Southwest Iowa Renewable Energy, LLC Announces Second Quarter Results for Fiscal 2014
Council Bluffs, Iowa ----- May 1, 2014 Southwest Iowa Renewable Energy, LLC (“ SIRE ”) announced its unaudited financial results for the three and six months ended March 31, 2014.
Results for the Second Quarter of Fiscal 2014
|
| | | |
| | Three Months Ended | | Six Months Ended |
| Net Income | $19,150,000 | | $30,009,000 |
| Modified EBITDA | $23,298,000 | | $39,141,000 |
| Debt Payments | $7,668,000 | | $20,303,000 |
SIRE reported net income of $19,150,000 or $1,457 per basic unit for the three months ended March 31, 2014, compared to a net loss of $(2,424,000) or $(184) per unit for the three months ended March 31, 2013. SIRE reported net income of $30,009,000 or $2,283 per basic unit for the six months ended March 31, 2014, compared to a net loss of $(11,107,000) or $(845) per unit for the six months ended March 31, 2013.
Modified EBITDA, which is defined as earnings before interest, income taxes, depreciation, amortization, and unrealized hedging gains and losses was $39,141,000 for the six months ended March 31, 2014, compared to $2,829,000 for the six months ended March 31, 2013.
SIRE had $22.3 million in cash and cash equivalents and $31.4 million available under revolving loan agreements, for total cash and available borrowings of $53.7 million at March 31, 2014. The cash flow from operating activities was $31.5 million compared to $0.4 million for the six months ended March 31, 2014 and 2013, respectively.
Brian Cahill, SIRE's President and CEO stated, "During the second quarter of Fiscal 2014, we continued to see some of the best margins in the history of the company, continuing the trend of the past few quarters. We were able to continue operating at full capacity nearly every day, capitalizing not only on our ability to manage our railcar fleet during the winter storms that caused many delays and slowdowns, but also on our dual-powering, as we utilized our steam line the majority of the second quarter, avoiding the higher prices and curtailments for natural gas that others in the industry experienced."
"Our book value per share has now surpassed $5,447 per unit," continued Cahill, "with $2,283 per unit profit through these first two quarters."
"Our conversations with lenders are proceeding well, and we anticipate closing on our new financing, both senior and subordinated debt, prior to their maturities in August. Our spring shutdown in April went well, and the plant is back up and running at full capacity again during this third quarter."
During the second quarter of Fiscal 2014, SIRE sold 29.1 million gallons of ethanol, well above the 24.7 million gallons during the second quarter of Fiscal 2013. Cahill commented: "we continue to focus on running the plant at full capacity, with a balance of optimizing the yield and profit."
During the second quarter of Fiscal 2014, SIRE continued to meet all debt obligations, with a net pay down of $7.7 million in debt, and $20.3 million year to date. Due to the fact that all of SIRE's debt has balloon payments in August, 2014, GAAP accounting requires all of this debt to be classified as current in the 10Q filed with the SEC.
SIRE continues to capitalize on its advantage of having a dual-powered ethanol plant capable of heating with natural gas or with steam from the nearby power plant, with an updated pricing formula in its contract with MidAmerican Energy.
About Southwest Iowa Renewable Energy, LLC:
SIRE is located on 275 acres in Council Bluffs, Iowa, operating a 125 million gallon per year ethanol plant. SIRE began producing ethanol in February 2009 and sells its ethanol, distillers grains, corn syrup, and corn oil 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 , 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 and Section 21E of the Securities Exchange Act of 1934, as amended. 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.
Financial Results
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SOUTHWEST IOWA RENEWABLE ENERGY, LLC Condensed Statements of Operations (Unaudited) (Dollars in thousands except for net income (loss) per unit) |
| | For the three months ended | | For the six months ended |
| | March 31, 2014 | | March 31, 2013 | | March 31, 2014 | | March 31, 2013 |
| Revenues | $ | 82,971 |
| | $ | 79,197 |
| | $ | 163,157 |
| | $ | 153,524 |
|
| Cost of Goods Sold | 60,750 |
| | 78,325 |
| | 126,823 |
| | 157,905 |
|
| Gross Margin (Loss) | 22,221 |
| | 872 |
| | 36,334 |
| | (4,381 | ) |
| General and administrative expenses | 1,151 |
| | 931 |
| | 2,357 |
| | 1,988 |
|
| Operating Income (Loss) | 21,070 |
| | (59 | ) | | 33,977 |
| | (6,369 | ) |
| Interest expense and other income, net | (1,920 | ) | | (2,365 | ) | | (3,968 | ) | | (4,738 | ) |
| Net Income (Loss) | $ | 19,150 |
| | $ | (2,424 | ) | | $ | 30,009 |
| | $ | (11,107 | ) |
| | | | | | | | |
| Weighted average units outstanding - basic | 13,144 |
| | 13,139 |
| | 13,144 |
| | 13,139 |
|
| Weighted average units outstanding - diluted | 25,523 |
| | 13,139 |
| | 25,518 |
| | 13,139 |
|
| Income (loss) per unit - basic | $ | 1,456.94 |
| | $ | (184.49 | ) | | $ | 2,283.09 |
| | $ | (845.35 | ) |
| Income (loss) per unit - diluted | $ | 778.79 |
| | $ | (184.49 | ) | | $ | 1,233.21 |
| | $ | (845.35 | ) |
Modified EBITDA
Management uses Modified EBITDA, a non-GAAP measure, to measure the Company’s financial performance and to internally manage its business. Management believes that Modified EBITDA provides useful information to investors as a measure of comparison with peer and other companies. Modified 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. Modified EBITDA calculations may vary from company to company. Accordingly, our computation of Modified EBITDA may not be comparable with a similarly-titled measure of another company. The following sets forth the reconciliation of Net Income (Loss) to Modified EBITDA for the periods indicated:
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| | | | | | | | | | | | | | | |
| | For the three months ended | | For the six months ended |
| | March 31, 2014 | | March 31, 2013 | | March 31, 2014 | | March 31, 2013 |
| | in 000's | | in 000's | | in 000's | | in 000's |
| EBITDA | | | | | | | |
| Net Income (Loss) | $ | 19,150 |
| | $ | (2,424 | ) | | $ | 30,009 |
| | $ | (11,107 | ) |
| Interest Expense, Net | 1,936 |
| | 2,399 |
| | 3,988 |
| | 4,788 |
|
| Depreciation | 2,870 |
| | 2,849 |
| | 5,727 |
| | 5,698 |
|
| EBITDA | 23,956 |
| | 2,824 |
| | 39,724 |
| | (621 | ) |
| Unrealized Hedging Loss (Gain) | (658 | ) | | 1,383 |
| | (583 | ) | | 3,450 |
|
| Modified EBITDA | $ | 23,298 |
| | $ | 4,207 |
| | $ | 39,141 |
| | $ | 2,829 |
|
| Modified EBITDA per unit - basic | $ | 1,772.52 |
| | $ | 320.19 |
| | $ | 2,977.86 |
| | $ | 215.31 |
|
Statistical Information
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| | | | | | | | | | | |
| | For the three months ended | | For the six months ended |
| | March 31, 2014 | | March 31, 2013 | | March 31, 2014 | | March 31, 2013 |
| Ethanol (thousands of gallons sold) | 29,133 |
| | 24,654 |
| | 60,643 |
| | 49,234 |
|
| Distiller's Grains (tons sold) | 96,094 |
| | 94,079 |
| | 203,123 |
| | 173,861 |
|
| Corn (thousands of bushels used) | 10,517 |
| | 8,703 |
| | 21,854 |
| | 17,383 |
|
Condensed Balance Sheets
(Dollars in thousands)
|
| | | | | | | |
| | March 31, 2014 | | September 30, 2013 |
| | (Unaudited) | | |
| Assets | | | |
| Current Assets | | | |
| Cash and restricted cash | $ | 22,649 |
| | $ | 12,740 |
|
| Accounts receivable | 13,692 |
| | 11,163 |
|
| Inventory | 8,896 |
| | 8,445 |
|
| Other current assets | 2,037 |
| | 1,205 |
|
| Total Current Assets | 47,274 |
| | 33,553 |
|
| Net property and equipment | 138,722 |
| | 143,184 |
|
| Other assets | 1,455 |
| | 1,689 |
|
| Total Assets | $ | 187,451 |
| | $ | 178,426 |
|
| | | | |
| Liabilities and Members' Equity | | | |
| Current Liabilities | | | |
| Accounts payable and accrued expenses | 9,682 |
| | 12,330 |
|
| Current maturities of notes payable | 105,609 |
| | 123,887 |
|
| Total current liabilities | 115,291 |
| | 136,217 |
|
| Total long term liabilities | 554 |
| | 612 |
|
| Total Members' equity | 71,606 |
| | 41,597 |
|
| Total Liabilities and Members' Equity | $ | 187,451 |
| | $ | 178,426 |
|
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Contact:
Brett Frevert, CFO
Southwest Iowa Renewable Energy, LLC
712.366.0392
