Cosan reports increased ethanol production in Q2 results

By Erin Voegele | August 20, 2014

Brazil-based Cosan recently released financial results for the second quarter, reporting a 16 percent increase in EBITDA for its Raízen Energia business unit, which comprises its sugar, ethanol and cogeneration operations.

At the close of the second quarter, Cosan indicated Raízen Energia was operating 24 sugar, ethanol and energy cogeneration mills, with a crushing capacity of 65.5 million tons of sugarcane per crop year.

Raízen Energia crushed 20.94 million tons of sugarcane during the quarter, up 13 percent from the 18.53 million tons crushed during the same quarter of last year. Cosan attributed the increase to a high number of days available for harvest during the quarter as a result of dry weather in the south-central region of Brazil.

The company produced 705,000 cubic meters of ethanol during the quarter (186.24 million gallons), up 18.5 percent from the 595,000 cubic meters produced during the second quarter of 2013. The 705,000 cubic meters of production includes 313,000 cubic meters of anhydrous ethanol and 392,000 hydrous ethanol. 

Raízen Energia reported net operating revenue of R$1.69 billion ($747.94 million), up 14.1 percent from R$1.48 billion during the same period of last year. Ethanol sales were R$879.3 million during the quarter, up 51.4 percent from R$580.7 million reported for the second period of 2013. Cosan attributed the increase to 35 percent higher sales volumes and a 12 percent increase in weighted average price. During the second quarter, the company reported R$359 million of sales into the domestic market, an 11.1 percent increase from the previous year, and R$289 million of sales into the foreign market, up 54 percent from the prior year. On a volume basis, the company indicated ethanol exports increased 44.4 percent.

Gross profit for the Raízen Energia segment reached R$325.5 million for the quarter, up 44.2 percent from the previous year. Gross profit from ethanol was R$86.2, an increase of 122.2 percent. Ethanol gross margin for the quarter was 13.3 percent, compared to 7.6 percent during the same period of 2013. EBITDA for the segment was R$478.3 million, an increase of 15.8 percent.

Overall, Cosan reported net revenue of R$9.6 billion for the quarter, up from R$8.77 billion during the same period of the prior year. The company reported a gross profit of R$1.17 billion, up from R$1.02 billion. EBIDTA was R$881.4 million for the quarter, up from R$827.7 the previous year. Net income for the second quarter was R$104.1 million, compared to a R$201.5 loss during the