Highwater Ethanol, LLC amended its 2026 Executive Bonus Plan, adding eligibility for the chief executive officer and chief financial officer tied to net income above $10,000,000 and the company’s receipt of incentives under Section 45Z clean fuel production tax credits. Under the amended plan, the chief executive officer can earn an annual bonus of up to 59% of base salary, and the chief financial officer up to 56% of base salary. The goals will be assessed at the fiscal year-end on October 31, 2026; the other material plan terms remain in effect.
Highwater Ethanol, LLC reported net income of $10,836,354 for its fiscal third quarter, including operating income of $5,661,285 and other income of $5,175,069, mainly from Section 45Z tax credits. The credits accounted for $5.0 million of income in the quarter and $11.7 million over nine months; nine-month net income was approximately $24.8 million. The company said it sold its 2025 Section 45Z credits in May 2026, and the resulting $12.6 million net tax credit appears in operating activities.
Production averaged 3.07 gallons of denatured ethanol per bushel of corn ground in the third quarter. Highwater submitted an air-emissions permit application in January 2026 and hopes for approval in October 2026; with the permit, management anticipates increasing production to approximately 87 million gallons of denatured ethanol annually. A sixth fermenter and a Dryer Exhaust Energy Recovery system are expected to come online in July 2027. The board will discuss whether to make a fiscal 2026 distribution in November or December.
HIGHWATER ETHANOL LLC (HEOL) reports a sharp turnaround in profitability for the nine months ended July 31, 2026, driven by stronger operating margins and substantial federal clean fuel tax credits. Revenue was $111.9 million, with ethanol sales up 7.6% and corn oil revenue up 29.0% versus the prior-year period. Cost of goods sold fell as average corn cost per bushel declined 9.8%, lifting gross margin to 15.61% of revenue from 3.85%. The company recognized $11.7 million of Section 45Z tax credits and sold $14.3 million of 2025 credits, helping net income rise to $24.8 million from $1.2 million. Cash increased to $34.9 million with no long‑term debt and $30 million of undrawn credit capacity. Highwater plans about $12.1 million of efficiency‑focused capital projects and has applied to increase its permitted ethanol production, while cautioning that earnings are sensitive to commodity volatility, Middle East conflict impacts on energy prices, and the temporary nature of Section 45Z incentives.
HIGHWATER ETHANOL LLC (HEOL) director Michael D. Stein filed an initial ownership report showing 400 Limited Liability Company Membership Units indirectly owned. These 400 units are held by Indeck Renewable Energy, LLC, which is wholly owned by Indeck Energy Services, Inc., where Mr. Stein serves as CFO.
HIGHWATER ETHANOL LLC (HEOL) reported a governance change. On August 19, 2026, the board of governors appointed Michael D. Stein to fill a vacancy on the board. He will serve for the unexpired term of his predecessor, ending in 2029.
Stein has been assigned to the board’s risk management, audit, and fixed assets committees, indicating involvement in oversight of the company’s financial reporting, risk oversight and asset management.
Highwater Ethanol, LLC reported that William Garth resigned from its Board of Governors effective July 27, 2026. The company stated that Mr. Garth did not resign because of a disagreement with the company.
The resignation changes the composition of the Board of Governors. Brian Kletscher, Chief Executive Officer, signed the related report on July 29, 2026, on behalf of Highwater Ethanol, LLC.
Highwater Ethanol reported a sharp turnaround to strong profitability for the quarter ended April 30, 2026. Quarterly revenue rose to $38.4 million from $35.1 million, while net income swung from a loss of $0.5 million to profit of $8.3 million, driven by wider crush margins and federal tax incentives.
For the first six months, revenue reached $72.8 million and net income was $13.9 million, compared with a loss a year earlier. The company recognized $6.7 million of Section 45Z clean fuel production tax credits and later sold $14.3 million of 2025 credits, adding a significant new income stream.
Highwater ended the period with $23.0 million of cash, no long‑term debt and $85.1 million of members’ equity, while maintaining unused revolving credit capacity. Management highlights ongoing exposure to volatile corn, natural gas and ethanol prices, and notes that Middle East conflict has temporarily boosted energy prices but could also pressure future demand and pricing.
Highwater Ethanol, LLC entered into a Tax Credit Purchase Agreement and sold $14,307,388 of 2025 U.S. federal clean fuel production tax credits tied to its Lamberton, Minnesota ethanol facility. The North Dakota banking counterparty paid the purchase price in cash on the Effective Date, May 29, 2026.
The buyer also received a right of first refusal through January 31, 2027 on up to $14,000,000 per year of Section 45Z tax credits generated from 2026–2029 on the same terms. The deal includes extensive tax, eligibility, emissions, prevailing wage, and insurance conditions, plus indemnities and detailed audit and cooperation provisions.
Highwater Ethanol, LLC held its 2026 annual members' meeting on March 5, 2026 to elect three governors whose terms were expiring in 2026. Members voted on a single proposal to elect David Eis, William Garth, and David Moldan to new terms.
All three nominees were elected by plurality vote to serve as governors until 2029. Vote totals were 1,812 for and 6 abstentions/withheld for Eis; 1,671 for and 147 abstentions/withheld for Garth; and 1,721 for and 97 abstentions/withheld for Moldan, confirming continuity in the company's board leadership.
Highwater Ethanol, LLC reported a strong turnaround quarter, earning net income of $5,609,932 on revenues of $34,401,853 for the three months ended January 31, 2026. Gross margin improved sharply as cost of goods sold fell to 89.76% of revenue from 97.08% a year earlier.
Results were boosted by $3,300,000 in federal Section 45Z clean fuel tax credits recorded in other income, helping other income, net reach $3,525,274. Core operations also strengthened, with ethanol revenue up about 2.8% and corn oil revenue up 26.8%, while corn and natural gas costs declined.
The company generated $4,271,323 of cash from operating activities, ended the quarter with $19,784,199 in cash and cash equivalents, and had no outstanding borrowings on its $30,000,000 of committed credit facilities. It declared member distributions of $6,652,100, or $1,400 per unit.