Message #6 From:
NewsBot Date: May 19, 2008 11:22:16 PM
Pacific Ethanol, Inc. Announces First Quarter 2008 Financial Results
Pacific Ethanol, Inc. Announces First Quarter 2008 Financial Results
Highlights
- Net sales up 63% over Q1 of 2007 and up 24% from Q4 of 2007
- Gallons sold up 58% from Q1 of 2007 to 59.2 million gallons
- Loss per diluted share of $0.90, which includes a non-cash
goodwill impairment net of noncontrolling interests of $0.96 per share
- SG&A as percentage of net sales improved 37% to 6.1% from 9.6% in Q1 of 2007
- EBITDA grew 159% to $12.4 million for the quarter from $4.8 million for Q1 of 2007
- Burley, Idaho plant completed start up
SACRAMENTO, Calif., May 19 /PRNewswire-FirstCall/ -- Pacific Ethanol, Inc.
(Nasdaq: PEIX), the leading West Coast-based marketer and producer of ethanol,
today announced its financial results for the quarter ended March 31, 2008.
Three Months Ended March 31, 2008
For the quarter ended March 31, 2008, the Company reported net sales of
$161.5 million, an increase of $62.3 million, or 63%, compared to
$99.2 million for the same period in 2007. This increase in net sales is
primarily due to a substantial increase in sales volume, which was partially
offset by lower average sales prices. The Company's sales volume increased by
21.7 million gallons, or 58%, to 59.2 million gallons, compared to
37.5 million gallons for the same period in 2007. The Company's average sales
price of ethanol decreased by $0.04 per gallon, or 2%, to $2.30 per gallon
compared to an average sales price of $2.34 per gallon in the first quarter of
2007.
Average corn prices rose significantly in the three months ended March 31,
2008 as compared to the same period in 2007. The Company partially offset
increased corn costs with derivative gains of $2.2 million for the three
months ended March 31, 2008 as compared to a loss of $303,000 from derivatives
for the three months ended March 31, 2007. Gross profit for the first quarter
of 2008 totaled $15.7 million compared to $15.3 million in the first quarter
of 2007. The Company's gross margin was 9.7% for the three months ended March
31, 2008 compared to 15.4% in the same period in 2007.
The Company completed its annual goodwill impairment test as of March 31,
2008. With the overall softening in the ethanol industry since the Company's
acquisition of its interest in Front Range Energy, LLC, market valuations
indicated impairment of goodwill. As a result, the Company recorded a non-cash
goodwill impairment of $87.0 million. Of this amount $48.4 million relates to
noncontrolling interests of the Company's variable interest entity, resulting
in net goodwill impairment of $38.6 million, which is included in the
Company's net loss for the first quarter of 2008.
The Company's net loss for the first quarter of 2008 was $35.2 million
compared to net income of $3.0 million for the first quarter of 2007. Loss
available to common stockholders for the first quarter of 2008 was
$36.3 million compared to $1.9 million for the first quarter of 2007. The
Company reported loss per common share of $0.90 for the first quarter of 2008
as compared to income per common share of $0.05 for the same period in 2007.
The loss per share for the first quarter of 2008 includes a non-cash goodwill
impairment of $0.96 per share. The Company's weighted-average number of
diluted shares outstanding for the first quarter of 2008 totaled 40.1 million.
The Company's CEO, Neil Koehler, observed that 'We achieved record sales
and are pleased to report solid operational results for the first quarter.
Our Madera, Columbia and the Front Range facilities continue to produce over
design basis and our Magic Valley plant has successfully completed start up.
We continued to hold overhead costs relatively steady from the first quarter
of 2007, even as we experience ongoing dynamic growth. Our destination model
has increased the availability of renewable fuels and high quality feed
products in the Western US. With high oil prices and limited expansion
possibilities in oil production, we are providing a critically needed and
valuable transportation fuel to the marketplace.'
Reconciliation of EBITDA to Net Income (Loss)
This press release contains, and the Company's conference call will
include, references to unaudited earnings before interest, taxes, depreciation
and amortization, including goodwill impairment ('EBITDA'), a financial
measure that is not in accordance with generally accepted accounting
procedures ('GAAP'). The table set forth below provides a reconciliation of
EBITDA to net income (loss). Management believes that EBITDA is a meaningful
measure of liquidity and the Company's ability to service debt because it
provides a measure of cash available for such purposes. Additionally,
management provides an EBITDA measure so that investors will have the same
financial information that management uses with the belief that it will assist
investors in properly assessing the Company's performance on a
period-over-period basis. EBITDA is not a measure of financial performance
under GAAP, and should not be considered an alternative to net income or any
other measure of performance under GAAP, or to cash flows from operating,
investing or financing activities as an indicator of cash flows or as a
measure of liquidity. EBITDA has limitations as an analytical tool and you
should not consider it in isolation or as a substitute for analysis of the
Company's results as reported under GAAP.
Earnings Call
The Company will host a live conference call and webcast today at 10:00 AM
EDT / 7:00 AM PDT. Neil Koehler, Chief Executive Officer, and Joseph Hansen,
Chief Financial Officer, will host the call.
To listen to the conference call, United States callers may dial
866-356-4279. International callers may dial 617-597-5394. All callers
should enter access code 64712247.
A link to the live audio webcast of the Company's earnings conference call
may be found on the Company's website at http://www.pacificethanol.net.
Approximately one hour after the conclusion of the call, an audio replay
of the call will be available. To listen to the replay, United States callers
may dial 888-286-8010. International callers may dial 617-801-6888. All
callers should enter access code 17981767. The replay will be available
through June 3, 2008.
About Pacific Ethanol, Inc.
Pacific Ethanol is the largest West Coast-based marketer and producer of
ethanol. Pacific Ethanol has ethanol plants in Madera, California; Boardman,
Oregon; and Burley, Idaho and has an additional plant under construction in
Stockton, California. Pacific Ethanol also owns a 42% interest in Front Range
Energy, LLC which owns an ethanol plant in Windsor, Colorado. Central to
Pacific Ethanol's growth strategy is its destination business model, whereby
each respective ethanol plant achieves lower process and transportation costs
by servicing local markets for both fuel and feed. Pacific Ethanol's goal is
to achieve 220 million gallons per year of ethanol production capacity in 2008
and to increase total production capacity to 420 million gallons per year in
2010. In addition, Pacific Ethanol is working to identify and develop other
renewable fuel technologies, such as cellulose-based ethanol production and
bio-diesel.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995
With the exception of historical information, the matters discussed in
this press release are forward-looking statements that involve a number of
risks and uncertainties. The actual future results of Pacific Ethanol could
differ from those statements. Factors that could cause or contribute to such
differences include, but are not limited to, the ability of Pacific Ethanol to
successfully and timely complete, in a cost-effective manner, construction of
its remaining ethanol plant under construction; the ability of Pacific Ethanol
to obtain all necessary financing to complete the construction of its other
planned ethanol production facilities; the ability of Pacific Ethanol to
timely complete its ethanol plant build-out program and to successfully
capitalize on its internal growth initiatives; the ability of Pacific Ethanol
to operate its plants at their planned production capacities; the price of
ethanol relative to the price of gasoline; and the factors contained in the
'Risk Factors' section of Pacific Ethanol's Form 10-K filed with the
Securities and Exchange Commission on March 27, 2008.
