| | | | Exhibit 99.2 | |
| |  | | Press Release | |
Council Bluffs, Iowa ----- May 9, 2011 ---- On May 9, 2011, Southwest Iowa Renewable Energy, LLC (“SIRE”) announced its financial results for the second fiscal quarter ending March 31, 2011. SIRE reported a net loss of $674,031 or $51.30 per unit, compared to a net loss of $742,851 or $56.54 per unit in the same period in 2010.
Brian Cahill, SIRE’s General Manager and CEO stated, “Our corn oil extraction implementation process is complete. This project has a positive effect on our operations and we expect the contributions from corn oil to grow as we progress through the fiscal year. Ethanol margins have contracted in the second quarter, just as they did one year ago. However, we achieved a slight improvement with a reduced loss for the quarter, in spite of the challenging commodity price conditions. In addition, this period has been characterized by cost containment and specific measures to increase and carefully manage our liquidity. We also continue to focus on maximizing ethanol production yields and coordinating rail car logistics to enhance our performance."
About Southwest Iowa Renewable Energy, LLC:
SIRE is an Iowa limited liability company, located in Council Bluffs, Iowa, formed in March, 2005 to construct and operate a 110 million gallon capacity ethanol plant. SIRE began producing ethanol in February, 2009 and sells its ethanol, modified wet distillers grains with solubles, corn syrup, and corn oil in the continental United States. SIRE also sells its dried distillers grains with soluble in the continental United States, Mexico and the Pacific Rim.
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “1995 Act”). Such statements are made in good faith by SIRE and are identified as including terms such as “may,” “will,” “should,” “expects,” “anticipates,” “estimates,” “plans,” or similar language. In connection with these safe-harbor provisions, SIRE has identified in its Annual Report to Shareholders for the fiscal year ended September 30, 2010, important factors that could cause actual results to differ materially from those contained in any forward-looking statement made by or on behalf of SIRE, including, without limitation, the risk and nature of SIRE’s business ,and the effects of general economic conditions on SIRE. The forward-looking statements contained in this Press Release are excluded from the safe harbor protection provided by Section 27A of the Securities Act of 1933, as amended (the “1933 Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). SIRE further cautions that such factors are not exhaustive or exclusive. SIRE does not undertake to update any forward-looking statement which may be made from time to time by or on behalf of SIRE.
Statistical Information
| | Three Months Ended March 31, 2011 (Unaudited) | | Three Months Ended March 31, 2010 (Unaudited) |
| | | | Gallons/Tons Sold | | % of Revenues | Gallons/Tons Average Price | | Gallons/Tons Sold | | % of Revenues | | Gallons/Tons Average Price |
| Statistical Revenue Information | | | | | | | | | | | | | | |
| | 28,728,974 | | 81% | $ | 2.22 | | | 27,482,126 | | 83% | | $ | |
| Dry Distiller’s Grains | | 76,682 | | 18% | $ | 175.87 | | | 77,473 | | 17% | | $ | 108.39 |
| Corn Oil | | 1,439 | | 1% | $ | 911 | | | - | | 0% | | $ | |
Financial Results
| | | Three Months Ended March 31, 2011 (Unaudited)(1) | | | Three Months Ended March 31, 2010 (Unaudited)(1) |
| | | | | | | | | | | | | | | |
| | | Amounts | | % of Revenues | | Gallons | | | Amounts | | % of Revenues | | Gallons |
| Income Statement Data | | | | | | | | | | | | | | |
| Revenues | $ | 79,436,677 | | 100% | $ | 2.77 | | $ | 51,977,147 | | 100% | | $ | 1.89 |
| Cost of Goods Sold | | | | | | | | | | | | | | |
| Material Costs | | 61,793,749 | | 78% | | 2.15 | | | 32,529,790 | | 63% | | | 1.18 |
| Variable Production Exp. | | 7,342,844 | | 9% | | .26 | | | 6,826,875 | | 13% | | | .26 |
| Fixed Production Exp. | | 7,421,642 | | 9% | | .26 | | | 10,015,684 | | 19% | | | .36 |
| Gross Margin | | 2,878,443 | | 4% | | 0.10 | | | 2,604,798 | | 5% | | | .09 |
| General and Administrative Expenses | | 1,158,462 | | 2% | | 0.04 | | | 1,358,410 | | 2% | | | 0.05 |
| Other Expense | | 2,394,011 | | 3% | | 0.08 | | | 1,989,239 | | 4% | | | 0.07 |
| Net Loss | $ | (674,030) | | (1%) | $ | (0.02) | | $ | (742,851) | | (1%) | | $ | (0.03) |
| Weighted Average Units | | | | | | | | | | | | | | |
| Outstanding—Basic & Diluted | | 13,139 | | | | | | | 13,139 | | | | | |
| Net (loss) per unit –basic & diluted | $ | (51.30) | | | | | | $ | (56.54) | | | | | |
(1) Includes ethanol and distillers grains converted to gallons.
Summary Balance Sheets
| ASSETS | March 31, 2011 | September 30, 2010 |
| | (Unaudited) | |
| Current Assets | | | | |
| Cash and cash equivalents | $ | 1,594,123 | $ | 3,432,544 |
| Restricted cash | | 175,607 | | 0 |
| Accounts receivable | | 296,337 | | 0 |
| Accounts receivable, related party | | 22,241,348 | | 23,392,670 |
| Due from broker | | 3,367,640 | | 2,260,015 |
| Inventory | | 14,823,894 | | 8,013,153 |
| Derivative financial instruments, related party | | 5,812,957 | | 688,039 |
| Prepaid expenses and other | | 1,853,479 | | 533,513 |
| Total current assets | | 50,165,385 | | 38,319,934 |
| Property, Plant, and Equipment | | | | |
| Land | | 2,064,090 | | 2,064,090 |
| Plant, Building and Equipment | | 203,419,944 | | 199,771,260 |
| Office and Other Equipment | | 731,527 | | 720,529 |
| Total Cost | | 206,215,561 | | 202,555,879 |
| Accumulated Depreciation | | (36,848,927) | | (28,757,303) |
| Net property and equipment | | 169,366,634 | | 173,798,576 |
| Other Assets | | | | |
| Other | | 125,000 | | 1,142,388 |
| Financing costs, net of amortization of $2,145,525 and $1,949,651 | | 1,734,608 | | 1,930,482 |
| Total other assets | | 1,859,608 | | 3,072,870 |
| Total Assets | $ | 221,391,627 | $ | 215,191,380 |
| LIABILITIES AND MEMBERS’ EQUITY | March 31, 2011 | September 30, 2010 |
| | (Unaudited) | |
| Current Liabilities | | | | |
| Accounts payable | $ | 731,122 | $ | 978,388 |
| Accounts payable, related parties | | 5,671,402 | | 2,542,055 |
| Derivative financial instruments | | 1,112,113 | | 75,125 |
| Accrued expenses | | 2,339,324 | | 2,624,916 |
| Accrued expenses, related parties | | 4,031,830 | | 2,913,206 |
| Current maturities of notes payable | | 27,793,654 | | 18,058,574 |
| Total current liabilities | | 41,679,445 | | 27,192,264 |
Long Term Liabilities | | | | |
Notes payable, less current maturities | | 128,701,500 | | 135,868,087 |
| Other | | 650,008 | | 700,006 |
| Total long term liabilities | | 129,351,508 | | 136,568,093 |
Commitments and Contingencies | | | | |
| Members’ Equity | | | | |
| Members’ capital, 13,139 Units issued and outstanding | | 76,474,111 | | 76,474,111 |
| Accumulated (deficit) | | (26,113,437) | | (25,043,088) |
| Total members’ equity | | 50,360,674 | | 51,431,023 |
| Total Liabilities and Members’ Equity | $ | 221,391,627 | $ | 215,191,380 |
