EXHIBIT 99.1
SOUTHWEST IOWA RENEWABLE ENERGY, LLC ANNOUNCES FIRST QUARTER FY2013 RESULTS
Council Bluffs, Iowa ----- February 15, 2013---- On February 14, 2013, Southwest Iowa Renewable Energy, LLC (“SIRE”) announced its unaudited financial results for the first quarter of fiscal year 2013 (“Fiscal 2013”) which ended December 31, 2012. SIRE reported a net loss of $8,683,000, or $660.83 per unit, compared to a net profit of $8,996,000, or $684.62 per unit, for the first quarter of fiscal year 2012 (“Fiscal 2012”) which ended December 31, 2011. The cash flow provided by operations for the first quarter of Fiscal 2013 was $1,097,000, compared to $7,141,000 for the same period in Fiscal 2012.
Adjusted EBITDA, which is defined as earnings before interest, income taxes, and depreciation and/or amortization (“EBITDA”), as adjusted for unrealized hedging losses (gains), was a loss of $1,259,000 for the first quarter of Fiscal 2013 and a gain of $10,014,000 for the same period in Fiscal 2012. At December 31, 2012, SIRE had $12,391,000 in cash and equivalents and $5,555,000 available under committed loan agreements (subject to satisfaction of specified lending conditions and covenants). For reconciliations of Adjusted EBITDA to net income attributable to SIRE, see “Adjusted EBITDA” below.
Brian Cahill, SIRE’s General Manager and CEO, stated, “Our first quarter in Fiscal 2013 reflects the continuing margin compression resulting from the relative high prices of our primary input and low prices our primary product during the quarter. In particular, the key factors during the quarter were relatively high prices compared to previous years of our primary input, corn, resulting from the drought conditions in the United States. In addition, pricing pressures have continued to depress ethanol prices. Notwithstanding these margins, we have continued to make scheduled payments to our banks, resulting in further principal reduction in overall debt and reduced interest costs. We have also continued to make modest capital investments that are resulting in incremental productivity improvements in our plant.”
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 name plate 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 solubles 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 on Form 10-K for the fiscal year ended September 30, 2012, 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 included in 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.
Summary Balance Sheets
| | | | | | | | |
| SOUTHWEST IOWA RENEWABLE ENERGY, LLC | |
| Balance Sheets | |
| (Dollars in thousands) | |
| | | | | | | | |
| ASSETS | | | December 31, 2012 | | | September 30, 2012 | |
| | | | (Unaudited) | | | | |
| Current Assets | | | | | | | |
| Cash and cash equivalents | | $ | 12,391 | | $ | 6,285 | |
| Restricted cash | | | 303 | | | 302 | |
| Accounts receivable | | | 145 | | | 268 | |
| Accounts receivable, related party | | | 8,108 | | | 12,088 | |
| Derivative financial instruments | | | 1,282 | | | 976 | |
| Inventory | | | 12,224 | | | 12,427 | |
| Derivative financial instruments, related party | | | 674 | | | 4,013 | |
| Prepaid expenses and other | | | 875 | | | 394 | |
| Total current assets | | | 36,002 | | | 36,753 | |
| | | | | | | | |
| Property, Plant and Equipment | | | | | | | |
| Land | | | 2,064 | | | 2,064 | |
| Plant, building and equipment | | | 204,493 | | | 204,597 | |
| Office and other equipment | | | 751 | | | 751 | |
| | | | 207,308 | | | 207,412 | |
| Accumulated depreciation | | | (56,449) | | | (53,679) | |
| Net property and equipment | | | 150,859 | | | 153,733 | |
| | | | | | | | |
| Other Assets | | | | | | | |
| Financing costs, net of amortization of | | | 866 | | | 1,001 | |
| $3,337 and $3,202, respectively | | | | | | | |
| Other assets | | | 896 | | | 896 | |
| | | | 1,762 | | | 1,897 | |
| Total Assets | | $ | 188,623 | | $ | 192,383 | |
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Summary Balance Sheets
| | | | | | | |
| SOUTHWEST IOWA RENEWABLE ENERGY, LLC |
| Balance Sheets |
| (Dollars in thousands) |
| | | | | | | |
| LIABILITIES AND MEMBERS' EQUITY | | | December 31, 2012 | | | September 30, 2012 |
| | | | (Unaudited) | | | |
| Current Liabilities | | | | | | |
| Accounts payable | | $ | 1,114 | | $ | 1,366 |
| Accounts payable, related parties | | | 3,737 | | | 3,937 |
| Accrued expenses | | | 2,379 | | | 2,837 |
| Accrued expenses, related parties | | | 2,466 | | | 1,657 |
| Current maturities of notes payable | | | 28,367 | | | 20,001 |
| Total current liabilities | | | 38,063 | | | 29,798 |
| | | | | | | |
| Long Term Liabilities | | | | | | |
| Notes payable, less current maturities | | | 111,706 | | | 115,023 |
| Other long-term liabilities | | | 475 | | | 500 |
| Total long term liabilities | | | 112,181 | | | 115,523 |
| Commitments and Contingencies | | | | | | |
| | | | | | | |
| Members' Equity | | | | | | |
| Members' capital | | | | | | |
| 13,139 Units issued and outstanding | | | 76,474 | | | 76,474 |
| Accumulated profit (deficit) | | | (38,095) | | | (29,412) |
| Total members' equity | | | 38,379 | | | 47,062 |
| Total Liabilities and Members' Equity | | $ | 188,623 | | $ | 192,383 |
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| SOUTHWEST IOWA RENEWABLE ENERGY, LLC |
| Statements of Operations |
| (Dollars in thousands) |
| (Unaudited) |
| | | | | | | |
| | | | Three Months Ended | | | Three Months Ended |
| | | | December 31, 2012 | | | December 31, 2011 |
| | | | | | | |
| Revenues | | $ | 74,327 | | $ | 95,197 |
| Cost of Goods Sold | | | | | | |
| Cost of goods sold-non hedging | | | 78,287 | | | 85,817 |
| Realized & unrealized hedging (gains) losses | | | 1,293 | | | (3,391) |
| | | | 79,580 | | | 82,426 |
| | | | | | | |
| Gross Margin (Loss) | | | (5,253) | | | 12,771 |
| | | | | | | |
| General and administrative expenses | | | 1,057 | | | 1,313 |
| | | | | | | |
| Operating Income (Loss) | | | (6,310) | | | 11,458 |
| | | | | | | |
| Other Income (Expense) | | | | | | |
| Interest and other income | | | 20 | | | 12 |
| Interest expense | | | (2,393) | | | (2,474) |
| | | | (2,373) | | | (2,462) |
| | | | | | | |
| Net Income (Loss) | | $ | (8,683) | | $ | 8,996 |
| | | | | | | |
| Weighted Average Units Outstanding | | | 13,139 | | | 13,139 |
| Net Income (loss) per unit, basic & diluted | | $ | (660.83) | | $ | 684.62 |
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Adjusted EBITDA
Management uses Adjusted EBITDA, a non-GAAP measure, to measure the SIRE’s financial performance and to internally manage its business. Management believes that adjusted EBITDA provides useful information to investors as a measure of comparison with peer and other companies. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, net income or cash flow as determined in accordance with generally accepted accounting principles. Adjusted EBITDA calculations may vary from company to company. Accordingly, our computation of Adjusted EBITDA may not be comparable with a similarly-titled measure of another company.
The following sets forth the reconciliation of Net Loss to Adjusted EBITDA (unaudited) for the periods indicated:
| | | | |
| | December 31, 2012 | | December 31, 2011 |
| | Amounts | | Amounts |
| | in 000's | | in 000's |
| EBITDA | | | |
| Net Income (Loss) | (8,683) | | 8,996 |
| Interest Expense, interest income, and other income | 2,373 | | 2,462 |
| Depreciation & Amortization | 2,984 | | 2,959 |
| EBITDA (Loss) | (3,326) | | 14,417 |
| | | | |
| Change in Unrealized Hedging (gain) loss | 2,067 | | (4,403) |
| | | | |
| Adjusted EBITDA (Loss) | (1,259) | | 10,014 |
| | | | |
| Adjusted EBITDA (Loss) per unit | (95.84) | | 762.15 |
Statistical Information
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| | December 31, 2012 | | December 31, 2011 |
| | Gallons/Tons Sold | | % of Revenues | | Gallons/Tons Average Price | | Gallons/Tons Sold | | % of Revenues | | Gallons/Tons Average Price |
| | | | | | | | | | | | |
| Denatured Ethanol | 24,580,450 | | 73.953% | | $ 2.24 | | 30,873,285 | | 80.475% | | $ 2.48 |
| Dry Distiller's Grains | 50,043 | | 17.483% | | $ 259.67 | | 70,376 | | 14.611% | | $ 197.64 |
| Wet Distiller's Grains | 29,740 | | 5.002% | | $ 125.01 | | 23,332 | | 2.017% | | $ 82.29 |
| Syrup | 5,211 | | 0.620% | | $ 88.41 | | 11,655 | | 0.469% | | $ 38.30 |
| Corn Oil | 2,949 | | 2.942% | | $ 741.60 | | 2,805 | | 2.429% | | $ 824.29 |
Contact:
Brett L. Frevert, CFO
Southwest Iowa Renewable Energy, LLC
712.366.0392
