Aemetis reports positive earnings, receives 3% EB-5 loan

By Susanne Retka Schill | November 12, 2014

California ethanol producer Aemetis Inc. reported record earnings for the first three quarters of 2014, turning the company around from the losses reported in 2013.

For the first nine months of the year, Aemetis reported revenues of $166.2 million, compared to $123.5 million during the same period of 2013. Gross profit was a record $34.7 million compared to $7 million during the same period in 2013. Net income was $10.9 million or 52 cents per diluted share compared to a net loss of $27.7 million or $1.47 loss per diluted share during the same period in 2013. Adjusted EBITDA for the nine months ended Sept. 30, 2014 was a record $29.4 million compared to $100,000 for the same period in 2013.

“Aemetis continued to generate strong positive cash flow and reduce debt during the third quarter of 2014,” stated Eric McAfee, Chairman and CEO. He emphasized the company’s efforts to reduce debt, explaining that it has received $21 million of low-interest EB-5 funding. In the U.S. Immigration Service program, foreign investors receive a green card to be able to work and study in the U.S. if they invest $500,000 in qualified, job-creating projects through the EB-5 program. McAfee said the 3 percent interest rate will bring the company’s interest expenses down to about $1 million per year as compared to the $25 million paid in 2013. 

In the earnings report, Aemetis reported Q3 revenues of $48.3 million, down 15 percent compared to same period last year, primarily due to lower ethanol prices. Gross profit, however, saw a dramatic 154 percent increase over Q3 2013 at $7.7 million for Q3 2014. The increase in gross profit was primarily due to corn prices falling faster than ethanol prices.

Adjusted EBITDA for Q3 was $6.1 million, compared to $1.3 million for the same period in 2013 and operating income for Q3 2014 was $4.6 million, compared to an operating loss of $1 million in Q3 2013. Net Income for the third quarter of 2014 was $464,000, or 2 cents per share, compared to a loss of $8.3 million, or 43 cents per share, for the third quarter of 2013. Cash flow resulted in cash and cash equivalents of $5.5 million as of Sept. 30, 2014 and allowed for principal and interest payments on outstanding debt of approximately $8.6 million during the third quarter of 2014.

The company expects to see a $10 million per year positive cash flow when the recently announced liquid CO2 plant begins operation in Q1 2016. The 300 ton-per-day CO2 plant will capture about 220 million pounds of the estimated 360 million pounds of CO2 produced annually at the Keyes, California, ethanol plant, according to McAfee. Other upgrades at the Keyes plant are improving the company’s returns, corn oil extraction technology and its proprietary clean-in-place system. “The plant is operating at very high yields,” McAfee said, “due to the low contamination rates and increased uptime.”

Aemetis owns and operates the 60 MMgy ethanol facility in Keyes, California. It is the first facility approved by the U.S. EPA to produce D5 advanced biofuels using the sorghum/biogas/CHP pathway. Aemetis also built, owns and operates a 50 MMgy biodiesel plant in India which supplies biodiesel and glycerin for customers in Europe and Asia. Aemetis operates a research and development laboratory at the Maryland Biotech Center, and holds five patents on the Z-microbe and related technology for the production of renewable fuels and biochemicals.