More Biodiesel Sold but Revenues Decreased, says Renewable Energy Group

Renewable Energy Group (REG) announced its financial results for the third quarter of 2014. Revenues for the quarter were $384.3 million. Compared to the third quarter of 2013, REG sold 14.4% more gallons of biomass-based diesel, while revenues decreased by 16.2% and Adjusted EBITDA decreased by 77.7%. The decline is attributable to a reduction in average sales price and lower RIN prices, which more than offset the 14.4% increase in gallons sold.

“Our third quarter results reflect a very solid financial performance despite weak market conditions, while we worked to bring REG Geismar online and continued to invest in product development,” said Daniel J. Oh, President and Chief Executive Officer. “Our traditional biodiesel business saw double digit volume growth of gallons sold and produced, compared to the third quarter of last year. The Mason City upgrades, which now allow that biorefinery to use lower cost feedstocks, were completed on time and within budget, and reflect our continued investment and focus on the biomass-based diesel business.”

Third Quarter 2014 Highlights

• In the 3Q14, REG sold 88.8 million gallons of biodiesel, an increase of 14.4% compared to 3Q13.
• REG produced 63.8 million gallons of biodiesel during the quarter, a 12.3% increase when compared to the 3Q13.
• The balance of the gallons sold consisted of 18.0 million gallons purchased from third parties and resold through the company’s distribution network and 7.0 million gallons from inventory
• Revenues of 3Q13 were US$384.3 million, decreasing 16.2% compared to 3Q13.
• The average price per gallon of biodiesel sold during the third quarter was US$3.54, or 28.5% lower than in the same quarter of 2013
• Gross profit was $22.7 million, or 5.9% of revenues, compared to gross profit of $57.8 million, or 12.6% of revenues, for the third quarter of 2013. The decrease in gross profit resulted from margin compression caused by lower selling prices.
• Operating income was $6.0 million, compared to $45.2 million for the third quarter of 2013.
• Net income attributable to common stockholders was US$4.5 million, or US$0.11 per share on a fully diluted basis.