SIRE reports improved net income

By Southwest Iowa Renewable Energy | May 12, 2017

Southwest Iowa Renewable Energy LLC has announced its unaudited financial results for the three months and six months ended March 31.

SIRE reported net income of $7.7 million or $577.55 per basic unit for the six months ended March 31, compared to a net loss of $1.1 million or $84.19 per basic unit for the six months ended March 31, 2016.  SIRE reported net income of $2.1 million for the three months ended March 31, 2017 or $154.95 per basic unit compared to net loss of $2.2 million or $167.18 per basic unit for the three months ended March 31, 2016.

SIRE revenue from operations was $108.1 million for the six months ended March 31 compared to $107.3 million for the six months ended March 31, 2016 and $56.1 million for the three months ended March 31, 2017 compared to $54.1 million for the three months ended March 31, 2016.

Modified EBITDA, which is defined as earnings before interest, income taxes, depreciation, amortization, and unrealized hedging gains and losses, was $13.6 million for the six months ended March 31, compared to $6.0 million for the six months ended March 31, 2016 and $5.4 million for the three months ended March 31, compared to $1.7 million for the three months ended March 31, 2016.

SIRE had $1.5 million in cash and cash equivalents and $25.7 million available under revolving loan agreements, for a total cash and available borrowings of $27.2 million at March 31. The cash flow provided by operating activities was $7.5 million compared to a loss of $2.6 million for the six months ended March 31, 2017 and 2016, respectively.

Brian Cahill, SIRE's president and CEO stated, "In the second quarter of fiscal 2017, we saw a 5 percent increase in our cost of corn as compared to the first quarter of fiscal 2017.  Seasonal influences have increased corn inventories and work-in-process during the current quarter. Demand for ethanol has been strong, both in the U.S. and abroad. The industry has continued to adjust, and we expect margins to remain positive, but are becoming more dependent on continued good export demand."

During the second quarter of Fiscal 2017, SIRE produced 31.1 million gallons of ethanol, compared to 31.2 million gallons during the second quarter of fiscal 2016. Cahill commented, "We continue to evaluate and implement new production technology. We will continue to focus on running the plant efficiently, with a balance of optimizing the yield and profit."