Pacific Ethanol, Inc. Reports Second Quarter 2013 Financial Results *Increased net sales 14% over second quarter 2012 *Improved quarterly gross profit to $7.0 million, compared to loss of $4.9 million in second quarter 2012 *Increased operating income to $3.8 million, compared to a loss of $8.0 million in second quarter 2012 *Achieved consolidated net income of $1.1 million, compared to loss of $10.0 million in second quarter 2012 *Improved Adjusted EBITDA to $6.6 million, compared to a loss of $1.5 million in second quarter 2012 *Extended all remaining Plant debt due in 2013 to 2016 *Retired or repaid approximately $13.5 million in debt *Began producing and selling corn oil at Magic Valley plant SACRAMENTO, Calif., July 24, 2013 (GLOBE NEWSWIRE) -- Pacific Ethanol, Inc. (Nasdaq:PEIX), the leading marketer and producer of low-carbon renewable fuels in the Western United States, reported its financial results for the three- and six-months ended June 30, 2013. Neil Koehler, the company's president and CEO, stated: "For the second quarter of 2013, we significantly increased our gross profit, operating income, net income and adjusted EBITDA. These improvements were driven by better market conditions, more favorable ethanol pricing, our continued focus on operating efficiencies and our increased plant ownership position. We also improved our balance sheet by extending all remaining plant debt due in 2013 to 2016, and we retired or repaid approximately $13.5 million in debt." "We made significant progress on our objectives to diversify our revenues and feedstock. In June, we began producing and selling corn oil at our Magic Valley plant, and we expect to begin production of corn oil at our Stockton plant in the third quarter of 2013. We continue to diversify our feedstock as we increase our blend of sorghum sourced from local, Midwest and international markets. We believe these efforts, combined with our focus on reducing the carbon intensity of ethanol we produce, will support profitable growth." Financial Results for the Three Months Ended June 30, 2013 Net sales were $233.8 million for the second quarter of 2013, compared to $205.4 million for the second quarter of 2012. The increase in net sales was attributable to a higher average price per gallon of ethanol sold, which was partially offset by a reduction in total gallons sold. Gross profit was $7.0 million for the second quarter of 2013, compared to a loss of $4.9 million in the second quarter of 2012. The increase is attributable to significantly improved commodity margins from the Pacific Ethanol plants. SG&A expenses were $3.1 million in the second quarter of 2013, which were flat compared to the second quarter of 2012. Operating income for the second quarter of 2013 was $3.8 million, compared to an operating loss of $8.0 million for the same period in 2012, again, primarily due to significantly improved commodity margins at the Pacific Ethanol plants. Income available to common stockholders for the second quarter of 2013 was $0.7 million, compared to a loss of $2.9 million for the second quarter of 2012. Adjusted EBITDA improved to positive $6.6 million for the second quarter of 2013, compared to Adjusted EBITDA of negative $1.5 million in the second quarter of 2012. Financial Results for the Six Months Ended June 30, 2013 For the six months ended June 30, 2013, net sales were $459.3 million, compared to $403.2 million for the same period in 2012. For the first six months of 2013, loss available to common stockholders was $5.0 million, compared to $8.2 million for the same period in 2012. Adjusted EBITDA for the first six months of 2013 was positive $6.9 million, compared to Adjusted EBITDA of negative $4.1 million for the first six months of 2012. Q2 Results Conference Call Management will host a conference call at 8:00 a.m. PT/11:00 a.m. ET on July 25, 2013. Neil Koehler, Chief Executive Officer, and Bryon McGregor, Chief Financial Officer, will deliver prepared remarks followed by a question and answer session. The webcast for the call can be accessed from Pacific Ethanol's website at www.pacificethanol.net. Alternatively, you may dial the following number up to ten minutes prior to the scheduled conference call time: (877) 847-6066. International callers should dial 00-1-(970) 315-0267. The pass code will be 20876091#. If you are unable to participate on the live call, the webcast will be archived for replay on Pacific Ethanol's website for one year. In addition, a telephonic replay will be available at 2:30 p.m. Eastern Time on July 25, 2013 through 11:59 p.m. Eastern Time on August 1, 2013. To access the replay, please dial (855) 859-2056. International callers should dial 00-1-(404) 537-3406. The pass code will be 20876091#. Reconciliation of Adjusted EBITDA to Net Income (Loss) Management believes that certain financial measures not in accordance with generally accepted accounting principles ("GAAP") are useful measures of operations. The company defines Adjusted EBITDA as unaudited earnings before interest, taxes, depreciation and amortization, noncash gain (loss) on debt extinguishments and fair value adjustments and warrant inducements. The table at the end of this release provides a reconciliation of Adjusted EBITDA to net income (loss) attributed to Pacific Ethanol, Inc. Management provides an Adjusted EBITDA measure so that investors will have the same financial information that management uses, which may assist investors in properly assessing the company's performance on a period-over-period basis. Adjusted EBITDA is not a measure of financial performance under GAAP, and should not be considered an alternative to net income (loss) 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. Adjusted 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. About Pacific Ethanol, Inc. Pacific Ethanol, Inc. (Nasdaq:PEIX) is the leading marketer and producer of low-carbon renewable fuels in the Western United States. Pacific Ethanol also sells co-products, including wet distillers grain ("WDG"), a nutritious animal feed. Serving integrated oil companies and gasoline marketers who blend ethanol into gasoline, Pacific Ethanol provides transportation, storage and delivery of ethanol through third-party service providers in the Western United States, primarily in California, Arizona, Nevada, Utah, Oregon, Colorado, Idaho and Washington. Pacific Ethanol has an 85% ownership interest in New PE Holdco LLC, the owner of four ethanol production facilities. Pacific Ethanol operates and manages the four ethanol production facilities, which have a combined annual production capacity of 200 million gallons. The facilities in operation are located in Boardman, Oregon, Burley, Idaho and Stockton, California, and one idled facility is located in Madera, California. The facilities are near their respective fuel and feed customers, offering significant timing, transportation cost and logistical advantages. Pacific Ethanol's subsidiary, Kinergy Marketing LLC, markets ethanol from Pacific Ethanol's managed plants and from other third-party production facilities, and another subsidiary, Pacific Ag. Products, LLC, markets WDG. For more information please visit www.pacificethanol.net. 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 including, without limitation, the ability of Pacific Ethanol to continue as the leading marketer and producer of low-carbon renewable fuels in the Western United States; and whether Pacific Ethanol's production and sale of corn oil, diversification of feedstock and continued focus on reducing the carbon intensity of produced ethanol will support profitable growth are forward-looking statements and considerations 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, adverse economic and market conditions, including for ethanol and its co-products, and in particular, low-carbon rated ethanol; raw material costs; changes in governmental regulations and policies; and other events, factors and risks previously and from time to time disclosed in Pacific Ethanol's filings with the Securities and Exchange Commission including, specifically, those factors set forth in the "Risk Factors" section contained in Pacific Ethanol's Form 10-K filed with the Securities and Exchange Commission on April 1, 2013. (Tables follow) PACIFIC ETHANOL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, 2013 2012 2013 2012 Net sales $233,808 $205,447 $459,267 $403,166 Cost of goods sold 226,843 210,347 451,456 415,543 Gross profit (loss) 6,965 (4,900) 7,811 (12,377) Selling, general and administrative 3,133 3,124 7,138 6,502 expenses Income (loss) from operations 3,832 (8,024) 673 (18,879) Fair value adjustments and warrant 1,437 1,285 745 1,252 inducements Interest expense, net (3,972) (3,093) (7,453) (6,002) Gain (loss) on extinguishments of (39) — 778 — debt Other expense, net (128) (200) (215) (394) Income (loss) before provision for 1,130 (10,032) (5,472) (24,023) income taxes Provision for income taxes — — — — Consolidated net income (loss) 1,130 (10,032) (5,472) (24,023) Net (income) loss attributed to noncontrolling interest in variable (79) 7,403 1,069 16,441 interest entity Net income (loss) attributed to $1,051 $(2,629) $(4,403) $(7,582) Pacific Ethanol Preferred stock dividends $(315) $(315) $(627) $(630) Income (loss) available to common $736 $(2,944) $(5,030) $(8,212) stockholders Net income (loss) per share, basic $0.07 $(0.51) $(0.48) $(1.43) and diluted Weighted-average shares outstanding, 10,853 5,759 10,462 5,754 basic Weighted-average shares outstanding, 12,135 5,759 10,462 5,754 diluted PACIFIC ETHANOL, INC. CONSOLIDATED BALANCE SHEETS (unaudited, in thousands, except par value) June 30, December 31, ASSETS 2013 2012 Current Assets: Cash and cash equivalents $6,983 $7,586 Accounts receivable, net 36,192 26,051 Inventories 19,148 16,244 Prepaid inventory 6,338 5,422 Other current assets 2,774 2,129 Total current assets 71,435 57,432 Property and equipment, net 150,915 150,409 Other Assets: Intangible assets, net 3,497 3,734 Other assets 4,550 3,388 Total other assets 8,047 7,122 Total Assets $230,397 $214,963 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable – trade $10,571 $5,104 Accrued liabilities 3,918 3,282 Current portion – long-term debt 6,405 4,029 Total current liabilities 20,894 12,415 Long-term debt, net of current portion 113,188 117,253 Accrued preferred dividends 5,120 5,852 Warrant liabilities and conversion features 10,427 4,892 Other liabilities 6,896 1,644 Total Liabilities 156,525 142,056 Stockholders' Equity: Pacific Ethanol, Inc. Stockholders' Equity: Preferred stock, $0.001 par value; 10,000 shares authorized; Series A: 0 shares issued and outstanding as ofJune 30, 2013 and December31, 2012 Series B: 927 shares issued and outstanding as of June 1 1 30, 2013 and December 31, 2012 Common stock, $0.001 par value; 300,000 shares authorized; 11,918 and 9,789 shares issued and 12 10 outstanding as of June 30, 2013 and December31, 2012, respectively Additional paid-in capital 600,846 582,861 Accumulated deficit (535,340) (530,310) Total Pacific Ethanol, Inc. Stockholders' Equity 65,519 52,562 Noncontrolling interest in variable interest entity 8,353 20,345 Total Stockholders' Equity 73,872 72,907 Total Liabilities and Stockholders' Equity $230,397 $214,963 Reconciliation of Adjusted EBITDA to Net Income (Loss) Three Months Ended Six Months Ended June 30, June 30, (in thousands) (unaudited) 2013 2012 2013 2012 Net income (loss) attributed to $1,051 $(2,629) $(4,403) $(7,582) Pacific Ethanol Adjustments: Interest expense* 3,393 1,193 6,125 2,342 Interest income* ---- (3) ---- (3) Extinguishment of debt - noncash 1,037 ---- 1,037 ---- Fair value adjustments (1,437) (1,285) (745) (1,252) Depreciation and amortization 2,529 1,195 4,915 2,433 expense* Total adjustments 5,522 1,100 11,332 3,520 Adjusted EBITDA $6,573 $(1,529) $6,929 $(4,062) ________________ * Adjusted for noncontrolling interest in variable interest entity. Commodity Price Performance Three Months Ended Six Months Ended June 30, June 30, (unaudited) 2013 2012 2013 2012 Ethanol production gallons sold (in 36.8 37.2 72.1 72.5 millions) Ethanol third party gallons sold (in 64.4 79.4 129.9 158.9 millions) Total ethanol gallons sold (in millions) 101.2 116.6 202.0 231.4 Ethanol average sales price per gallon $2.79 $2.30 $2.69 $2.32 Corn cost – CBOT equivalent $6.55 $6.10 $6.85 $6.28 Total co-product tons sold (in thousands) 337.4 342.2 638.3 647.6 Co-product return % (1) 27.6% 26.6% 27.9% 25.6% ________________ (1) Co-product revenue as a percentage of delivered cost of corn. CONTACT: Company IR Contact: Pacific Ethanol, Inc. 916-403-2755 866-508-4969 Investorrelations@pacificethanol.net IR Agency Contact: Becky Herrick LHA 415-433-3777 Media Contact: Paul Koehler Pacific Ethanol, Inc. 503-235-8241 firstname.lastname@example.org company logo
Pacific Ethanol, Inc. Reports Second Quarter 2013 Financial Results
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