO: Renewable Volume Obligation, the annual volume of renewable fuel that obligated parties must blend into transportation fuel.

Full Conference Call Transcript

Operator: Good afternoon and welcome to the Alto Ingredients Second Quarter 26 Financial Results Conference Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. To withdraw your question, please press *2. Please note this event is being recorded. I would now like to turn the conference over to Jody Burfening. Please go ahead. Thank you, Danielle, and thank you all for joining us today for Alto Ingredients Second Quarter 26 Results Conference Call. With me on the call are our President and CEO, Bryon McGregor and CFO, Robert R. Olander.

Alto Ingredients issued a press release after the market closed today providing details of the company's financial results for the second quarter of 26. A webcast and webcast replay will be available on the Alto Ingredients website at altoingredients.com. Please note that the information on this call speaks only as of today, 08/05/2026. You are advised that time sensitive information may no longer be accurate at the time of any replay. Company also prepared a presentation for today's call that is available on its website. Please refer to the company's safe harbor statement in the presentation which states that some of the comments constitute forward looking statements in consideration that involve risks and uncertainties.

The actual results of all 2 ingredients could differ materially from those statements. Factors that could cause or contribute to such differences include, but are not limited to, events, risks, and other factors previously and from time to time disclosed in Alto Ingredients filings with the SEC. Except as required by applicable law, the company assumes no obligation to update any forward looking statements. In management's prepared remarks, non-GAAP measures will be referenced. Management uses these non GAAP measures to monitor the company's financial performance of its operations and believes these measures will assist investors in assessing the company's performance for the periods reported.

The company defines adjusted EBITDA as unaudited consolidated net income or loss before interest expense interest income, provision or benefit for income taxes, asset impairments, unrealized derivative gains and losses, acquisition related expenses, excess insurance proceeds, depreciation and amortization expense. To support the company's review of non GAAP information, a reconciling table has been included in the second quarter earnings release and presentation. With that, it is now my pleasure to introduce Bryon McGregor. Bryon, please go ahead.

Bryon T. McGregor: Thanks, Jody. And thanks everyone for joining us today. I will begin with a high level review of our second quarter results. And operational activities. Then I will turn the call over to Robert for a detailed review of our financial results for the quarter. After that, I will wrap up and open the call for Q&A. We delivered our fourth consecutive quarter of positive gross profit, income from operations, net income, and adjusted EBITDA. We have been consistently profitable during this period even without the contribution of 45Z tax credits. These results demonstrate the strength of our diversified operating model. Which gives us the flexibility to shift production toward the most attractive end markets and capture premium value opportunities.

We remain focused on disciplined execution of our strategic plan, and unlocking additional value across our portfolio. Our latest 12-month results are also a testament to our efforts to drive profitability and maximize our asset base. And to make smart capital allocation decisions, including purchasing Alto Carbonic, investing in our dry mill optimization and carbon intensity reduction projects, We have executed well on these initiatives and more. For the second quarter, our results reflect strong domestic demand and improved essential ingredient values compared to the same period last year. The quarter's market crush margins improved significantly to $0.33 per gallon from $0.11 per gallon in the same period last year.

This increase was driven by robust export demand strong domestic blending activity, and tighter ethanol inventories following industry wide spring maintenance outages. As a result, ethanol prices improved during the quarter supported by strong Renewable Volume Obligation or RVO blending requirements Meanwhile, favorable crop conditions and larger projected grain supplies contributed to lower corn costs and higher margins. Q2 crush margins were not only significantly higher than the same period last year, but were also strong by historical standards. Q3 margins which in the past have marked the seasonal peak of the year, continue to be healthy and profitable.

While European demand remained robust, ongoing geopolitical disruption in the Middle East negatively impacted export economics from The United States during the quarter. Higher freight costs and reduced certainty of vessel availability to move exports from the Gulf Coast compressed the US to Europe arbitrage, increasing the competitiveness of Brazil exports into Europe. As a result, our renewable fuel export volumes declined compared to the second quarter of last year. Given the strength of domestic ethanol markets, we successfully optimized our product mix towards fuel grade ethanol sales in the US markets. This underscores the benefits of our diversified commercial platform enabling us to adapt and capture the value of strong crush margin environments.

Also, we believe that the geopolitical disruption in the Middle East created favorable conditions that drive domestic support for implementing E15 blending. More on that in a minute. During the quarter, we continued to improve utilization, reliability, and throughput, With the goal of increasing total 26 volumes over 2025. At our Pekin campus, we completed the dry mill planned outage along with our debottlenecking project to increase annual production capacity by about 8%. or 5 million gallons. This project demonstrates our dedication to highly attractive ROI investments. By increasing production at our most efficient facility, we are positioning Alto for incremental gross margin and to qualify for additional 45Z tax credits.

After a successful dry mill restart, we are now ramping up to our new production levels. And still expect to realize the full benefit of the additional capacity in the fourth quarter. We also performed our routine spring outage at ICP during the quarter. We remain on track to finish the repairs on our existing dock and the installation of the second alcohol load out by the end of the year improving our logistics and loading capacity. At our Columbia facility, we began working to add a third CO2 storage tank And expect it to be operational in Q4. The expanded storage capacity will allow us to further capitalize on growing demand for premium CO2. in the Pacific Northwest.

We continue advancing multiple pathways to further monetize our CO2 stream, including both utilization and sequestration opportunities. Our strategy emphasizes low capital, high return projects while preserving flexibility as regulatory and commercial markets continue to evolve. Our intent is to move quickly by pursuing partnership with stakeholders that already have compression capabilities allowing us to accelerate commercialization. In the meantime, we are focused on increasing our 45Z credits by producing more volume. We also continue to explore opportunities to lower our carbon scores without significant capital investment by working with our farmer partners to encourage them to lower the carbon intensity of their corn.

We remain on track to qualify 90 million gallons or more of combined production this year supporting our expectation for generating a minimum of $15 million in income from tax credits after monetization costs We are encouraged by the growing momentum for year round E15 adoption. As an example, recently the Renewal Fuels Association reported that about 72% of US voters favor year-round E15 blending the highest level recorded since polling began in 2016. Nationally, support continues to build around the promise of E15 to reduce fuel cost. Strengthen energy security, and to increase demand for domestically produced renewable fuels. Meanwhile, several Midwestern states have moved forward with permanent year round E15 access. Providing an important blueprint for broader adoption.

California is also making progress following the passage of Assembly Bill 30. While final implementation steps remain, we believe the state's transition toward E15 represents a meaningful long term demand opportunity given its position as 1 of the largest gasoline markets in the country. Taken together, expanding E15 adoption at both the federal and state levels has the potential to drive significant incremental ethanol demand. Improved industry capacity utilization, and support a more favorable margin environment over time. With that, I will turn the call over to Robert for a more detailed review of our second quarter financial results.

Robert R. Olander: Thank you, Bryon. I will start with a review of the second quarter 26 income statement compared to the second quarter of 2025. Consolidated net sales of $246 million, up $27 million. We sold 88.5 million gallons of ethanol and specialty alcohols, an increase of 1.8 million gallons at an average sales price of $2.15 per gallon which was $0.20 per gallon or 10% higher than last year. With the 2026 RVO regulations finalized during the second quarter, ethanol and RIN prices supported higher domestic ethanol sales and improved crush margins. With the diverse production capabilities at the Pekin campus, we are well positioned to serve this changing market demand by shifting our production and sales mix.

Revenue from renewable fuel exports increased by $800 thousand reflecting a 2.2 million reduction in gallons sold at a significantly higher premium to domestic renewable fuel than last year. This decrease in volume reflects the impact of the conflict in the Middle East on the cost and availability of freight. High quality alcohol volumes increased by 3.6 million gallons, Although average premiums over ethanol narrowed, reducing revenue by approximately $2.9 million realized gains from our derivative positions largely offset the impact as intended. Limiting the net premium decline to $0.02 per gallon. As a result, the higher volumes generated a modest increase in profitability despite the lower premium environment.

Essential ingredient sales increased $6.1 million on overall improved average sales prices. Dry distiller grain sales were supported by a strong export market and tighter domestic supply as a result of the seasonal spring maintenance downtime in the industry. In addition, the 2026 RVO set strong demand for corn oil and germ as a feedstock. for biodiesel and renewable diesel drove prices up. Coupled with a 5% decrease in our cost of corn, our essential ingredients return improved to 51.6% compared to 45.2% for the second quarter last year. Gross profit increased by $19 million year over year to $17 million.

In addition to the sales mix changes, the improvement was primarily driven by stronger industry crush margins, which increased to $0.33 per gallon from $0.11 per gallon in the second quarter of last year. Contributing approximately $17 million of incremental gross profit. We also benefited from lower utility costs, with natural gas and electricity expenses declining by nearly $600 thousand year over year. Offsetting these positives, we incurred approximately $2 million more in repairs and maintenance expense due to our Pekin dry mill and ICP spring outages. And continued work at our Carbonic facility to ensure we are prepared to reliably support the increased demand for our premium CO2 during the seasonally strong summer months.

Even with these higher expenses, our Western facilities remain profitable on a gross profit basis for Q2 26. As a reminder, we employ hedging strategies to protect the premiums over ethanol on our high quality alcohol contractual commitments and to adjust our fixed price corn back to market. For the second quarter, realized derivative gains increased $1.2 million while unrealized derivative losses related to future shipments increased $1.5 million As of the end of the second quarter, our open derivative positions resulted in a net asset of $3.9 million. SG&A expenses increased by $1.8 million.

Because of our strong second quarter and year to date results, we accrued performance compensation for the first and second quarters in the amount of $800 thousand whereas last year, we did not accrue performance compensation until the second half of the year. Last year's SG&A expense also included a 1-time $800 thousand gain related to the final payment for the Eagle Alcohol acquisition. Excluding these notable items, SG&A was comparable, reflecting the actions taken last year to rightsize our staff levels, and cut costs. We continue to maintain strict discipline over our spending.

Moving down the income statement, we generated $5.1 million in 45Z tax credit earnings reflecting $4 million of credits earned in the second quarter and $1.1 million in final adjustments on our 2025 sales proceeds as we completed the sale of our 25 credits in June. In Q2 25, we did not recognize any 45Z tax credit earnings as we were not yet accounting for them on a quarterly basis. Year to date, we have accrued $7.9 million in net 26 45Z tax credits which we expect to monetize in the future. Interest expense decreased $900 thousand on lower debt balances. Reflecting our continued focus on minimizing idle cash, and reducing our interest expense burden by paying down debt.

Adjusted EBITDA improved by $23.9 million to $23.7 million compared to negative adjusted EBITDA in the prior year period. The improvement was driven by a combination of the $19 million swing to positive gross profit and a $5.1 million increase in 45Z tax credit earnings. Partially offset by higher SG&A expenses. Net income attributable to common stockholders $11.4 million or $0.15 per share compared to a net loss of $11.3 million or a negative $0.15 per share for Q2 25. A significant improvement of $22.7 million Our tax provision amount is zero, we expect to use a portion of our NOLs to offset income this year.

Turning to the balance sheet, As of 6/30/2026, our cash balance was $24 million During the second quarter, we generated $28.5 million in cash flow from operating activities. Capital expenditures for the quarter amounted to $10.6 million and $11.5 million year to date. We are on track with our annual targeted CapEx spend of $25 million With strong earnings, and positive cash flow from operations, we paid down an additional $8.5 million in principal on our term debt facility and ended the quarter with $29.9 million in term debt outstanding. Bringing our total principal payments this year to $25.1 million.

At quarter end, our total borrowing availability was $106 million, consisting of $41 million under our operating line of credit, and $65 million under our term loan facility. Todd, we established a 50 million at the market equity program. Alongside our available borrowing capacity, and operating cash flow, the ATM gives us additional financial flexibility and a prudent and low cost tool to effectively access equity capital. We see a number of attractive high return organic opportunities across our platform. Having the ATM in place allows us to remain prepared to pursue these opportunities when expected returns market conditions, and shareholder interests align. Any use of the program would be disciplined, measured, and evaluated against other available sources of capital.

With that, I will turn the call back to Bryon.

Bryon T. McGregor: Thanks, Robert. Our results for the past 4 quarters demonstrate the success to date of this strategic realignment we began 3 years ago. With a diversified product portfolio, a leaner cost structure, we have positioned Alto to capture higher value revenue opportunities to enhance profitability and drive shareholder value. Our operating model is now capable of generating annual positive adjusted EBITDA through the commodity cycles. While providing meaningful upside when market conditions are favorable. In addition, this year we are executing high return capital projects focused on capacity expansion, CO2 optimization, and process efficiency improvements.

These projects represent over $10 million of capital investment offering attractive returns and are expected to generate paybacks of just over 1 year on average Importantly, these investments are within our control and are designed to enhance earnings and cash flow regardless of commodity market conditions. These are only a few of many compelling organic opportunities that we intend to pursue, while maintaining our disciplined approach to capital allocation. In summary, we remain on track to increase production volumes in 2026 compared to 2025. We will continue optimizing our product mix capturing more value from our unique asset base and executing high return opportunities and improve profitability and cash flow Our diversified strategy is working.

Our operating model is stronger, and our financial results reinforce our confidence in Alto's ability to generate sustainable earnings and create long term shareholder value. Danielle, we are ready to begin the Q&A session.

Operator: Thank you. We will now begin the question and answer session. You are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press *2. The first question comes from Eric Stine from Craig Hallum. Please go ahead.

Eric Stine: Hi, Bryon. Hi, Robert. So, I mean, obviously, you have you have kinda laid out these capital projects and the progress, pretty steady progress you are making. But also alluding to a host of others. You know, should we think about that as you know, just kinda going deeper? In the paths that you are already on, or are there others? And if so, could you know, give some details on what those other areas might be?

Bryon T. McGregor: Sure. So while in general, they are deeper moves along some of the same things that we have been talking about. Right? We are it is clearly around monetizing CO2. Capturing taking advantage of the 45Z opportunities that are you know, available at least through 2029. To help monetize that value and be able to reinvest those dollars into other longer term projects. it is about leaning into our efficient projects and expanding capacity where it makes sense to do so, particularly in our most efficient locations and making them those that may be less efficient, more efficient.

Probably not appropriate to share the exact details yet because have not committed full capital to those yet, but we will certainly be sharing. Mhmm. You know? Orders to come. But as I mentioned in our in the prepared remarks, is that we see really exciting organic opportunities with excellent paybacks. That we you know, see as almost obligations to pursue. So with that, that is that is the focus of the company, and we will share more as we as we commit capital to those projects.

Eric Stine: Yep. Understood. I mean, it is worth a shot to ask. But, maybe just on the you know, talking about to improve the CI scores and going down the path you know, on the crop side and with farmers. I mean, when you think about that, given that the, I mean, 45Z has been in place, but is relatively new. To the market I mean, you feel like that is I mean, are farmers how open are they to that, or what are you finding? You know, is that something an opportunity that people have kind of already mined, or it really is ripe to make further strides in that area?

Bryon T. McGregor: Yeah. it is relatively fresh for the farmers, especially because the rules have not yet been established until earlier, a month or 2 ago. But I think with the rules now, and while there is still some clarifications that need to be made, I think that the pathway is clear. For the farmers, and there is a lot of inquiry and a lot of work that is being done on our part. And as well others in the industry. And the farmers are very keen to it.

If you think about it from a context of you know, on a relative basis, if we were to save an additional $0.10 or, you know, generate additional 10¢ in carbon intensity credit or the credits around the 45Z, that translates in almost $0.30 per bushel for those farmers who are participating. And that is real dollars, especially where you know, the price for corn this year and last is somewhat difficult to justify the investment that the farmers are making. But these are easy some of the steps are incredibly easy for them to do. Far as registration and doing some of the other things.

And so we see this as a real opportunity And I know that, you know, more and more farmers are only asking questions, but you know, doing what they can to get on board.

Eric Stine: Okay. Got it. Last 1, just I know Q2, you had the dry mill planned outage there and got through that. It had a very good quarter, but limited to an extent by that outage. I mean, when you think about third quarter, I know you are ramping that back up. Do you feel like you get a with the market conditions still quite good, that you get a, you know, a greater capture of that since you are through the outage?

Bryon T. McGregor: Yeah. I mean, as we said in the prepared remarks, We expect to fully be able to realize it in Q4. Do not wanna rush our team too quickly when you are making changes not only to you know, debottlenecking, but making improvements to your you know, DCO, your IT systems and the like. So you wanna make sure you line all that out and keep things safe. That said, we are excited about the opportunity. We have seen it we have seen some real promise. In what we are what we are seeing at the plan. Excess capacity, things like that. So really excited about that.

And the nice thing about that facility is not only just the additional amount of production, but as well, again, it is 1 of our lowest cost if not our lowest cost facility. In operations. So really driving profitability to the bottom line, but also those gallons are eligible for 45 c credit. So it has a multiplying effect. And, again, really excited about that opportunity. Okay. Thank you. Thanks, Eric.

Operator: Thank you. The next question comes from Sameer Joshi from C. Wainwright. Wainwright. Please go ahead.

Sameer Joshi: Hey, good afternoon, Bryon, Robert. Thanks for taking my questions. and congratulations on a great quarter. So just stepping back. Just stepping back when you make decisions whether to delever or to invest because you do have these projects that you just have outlined to work on to improve CI scores, monetize this CO2 to expand capacity. At the same time, you are also paying back some of the principal. What are the takes and puts in that decision making?

Bryon T. McGregor: So we have a full committed process around evaluating each 1 of our projects, Stacking them against, you know, weighing them against other opportunities. And then some of the projects may not have as solid as a return, but they are core. And or foundational in being able to then expand into other areas So a good example of that would be the improvements in the debottlenecking that we did at the dry mill. at the Pekin campus. But it actually lays the foundation to be able to do an incremental or a significant higher expansion on that facility. Going forward. That said, that also requires an additional amount of capital or significantly more amount of capital than the debottlenecking.

And so those are things that we have to take into account. Weigh those against the cost of capital, and against other projects that may have other more beneficial returns or less returns. Right? And so we are gonna stack with those. Mhmm. Robert, anything you wanna add to that?

Robert R. Olander: Yeah. Sure. Thanks, Bryon. I guess I would just add you know, with our strong profitability and cash flows, year to date, we have been able to fund a lot of our low cost high return projects. And we have commented before, you know, as opposed to letting that cash sit idle, in the bank, you know, we would rather put that to work and reduce our interest expense burden. So we are taking the opportunity to pay down debt, which also, you know, improves our profitability as well.

Sameer Joshi: Understood. Thanks for that color. My second question is, about the European disruption and how it or rather European exports impacted by the disruption in shipping Would your EBITDA would have been higher if you had been able to avail of the European opportunity versus redirecting your efforts towards domestic sales.

Bryon T. McGregor: Yeah. So it is a dynamic market clearly. Right? I mean, prices continue--you know, it is a commodity space. Yeah. market. So it is it is it is a bit speculative, but you know, all things being equal, if you have the same price and the same volume that you were experiencing in Q1 and Q4 of last year, yes, we would have generated more. That said, margins were significantly higher in Q2 than they were in Q1 for domestic fuel as well. So it is a bit of a speculative analysis. Mhmm. Yeah. But we still continue, as I think we said in our in my prepared remarks was it is still a very strong market.

Of course, that market is going to always in those consumers in those markets are always gonna look for the most competitive product. And right now, there is an arbitrage opportunity with Brazil and so it is an easy market to look to, but those change and share prices change and the supplies and the like. And, you know, depending on what happens with the US dollar, particularly in relation to the real, we expect it to fully come around. And these are longer-term--these are longer term relationships as well. So some of the countries or some of the parties in the countries also were just engaging in what would be, you know, 2027-types of volumes. So we are Yeah.

We remain optimistic and we are excited that there is domestic market that we can turn to be able to place that product. Understood. Yeah. And I do understand that the dynamics and disruption does not only affect the European market It also, in turn, impacts dynamics in the domestic market. So I understand.

Sameer Joshi: A clarification on this 45Z I think maybe, Robert, I mean, I heard that you had already, accounted for 7.9 million in credit that you are planning to sell in the second half. I was just not sure if I heard that right. Can you explain what that is?

Robert R. Olander: Yeah. that is correct. You know, we have said minimum baseline target expectation of $15 million in net 45Z proceeds, and that is on 90 million gallons. Now with that said, we are we are still pursuing opportunities to qualify more volume, both with the Pekin dry mill debottlenecking project as well as, you know, efforts to improve our reliability and uptime, as well as potentially even qualifying, you know, other volume that is currently destined for other end markets, you know, outside of the United States. That, as well as, the efforts to reduce our energy consumption, and what Bryon talked about earlier with the low carbon intensity corn.

So getting back to your question, year to date, we have recognized just under $8 million of net 45Z credits for the year. So we are currently on track for, you know, $15 million to $16 million range. Understood. Great. Thanks for that, guys. Clarification. I will take my other questions offline. Thanks.

Operator: Thank you. The next question comes from Justin Dobrioglo from Domo Capital Management. Please go ahead.

Analyst: Hey. Thanks for taking my phone call. You bet, Justin. Just have 2 questions here. First, did I hear that correctly? So after the quarter ended, you paid down an additional $6 million approximately in debt?

Robert R. Olander: No. During the quarter, we paid down the $8.5 million of debt. Oh, okay. The $8.5 million was all during the quarter? Got it. And then just piggybacking on the last question then. So with the with the 45Z credits you have you have generated, so that will be a cash that is coming in the door later in the year that could be used for further debt reduction as well, I would assume. Yes. We are in preliminary discussions with buyers on the 26 credits. So we expect to monetize those in the not too distant future.

Bryon T. McGregor: Excellent. But I should add, Justin, that--Justin, just 1 clarification is that it is not necessarily dedicated to the reduction of debt. We will certainly evaluate that, and there are certain covenants that we have under our agreement, you know, with regards to that are based on EBITDA. You know, and ratios. So we will do that. But if it makes economic sense to do that, rather than deploying it elsewhere, we will certainly evaluate that. Okay.

Analyst: And then regarding the farming practices, I know you guys like to be conservative. But I just want to just want to ask. So, like, is that something that could possibly be realized in 2026 where if you are able to get the farmers in line or whatever that you are able to realize extra $0.10 per gallon in 2026, And if so, would that apply to all of the gallons that the dry mill and Pekin unless you are also looking to do this at Columbia, maybe clarifying that as well. But my question is, would that then apply the gallons for the entire year's worth of production?

Robert R. Olander: Robert, you want to start and I will fill in? Yeah. I will I will take that 1. You know, we are we are currently you know, in discussions, with our farmer partners. We are not at the point that can support recognizing you know, that benefit. We are definitely trying to set ourselves up for the future. But we are in the process of exploring how many bushels or how much volume could qualify under the low carbon intensity corn and then that would be applied against our production and then calculate what the carbon intensity reduction would be. So we cannot say definitively 1 way or the other at this time.

We are still in that process, but definitely, laying the groundwork for the future.

Bryon T. McGregor: And maybe what I would add to that is if we can, clearly, we would. Right? It would be derelict not to do that. For 2026. But it is important to note that even if you do if you do not pick it up for 2026, I mean, it would be incremental or a relatively small change this year, but you should see much more significant, especially the more you know, low carbon practices that are implemented, you know, with cover crops, things like that. Those will not apply this year unless they were already doing them. But if they, you know, enter this fall after harvest and doing cover crops, you really start to see the benefit in 2027.

Alright. Thank you. Fantastic quarter. Thank you. Appreciate it.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Bryon McGregor for closing remarks.

Bryon T. McGregor: Thanks, Danielle. Thanks to everyone for joining us today. As always, we appreciate your interest in and support of Alto Ingredients. Have a great day.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.