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| 8-K - 8-K SIRE 2016 Q3 PRESS RELEASE - SOUTHWEST IOWA RENEWABLE ENERGY, LLC | sire10-qpressrelease2016q3.htm |
Council Bluffs, Iowa ----- On August 3, 2016, Southwest Iowa Renewable Energy, LLC (“ SIRE ” or the "Company") announced its unaudited financial results as of and for the three and nine months ended June 30, 2016.
Results for the Third Quarter of Fiscal 2016
Three Months Ended June 30, 2016 | Three Months Ended June 30, 2015 | Nine Months Ended June 30, 2016 | Nine Months Ended June 30, 2015 | ||||||||||
• | Revenues - | $58,128,000 | $58,235,000 | $165,449,000 | $186,243,000 | ||||||||
• | Gross Margin - | $1,227,000 | $7,749,000 | $2,935,000 | $23,468,000 | ||||||||
• | Net Income (Loss) - | ($273,000 | ) | $6,091,000 | ($1,395,000 | ) | $13,009,000 | ||||||
• | Modified EBITDA - | $4,361,000 | $9,388,000 | $10,242,000 | $27,085,000 | ||||||||
SIRE reported net income (loss) for the nine months ended June 30, 2016 of $(1.4) million or $(104.67) per basic unit compared to $13.0 million or $976.14 per basis unit for the nine months ended June 30, 2015, and SIRE reported a net income (loss) for the three months ended June 30, 2016 of $(0.3) million or $(20.48) per basic unit compared to $6.1 million or $457.04 per basic unit for the three months ended June 30, 2015.
SIRE revenue from operations was $165.4 million for the nine months ended June 30, 2016 compared to $186.2 million for the nine months ended June 30, 2015 and $58.1 million for the three months ended June 30, 2016 compared to $58.2 million for the three months ended June 30, 2015.
Modified EBITDA, which is defined as earnings before interest, income taxes, depreciation, amortization, unrealized hedging gains and losses, and other significant noncash expenses was $10.2 million for the nine months ended June 30, 2016, compared to $27.1 million for the nine months ended June 30, 2015 and $4.4 million for the three months ended June 30, 2016 compared to $9.4 million for the three months ended June 30, 2015.
On June 30, 2016, SIRE had $3.0 million in cash and cash equivalents and $18.3 million available under the Revolving Term Loan and working capital of $14.5 million.
Brian Cahill, SIRE's President and CEO stated, “Margins did improve this quarter, compared to the second quarter, as we capitalized on the increased demand for gasoline and ethanol in the US. Our margins are being directly impacted by lower oil prices, which increase demand for ethanol but drive down ethanol prices, as well as the lower corn prices towards the end of June as the 2016 weather has been excellent for corn, and the corn crop and harvest look very favorable to the ethanol industry."
During the third quarter of Fiscal 2016, SIRE produced 30.9 million gallons of ethanol. Cahill commented - "We continue to focus on running the plant efficiently, seeking the right balance of optimizing yield and profit."
SIRE also announced that on July 15, 2016, the Board of Directors declared a distribution of $250 per unit to its members. The distributions are expected to be paid on or around August 15, 2016 to members of record on July 15, 2016. Based on the current number of units outstanding, the aggregate payment will be approximately $3.3 million.
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
SOUTHWEST IOWA RENEWABLE ENERGY, LLC Summary Statements of Operations Unaudited (Dollars in thousands) | |||||||||||||||
For the three months ended June 30, | For the nine months ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues | $ | 58,128 | $ | 58,235 | $ | 165,449 | $ | 186,243 | |||||||
Cost of Goods Sold | 56,901 | 50,486 | 162,514 | 162,775 | |||||||||||
Gross Margin | 1,227 | 7,749 | 2,935 | 23,468 | |||||||||||
General and administrative expenses | 1,104 | 1,256 | 3,273 | 3,771 | |||||||||||
Interest expense and other income, net | 396 | 402 | 697 | 1,388 | |||||||||||
Change in fair value of put option liability | — | — | 360 | 600 | |||||||||||
Loss from debt extinguishment | — | — | — | 4,700 | |||||||||||
Net Income (Loss) | $ | (273 | ) | $ | 6,091 | $ | (1,395 | ) | $ | 13,009 | |||||
Weighted Average Units Outstanding, Basic | 13,327 | 13,327 | 13,327 | 13,327 | |||||||||||
Weighted Average Units Outstanding, Diluted | 13,327 | 14,039 | 13,327 | 16,522 | |||||||||||
Net Income (Loss) per unit, Basic | $ | (20.48 | ) | $ | 457.04 | $ | (104.67 | ) | $ | 976.14 | |||||
Net Income (Loss) per unit, Diluted | $ | (20.48 | ) | $ | 433.86 | $ | (104.67 | ) | $ | 847.84 | |||||
Summary Balance Sheets
(Dollars in thousands)
June 30, 2016 | September 30, 2015 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Current Assets | |||||||
Cash & restricted cash | $ | 3,016 | $ | 3,335 | |||
Accounts receivable | 13,780 | 3,764 | |||||
Inventory | 13,431 | 14,298 | |||||
Other current assets | 2,190 | 1,146 | |||||
Total current assets | 32,417 | 22,543 | |||||
Net property and equipment | 124,154 | 129,420 | |||||
Other assets | 2,450 | 2,513 | |||||
Total Assets | $ | 159,021 | $ | 154,476 | |||
LIABILITIES AND MEMBERS' EQUITY | |||||||
Current Liabilities | |||||||
Accounts payable, accrued expenses, and other current liabilities | $ | 11,456 | $ | 11,587 | |||
Current maturities of notes payable | 6,511 | 6,506 | |||||
Total current liabilities | 17,967 | 18,093 | |||||
Total long term liabilities | 41,133 | 35,067 | |||||
Total members' equity | 99,921 | 101,316 | |||||
Total Liabilities and Members' Equity | $ | 159,021 | $ | 154,476 | |||
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 chart below sets forth the reconciliation of Net Income (Loss) to Modified EBITDA for the periods indicated.
Modified EBITDA, which is defined as earnings before interest, income taxes, depreciation and amortization, unrealized hedging gains and losses, and other significant non cash expenses was $10.2 million for the nine months ended June 30, 2016, compared to $27.1 million for the nine months ended June 30, 2015 and $4.4 million for the three months ended June 30, 2016 compared to $9.4 million for the three months ended June 30, 2015.
Three months ended | Nine months ended | ||||||||||||||
June 30, 2016 | June 30, 2015 | June 30, 2016 | June 30, 2015 | ||||||||||||
EBITDA | |||||||||||||||
Net Income (Loss) | $ | (273 | ) | $ | 6,091 | $ | (1,395 | ) | $ | 13,009 | |||||
Interest Expense | 372 | 407 | 1,072 | 1,525 | |||||||||||
Depreciation | 2,942 | 2,851 | 8,820 | 8,624 | |||||||||||
EBITDA | 3,041 | 9,349 | 8,497 | 23,158 | |||||||||||
Unrealized Hedging (Gain) Loss | 1,320 | 39 | 1,385 | (1,373 | ) | ||||||||||
Loss from debt extinguishment | — | — | — | 4,700 | |||||||||||
Change in fair value of put option liability | — | — | 360 | 600 | |||||||||||
Modified EBITDA | $ | 4,361 | $ | 9,388 | $ | 10,242 | $ | 27,085 | |||||||
Statistical Information
Product Revenue Information | |||||||||||||
Three Months Ended June 30, 2016 | Three Months Ended June 30, 2015 | ||||||||||||
Amounts in 000's | % of Revenues | Amounts in 000's | % of Revenues | ||||||||||
Denatured and undenatured Ethanol | $ | 45,198 | 77.8 | % | $ | 42,341 | 72.7 | % | |||||
Distillers Grains | 10,200 | 17.5 | % | 13,229 | 22.7 | % | |||||||
Corn Oil | 2,401 | 4.1 | % | 2,324 | 4.0 | % | |||||||
Other | 329 | 0.6 | % | 341 | 0.6 | % | |||||||
Product Revenue Information | |||||||||||||
Nine Months Ended June 30, 2016 | Nine Months Ended June 30, 2015 | ||||||||||||
Amounts in 000's | % of Revenues | Amounts in 000's | % of Revenues | ||||||||||
Denatured and undenatured Ethanol | $ | 128,822 | 77.8 | % | $ | 144,000 | 77.3 | % | |||||
Distillers Grains | 29,243 | 17.7 | % | 34,479 | 18.5 | % | |||||||
Corn Oil | 6,387 | 3.9 | % | 6,885 | 3.7 | % | |||||||
Other | 997 | 0.6 | % | 879 | 0.5 | % | |||||||
Contact:
Brett Frevert, CFO
Southwest Iowa Renewable Energy, LLC
712.366.0392