SIRE reports increased ethanol production for Q2

By Erin Voegele | May 15, 2019

Southwest Iowa Renewable Energy Inc. recently released financial results for its fiscal second quarter, the three months ended March 31. The company reported increased ethanol production and a slight decrease in revenues.

“So far during fiscal 2019, we have seen very tight margins, continuing the trends of the previous quarters, said Mike Jerke, president and CEO of SIRE, in a statement. “Corn prices have increased by almost 6.5 percent per bushel in 2019 as compared to fiscal 2018, and ethanol prices in the U.S. remain below last year's levels by almost 7 percent. The industry has continued to adjust to lower exports to China, and is becoming more dependent on continued export demand to other parts of the world. U.S. demand could eventually improve with expansion of E15 sales per the directive of President Trump to the EPA. Our distiller grains have also seen a slight increased price and demand improvement in fiscal 2019 as compared to fiscal 2018."

SIRE produced 33.1 million gallons of ethanol during the quarter, up from 31.9 million gallons produced during the same period of last year. "We continue to evaluate and implement new production technology to expand our income stream,” Jerke said. “We are focused on running the plant efficiently, increasing our ethanol yield, with a balance of optimizing the yield and profit, and at the same time scrutinizing our expenses.”

The company reported revenue from operations of $53.2 million for the quarter, down slightly from $53.6 million during the same quarter of last year.

Ethanol accounted for $39.17 million in revenue, or 73.6 percent of total revenue, for the fiscal second quarter of 2019, compared to $42.02 million, or 80.3 percent of total revenue, during the same quarter of 2018.

Revenue from distillers grains reached $10.78 million and accounted for 20.3 percent of total revenue, compared to $8.08 million and 15.1 percent of total revenue during the same period of last year.

Revenue from corn oil also increased, reaching $2.98 million or 5.6 percent of total revenue. During the same period of last year, corn oil accounted for $2.16 million or 4 percent of total revenue.

SIRE reported a net loss of $1.8 million, or $132.59 per basic unit for the quarter, compared to a net loss of $900,000, or $69.63 per basic unit, reported for the same period of last year.

Modified EBITDA was $800,000, down from $1.9 million during the second fiscal quarter of 2018.