UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended	~~June~~December 3031, 2024
	OR
o	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:	000-52033

RED TRAIL ENERGY, LLC

(Exact name of registrant as specified in its charter)

North Dakota

76-0742311

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer Identification No.)

3682 Highway 8 South, P.O. Box 11, Richardton, ND 58652

(Address of principal executive offices)

(701) 974-3308

(Registrant's telephone number, including area code)

N/A

(Former name, former address and formal fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered

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

☐

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

☐

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 Filer	o	Accelerated Filer	o
Non-Accelerated Filer	x	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).

o Yes x No

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

As of ~~August~~February 1419, ~~2024~~2025, there were 40,148,160 Class A Membership Units issued and outstanding.

Table of Contents

INDEX

			Page Number
PART I. FINANCIAL INFORMATION			3
Item 1. Financial Statements			3
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			1516
Item 3. Quantitative and Qualitative Disclosures about Market Risk			2421
Item 4. Controls and Procedures			2622
PART II. OTHER INFORMATION			2623
Item 1. Legal Proceedings			2623
Item 1A. Risk Factors			2623
Item 2. Unregistered Sales of Equity Securities			2723
Item 3. Defaults Upon Senior Securities			2723
Item 4. Mine Safety Disclosures			2723
Item 5. Other Information			2724
Item 6. Exhibits			2724
SIGNATURES			2825

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

RED TRAIL ENERGY, LLC

Condensed Balance Sheets

ASSETS

~~June~~December 3031, 2024

September 30, ~~2023~~2024

(Unaudited)

(Audited)

Current Assets

Cash and equivalents

38,~~454~~483,~~535~~840

113,~~617~~390,~~435~~382

Restricted cash - margin account

4878,~~269,855~~992

23,~~933~~714,~~668~~985

Accounts receivable, net, primarily related party

24,~~836~~339,~~519~~795

74,~~669~~030,~~441~~089

Inventory

1113,~~994~~395,~~207~~980

9,~~099~~913,~~945~~061

Prepaid expenses

~~838~~788,~~082~~347

~~369~~569,~~430~~376

Total current assets

2327,~~393~~886,~~198~~954

3121,~~689~~617,~~919~~893

Property, Plant and Equipment

Land

1,333,681

Land improvements

1718,~~662~~563,~~538~~059

Buildings

15,333,~~675~~676

15,~~320~~333,~~492~~676

Plant and equipment

124,~~273~~449,~~872~~958

~~122~~124,~~444~~473,~~522~~132

Construction in progress

13,~~527~~690,~~696~~888

12,~~986~~759,~~776~~400

160,131,462

158,748,009

163,371,262

162,462,948

Less accumulated depreciation

8891,~~018~~253,~~219~~628

8389,~~208~~641,~~524~~814

Net property, plant and equipment

72,~~113~~117,~~243~~634

7572,~~539~~821,~~485~~134

Other Assets

Right of use operating lease assets, net

1,~~837~~678,~~988~~853

21,~~122~~746,~~550~~528

Investment in RPMG

940,642

Patronage equity

6,~~105~~606,~~316~~241

67,~~457~~047,604

Deposits

40,000

Total other assets

89,~~923~~265,~~946~~736

9,~~560~~774,~~796~~774

Total Assets

~~104~~109,~~430~~270,~~387~~324

~~116~~104,~~790~~213,~~200~~801

Notes to Unaudited Condensed Financial Statements are an integral part of this Statement.

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RED TRAIL ENERGY, LLC

Condensed Balance Sheets

LIABILITIES AND MEMBERS' EQUITY

~~June~~December 3031, 2024

September 30, ~~2023~~2024

(Unaudited)

(Audited)

Current Liabilities

Accounts payable

37,~~340~~217,~~227~~814

62,~~805~~527,~~187~~925

Accrued expenses

12,~~446~~770,~~708~~335

12,~~921~~271,~~880~~428

Commodities derivative instruments, at fair value (see note 3)

~~684~~66,~~237~~562

—289,200

Accrued loss on firm purchase commitments (see notes 4 and 8)

7650,000

—50,000

Customer deposits

11184,~~078~~358

3825,~~294~~895

Current maturities of notes payable

2,~~127~~125,~~700~~864

2,~~341~~126,~~784~~544

Current portion of operating lease liabilities

~~374~~392,~~508~~663

~~376~~381,~~021~~258

Total current liabilities

812,~~060~~807,~~458~~596

117,~~483~~672,~~166~~250

Long-Term Liabilities

Notes payable

18,054,528

2018,~~188~~054,~~774~~528

Long-term operating lease liabilities

1,~~463~~286,~~480~~190

1,~~746~~365,~~528~~270

Total long-term liabilities

19,518,008

21,935,302

Asset Retirement Obligation

1,013,740

1,002,032

Total long-term liabilities

20,354,458

20,421,830

Commitments and Contingencies (Notes 4, 5, 7 and 8)

Members’ Equity 40,148,160 Class A Membership Units issued and outstanding

76,~~851~~108,~~921~~270

8376,~~371~~119,~~732~~721

Total Liabilities and Members’ Equity

~~104~~109,~~430~~270,~~387~~324

~~116~~104,~~790~~213,~~200~~801

Notes to Unaudited Condensed Financial Statements are an integral part of this Statement.

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RED TRAIL ENERGY, LLC

Condensed Statements of Operations (Unaudited)

	Three Months Ended		Three Months Ended		~~Nine Months Ended~~		~~Nine Months Ended~~
	June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023
	December 31, 2024		December 31, 2023
	(Unaudited)		(Unaudited)		~~(Unaudited)~~		~~(Unaudited)~~
Revenues, primarily related party	$	34,~~578~~074,~~254~~726	$	4943,~~690~~456,~~760~~009	$	~~112,069,256~~	$	~~148,820,593~~
Cost of Goods Sold
Cost of goods sold	2932,~~283~~259,~~620~~172		4738,~~967~~958,~~330~~689		~~107,201,453~~		~~142,207,229~~
Lower of cost or net realizable value adjustment	—		—		—		74,000
Loss on firm purchase commitments	—		1,394,000
Loss on firm purchase commitments	—		71,000		1,394,000		535,000
Total Cost of Goods Sold	32,259,172		40,352,689
Total Cost of Goods Sold	29,283,620		48,038,330		108,595,453		142,816,229
Gross Profit	1,815,554		3,103,320
Gross Profit	5,294,634		1,652,430		3,473,803		6,004,364
General and Administrative Expenses	1,633,536		1,295,942
General and Administrative Expenses	1,231,379		1,310,476		3,819,594		4,098,939
Operating Income	182,018		1,807,378
Operating Income (Loss)	4,063,255		341,954		(345,791)		1,905,425
Other Income (Expense)
Interest income	2758,~~722~~382		14165,~~953~~894		~~248,820~~		~~44,978~~
Other income (expense), net	~~173~~2,410		43455,~~625~~147		~~456,481~~		~~70,471~~
Interest (expense)	(~~286~~254,~~097~~261)		(~~264~~267,~~282~~904)		~~(800,086)~~		~~(818,859)~~
Total other income (expense), net	(~~258~~193,~~202~~469)		~~(205~~353,~~704)~~137		~~(94,785)~~		~~(703,410)~~
Net Income (Loss)	$	3(11,~~805,053~~451)	$	~~136~~2,~~250~~160,515	$	~~(440,576)~~	$	~~1,202,015~~
Weighted Average Units Outstanding
Basic	40,148,160		40,148,160		~~40,148,160~~		~~40,148,160~~
Diluted	40,148,160		40,148,160		~~40,148,160~~		~~40,148,160~~
Net Income (Loss) Per Unit
Basic	$	~~0.09~~—	$	—0.05	$	~~(0.01)~~	$	~~0.03~~
Diluted	$	~~0.09~~—	$	—0.05	$	~~(0.01)~~	$	~~0.03~~

Notes to Unaudited Condensed Financial Statements are an integral part of this Statement.

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RED TRAIL ENERGY, LLC

Condensed Statements of Cash Flows (Unaudited)

	Nine Months Ended		Nine Months Ended
	Three Months Ended		Three Months Ended
	June 30, 2024		June 30, 2023
	December 31, 2024		December 31, 2023
Cash Flows from Operating Activities
Net income (Loss)	$	(~~440~~11,~~576~~451)	$	12,~~202~~160,~~015~~515
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation	41,~~809~~634,~~695~~988		41,~~745~~591,~~508~~194
Loss on disposal of fixed assets	—		~~9,759~~—
Change in fair value of derivative instruments	~~684~~(222,~~238~~638)		(1,~~010~~467,~~567)~~393
Lower of cost of net realizable value adjustment	—		74,000
Loss on firm purchase commitments	—		1,394,000
Loss on firm purchase commitments	1,394,000		535,000
Noncash patronage equity	441,363		65,616
Noncash patronage equity	352,288		50,897
Asset Retirement Obligation Liability Accretion	11,708		—
Changes in operating assets and liabilities:
Accounts receivable, net, primarily related party	4(309,~~832,922~~706)		(2,~~778~~669,~~879)~~757
Inventory	(43,~~288~~482,~~262~~916)		(38,~~095~~689,~~539~~751)
Prepaid expenses	(~~468~~218,~~653~~972)		(~~261~~781,~~853~~751)
Customer deposits	~~(27~~158,~~217)~~463		35116,~~957~~607
Accounts payable	(34,~~464~~689,~~960)~~889		15,~~050~~549,~~669~~944
Accrued expenses	~~(475~~498,~~171)~~904		1446,~~268,459~~388
Accrued loss on firm purchase commitments	~~76,000~~—		~~419~~1,394,000
Net cash provided by (used for) operating activities	2,984,304		2,244,426
Net cash provided by operating activities	3,189,632		7,383,912
Cash Flows from Investing Activities
Investment in RPMG	—		(335,642)
Capital expenditures	(931,487)		(448,214)
Proceeds from disposal of fixed assets	—		33,000
Net cash (used for) investing activities	(931,487)		(448,214)
Capital expenditures	(1,383,452)		(1,917,310)
Net cash provided by (used for) investing activities	(1,383,452)		(2,219,952)
Cash Flows from Financing Activities
Distribution Paid	~~(6,079,234)~~—		(~~6,023,250~~995)
Proceeds from notes payable	5,025,833		7,000,000
Debt repayments	(680)		(219,429)
Debt repayments	(7,374,164)		(3,420,139)
Net cash (used for) financing activities	(680)		(220,424)
Net cash (used for) financing activities	(8,427,565)		(2,443,389)
Net Change in Cash, Cash Equivalents and Restricted Cash	2,257,465		6,715,274
Net Change in Cash, Cash Equivalents and Restricted Cash	(6,826,713)		(2,418,915)
Cash, Cash Equivalents and Restricted Cash - Beginning of Period	7,105,367		14,551,103
Cash, Cash Equivalents and Restricted Cash - Beginning of Period	14,551,103		11,152,015
Cash, Cash Equivalents and Restricted Cash - End of Period	$	9,362,832	$	21,266,377
Cash, Cash Equivalents and Restricted Cash - End of Period	$	7,724,390	$	8,733,100
Reconciliation of Cash, Cash Equivalents and Restricted Cash
Cash and cash equivalents	$	38,~~454~~483,~~535~~840	$	616,~~022~~563,~~687~~108
Restricted cash	4878,~~269,855~~992		24,~~710~~703,~~413~~269
Total Cash, Cash Equivalents and Restricted Cash	$	79,~~724~~362,~~390~~832	$	821,~~733~~266,~~100~~377
Supplemental Disclosure of Cash Flow Information
Interest paid	$	1254,~~103,585~~261	$	~~437~~267,~~438~~904
Noncash Investing and Financing Activities
Operating lease asset acquired	$	—	$	~~1,620,653~~—
Distribution Payable	$	—	$	6,022,224
Capital expenditures in accounts payable	$	—	$	—

Notes to Unaudited Condensed Financial Statements are an integral part of this Statement.

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

The accompanying condensed unaudited financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted as permitted by such rules and regulations. These financial statements and related notes should be read in conjunction with the financial statements and notes thereto included in the Company's audited financial statements for the fiscal year ended September 30, ~~2023~~2024, contained in the Company's Annual Report on Form 10-K filed with the SEC on ~~December~~January 2915, ~~2023~~2025.

In the opinion of management, the interim condensed unaudited financial statements reflect all adjustments considered necessary for fair presentation. The adjustments made to these statements consist only of normal recurring adjustments. Operating results for the periods presented are not ~~necessarily~~ indicative of the results that may be expected for the fiscal year ending September 30, ~~2024~~2025.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

As of December 31, 2024, Red Trail Energy, LLC, a North Dakota limited liability company (the “Company”), ~~owns~~owned and ~~operates~~operated a 50 million gallon annual name-plate production ethanol plant near Richardton, North Dakota (the “Plant”).

Reduced Carbon Dioxide Fuels Credits

~~The~~As of December 31, 2024, the Company ~~recently~~was ~~entered~~in athe market to sell voluntary carbon dioxide reduction credits. The Company isgenerated ~~generating~~ these credits through ~~our~~its carbon dioxide sequestration project. The Company ~~holds~~held these credits in inventory asfor wethe ~~seek~~purpose of seeking buyers who ~~are~~were interested in purchasing ~~the credits~~them. The Company isused ~~using~~ the inventory method of accounting for these credits and wedid ~~are~~ not ~~including~~include these credits as assets on ~~our~~its balance sheet asbecause they have negligible incremental costs associated with ~~generating~~their generation. As of December 31, 2024 the ~~credits~~Company has received $948,000 for carbon credit sales. When the Company ~~enters~~entered into a contract to sell these credits, weit ~~will~~recognized ~~recognize~~ income upon transferring of the credit.

Accounting Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported revenues and expenses. Significant items subject to such estimates and assumptions include the useful lives of property, plant and equipment, inventory, asset retirement obligation, and allowance for credit losses. Actual results could differ from those estimates.

Net Income (Loss) Per Unit

Net income (loss) per unit is calculated on a basic and fully diluted basis using the weighted average units outstanding during the period.

2. REVENUE

Revenue Recognition

~~The~~As of December 31, 2024, the Company ~~recognizes~~recognized revenue from sales of ethanol and co-products at the point in time when the performance obligations in the Company's contracts with customers are met, which is when the customer obtains control of such products and typically occurs upon shipment (depending on the terms of the underlying contracts). Revenue is measured as the amount of consideration expected to be received in exchange for transferring goods or providing services. In some instances, the Company ~~enters~~has entered into contracts with customers that contain multiple performance obligations to deliver specified volumes of co-products over a contractual period of less than 12 months. In such instances, the Company allocates the transaction price to each performance obligation identified in the contract based on relative standalone selling prices and recognizes the related revenue when control of each individual product is transferred to the customer in satisfaction of the corresponding performance obligation.

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

Revenue by Source

The following table disaggregates revenue by the Company's major ~~source~~sources for the ~~nine~~three months ended ~~June~~December 3031, 2024 and 2023.

Revenues	For the three months ended ~~June~~December 3031, 2024 (unaudited)		For the three months ended ~~June~~December 3031, 2023 (unaudited)		~~For the nine months ended June 30, 2024 (unaudited)~~		~~For the nine months ended June 30, 2023 (unaudited)~~
Ethanol, E85 and Industrial Alcohol	$ 26,062,303	~~26,459,827~~	$	3832,~~727~~058,~~252~~346	$	~~82,589,455~~	$	~~111,546,165~~
Distillers Grains	5,~~772~~852,~~019~~224		8,~~572~~001,~~529~~772		~~21,214,955~~		~~28,780,739~~
Syrup	~~139~~134,~~269~~151		~~140~~144,~~032~~647		~~433,056~~		~~512,350~~
Corn Oil	21,~~159~~965,~~064~~512		23,~~208~~179,~~059~~871		~~7,668,057~~		~~7,831,189~~
NDGI Inspection Fee	48,075		42,888		163,733		150,149
Carbon Credits	948,000		—
Total revenue from contracts with customers	$	34,578,254	$	49,690,760	$	112,069,256	$	148,820,592
Corn Inspection Fee	60,536		71,373
Total revenue from contracts with customers	$	34,074,726	$	43,456,009

Shipping and Handling Costs

WeAs ~~account~~of December 31, 2024, the Company accounted for shipping and handling activities related to contracts with customers as costs to fulfill ~~our~~its promises to transfer the associated products. Accordingly, wethe ~~record~~Company recorded customer payments associated with shipping and handling costs as a component of revenue and ~~classify~~classified such costs as a component of cost of goods sold.

Customer Deposits

Customer deposits are contract liabilities for payments in excess of revenue recognized. Customer deposits are recognized when modified distillers grains customers make prepayments on their contracts. The ending balances for accounts receivable and customer deposits were as follows for the ~~periods~~three ~~nine~~month ~~months~~periods ended ~~June~~December 3031, 2024 and 2023 and the year-end periods ended September 30, ~~2023~~2024 and ~~2022~~2023:

For the period ended June 30, 2024 (unaudited)

For the period ended June 30, 2023 (unaudited)

For the period ended September 30, 2023 (unaudited)

For the period ended September 30, 2022 (unaudited)

For the period ended December 31, 2024 (unaudited)

For the period ended December 31, 2023 (unaudited)

For the period ended September 30, 2024 (audited)

For the period ended September 30, 2023 (audited & restated)

Accounts receivable

24,~~836~~339,~~519~~795

74,~~657~~999,~~890~~684

74,~~669~~030,~~441~~089

47,~~879~~669,~~011~~441

Customer deposits

11184,~~078~~358

46154,~~593~~901

3825,~~294~~895

1038,~~636~~294

3. DERIVATIVE INSTRUMENTS

Commodity Contracts

As of December 31, 2024, as part of ~~its~~a hedging strategy, the Company ~~may~~from ~~enter~~time to time entered into ethanol, soybean, soybean oil, natural gas and corn commodity-based derivatives inwhere ~~order~~the toprices ~~protect~~are ~~cash~~set ~~flows~~at ~~from~~a ~~fluctuations~~future ~~caused~~date ~~by volatility~~ in ~~commodity prices in~~ order to protect ~~gross~~cash ~~profit~~flows ~~margins~~ from ~~potentially~~fluctuations ~~adverse~~caused ~~effects~~by ~~of market and price~~ volatility onin ~~ethanol~~commodity ~~sales, corn oil sales, and corn purchase commitments where the~~ prices ~~are set at a future date~~. These derivatives ~~are~~were not designated as effective hedges for accounting purposes. For derivative instruments that are not accounted for as hedges, or for the ineffective portions of qualifying hedges, the change in fair market value is recorded through earnings in the period of change. Ethanol derivative fair market value gains or losses ~~are~~were included in the results of operations and are classified as revenue, and corn derivative changes in fair market value are included in cost of goods sold.

The following tables provide details regarding the Company's derivative financial instruments at December 31, 2024 and September 30, 2024:

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

As of:

~~June~~December 3031, 2024 (unaudited)

September 30, ~~2023~~2024 (audited)

Contract Type

# of Contracts

Notional Amount (Qty)

Fair Value

# of Contracts

Notional Amount (Qty)

Fair Value

Corn options

~~932~~50

4250,~~660,~~000

(~~597~~66,~~237~~562)

—912

—4,560,000

bushels

—(289,200)

Soybean oil options

~~100~~—

~~10,000~~—

~~(19,500)~~—

—

gal

—

Natural gas options

50—

~~500,000~~—

~~(67,500)~~—

—

Total fair value

(~~684~~66,~~237~~562)

—(289,200)

Amounts are combined on the balance sheet - negative numbers represent liabilities

The following tables provide details regarding the Company's derivative financial instruments at June 30, 2024 and September 30, 2023:


Derivatives not designated as hedging instruments:

Balance Sheet - as of December 31, 2024 (unaudited)	Asset		Liability
Commodity derivative instruments, at fair value	$	—	$	66,562
Total derivatives not designated as hedging instruments for accounting purposes	$	—	$	66,562

Balance Sheet - as of September 30, 2024 (audited)	Asset		Liability
Commodity derivative instruments, at fair value	$	—	$	289,200
Total derivatives not designated as hedging instruments for accounting purposes	$	—	$	289,200

Derivatives not designated as hedging instruments:
Balance Sheet - as of June 30, 2024 (unaudited)	Asset		Liability
Commodity derivative instruments, at fair value	$	—	$	(684,237)
Total derivatives not designated as hedging instruments for accounting purposes	$	—	$	(684,237)
Balance Sheet - as of September 30, 2023	Asset		Liability
Commodity derivative instruments, at fair value	$	—	$	—
Total derivatives not designated as hedging instruments for accounting purposes	$	—	$	—

The following table provides details regarding the Company's amount of recognized gain or loss in income during the three month periods ending at December 31, 2024 and December 31, 2023:

Statement of Operations Income/(Expense)	Location of gain (loss) in fair value recognized in income	Amount of gain (loss) recognized in income during the three months ended ~~June~~December 3031, 2024 (unaudited)		Amount of gain (loss) recognized in income during the three months ended ~~June~~December 3031, 2023 (unaudited)		~~Amount of gain (loss) recognized in income during the nine months ended June 30, 2024 (unaudited)~~		~~Amount of gain (loss) recognized in income during the nine months ended June 30, 2023 (unaudited)~~
Corn derivative instruments	Cost of Goods Sold	$	(1386,~~975,563)~~644	$	~~675~~776,~~471~~649	$	~~(151,029)~~	$	~~987,956~~
Ethanol derivative instruments	Revenue	56,750		570		56,750		21,999
Natural gas derivative instruments	Cost of Goods Sold	—		439,330
Natural gas derivative instruments	Cost of Goods Sold	13,990		45,610		702,660		74,000
Total		$	386,644	$	1,215,979
Total		$	(1,904,823)	$	721,651	$	608,381	$	1,083,955

4. INVENTORY

Inventory is valued at the lower of cost or net realizable value. Inventory values as of ~~June~~December 3031, 2024 and September 30, ~~2023~~2024 were as follows:

June 30, 2024(unaudited)

September 30, 2023

December 31, 2024(unaudited)

September 30, 2024 (audited)

Raw materials, including corn, chemicals and supplies

46,~~111~~780,~~374~~080

45,~~263~~107,~~403~~854

Work in process

1,~~129~~068,~~510~~601

1,~~435~~058,~~905~~478

Finished goods, including ethanol and distillers grains

42,~~166~~824,~~194~~991

1,~~918~~252,~~439~~483

Spare parts

2,~~587~~722,~~129~~308

12,~~482~~494,~~198~~246

Total inventory

1113,~~994~~395,~~207~~980

9,~~099~~913,~~945~~061

Lower of cost or net realizable value adjustments for the three months ended December 31, 2024 and 2023 were as follows:

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

Lower of cost or net realizable value adjustments for the nine months ended June 30, 2024 and 2023 were as follows:


	For the three months ended December 31, 2024 (unaudited)		For the three months ended December 31, 2023 (unaudited)
Loss on firm purchase commitments	$	—	$	1,394,000
Loss on lower of cost or net realizable value adjustment for inventory on hand	$	—	$	—
Total loss on lower of cost or net realizable value adjustments	$	—	$	1,394,000

	For the three months ended June 30, 2024 (unaudited)		For the three months ended June 30, 2023 (unaudited)		For the nine months ended June 30, 2024 (unaudited)		For the nine months ended June 30, 2023 (unaudited)
Loss on firm purchase commitments	$	—	$	71,000	$	1,394,000	$	535,000
Loss on lower of cost or net realizable value adjustment for inventory on hand	$	—	$	—	$	—	$	74,000
Total loss on lower of cost or net realizable value adjustments	$	—	$	71,000	$	1,394,000	$	609,000

As of December 31, 2024, the Company had entered into forward corn purchase contracts which required the Company to take delivery of corn at the prenegotiated contract price. At the time the contracts were created, the price of the contract approximated market price. It was expected that subsequent changes in market conditions could cause the fixed prenegotiated contract price to become higher or lower than fluctuating market prices. As of December 31, 2024, the average price of corn purchased under certain fixed price contracts, that had not yet been delivered, was greater than the approximated market price. Based on this information, the Company estimated loss on firm purchase commitments of approximately $0 and 1,394,000 for the three months ended December 31, 2024 and 2023, respectively. The loss is recorded in “Loss on firm purchase commitments” on the statement of operations and "Accrued loss on firm purchase commitments" on the balance sheet. The amount of the potential loss was determined by applying a methodology similar to that used in the impairment valuation with respect to inventory. Given the uncertainty of future ethanol and commodity prices, future losses on the outstanding purchase commitments could be recorded in future periods.

The Company has entered into forward corn purchase contracts under which it is required to take delivery at the contract price. At the time the contracts were created, the price of the contract approximated market price. Subsequent changes in market conditions could cause the contract prices to become higher or lower than market prices. As of June 30, 2024, the average price of corn purchased under certain fixed price contracts, that had not yet been delivered, was greater than the approximated market price. Based on this information, the Company has estimated loss on firm purchase commitments of approximately $1,394,000 and $535,000 for the nine months ended June 30, 2024 and 2023, respectively. The loss is recorded in “Loss on firm purchase commitments” on the statement of operations and "Accrued loss on firm purchase commitments" on the balance sheet. The amount of the potential loss was determined by applying a methodology similar to that used in the impairment valuation with respect to inventory. Given the uncertainty of future ethanol prices, future losses on the outstanding purchase commitments could be recorded in future periods.

5. BANK FINANCING

Ethanol Recovery Program

On July 13, 2020, we received a $5.41 million loan through the Bank of North Dakota's Ethanol Recovery Program and Cornerstone Bank ("Cornerstone"). The Ethanol Recovery Program was developed by the North Dakota Ethanol Producers Association and the Bank of North Dakota to use the existing Biofuels Partnership in Assisting Community Expansion ("PACE") program and Value-added Guarantee Loan program to help ethanol production facilities weather the economic challenges caused by the COVID-19 pandemic. Ethanol producers could qualify for up to $15 million of a low interest loan of 1% based on the amount of such producers' annual corn grind. On December 3, 2021 we received forgiveness of $2.65 million of the loan. The forgiveness was recorded as other income. The outstanding balance as of September 30,2023 was $306,000 and the current balance as of June 30, 2024 was $0. The maturity date of the loan is July 13, 2025. The fixed interest rate on June 30, 2024 was 3.75% with an interest rate being bought down through the Bank of North Dakota to 1%.

Revolving Loan

OnAs ~~February~~of 3December 31, ~~2022~~2024, wethe ~~renewed~~Company ~~our~~had a $10 million revolving loan (the "Revolving Loan") ~~with~~from Cornerstone. OnBank ~~April~~("Cornerstone") ~~8, 2022 the Revolving Loan was renewed~~ with ~~maturity date of April 7, 2023. Subsequent to year end the Revolving Loan was again renewed with~~ a maturity date of April 49, ~~2024~~2025. OnAt ~~April 11~~December 31, 2024, the ~~Revolving~~Company ~~loan~~had ~~was~~$10 ~~renewed~~million ~~for~~available ~~another~~on ~~year~~the ~~with~~Revolving ~~a maturity date of April 5, 2025~~Loan. Interest accrued on ~~Revolving~~any ~~Loan~~outstanding ~~accrues~~balance on ~~any~~the ~~outstanding~~Revolving ~~balance~~Loan at a rate of 0.25% less than the prime rate as published by the Wall Street Journal, ~~which is~~ adjusted monthly. The Revolving Loan has a minimum interest rate of 7.5%. AtThe ~~June~~variable interest rate on December 3031, 2024 was 7.5%. Subsequent to the December 31, we2024 ~~had~~period ~~$10~~end, ~~million~~the ~~available~~Company, ~~under~~in connection with the ~~Revolving~~Asset ~~Loan.~~Sale, ~~The~~paid ~~variable~~all ~~interest~~outstanding ~~rate~~amounts ofdue under the Revolving Loan onand ~~June 30,~~terminated ~~2024~~the ~~was~~Revolving 7Loan.~~500%.~~

Construction ~~Loans~~Loan

On October 28, 2022, wethe Company entered into a $25 million loan with Cornerstone Bank to refinance two (2) previous construction loans with Cornerstone Bank (the "Consolidated Construction Loan"). WeInterest ~~make~~accrued on the Consolidated Construction Loan at a fixed rate of 4.65%. As of December 31, 2024, the Company was making annual payments of approximately $3.1 million ~~that is due~~ in January of each year on the Consolidated Construction Loan. ~~The~~As of December 31, 2024, the maturity date of the Consolidated Construction Loan iswas January 31, 2032. The ~~fixed~~outstanding ~~interest~~balance ~~rate~~as isof 4December 31, 2024 on the Consolidated Construction Loan was $20,054,528.~~65%.~~ The ~~outstanding~~Consolidated ~~balance~~Construction asLoan was secured by a lien on substantially all of ~~June~~the Company's assets. Subsequent to the December 3031, 2024 period end, ~~was~~the ~~$20~~Company, in connection with the Asset Sale, paid all outstanding amounts due under the Consolidated Construction Loan and terminated the Consolidated Construction Loan.~~0 million.~~

Each of the Company's loans were secured by a lien on substantially all of the assets of the Company which were released in connection with the Asset Sale.

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

Each of the Company's loans are secured by a lien on substantially all of the assets of the Company.


Schedule of debt maturities for the twelve months ending December 31	Totals
2025	$	2,125,864
2026	2,229,313
2027	2,335,215
2028	2,446,147
2029	2,562,348
Thereafter	8,481,505
Total	$	20,180,392

Schedule of debt maturities and finance lease liabilities for the twelve months ending June 30, 2024	Totals
2025	$	2,127,700
2026	2,229,313
2027	2,335,215
2028	2,446,147
2029	2,562,348
Thereafter	8,481,505
Total	$	20,182,228

6. FAIR VALUE MEASUREMENTS

The following table provides information on those liabilities that are measured at fair value on a recurring basis as of ~~June~~December 3031, 2024 and September 30, ~~2023~~2024, respectively.

					Fair Value Measurement Using
	Carrying Amount as of June 30, 2024 (unaudited)		Fair Value as of June 30, 2024 (unaudited)		Level 1		Level 2		Level 3
	Carrying Amount as of December 31, 2024 (unaudited)		Fair Value as of December 31, 2024 (unaudited)		Level 1		Level 2		Level 3
Liabilities
Commodities derivative instruments	$	~~684~~66,~~238~~562	$	~~684~~66,~~238~~562	$	~~684~~66,~~238~~562	$	—	$	—
Total	$	~~684~~66,~~238~~562	$	~~684~~66,~~238~~562	$	~~684~~66,~~238~~562	$	—	$	—
					Fair Value Measurement Using
	Carrying Amount as of September 30, 2023		Fair Value as of September 30, 2023		Level 1		Level 2		Level 3
	Carrying Amount as of September 30, 2024		Fair Value as of September 30, 2024		Level 1		Level 2		Level 3
Liabilities
Commodities derivative instruments	$	—289,200	$	—289,200	$	—289,200	$	—	$	—
Total	$	—289,200	$	—289,200	$	—289,200	$	—	$	—

The fair value of the corn, ethanol, soybean oil and natural gas derivative instruments is based on quoted market prices in an active market.

7. LEASES

~~The~~As of December 31, 2024, the Company ~~leases~~leased railcar and plant equipment. Operating lease right of use assets and liabilities ~~are~~were recognized at the date of commencement of the lease based on the present value of lease payments over the lease term. The Company ~~uses~~used its estimated incremental borrowing rate, unless an implicit rate is readily determinable, as the discount rate for each lease in determining the present value of lease payments. For the ~~nine~~three months ended ~~June~~December 3031, 2024, the Company's estimated weighted-average discount rate was 7.50%. Operating lease expense iswas recognized on a straight-line basis over the lease term.

The Company ~~has~~ elected the short-term lease exemption for all leases with a term of 12 months or less for both existing and ongoing operating leases to not recognize the asset and liability for those leases. Lease payments for short-term leases ~~are~~were recognized on straight-line basis.

The Company determines if an arrangement is a lease or contains a lease at inception. The Company's existing leases at December 31, 2024 had remaining lease terms of approximately one year to seven years, which included options to extend the

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

~~The Company determines if an arrangement is a lease or contains a lease at inception. The Company's existing~~ leases ~~have remaining lease terms of approximately one year to seven years, which may include options to extend the leases~~ when it iswas reasonably certain the Company ~~will~~would exercise those options. At ~~June~~December 3031, 2024 the weighted-average remaining lease term was ~~six~~four years. The Company does not have lease arrangements with residual value guarantees, sale leaseback terms, or material restrictive covenants. The Company does not have any sublease agreements.

~~The~~After ~~Company~~the isperiod ~~generally~~end ~~responsible~~of ~~for maintenance~~December 31, ~~taxes~~2024, ~~and~~due ~~utilities~~to ~~for~~the ~~leased~~closing ~~equipment.~~of ~~Rent~~the ~~expense~~Asset ~~for~~Sale, ~~operating~~on ~~leases~~January ~~was approximately $605~~31,~~000~~ ~~and $747~~2025,~~000~~ ~~for~~ the ~~nine~~Company ~~months~~either ~~ended~~assigned ~~June 30,~~or ~~2024~~terminated ~~and~~all ~~2023,~~of ~~respectively~~its outstanding leases.

~~Equipment~~At ~~under~~the ~~financing~~period ~~leases~~ending ~~consists~~December 31, of2024, ~~office~~the ~~equipment~~Company ~~and~~was ~~plant~~generally ~~equipment.~~responsible Atfor ~~June 30~~maintenance, ~~2024~~taxes, and ~~September 30,~~utilities ~~2023,~~for leased equipment. ~~under~~Rent ~~financing~~expense for operating leases was asapproximately ~~follows:~~$208,042 for the three months ended December 31, 2024 and $182,575 for the three months ended December 31, 2023.

	June 30, 2024		September 30, 2023
Equipment	$	493,414	$	493,414
Less accumulated amortization	(260,861)		(243,277)
Net equipment under financing lease	$	232,553	$	250,137

Equipment under financing leases consists of office equipment and plant equipment, this lease ended in 2024. At December 31, 2024 and September 30, 2024, equipment under financing leases was as follows:

At June 30, 2024, the Company had the following minimum commitments, which at inception had non-cancellable terms of more than one year. Amounts shown below are for the 12 month periods ending December 31:


	December 31, 2024		September 30, 2024
Equipment	$	470,241	$	493,414
Less accumulated amortization	(248,444)		(246,032)
Net equipment under financing lease	$	221,797	$	247,382

	Operating Leases		Financing Leases
2024	$	374,508	$	1,836
2025	402,203		—
2026	406,657		—
2027	395,390		—
2028	259,230		—
Total minimum lease commitments	$	1,837,988	1,836
Less amount representing interest			—
Present value of minimum lease commitments included in notes payable on the balance sheet			$	1,836

At December 31, 2024, the Company had the following minimum commitments, which at inception had non-cancellable terms of more than one year. Amounts shown below are for the 12 month periods ending December 31:


	Operating Leases		Financing Leases
2025	$	392,663	$	—
2026	415,412		—
2027	461,140		—
2028	220,015		—
2029	189,623		—
Total minimum lease commitments	$	1,678,853	—
Less amount representing interest			—
Present value of minimum lease commitments included in notes payable on the balance sheet			$	—

**Note, after the period end of December 31, 2024, due to the closing of the Asset Sale, on January 31, 2025, the Company either assigned or terminated all of its outstanding leases which is not reflected in this table.

8. COMMITMENTS AND CONTINGENCIES

Firm Purchase Commitments for Corn

ToAs of December 31, 2024, to ensure an adequate supply of corn to operate the Plant, the Company ~~enters~~entered into contracts to purchase corn from local farmers and elevators. At ~~June~~December 3031, 2024, the Company had various fixed price contracts for the purchase of approximately 89.298 million bushels of corn. Using the stated contract price for the fixed price contracts, the Company had commitments of approximately $2741.9 million related to the 89.298 million bushels under contract.

After the period end of December 31, 2024, due to the closing of the Asset Sale, on January 31, 2025, the Company either assigned or terminated all of its firm purchase commitments for Corn.

Water

On April 21, 2015, wethe Company entered into a ten-year contract to purchase raw water from Southwest Water Authority in order to meet the Plant's water requirements (the "Water Contract"). ~~Our~~The ~~contract~~Water ~~requires~~Contract usrequired the Company to purchase a minimum of 160 million gallons of water per year. The minimum estimated obligation for this contract is $424,000 per year.

Profit and Cost Sharing Agreement

The Company entered into a Profit and Cost Sharing Agreement with Bismarck Land Company, LLC, which became effective on November 1, 2016. The Profit and Cost Sharing Agreement provides that the Company will share 70% of the net revenue generated by the Company from business activities which are brought to the Company by Bismarck Land Company, LLC and conducted on the real estate purchased from the Bismarck Land Company, LLC. The real estate was initially purchased in exchange for 2 million membership units of the Company at $1.66 per unit. This obligation will terminate ten years after the

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, 2024

~~real~~After ~~estate~~the ~~closing~~period ~~date~~end of ~~October 11~~December 31, ~~2016 or after Bismarck Land Company~~2024, ~~LLC~~due ~~receives~~to ~~$10~~the ~~million~~closing inof ~~proceeds from~~ the ~~agreement.~~Asset ~~In addition~~Sale, ~~the~~on ~~Profit~~January ~~and~~31, ~~Cost Sharing Agreement provides that the Company will pay Bismarck Land Company~~2025, ~~LLC 70% of any net proceeds received by~~ the Company ~~from~~assigned ~~the~~its ~~sale~~contract ~~of the subject real estate if a sale were~~ to ~~occur~~purchase ~~prior~~raw ~~to termination of this obligation in accordance with the $10 million cap or the ten-year term of this obligation~~water. ~~The Company has paid Bismarck Land Company, LLC $1,647,581 as of June 30, 2024.~~

Profit and Cost Sharing Agreement

The Company entered into a Profit and Cost Sharing Agreement with Bismarck Land Company, LLC, which became effective on November 1, 2016 (the "Bismark Profit and Cost Sharing Contract"). The Bismark Profit and Cost Sharing Contract provided that the Company share 70% of the net revenue generated by the Company from business activities which are brought to the Company by Bismarck Land Company, LLC and conducted on the real estate purchased from the Bismarck Land Company, LLC. The real estate was initially purchased in exchange for 2 million membership units of the Company at $1.66 per unit. This obligation will terminate ten years after the real estate closing date of October 11, 2016 or after Bismarck Land Company, LLC receives $10 million in proceeds from the agreement. In addition, the Profit and Cost Sharing Agreement provides that the Company will pay Bismarck Land Company, LLC 70% of any net proceeds received by the Company from the sale of the subject real estate if a sale were to occur prior to termination of this obligation in accordance with the $10 million cap or the ten-year term of this obligation. The Company has paid Bismarck Land Company, LLC a total of $1,947,581 as of December 31, 2024 in the aggregate and an amount of $0 during the three month period ended December 31, 2024.

After the period end of December 31, 2024, due to the closing of the Asset Sale, on January 31, 2025, the Company paid Bismark Land Company, LLC an amount of $8.1 million to terminate this agreement resulting in a total payment of $10,047,581 by the Company under the agreement.

9. RELATED PARTY TRANSACTIONS

The Company has balances and transactions in the normal course of business with various related parties for the purchase of corn, sale of distillers grains, and sale of ethanol. The related parties include unit holders, members of the board of governors of the Company, and RPMG, Inc. (“RPMG”). Significant related party activity affecting the financial statements is as follows:

June 30, 2024(unaudited)

September 30, 2023

December 31, 2024(unaudited)

September 30, 2024

Balance Sheet

Accounts receivable

23,~~475~~667,~~162~~917

63,~~939~~815,~~350~~434

Accounts payable

~~275~~527,~~611~~179

187,~~299,333~~635

For the three months ended June 30, 2024 (unaudited)

For the three months ended June 30, 2023 (unaudited)

For the nine months ended June 30, 2024 (unaudited)

For the nine months ended June 30, 2023 (unaudited)

For the three months ended December 31, 2024 (unaudited)

For the three months ended December 31, 2023 (unaudited)

Statement of Operations

Revenues

3331,~~042~~527,~~103~~231

4742,~~556~~144,~~566~~640

~~139,085,302~~

~~137,492,078~~

Cost of goods sold

~~749~~760,~~101~~852

~~674~~789,~~171~~359

~~3,120,136~~

~~2,688,422~~

General and administrative

—

~~39,889~~

Inventory Purchases

36,~~800~~842,~~078~~381

68,~~248~~801,~~650~~010

~~27,523,669~~

~~26,714,488~~

10. UNCERTAINTIES IMPACTING THE ETHANOL INDUSTRY AND OUR FUTURE OPERATIONS

~~During~~As ~~volatile~~of ~~market~~December ~~conditions~~31, 2024, the Company ~~experiences~~had certain risks and uncertainties that it experienced during volatile market conditions, which could have a severe impact on operations. The Company's revenues ~~are~~were derived ~~primarily~~ from the sale and distribution of ethanol and distillers grains to customers primarily located in the United States. Corn for the production process iswas supplied to the ~~Plant~~plant primarily from local agricultural producers and from purchases on the open market. The Company's operating and financial performance iswas largely driven by prices at which the Company ~~sells~~sold ethanol and distillers grains and by the cost at which it iswas able to purchase corn for operations. The price of ethanol is influenced by factors such as ~~supply and demand, weather, government policies and programs, and unleaded gasoline and the petroleum markets, although since 2005 the~~ prices ~~of ethanol and gasoline began a divergence with ethanol generally selling for less than gasoline at the wholesale level. Excess ethanol supply in the market~~, in particular, puts downward pressure on the price of ethanol. The Company's largest cost of production is corn. The cost of corn is generally impacted by factors such as supply and demand, weather, and government programs, global political or economic issues, including but not limited to the war in Ukraine and sanctions associated therewith, or global damaging growing conditions, such as plant disease or adverse weather, including drought, increased fertilizer costs as well as global conflicts, including but not limited to unrest in the Middle East.

The Company's financial performance is highly dependent on the Federal Renewable Fuels Standard ("RFS"), which requires that a certain amount of renewable fuels must be used each year in the United States. Corn based ethanol, such as the ethanol the Company produces, can be used to meet a portion of the RFS requirement. In November 2013, the EPA issued a proposed rule which would reduce the RFS for 2014, including the RFS requirement related to corn based ethanol. The EPA proposed rule was subject to a comment period which expired in January 2014. On November 30, 2015, the EPA released its final ethanol use requirements for 2014, 2015 and 2016, which were lower than the statutory requirements in the RFS. However, the final RFS for 2017 equaled the statutory requirement which was also the case for the 2018, 2019, 2020, 2021, and 2022 RFS final

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED ~~JUNE~~DECEMBER 3031, ~~2023~~2024

~~rules. The~~supply ~~final~~and ~~RFS~~demand, ~~for~~weather, ~~2022~~government ~~was~~policies ~~significantly~~and ~~larger~~programs, ~~than~~and ~~2021~~unleaded gasoline and the petroleum markets, ~~with~~although asince ~~final~~2005 ~~volume~~the ~~requirement~~prices of ~~20.63~~ethanol ~~billion~~and ~~gallons~~gasoline ~~and~~began a ~~supplemental~~divergence ~~standard~~with ethanol selling for less than gasoline at the wholesale level. Excess ethanol supply in the market, in particular, puts downward pressure on the price of ethanol.25 ~~billion~~The ~~gallons~~Company's largest cost of production was corn. The ~~final~~cost ~~RFS~~of ~~for~~corn ~~2023~~is generally impacted by factors such as supply and ~~2024~~demand, ~~had~~weather, aand ~~volume~~government ~~requirement~~programs, ofglobal ~~20.94~~political ~~billion~~or ~~gallons~~economic issues, including but not limited to the war in Ukraine and ~~21.54~~sanctions ~~billion~~associated ~~gallons~~therewith, ~~respectively.~~or global damaging growing conditions, such as plant disease or adverse weather, including drought, increased fertilizer costs as well as global conflicts, including but not limited to, unrest in the Middle East.

~~The~~As ~~Company~~of ~~anticipates~~December ~~that~~31, 2024, the ~~results~~Company's offinancial ~~operations~~performance ~~during~~was highly dependent on the ~~remainder~~Federal ofRenewable ~~fiscal~~Fuels ~~year~~Standard ~~2024~~("RFS"), ~~will~~which ~~continue~~requires tothat a certain amount of renewable fuels must be ~~affected~~used byeach ~~volatility~~year in the ~~commodity~~United ~~markets~~States. ~~The~~Corn ~~volatility~~based isethanol, ~~due~~such as the ethanol the Company produced, could be used to ~~various~~meet ~~factors~~a portion of the RFS requirement. In November 2013, the EPA issued a proposed rule which would reduce the RFS for 2014, including ~~uncertainty~~the ~~with~~RFS ~~respect~~requirement related to corn based ethanol. The EPA proposed rule was subject to a comment period which expired in January 2014. On November 30, 2015, the ~~availability~~EPA released its final ethanol use requirements for 2014, 2015 and ~~supply~~2016, ofwhich ~~corn~~were lower than the statutory requirements in the RFS. However, ~~increased~~the ~~demand~~final RFS for ~~grain~~2017 ~~from~~equaled ~~global~~the ~~and~~statutory ~~national~~requirement ~~markets,~~which ~~speculation~~was inalso the ~~commodity~~case ~~markets~~for the 2018, 2019, 2020, 2021, and ~~demand~~2022 RFS final rules. The final RFS for ~~corn~~2022 ~~from~~was significantly larger than 2021, with a final volume requirement of 20.63 billion gallons and a supplemental standard of .25 billion gallons. The final RFS for 2023, 2024, and 2025 contains a volume requirement of 20.94 billion gallons, 21.54 billion gallons, and 22.33 billion gallons, respectively. For 2023, 2024, and 2025, the corn-based ethanol ~~industry.~~RVO was set at 15 billion gallons.

11. MEMBER'S EQUITY

Changes in member's equity for the ~~nine~~three months ended ~~June~~December 3031, 2024 and 2023.

	Class A Member Units		Additional Paid in Capital		Accumulated Deficit/Retained Earnings		Treasury Units		Total Member Equity
Balances - September 30, 2023	$	39,044,595	$	75,541	$	44,411,136	$	(159,540)	$	83,371,732
Balances - September 30, 2024	$	39,044,595	$	75,541	$	37,159,125	$	(159,540)	$	76,119,721
Distribution	—		—		(6,023,219)		—		(6,023,219)
Net income	—		—		2,160,515		—		2,160,515
Balances December 31, 2023	$	39,044,595	$	75,541	$	40,548,432	$	(159,540)	$	79,509,028
Distribution	—		—		(56,015)		—		(56,015)
Net (loss)	—		—		(6,406,145)		—		(6,406,145)
Balances - March 31, 2024	$	39,044,595	$	75,541	$	34,086,272	$	(159,540)	$	73,046,868
Distribution	—		—		—		—		—
Net income	—		—		3(11,~~805,053~~451)		—		3(11,~~805,053~~451)
Balances - June 30, 2024	$	39,044,595	$	75,541	$	37,891,325	$	(159,540)	$	76,851,921
Balances December 31, 2024	$	39,044,595	$	75,541	$	37,147,674	$	(159,540)	$	76,108,270

	Class A Member Units		Additional Paid in Capital		Accumulated Deficit/Retained Earnings		Treasury Units		Total Member Equity
Balances - September 30, 2022	$	39,044,595	$	75,541	$	46,880,539	$	(159,540)	$	85,841,135
Balances - September 30, 2023	$	39,044,595	$	75,541	$	44,411,136	$	(159,540)	$	83,371,732
Net income	—		—		1,865,215		—		1,865,215
Distribution	—		—		(6,023,219)		—		(6,023,219)
Balances - December 31, 2022	$	39,044,595	$	75,541	$	48,745,754	$	(159,540)	$	87,706,350
Net income	—		—		2,160,515		—		2,160,515
Distribution	—		—		(6,024,235)		—		(6,024,235)
Balances December 31, 2023	$	39,044,595	$	75,541	$	40,548,432	$	(159,540)	$	79,509,028
Net income	—		—		(799,450)		—		(799,450)
Balances - March 31, 2023	$	39,044,595	$	75,541	$	41,922,069	$	(159,540)	$	80,882,665
Distribution $0.10 per unit	—		—		(2,006,423)		—		(2,006,423)
Net income	—		—		136,250		—		136,250
Balances - June 30, 2023	$	39,044,595	$	75,541	$	40,051,896	$	(159,540)	$	79,012,492

12. SUBSEQUENT EVENTS

~~Management~~On ~~evaluated~~January ~~all~~31, ~~other~~2025 ~~activity~~(the of“Closing Date”) the Company ~~and~~completed ~~concluded~~the previously announced transaction pursuant to that nocertain ~~subsequent~~Asset ~~events~~Purchase ~~have~~Agreement ~~occurred~~dated ~~that~~as ~~would~~of ~~require~~September ~~recognition~~10, in2024 (the ~~condensed~~“Asset ~~financial~~Purchase ~~statements~~Agreement”) by and among Red Trail Energy, LLC (the “Company”), Gevo, Inc. (NASDAQ: GEVO) (“Parent” or ~~disclosure~~“Gevo”), inand its wholly owned subsidiaries, Richardton CCS, LLC (“R-CCS”) and Net-Zero Richardton, LLC (“NZ-R”), and together with R-CCS, (the ~~notes~~“Buyers”). Pursuant to the ~~condensed~~Asset ~~financial~~Purchase ~~statements~~Agreement, and subject to the terms and conditions thereof, the Buyers acquired substantially all of the assets, and assumed certain liabilities, of the Company on the terms set forth therein (such transaction, the “Asset Sale”). As a result of the Asset Sale, the Company no longer maintains operations. This description does not purport to be a complete description of the Asset Purchase Agreement and is subject to and qualified in its entirety by reference to the full text of the

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RED TRAIL ENERGY, LLC

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED DECEMBER 31, 2024

Asset Purchase Agreement, which was filed as Exhibit 2.1 to the Current Report on Form 8-K, filed by the Company with the SEC on September 16, 2024, and is incorporated by reference.

On the Closing Date, the Company closed on the sale of substantially all of its assets for a purchase price of $210 million (subject to adjustment based on the terms of the Asset Purchase Agreement) (the “Purchase Price”) to the Buyers, which was approved by the Members of the Company at the Special Meeting of the Members held on December 5, 2024, as described in the definitive proxy statement filed by the Company with the SEC on October 18, 2024.

As previously disclosed, the Company and Gevo entered into an escrow agreement pursuant to which Gevo deposited $10 million in earnest money, which was applied against the Purchase Price. In addition, pursuant to such escrow agreement, Gevo deposited on the Closing Date: (i) $1.26 million of the Purchase Price for the purposes of securing the post-closing indemnification obligations of the Company, and (ii) $5 million of the Purchase Price for purposes of securing any Purchase Price adjustments as described in the Asset Purchase Agreement.

On February 7, 2025, the Company issued a distribution of $4.05 per Unit to each member due to cash received from the Asset Sale.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

We prepared the following discussion and analysis to help you better understand our financial condition, changes in our financial condition, and results of operations for the ~~nine~~three month period ended ~~June~~December 3031, 2024, compared to the same period of the prior fiscal year. This discussion should be read in conjunction with the financial statements, notes and information contained in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, ~~2023~~2024 filed with the SEC on ~~December~~January 2915, ~~2023~~2025. Unless otherwise stated, references in this report to particular years, quarters, months, or periods refer to our fiscal years ended in September and the associated quarters, months, or periods of those fiscal years.

This Form 10-Q has been prepared to disclose the financial condition of the Company as of the three month period ended December 31, 2024, however, on January 31, 2025 (the “Closing Date”), the Company completed the previously announced transaction pursuant to that certain Asset Purchase Agreement dated as of September 10, 2024 (the “Asset Purchase Agreement”) by and among Red Trail Energy, LLC (the “Company”), Gevo, Inc. (NASDAQ: GEVO) (“Parent” or “Gevo”), and its wholly owned subsidiaries, Richardton CCS, LLC (“R-CCS”) and Net-Zero Richardton, LLC (“NZ-R”), and together with R-CCS, (the “Buyers”). Pursuant to the Asset Purchase Agreement, and subject to the terms and conditions thereof, the Buyers acquired substantially all of the assets, and assumed certain liabilities, of the Company on the terms set forth therein (such transaction, the “Asset Sale”). As a result of the Asset Sale, the Company no longer maintains operations.

This description does not purport to be a complete description of the Asset Purchase Agreement and is subject to and qualified in its entirety by reference to the full text of the Asset Purchase Agreement, which was filed as Exhibit 2.1 to the Current Report on Form 8-K, filed by the Company with the SEC on September 16, 2024, and is incorporated by reference.

Forward Looking Statements

This report contains forward-looking statements that involve future events, our future performance, and our future operations and actions. In some cases you can identify forward-looking statements by the use of words such as "may," "should," "anticipate," "believe," "expect," "plan," "future," "intend," "could," "estimate," "predict," "hope," "potential," "continue," or the negative of these terms or other similar expressions. These forward-looking statements are only our predictions and involve numerous assumptions, risks and uncertainties. Our actual results or actions may differ materially from these forward-looking statements for many reasons, including the following factors:

•~~Reductions~~The incompletion ~~the~~of ~~corn-based ethanol use requirement in~~ the ~~Federal~~Asset ~~Renewable~~Sale. ~~Fuels Standard;~~

•~~Increased~~Any ~~inflation~~reduction ~~which~~in ~~can~~the ~~have~~amount anof ~~impact~~cash on the ~~costs~~Company receives due to any escrowed portions of ~~our~~the ~~raw~~purchase ~~materials;~~price which release is contingent on future events.

•~~Higher~~The ~~natural~~uncertainty ~~gas~~of ~~prices~~the invalue ~~the~~of ~~United~~any ~~States~~carbon ~~due~~dioxide toremoval ~~increased~~credits ~~exports~~that ofthe ~~natural~~Company ~~gas~~may tosell ~~Europe;~~on the Puro Registry.

•~~Market~~The ~~prices~~winding ~~and~~down ~~availability~~ of ~~corn~~our ~~that~~operations. ~~we require to operate the ethanol plant;~~

•~~Continued~~Our ~~economic~~ability ~~impacts~~to ~~from~~generate ~~the~~and ~~COVID-19~~maintain ~~pandemic,~~sufficient ~~including~~liquidity ~~reduced~~to ~~gasoline~~fund ~~demand;~~our necessary capital expenditures.

•Continued economic impacts of the war in Ukraine, including increased commodities prices and effect of sanctions;

•Economic impacts from global conflicts, including impacts from the conflict in the Middle East following the attack in Israel by Hamas;

•Lower oil prices which result in lower ethanol prices;

•Negative operating margins which result from lower ethanol prices;

•Lower distillers grains prices which result from the Chinese anti-dumping and countervailing duty tariffs;

•Lower ethanol prices due to the Chinese ethanol tariff and the Brazilian ethanol tariff;

•Logistics difficulties preventing us from delivering our products to our customers;

•Fluctuations in the price and market for ethanol, distillers grains and corn oil;

•Availability and costs of products and raw materials, particularly corn and natural gas;

•Changes in the environmental regulations that apply to our plant operations and our ability to comply with such regulations;

•Ethanol supply exceeding demand and corresponding ethanol price reductions impacting our ability to operate profitably and maintain a positive spread between the selling price of our products and our raw material costs;

•Our ability to generate and maintain sufficient liquidity to fund our operations and meet our necessary capital expenditures;

•Our ability to continue to meet our loan covenants;

•Our ability to successfully produce and sell carbon dioxide removal credits on the Puro Registry;

•Limitations and restrictions contained in the instruments and agreements governing our indebtedness;

•Results of our hedging transactions and other risk management strategies;

•Changes and advances in ethanol production technology;

•Reductions in demand for fuel, including ethanol, as electric car production increases; and

•Competition from alternative fuels and alternative fuel additives.

Overview

As of December 31, 2024, Red Trail Energy, LLC, a North Dakota limited liability company (the "Company," ~~"Red Trail~~," or "we," "our," or "us"), ~~owns~~owned and ~~operates~~operated a 50 million gallon annual name-plate production ethanol plant near Richardton, North Dakota. ~~Our~~The Company’s revenues ~~are~~were mainly derived from the sale and distribution of ~~our~~ ethanol, distillers grains and corn oil primarily in the continental United States. ~~Corn~~Additionally, the Company received some revenues from the sale of its carbon dioxide removal credits on the Puro Registry, a venture that is new to the Company. Corn was our largest cost component and our profitability iswas ~~highly~~ dependent on the spread between the price of corn and the price of ethanol. The Company ~~expects~~continues to expect to receive some revenue from the sale of its carbon dioxide removal credits ~~on the Puro Registry, a venture that is new to the Company~~.

15Results of Operations for the Three Months Ended December 31, 2024 and 2023

~~Table~~ The following table shows the results of ~~Contents~~our operations and the percentages of revenues, cost of goods sold, general and administrative expenses and other items to total revenues in our unaudited statements of operations for the three months ended December 31, 2024 and 2023:

Results of Operations for the Three Months Ended June 30, 2024 and 2023

The following table shows the results of our operations and the percentages of revenues, cost of goods sold, general and administrative expenses and other items to total revenues in our unaudited statements of operations for the three months ended June 30, 2024 and 2023:

	Three Months EndedJune 30, 2024 (Unaudited)			Three Months Ended June 30, 2023 (Unaudited)
Statement of Operations Data	Amount		%	Amount		%
Revenues	$	34,578,254	100.00	$	49,690,760	100.00
Cost of Goods Sold	29,283,620		84.69	48,038,330		96.67
Gross Profit	5,294,634		15.31	1,652,430		3.33
General and Administrative Expenses	1,231,379		3.56	1,310,476		2.64
Operating Income	4,063,255		11.75	341,954		0.69
Other Income (Loss), net	(258,202)		(0.75)	(205,704)		(0.41)
Net Income	$	3,805,053	11.00	$	136,250	0.27

The following table shows additional data regarding production and price levels for our primary inputs and products for the three months ended June 30, 2024 and 2023.

	Three Months Ended June 30, 2024 (unaudited)		Three Months EndedJune 30, 2023(unaudited)
Production:
Ethanol sold (gallons)	15,292,810		15,896,285
Dried distillers grains sold (tons)	25,387		27,670
Modified distillers grains sold (tons)	21,247		21,796
Corn oil sold (pounds)	5,309,840		4,263,660
Revenues:
Fuel grade ethanol average price per gallon (net of hedging)	$	1.73	$	2.44
Dried distillers grains average price per ton	161.92		228.57
Modified distillers grains average price per ton	78.20		103.14
Corn oil average price per pound	0.41		0.52
Primary Inputs:
Corn ground (bushels)	5,573,373		5,388,791
Natural gas (MMBtu)	386,893		391,585
Costs of Primary Inputs:
Corn average price per bushel (net of hedging)	$	4.15	$	7.04
Natural gas average price per MMBtu (net of hedging)	2.10		3.03
Other Costs (per gallon of ethanol sold):
Chemical and additive costs	$	0.079	$	0.079
Denaturant cost	0.046		0.047
Electricity cost	0.096		0.091
Direct labor cost	0.084		0.075

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Revenue


	Three Months Ended December 31, 2024 (Unaudited)			Three Months Ended December 31, 2023 (Unaudited)
Statement of Operations Data	Amount		%	Amount		%
Revenues	$	34,074,726	100.00	$	43,456,009	100.00
Cost of Goods Sold	32,259,172		94.67	40,352,689		92.86
Gross Profit	1,815,554		5.33	3,103,320		7.14
General and Administrative Expenses	1,633,536		4.79	1,295,942		2.98
Operating Income	182,018		0.54	1,807,378		4.16
Other Income (Loss), net	(193,469)		(0.57)	353,137		0.81
Net Income (Loss)	$	(11,451)	(0.04)	$	2,160,515	4.97

~~Our~~The ~~total~~following ~~revenue~~table ~~was~~shows ~~lower~~additional indata ~~the~~regarding ~~third~~production ~~quarter~~and ofprice ~~our~~levels ~~2024~~for ~~fiscal year compared to the third quarter of~~ our ~~2023~~primary ~~fiscal~~inputs ~~year~~and ~~primarily~~products ~~due to decreased average prices~~ for ~~our products during~~ the ~~third~~three ~~quarter~~months ofended ~~our~~December 31, 2024 fiscal year along with fewer gallons of ethanol sold during the 2024 period. During the third quarter of our 2024 fiscal year, approximately 76.5% of our total revenue was derived from ethanol sales, approximately 16.7% was from distillers grains sales, approximately 0.4% was from syrup sales, and ~~approximately 6.2% was from corn oil sales. During the third quarter of our~~ 2023 ~~fiscal year, approximately 77~~.9% of our total revenue was derived from ethanol and industrial alcohol sales, approximately 17.3% was from distillers grains sales, approximately 0.4% was from syrup sales and approximately 4.4% was from corn oil sales.

Ethanol


	Three Months Ended December 31, 2024 (Unaudited)	Three Months Ended December 31, 2023 (Unaudited)
Production:
Ethanol sold (gallons)	16,559,396	16,704,306

Dried distillers grains sold (tons)	22,028	25,666
Modified distillers grains sold (tons)	37,773	32,396
Corn oil sold (pounds)	4,659,880	5,438,520
Revenues:
Fuel grade ethanol average price per gallon (net of hedging)	$ 1.58	$	1.92

Dried distillers grains average price per ton	144.10	198.00
Modified distillers grains average price per ton	70.90	90.13
Corn oil average price per pound	0.42	0.58
Primary Inputs:
Corn ground (bushels)	6,033,314	5,968,261
Natural gas (MMBtu)	423,581	413,325
Costs of Primary Inputs:
Corn average price per bushel (net of hedging)	$ 3.83	$	4.62
Natural gas average price per MMBtu (net of hedging)	2.67	4.08
Other Costs (per gallon of ethanol sold):
Chemical and additive costs	$ 0.104	$	0.104
Denaturant cost	0.050	0.048
Electricity cost	0.095	0.118
Direct labor cost	0.101	0.097

The average price we received for our ethanol, without taking into account our hedge positions, was lower during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year. Management attributes this decrease in average ethanol prices received to increased market supply of ethanol and lower gasoline prices during the third quarter of our 2024 fiscal year compared to the 2023 period which has an impact on ethanol prices. Management anticipates that energy prices will remain lower than our 2023 fiscal year but higher than the prices we experienced during our third quarter of our 2024 fiscal year.

We sold fewer gallons of ethanol during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to decreased corn to ethanol conversion ratios during our 2024 fiscal year. Management anticipates ethanol production will be consistent during the rest of our 2024 fiscal year provided market conditions allow us to continue to operate the ethanol plant at capacity. We anticipate continuing to focus on operating the ethanol plant as efficiently as possible in order to maximize our profitability.

From time to time we enter into futures contracts for our products. At June 30, 2024, we had no open ethanol futures contracts. At June 30, 2023, we had no open ethanol futures contracts.

Distillers Grains

During the third quarter of our 2024 fiscal year, we sold fewer tons of distillers grains compared to the same period of our 2023 fiscal year due to decreased production overall along with increased corn oil production during the 2024 period. When we produce more pounds of corn oil, it has a corresponding negative impact on the volume of distillers grains we produce. We sold a majority of our distiller grains during the 2024 period in the dried form due to demand factors which favored the dried product. The average price we received for both our dried and modified distillers grains was lower during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to lower market corn prices during the 2024 period. As distillers grains are a feed product which competes with corn, when corn prices are lower it has a corresponding negative impact on distillers grains prices. Management anticipates distillers grains prices will remain at their current levels during the rest of our 2024 fiscal year but they may change at the beginning of our 2025 fiscal year depending on the amount of corn harvested in the fall of 2024. Management anticipates distillers grains production will remain at its current mix during the rest of our 2024 fiscal year.

Corn Oil

The total pounds of corn oil we sold was higher during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to increased corn oil production during the 2024 period compared to the 2023 period. Management anticipates that our corn oil production will remain at current levels for the remaining quarter of our 2024 fiscal year provided market conditions allow us to continue to operate the ethanol plant at capacity and provided the market price of corn oil remains at current levels. The average price we received for our corn oil during the third quarter of our 2024 fiscal year was lower than the average price we received during the third quarter of our 2023 fiscal year. Corn oil is used for biodiesel and renewable diesel production which have increased recently, benefiting market corn oil prices. However, oil supplies have also increased which have impacted the market price of corn oil.

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Syrup

The total gallons of syrup we sold was lower during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to decreased overall production. Management anticipates that our syrup production will remain at the current levels for the remaining quarter of our 2024 fiscal year provided that market conditions allow us to continue to operate the ethanol plant at capacity. The average price we received for our syrup during the third quarter of our 2024 fiscal year was lower compared to the average price we received during the third quarter of our 2023 fiscal year primarily due to discounted pricing to ensure product moves in a timely manner.

Cost of Goods Sold

Our cost of goods sold is primarily made up of corn and natural gas expenses. Our cost of goods sold was lower for the third quarter of our 2024 fiscal year as compared to the third quarter of our 2023 fiscal year due primarily to lower corn cost per bushel and lower natural gas costs per MMBtu along with increased corn consumption during the 2024 fiscal year.

Corn Costs

Our cost of goods sold related to corn was lower for the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to a decreased average cost per bushel of corn, without taking derivative instrument positions into account, along with increased corn consumption. For the third quarter of our 2024 fiscal year, we used approximately 3.4% more bushels of corn compared to the third quarter of our 2023 fiscal year due to less favorable corn to ethanol conversion rates during the 2024 period. The average price we paid per bushel of corn, without taking into account our derivative instruments, was approximately 43.8% lower for the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to lower market corn prices during the third quarter of our 2024 fiscal year. In addition, during the third quarter of our 2024 fiscal year, we had a realized loss of approximately $1,976,000 for our corn derivative instruments, which increased our cost of goods sold related to corn. For the third quarter of our 2023 fiscal year, we had a realized gain of approximately $675,000 for our corn derivative instruments, which decreased our cost of goods sold related to corn during that period. Management anticipates corn prices will remain lower during the rest of our 2024 fiscal year due to expected favorable weather which we anticipate will result in a larger corn crop to be harvested in the fall of 2024.

Natural Gas Costs

We used approximately 1.2% fewer MMBtu of natural gas during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to decreased overall production at the ethanol plant. Our average cost per MMBtu of natural gas was approximately 24.4% lower during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to lower energy prices compared to our 2023 fiscal year. We had a realized gain on our natural gas derivative instruments of approximately $14,000 for the third quarter of our 2024 fiscal year. We had a realized gain on our natural gas derivative instruments of approximately $46,000 for the third quarter of our 2023 fiscal year. Management anticipates relatively stable natural gas prices during the rest of our 2024 fiscal year.

General and Administrative Expenses

Our general and administrative expenses were lower for the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to a decrease in need for outside consulting for fuel pathway renewals.

Other Income/Expense

We had more interest income during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to having more cash on hand during our 2024 fiscal year. Our other income was less during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to patronage dividends received last year and not in 2024. We had more interest expense during the third quarter of our 2024 fiscal year compared to the third quarter of our 2023 fiscal year due to additional rental lease agreements.

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Results of Operations for the Nine Months Ended June 30, 2024 and 2023

	Nine Months EndedJune 30, 2024 (Unaudited)			Nine Months Ended June 30, 2023 (Unaudited)
Statement of Operations Data	Amount		%	Amount		%
Revenues	$	112,069,256	100.00	$	148,820,593	100.00
Cost of Goods Sold	108,595,453		96.90	142,816,229		95.97
Gross Profit	3,473,803		3.10	6,004,364		4.03
General and Administrative Expenses	3,819,594		3.41	4,098,939		2.75
Operating Income (Loss)	(345,791)		(0.31)	1,905,425		1.28
Other Income (Loss), net	(94,785)		(0.08)	(703,410)		(0.47)
Net Income (Loss)	$	(440,576)	(0.39)	$	1,202,015	0.81

The following table shows additional data regarding production and price levels for our primary inputs and products for the nine months ended June 30, 2024 and 2023.

	Nine Months Ended June 30, 2024 (unaudited)		Nine Months EndedJune 30, 2023(unaudited)
Production:
Ethanol sold (gallons)	48,481,152		48,317,107
Dried distillers grains sold (tons)	68,528		70,143
Modified distillers grains sold (tons)	96,400		92,274
Corn oil sold (pounds)	16,014,080		12,870,140
Revenues:
Fuel grade ethanol average price per gallon (net of hedging)	$	1.63	$	2.31
Dried distillers grains average price per ton	186.26		243.00
Modified distillers grains average price per ton	87.26		120.65
Corn oil average price per pound	0.48		0.61
Primary Inputs:
Corn ground (bushels)	17,501,763		16,512,148
Natural gas (MMBtu)	1,198,420		1,183,109
Costs of Primary Inputs:
Corn average price per bushel (net of hedging)	$	4.42	$	6.66
Natural gas average price per MMBtu (net of hedging)	3.18		5.03
Other Costs (per gallon of ethanol sold):
Chemical and additive costs	$	0.102	$	0.078
Denaturant cost	0.046		0.047
Electricity cost	0.910		0.090
Direct labor cost	0.085		0.075

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Revenue

Our total revenue was lower in the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to ~~2023~~the first quarter of our 2024 fiscal year primarily due to decreased average prices for our products during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year along with fewer gallons of ethanol sold during the 2025 period. During the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year, approximately 7376.75% of our total revenue was derived from ethanol sales, approximately 1817.92% was from distillers grains sales, ~~approximately 0.4% was from syrup sales,~~ and approximately 65.8% was from corn oil sales. During the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year, approximately 7573.08% of our total revenue was derived from ethanol ~~and industrial alcohol~~ sales, approximately 1918.34% was from distillers grains sales, ~~approximately 0.4% was from syrup sales~~ and approximately 57.3% was from corn oil sales.

Ethanol

The average price we received for our ethanol, without taking into account our hedge positions, was lower during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to ~~2023~~the first quarter of our 2024 fiscal year. Management attributes this decrease in average ethanol prices received to increased market ~~ethanol~~ supply of ethanol and lower gasoline prices during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~2023~~2024 period which has an impact on ethanol prices.

We sold ~~slightly~~fewer ~~more~~ gallons of ethanol during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June 30, 2024 compared to 2023 due to rail disruptions from adverse weather during~~ our ~~2023~~2025 fiscal year ~~which~~compared ~~reduced ethanol sales during that time period. Management anticipates ethanol production~~ to ~~be consistent during~~ the ~~rest~~first quarter of our 2024 fiscal year todue ~~2023 fiscal year levels provided market conditions allow us~~ to ~~continue~~decreased tocorn ~~operate the ethanol plant at capacity. We anticipate continuing~~ to ~~focus on operating the~~ ethanol ~~plant~~conversion asratios ~~efficiently~~during asour ~~possible~~2025 infiscal ~~order to maximize our profitability~~year.

From time to time we enter into futures contracts for our products. At ~~June~~December 3031, 2024, we had no open ethanol futures contracts. At ~~June~~December 3031, 2023, we had no open ethanol futures contracts.

Distillers Grains

During the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year, we sold slightly more tons of distillers grains compared to the same period of our ~~2023~~2024 fiscal year due to ~~increased~~decreased corn oil production. ~~Production~~and ~~was~~reduced ~~lower~~corn to ethanol conversion efficiency during the ~~same~~2025 ~~2023~~period. ~~fiscal~~When ~~year~~we ~~period~~produce ~~due~~more topounds ~~rail~~of ~~disruptions~~corn ~~and~~oil, ~~adverse~~it ~~weather~~has a corresponding negative impact on the volume of distillers grains we produce. We sold amost ~~majority~~ of our distiller grains during the ~~2024~~2025 period in the modified form due to demand factors which favored the modified product. The average price we received for both our dried and modified distillers grains was lower during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to ~~2023~~the first quarter of our 2024 fiscal year due to lower market corn prices during the ~~2024~~2025 period. As distillers grains are a feed product which competes with corn, when corn prices are lower it has a corresponding negative impact on distillers grains prices. Management anticipates distillers grains prices will remain at their current levels during the rest of our 2024 fiscal year but they may change at the beginning of our 2025 fiscal year depending on the amount of corn harvested in the fall of 2024. Management anticipates distillers grains production will remain at its current mix during the rest of our 2024 fiscal year.

Corn Oil

The total pounds of corn oil we sold was ~~higher~~lower during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to ~~2023~~the first quarter of our 2024 fiscal year due to ~~increased~~decreased overall production at the plant and decreased corn oil production efficiency during the ~~2024~~2025 period compared to the ~~2023~~2024 period. The average price we received for our corn oil during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year was lower than the average price we received during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal ~~due to excess corn oil supply in the market~~year. Corn oil is used for biodiesel and renewable diesel production which have increased recently, benefiting market corn oil prices. However, oil supplies have also increased which have impacted the market price of corn oil.

Syrup

The total gallons of syrup we sold was slightly lower during the nine months ended June 30, 2024 compared to 2023 due to decreased overall production. The average price we received for our syrup during the nine months ended June 30, 2024 was lower compared to the average price we received during the nine months ended June 30, 2023 primarily due to discounted pricing to ensure product moves in a timely manner.

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Cost of Goods Sold

Our cost of goods sold is primarily made up of corn and natural gas expenses. Our cost of goods sold was lower for the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year as compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due primarily to lower corn cost per bushel and lower natural gas costs per MMBtu along with ~~increased~~decreased ~~corn~~natural gas consumption and ~~natural~~increased ~~gas~~corn consumption during the ~~2024~~2025 fiscal year.

Corn Costs

Our cost of goods sold related to corn was lower for the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to a decreased average cost per bushel of corn, without taking derivative instrument positions into account, ~~along~~partially ~~with~~offset by increased corn consumption. For the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year, we used approximately 51.9909% more bushels of corn compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to ~~increased~~less ~~overall~~favorable ~~production~~corn to ethanol conversion rates during the ~~2024~~2025 period. The average price we paid per bushel of corn, without taking into account our derivative instruments, was approximately 34.08% lower for the nine months ended June 30, 2024 compared to the nine months ended June 30, 2023 due to lower market corn prices during the nine months ended June 30, 2024. In addition, during the nine months ended June 30, 2024, we had a realized loss of approximately $151,000 for our corn derivative instruments, which increased our cost of goods sold related to corn. For the nine months ended June 30, 2023, we had a realized gain of approximately $988,000 for our corn derivative instruments, which decreased our cost of goods sold related to corn during that period. Management anticipates corn prices will remain lower during the rest of our 2024 fiscal year due to expected favorable weather which we anticipate will result in a larger corn crop to be harvested in the fall of 2024.

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derivative instruments, was approximately 17.1% lower for the first quarter of our 2025 fiscal year compared to the first quarter of our 2024 fiscal year due to lower market corn prices during the first quarter of our 2025 fiscal year. In addition, during the first quarter of our 2025 fiscal year we had a realized loss of approximately $0 for our firm corn purchase commitments which increased our cost of goods sold related to corn. For the first quarter of our 2024 fiscal year, we had a realized loss of approximately $1.4 million for our corn derivative instruments, which increased our cost of goods sold related to corn during that period.

Natural Gas Costs

We used approximately 12.295% ~~more~~fewer MMBtu of natural gas during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to ~~increased~~decreased ~~overall~~ production atof ~~the~~dried ~~ethanol~~distillers ~~plant~~grains compared to modified distillers grains. Modified distillers grains requires less natural gas to produce compared to dried distillers grains. Our average cost per MMBtu of natural gas was approximately 3634.786% lower during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to lower energy prices compared to our 2024 ~~2023~~ fiscal year. We had a realized gain on our natural gas derivative instruments of approximately $~~703,000~~0 for the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year since we did not have any natural gas derivatives during that time period. We had a realized gain on our natural gas derivative instruments of approximately $7446,000 for the ~~nine~~first ~~months~~quarter ~~ended June 30, 2023. Management anticipates relatively stable natural gas prices during the rest~~ of our 2024 fiscal year.

General and Administrative Expenses

Our general and administrative expenses were ~~slightly~~higher ~~lower~~ for the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to acosts ~~decrease~~associated inwith ~~need~~the ~~for~~Asset ~~outside~~Sale, ~~consulting~~including inlegal ~~fuel~~fees ~~pathway~~and ~~renewals~~costs.

Other Income/Expense

We had ~~more~~less interest income during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to ~~more~~having less cash on hand during our ~~2024~~2025 fiscal year. Our other income was ~~higher~~less during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to ~~receiving~~ patronage ~~from~~dividends ~~RPMG~~received last year and not in 2025. We had ~~slightly~~ less interest expense during the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2025 ~~2024~~fiscal year compared to the ~~nine~~first ~~months~~quarter ~~ended~~of ~~June~~our ~~30,~~2024 ~~2023~~fiscal year due to ~~the~~less ~~termination~~debt offinancing and additional rental ~~leases~~lease agreements.

Changes in Financial Condition for the ~~Nine~~Three Months Ended ~~June~~December 3031, 2024

Current Assets

We had ~~less~~more cash and cash equivalents at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 primarily due to deferred corn payments we make early in January each year. We had ~~more~~less restricted cash in our margin account at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to changing values of our derivative instrument positions. Due to the timing of shipments, the value of our accounts receivable was ~~lower~~higher at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024. We had more inventory on hand at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due primarily to more finished goods inventory due to the timing of our finished goods shipments at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024. Our prepaid expenses were higher at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to an increase in our insurance premiums paid for the year.

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Property, Plant and Equipment

The value of our property, plant and equipment was less at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to regular depreciation of our assets during the first ~~nine~~three months of our ~~2024~~2025 fiscal year partially offset by capital projects which were completed and construction in progress at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024. Open construction in progress projects as of December 31, 2024 include combined heat & power, 200-proof loading, and restoration of the cooling towers.

Other Assets

Our right of use operating lease assets at ~~June~~December 3031, 2024 ~~was~~were lower compared to September 30, ~~2023~~2024 due to the ~~termination~~paydown of ~~our~~existing ~~telehandler and boom lift~~ leases. ~~Our patronage equity was lower at June 30, 2024 compared to September 30, 2023 due to the general retirement of capital credits.~~

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Current Liabilities

Our accounts payable was ~~less~~greater at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to deferred corn payments wethat ~~made~~would ~~early~~have inbeen ~~our~~made during the second quarter of our 2025 fiscal year if not for the closing of the Asset Sale. Our accrued expenses were ~~lower~~higher at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to ~~lower~~costs ~~accrued~~associated ~~corn~~with ~~payables~~the Asset Sale. We had a ~~higher~~lower liability associated with our corn derivative instrument positions at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to changing market corn prices compared to our derivative instrument positions. We had agreater ~~higher accrued loss on our firm corn purchase commitments due to the difference between the market value of our firm corn purchases and the contract price of our corn purchases. We had a smaller~~ current ~~maturity associated with our notes payable due to a lower amount we need to pay on our debt instruments in the next 12 months. We had less current~~ portion of operating lease liabilities at ~~June~~December 3031, 2024 compared to September 30, ~~2023~~2024 due to the ~~termination~~addition of ~~rental~~a ~~lease~~new ~~agreements~~Marco copier lease.

Long-Term Liabilities

Our notes payable ~~balance~~balances ~~was~~were ~~lower~~the same at ~~June~~December 3031, 2024 ~~compared to~~and September 30, ~~2023 due to loan payments we made during our~~ 2024 ~~fiscal year~~. We had lower long-term liabilities for our operating leases at ~~June~~December 3031, 2024 compared to September 30, 2024 due to additional equipment leases offset by amortization of our long-term leases during our 2024 fiscal year.

Liquidity and Capital Resources

Based on financial forecasts performed by our management, we anticipate that we will have sufficient cash from ~~our~~the ~~current~~Asset ~~credit~~Sale ~~facilities and cash from our operations~~ to continue to ~~operate~~maintain the ~~ethanol~~Company’s ~~plant~~limited ~~for~~operations as it winds-down in the next 12 months and beyond. Should we experience unfavorable ~~operating~~liquidity conditions in the future, we may have to secure additional debt or equity sources ~~for working capital or other purposes~~.

The following table shows cash flows for the ~~nine~~three months ended ~~June~~at December 3031, 2024 and 2023:

	June 30, 2024(unaudited)		June 30, 2023(unaudited)
	December 31, 2024(unaudited)		December 31, 2023(unaudited)
Net cash used in operating activities	$	2,984,304	$	2,244,426
Net cash provided operating activities	$	3,189,632	$	7,383,912
Net cash used in investing activities	(1931,~~383,452~~487)		(2448,~~219,952~~214)
Net cash used for financing activities	(~~8,427,565~~680)		(2220,~~443,389~~424)
Net decrease in cash	$	(6,826,713)	$	(2,418,915)
Net increase in cash	$	2,257,465	$	6,715,274
Cash, cash equivalents and restricted cash, end of period	$	79,~~724~~362,~~390~~832	$	821,~~733~~266,~~100~~377

Cash Flow from Operations

Our operations ~~used~~provided less cash during the ~~nine~~three months ended ~~June~~December 3031, 2024 compared to the same period of our ~~2023~~2024 fiscal year due primarily to ~~changes~~less innet ~~accounts~~income ~~receivable and accounts payable~~ during the ~~2024~~2025 ~~period.~~fiscal year.

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Cash Flow From Investing Activities

We used ~~less~~more cash for capital expenditures during the ~~nine~~three months ended ~~June~~December 3031, 2024 compared to the same period ofended ~~our~~December 31, 2023 ~~fiscal year~~. During the ~~2024~~three ~~period~~months ended December 31, 2024, our primary capital expenditures were tofor ~~finalize~~restorations ~~our~~to ~~CCS~~the ~~project~~cooling tower and ~~restorations~~equipment tofor the ~~cooling~~combined ~~tower~~heat and power project.

Cash Flow from Financing Activities

Our financing activities used ~~more~~less cash during the ~~nine~~three months ended ~~June~~December 3031, 2024 compared to the same period of our ~~2023~~2024 fiscal year due to ~~fewer~~line ~~proceeds~~of wecredit ~~received~~repayments ~~from~~that ~~our~~were ~~debt~~made ~~instruments~~ during the 2024 fiscal year.

Our liquidity, results of operations and financial performance will be impacted by many variables, including the market price for commodities such as, but not limited to, corn, ethanol and other energy commodities, as well as the market price for any co-products generated by the facility and the cost of labor and other operating costs. Assuming future relative price levels for corn, ethanol and distillers grains remain consistent, we expect operations to generate adequate cash flows to maintain operations for the next 12 months and beyond.

Plans for Cash in the Short Term and in the Long Term

In the next 12 months, the Company plans to reinvest ~~its~~the cash it is holding into ~~current~~winding ~~business~~down the Company’s operations and to ~~use~~distribute ~~the~~any cash ~~towards~~ the ~~completion~~Board ofdoes ~~the~~not ~~cooling~~keep ~~tower~~for ~~restoration~~reasonable reserves to the members. In the long term, the Company plans to ~~reinvest~~continue ~~its~~to ~~cash~~wind-down ~~into~~the ~~current~~Company’s business operations and may provide further distributions to its members. On February 7, 2025, the Company issued a distribution of $4.05 per Unit to each member due to the Asset Sale.

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Capital Expenditures

The Company had approximately $13.57 million in construction in progress as of ~~June~~December 3031, 2024 primarily relating to the ~~completion~~engineering and planning of the ~~cooling~~Combined ~~tower~~Heat ~~restoration.~~& ~~The~~Power ~~Company plans to finance this construction in progress using cash from current business operations~~project.

Capital Resources

Revolving Loan

OnAs ~~January~~of 22December 31, ~~2020~~2024, wethe ~~entered~~Company ~~into~~had a $10 million revolving loan (the "Revolving Loan") ~~with~~from Cornerstone Bank ("Cornerstone") with a maturity date of April 9, 2025. At December 31, 2024, the Company had $10 million available on the Revolving Loan. Interest ~~accrues~~accrued on any outstanding balance on the Revolving Loan at a rate of 0.25% less than the prime rate as published by the Wall Street Journal, adjusted monthly. The Revolving Loan has a minimum interest rate of 7.5%. The ~~maturity~~variable ~~date~~interest ofrate ~~the~~on ~~Revolving Loan was January~~ December 31, ~~2022. On~~2024 ~~February 3, 2022, the Revolving Loan~~ was ~~renewed, and the new maturity date was March 31, 2022. On April 8, 2022, the Revolving Loan maturity date was extended to April~~ 7~~, 2023~~. ~~On April 8, 2023 we renewed the Revolving Loan with a new maturity date of April~~ 5~~, 2024~~%. WeSubsequent ~~again~~to ~~renewed~~ the ~~Revolving loan on April 11~~December 31, 2024 ~~for~~period ~~another year with a a maturity date of April 9~~end, ~~2025.~~the ~~The Revolving Loan is secured by a lien on substantially all of our assets. At June 30~~Company, ~~2024,~~in weconnection ~~had~~with ~~$7 million available on~~ the ~~Revolving~~Asset ~~Loan. The variable interest rate on June 30~~Sale, ~~2024 was 7.50%. On April 10, 2024, the Company has~~ paid~~-off~~ ~~the~~all $3outstanding ~~million~~amounts ~~outstanding~~due onunder the Revolving Loan, and ~~the~~terminated ~~Company has since had $10 million available to draw on from~~ the Revolving Loan.

Construction ~~Loans~~Loan

On ~~January~~October 2228, ~~2020~~2022, wethe Company entered into a ~~new~~ $7 25 million loan with Cornerstone Bank to refinance two (2) previous construction ~~loan~~loans with Cornerstone Bank (the "~~First~~Consolidated Construction Loan"). ~~with~~Interest ~~Cornerstone~~accrued toon ~~finance~~the ~~our~~Consolidated ~~carbon~~Construction ~~capture~~Loan ~~and~~at ~~storage~~a ~~project~~fixed rate of 4.65%. As ~~The~~of ~~original~~December 31, ~~maturity~~2024, ~~date~~the Company was making annual payments of approximately $3.1 million in January of each year on the ~~First~~Consolidated Construction Loan. ~~was~~As ~~June~~of 1December 31, ~~2021. On June 3~~2024, ~~2021~~ the maturity date ~~was~~of ~~extended~~the toConsolidated ~~February~~Construction 1Loan was January 31, ~~2022~~2032. OnThe ~~April~~outstanding 8,balance ~~2022~~as of December 31, 2024 on the ~~First~~Consolidated Construction Loan was ~~extended~~$18,054,528. Subsequent to ~~October~~the 8December 31, ~~2022. On~~2024 ~~October~~period 28end, ~~2022~~in connection with the Asset Sale, the ~~First~~Company ~~Construction~~paid ~~Loan~~all ~~was~~outstanding ~~consolidated~~amounts ~~with~~due under the ~~Second~~Consolidated Construction Loan ~~(below)~~and terminated the Consolidated Construction Loan.

OnEach ~~February~~of ~~1, 2021, we entered into a $28 million construction loan (~~the ~~"Second~~Company's ~~Construction~~loans ~~Loan")~~were ~~with~~secured ~~Cornerstone~~by toa ~~finance~~lien ~~our~~on ~~carbon~~substantially ~~capture~~all ~~and~~of ~~storage~~the ~~project. The~~assets ~~maturity date~~ of the ~~Second~~Company ~~Construction~~which ~~Loan~~were ~~was~~released ~~January~~in ~~31,~~connection ~~2022. On~~with ~~February 17, 2022,~~ the ~~Second~~Asset ~~Construction Loan was extended to March 15, 2022~~Sale. ~~On April 8, 2022, the~~

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Second Construction Loan was again extended to October 8, 2022. On October 28, 2022, the Second Construction loan was consolidated and replaced (below).

On October 28, 2022, we entered into a $25 million loan to replace the First Construction Loan and Second Construction Loan (the "Consolidated Loan"). The maturity date of the Consolidated Loan is January 31, 2032. The fixed interest rate is 4.65%. The outstanding balance as of June 30, 2024 was $20.0 million.

Ethanol Recovery Program

On July 13, 2020, we entered into a $5.41 million loan through the Bank of North Dakota's Ethanol Recovery Program and Cornerstone. The Ethanol Recovery Program was developed by the North Dakota Ethanol Producers Association and the Bank of North Dakota to use the existing Biofuels Partnership in Assisting Community Expansion ("PACE") program and Value-added Guarantee Loan program to help ethanol production facilities weather the economic challenges caused by the COVID-19 pandemic. Ethanol producers could qualify for up to $15 million of a low interest loan of 1% based on the amount of such producers' annual corn grind. The maturity date of the loan is July 13, 2025. The fixed interest rate as of June 30, 2024 was 3.75% with an interest rate buy down through the Bank of North Dakota to 1%. On December 3, 2021 we received forgiveness of $2.65 million of the loan, and the balance outstanding on June 30, 2024 was $0.

Significant Accounting Policies and Estimates

We describe our significant accounting policies in Note 1, Summary of Significant Accounting Policies, of the Notes to Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended September 30, ~~2023~~2024, filed with the SEC on January 15, 2025 (such filing, the “2025 10-K”). We discuss our critical accounting estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, inof ~~our~~the ~~Annual~~2025 ~~Report on Form~~ 10-K ~~for the fiscal year ended September 30, 2023~~. There has been no significant change in our critical accounting estimates since the ~~end~~fiscal ofyear ~~our~~ended ~~2023~~September 30, ~~fiscal~~2024 ~~year~~as described in the 2025 10-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

WeAs ~~are~~of December 31, 2024, before the consummation of the Asset Sale, we were exposed to the impact of market fluctuations associated with commodity prices ~~and interest rates~~ as discussed below. We ~~use~~had ~~derivative~~no ~~financial~~exposure ~~instruments as part of an overall strategy~~ to ~~manage~~foreign ~~market~~currency risk. Weas ~~use~~all ~~cash,~~of ~~futures~~our ~~and~~business ~~option~~was ~~contracts~~conducted toin ~~hedge~~U.S. ~~changes~~Dollars ~~to the commodity prices of corn~~ and ~~ethanol.~~we Wehad doimmaterial ~~not~~exposure ~~enter~~to ~~into~~interest ~~these~~rate ~~derivative~~risk ~~financial~~since ~~instruments~~we ~~for~~had ~~trading~~$10 ormillion ~~speculative~~outstanding ~~purposes,~~on ~~nor~~variable dointerest wedebt ~~designate~~indexed ~~these~~to ~~contracts~~prime asinterest ~~hedges~~rates ~~for~~(see ~~accounting purposes pursuant to~~ the ~~requirements~~subsection ofabove ~~Generally~~entitled ~~Accepted~~“Capital ~~Accounting Principles ("GAAP"~~Resources”).

~~Interest~~As ~~Rate~~of ~~Risk~~December 31, 2024, we used derivative financial instruments as part of an overall strategy to manage market risk. We used cash, futures and option contracts to hedge changes to the commodity prices of corn and ethanol. We did not enter into these derivative financial instruments for trading or speculative purposes, nor did we designate these contracts as hedges for accounting purposes pursuant to the requirements of Generally Accepted Accounting Principles ("GAAP").

We are exposed to market risk from changes in interest rates. Exposure to interest rate risk results primarily from holding loans which bear variable interest rates. As of June 30, 2024, we had $3 million outstanding on our revolving variable loan. If we were to experience a 10% increase in the variable portion of our loans, the annual effect such change would have on our income statement, based on the amount we had outstanding on our variable interest rate loans as of June 30, 2024, would be immaterial. As of April 10, 2024, we have paid-off the amount outstanding on our revolving variable loan and have had $10 million available to draw on since such date.

Commodity Price Risk

We expect to be exposed to market risk from changes in commodity prices. Exposure to commodity price risk results from our dependence on corn and natural gas in the ethanol production process and the sale of ethanol. Our exposure to commodity price risk may be heightened due to the crisis in Ukraine and the Middle East. 21

We enter into fixed price contracts for corn purchases on a regular basis. It is our intent that, as we enter into these contracts, we will use various hedging instruments (puts, calls and futures) to maintain a near even market position. For example, if we have one million bushels of corn under fixed price contracts we would generally expect to enter into a short hedge position to offset our price risk relative to those bushels we have under fixed price contracts. Because our ethanol marketing company ("RPMG") is selling substantially all of the gallons it markets on a spot basis we also include the corn bushel equivalent of the ethanol we have produced that is inventory but not yet priced as bushels that need to be hedged.

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~~Although~~As weof ~~believe our hedge positions will accomplish an economic hedge against our future purchases~~December 31, ~~they are not designated as hedges for accounting purposes~~2024, ~~which~~before ~~would match~~ the ~~gain~~consummation orof ~~loss on our hedge positions to~~ the ~~specific~~Asset ~~commodity purchase being hedged. We use fair value accounting for our hedge positions~~Sale, ~~which~~we ~~means~~expected asto ~~the~~be ~~current~~exposed to market ~~price~~risk offrom ~~our hedge positions~~ changes, ~~the gains and losses are immediately recognized~~ in ~~our~~commodity ~~cost of sales~~prices. ~~The~~This ~~immediate~~exposure ~~recognition~~to ofcommodity ~~hedging~~price ~~gains~~risk ~~and~~was ~~losses~~due ~~under fair value accounting can cause net income~~ to beour ~~volatile~~dependence ~~from~~on ~~quarter~~corn ~~to quarter~~ and ~~year~~natural togas ~~year~~in ~~due to~~ the ~~timing~~ethanol ofproduction ~~the~~process ~~change~~and ~~in value of derivative instruments relative to~~ the ~~cost~~sale of ~~the commodity being hedged~~ethanol. ~~However,~~ ~~it is likely that commodity cash prices will have the greatest impact on the derivatives instruments with delivery dates nearest the current cash price.~~

AsWe ofentered ~~June~~into fixed price contracts for corn purchases on a regular basis. 30It was our intent that, ~~2024~~as we ~~had~~entered ~~corn~~into ~~futures~~these ~~and~~contracts, ~~option~~we ~~contracts~~would ~~for~~use ~~approximately~~various 4hedging instruments (puts,~~660,000~~ ~~bushels~~calls ofand ~~corn. As~~futures) ofto ~~June~~maintain a near even market position. 30For example, ~~2024~~if we had anone ~~unrealized~~million ~~loss~~bushels of ~~approximately~~corn ~~$684,000~~under ~~related~~fixed price contracts we would generally expect to enter into a short hedge position to offset our ~~corn~~price ~~futures~~risk ~~and~~relative ~~options~~to those bushels we had under fixed price contracts. Because the ethanol marketing company we utilized ("RPMG") operates by selling substantially all of the gallons it markets on a spot basis we also included the corn bushel equivalent of the ethanol we have produced that is inventory but not yet priced as bushels that we believe needed to be hedged.

It Our ishedge positions were not designated as hedges for accounting purposes, which would match the ~~current~~gain ~~position~~or ofloss on our ~~ethanol~~hedge ~~marketing~~positions ~~company,~~to ~~RPMG~~the specific commodity purchase being hedged. Instead, ~~that~~we ~~under~~used ~~current~~fair ~~market~~value ~~conditions~~accounting for our hedge positions, ~~selling~~which ~~ethanol~~means inas the ~~spot~~current market ~~will~~price ~~yield~~of our hedge positions changed, the ~~best~~gains ~~price~~and ~~for~~losses were immediately recognized in our ~~ethanol~~cost of sales. ~~RPMG~~The ~~will,~~immediate ~~from~~recognition ~~time~~of tohedging ~~time,~~gains ~~contract~~and alosses ~~portion~~under offair ~~the~~value ~~gallons~~accounting ~~they~~can ~~market~~cause ~~with~~net ~~fixed~~income ~~price~~to ~~contracts. At~~be ~~June 30,~~volatile ~~2024,~~from wequarter ~~had~~to noquarter ~~fixed~~and ~~ethanol~~year ~~sales~~to ~~contracts~~year ~~and~~due ~~ethanol~~to ~~futures~~the ~~and~~timing ~~option~~of ~~contracts.~~the Aschange in value of ~~June~~derivative instruments relative to the cost of the commodity being hedged. 30However, ~~2024~~it weis likely that commodity cash prices had nothe ~~unrealized~~greatest ~~gain~~impact oron ~~loss~~the ~~related~~derivatives toinstruments ~~ethanol~~with ~~futures~~delivery ~~and~~dates ~~option~~nearest ~~contracts~~the current cash price.

WeAs ~~estimate~~of ~~that~~December 31, ~~our~~2024, ~~corn~~we ~~usage~~had ~~will~~approximately be250,000 ~~between 18 million and 20 million~~ bushels ~~per year for the production~~ of ~~approximately 59 million to 64 million gallons of ethanol. As~~ corn ~~prices~~under ~~move~~fixed inprice ~~reaction to market trends and information, our income statement will be affected depending on the impact such market movements have on the value of our derivative instruments~~contracts.

A It ~~sensitivity~~is ~~analysis~~the ~~has~~current ~~been~~position ~~prepared~~of toRPMG, ~~estimate~~that ~~our~~under ~~exposure~~current tomarket ~~corn~~conditions, ~~natural~~selling ~~gas and~~ ethanol ~~price~~in ~~risk.~~the ~~Market~~spot ~~risk~~market ~~related~~will toyield ~~our~~the ~~corn,~~best ~~natural~~price ~~gas~~for ~~and~~our ethanol. RPMG ~~prices~~will, isfrom ~~estimated~~time asto ~~the~~time, ~~potential~~contract ~~change in income resulting from~~ a ~~hypothetical~~portion ~~10%~~of ~~adverse change in~~ the ~~average~~gallons ~~cost~~they ofmarket ~~our~~with ~~corn~~fixed ~~and natural gas, and our average ethanol sales~~ price ascontracts. At ~~of June~~December 3031, 2024, ~~net~~we ofhad ~~the~~no ~~forward~~fixed ~~and~~ethanol ~~future~~sales contracts ~~used to hedge our market risk for corn, natural gas~~ and ethanol. ~~The~~futures ~~volumes~~and ~~are~~option ~~based~~contracts. onAs ~~our expected use and sale~~ of ~~these commodities for a one year period from June~~December 3031, 2024~~. The~~ ~~results~~we ofhad ~~this~~no ~~analysis,~~unrealized ~~which~~gain ~~may~~or ~~differ~~loss ~~from~~related ~~actual~~to ~~results,~~ethanol ~~are~~futures asand ~~follows:~~option contracts.

	Estimated Volume Requirements for the next 12 months (net of forward and futures contracts)	Unit of Measure	Hypothetical Adverse Change in Price		Approximate Adverse Change to Income
Ethanol	63,900,000	Gallons	10	%	$	(11,502,000)
Corn	22,821,429	Bushels	10	%	$	(6,907,000)
Natural gas	1,664,000	MMBtu	10	%	$	(304,000)

We have not prepared a sensitivity analysis on our estimated exposure to corn, natural gas and ethanol price risk for our expected use and sale of such commodities due to the fact that we have both: (i) assigned all of our derivatives to a subsidiary of GEVO and (ii) no longer maintain operations, each due to the Asset Sale and, as such, do not expect to have any risk related to these commodity prices and derivatives past January 31, 2025.

For comparison purposes, our sensitivity analysis for our quarter ended June 30, 2023 is set forth below:

	Estimated Volume Requirements for the next 12 months (net of forward and futures contracts)	Unit of Measure	Hypothetical Adverse Change in Price		Approximate Adverse Change to Income
Ethanol	63,900,000	Gallons	10	%	$	(15,975,000)
Corn	18,048,000	Bushels	10	%	$	(12,634,000)
Natural gas	1,384,000	MMBtu	10	%	$	(471,000)

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Item 4. Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit pursuant to the Securities Exchange Act of 1934 (the "Exchange Act") is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosures.

~~Our~~ Because ~~management,~~of ~~including~~its ~~our~~inherent ~~President~~limitations, disclosure controls and ~~Chief~~procedures ~~Executive~~concerning ~~Officer~~financial ~~(the~~reporting ~~principal~~may ~~executive~~not ~~officer),~~prevent ~~Jodi~~or ~~Johnson~~detect misstatements. Also, ~~along~~projections ~~with~~of ~~our~~any ~~Chief~~evaluation ~~Financial~~of ~~Officer,~~effectiveness ~~(the~~to ~~principal~~future ~~financial~~periods ~~officer),~~are ~~Joni~~subject ~~Entze,~~to ~~have~~the ~~reviewed~~risk ~~and~~that ~~evaluated~~controls ~~the~~may ~~effectiveness~~become inadequate because of ~~our~~changes ~~disclosure~~in ~~controls~~conditions, ~~and~~or ~~procedures~~that asthe degree of ~~June 30,~~ ~~2024.~~compliance ~~Based~~with onthe ~~this~~policies ~~review~~or ~~and~~procedures ~~evaluation,~~may ~~these~~deteriorate. ~~officers~~No ~~believe~~system ~~that~~of ~~our~~controls, ~~disclosure~~no ~~controls~~matter how well designed and ~~procedures~~operated, ~~were~~can ~~effective~~provide inabsolute ~~ensuring~~assurance that ~~material~~the ~~information~~objectives ~~related~~of tothe ussystem isof ~~recorded,~~controls ~~processed~~are met, ~~summarized~~ and ~~reported~~no ~~within~~evaluation ~~the~~of ~~time~~controls ~~periods~~can ~~required~~provide byabsolute ~~the~~assurance ~~forms~~that ~~and~~the ~~rules~~system of ~~the~~controls ~~Securities~~has ~~and~~operated ~~Exchange~~effectively ~~Commission~~in all cases.

~~For~~ The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the ~~fiscal~~effectiveness ~~quarter~~of ~~ended~~the ~~June 30,~~design ~~2024,~~and ~~there~~operation ~~has~~of ~~been~~its nodisclosure ~~change~~controls inand ~~our~~procedures ~~internal~~with ~~control~~the ~~over~~assistance ~~financial~~and ~~reporting~~participation ~~that~~of ~~has~~other ~~materially~~members ~~affected~~of management. Based upon that evaluation, orthe isCompany’s ~~reasonably~~Chief ~~likely~~Executive toOfficer ~~materially~~and ~~affect~~Chief Financial Officer have concluded that, as of December 31, 2024, our disclosure controls and procedures were not effective due to the material weakness in internal control over financial reporting. as described below.

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As of December 31, 2024, we did not maintain effective monitoring and oversight of controls over property, plant and equipment. Specifically, reviewing assets for asset retirement obligations. In June 2022 an asset retirement obligation related to our Class VI monitoring and injection wells should have been recognized and recorded.

The errors arising from the underlying deficiency are not material to the financial statements reported in any interim or annual period and therefore, did not result in a revision to previously filed financial statements. However, this control deficiency could result in misstatements of the aforementioned accounts and disclosures that would result in a material misstatement to the annual or interim financial statements that would not be prevented or detected in a timely manner. Accordingly, we have determined that this control deficiency constitutes a material weakness.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected in a timely basis.

For the fiscal quarter ended December 31, 2024, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time in the ordinary course of business, we may be named as a defendant in legal proceedings related to various issues, including without limitation, workers' compensation claims, tort claims, or contractual disputes. We are not currently involved in any material legal proceedings.

Item 1A. Risk Factors

The following risk factors are provided due to material changes from the risk factors previously disclosed in our annual report on Form 10-K for the fiscal year ended September 30, ~~2023~~2024. The risk factors set forth below should be read in conjunction with the risk factors section and the Management's Discussion and Analysis section included in our annual report on Form 10-K for the fiscal year ended September 30, ~~2023~~2024 filed with the Securities Exchange Commission on ~~December~~January 2915, ~~2023~~2025.

ITOn ~~outages~~the Closing Date, ~~data~~the ~~loss~~Company closed on the sale of substantially all of its assets for a purchase price of $210 million (subject to adjustment based on the terms of the Asset Purchase Agreement) (the “Purchase Price”) to the Buyers. The Company and Gevo entered into an escrow agreement pursuant to which Gevo deposited $10 million in earnest money, ~~data~~which was applied against the Purchase Price. In addition, pursuant to such escrow agreement, Gevo deposited on the Closing Date: (i) $1.26 million of the Purchase Price for the purposes of securing the post-closing indemnification obligations of the Company, and (ii) $5 million of the Purchase Price for purposes of securing any Purchase Price adjustments as described in the Asset Purchase Agreement. In the event that the Company breaches the provisions of the covenant, representations and ~~cyber-attacks~~warranties ~~could~~in ~~compromise~~the ~~our~~Asset ~~intellectual~~Purchase ~~property~~Agreement (which may or ~~other~~may ~~sensitive~~not ~~information~~have been within the Company’s control), bethe ~~costly~~Company tomay ~~remediate~~not receive the entire post-closing indemnification escrow amount of $1.26 million. Further, if the Company’s Net Working Capital on the Closing Date (as described in Section 2.5 of the Asset Purchase Agreement) does not meet or ~~cause~~exceed ~~significant~~the ~~damage~~Target toNet ~~our~~Working ~~business~~Capital set in the Asset Purchase Agreement, ~~reputation~~the ~~and~~Company ~~operations~~may not receive the entire $5 million of the Purchase Price.

As AI capabilities improve and are increasingly adopted, we may see cyberattacks created through AI. These attacks could be crafted with an AI tool to directly attack information systems with increased speed and/or efficiency than a human threat actor or create more effective phishing emails. The threat could be introduced from the result of our or our customers and business partners incorporating the output of an AI tool that includes a threat, such as introducing malicious code by incorporating AI generated source code.

We have not actively worked to integrate any artificial intelligence into our operations. This may cause us to fall behind competitors in terms of efficiency, innovation, and competitiveness.

In today's fast-paced business environment, AI can provide companies with the ability to analyze vast amounts of data quickly, identify patterns, and make data-driven decisions in real-time. Failure to integrate AI means missing out on these capabilities, potentially leading to inefficiencies and slower decision-making processes compared to competitors who leverage AI effectively. Without AI, we rely somewhat on manual processes for tasks such as data analysis, customer service, or production optimization which may increase our risk of error vs using AI for these processes. This may result in suboptimal resource allocation, increased operational costs, and missed opportunities for growth and expansion as compared to companies who utilize AI.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures.

None.

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Item 5. Other Information

~~Insider~~Changes ~~Trading~~to ~~Arrangements.~~Annual Meeting Date

NoThe ~~director~~Company’s or2025 ~~officer~~Annual ~~adopted~~Meeting ormay ~~terminated~~be ~~any~~held ~~contract,~~after ~~instruction,~~30 ordays ~~written~~from ~~plan~~the ~~for~~previous year’s annual meeting (April 4, 2025) but the ~~purchase~~Company orhas ~~sale~~not ofyet ~~company~~determined ~~securities~~this. ~~during~~The ~~the~~Company’s ~~period~~2025 ~~ending~~Annual ~~June~~Meeting ~~30,~~is ~~2024~~currently expected to happen by the middle of May 2025.

Insider Trading Arrangements

No governor or officer adopted or terminated any contract, instruction, or written plan for the purchase or sale of company securities during the period ending December 30, 2024.

Item 6. Exhibits.

(a)The following exhibits are filed as part of this report.


Exhibit No.						Exhibits
31.1						Certificate Pursuant to 17 CFR 240.13a-14(a)*
31.2						Certificate Pursuant to 17 CFR 240.13a-14(a)*
32.1						Certificate Pursuant to 18 U.S.C. Section 1350*
32.2						Certificate Pursuant to 18 U.S.C. Section 1350*
101.INS*						Inline XBRL Instance Document
101.SCH*						Inline XBRL Schema Document
101.CAL*						Inline XBRL Calculation Document
101.LAB*						Inline XBRL Labels Linkbase Document
101.PRE*						Inline XBRL Presentation Linkbase Document
101.DEF*						Inline XBRL Definition Linkbase Document
104						The cover page from this Quarterly Report on Form 10-Q formatted in Inline XBRL.

(*) Filed herewith.

(**) Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		RED TRAIL ENERGY, LLC
Date:	~~August~~February 1419, ~~2024~~2025	/s/ Jodi Johnson
		Jodi Johnson
		President and Chief Executive Officer
		(Principal Executive Officer)
Date:	~~August~~February 1419, ~~2024~~2025	/s/ Joni Entze
		Joni Entze
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

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