Green Plains reports third quarter 2012 financial results

By Green Plains Renewable Energy Inc. | October 30, 2012

Green Plains Renewable Energy Inc. announced on Oct. 30 its financial results for the three months ended Sept. 30, 2012. Net loss attributable to Green Plains for the quarter was $1 million, or 3 cents per diluted share, compared to net income of $12.4 million, or 32 cents per diluted share, for the same period in 2011. Revenues were $947.4 million for the three months ended Sept. 30, 2012 compared to $957.0 million for the same period in 2011.

"Our platform performed well in the third quarter considering the difficult margin environment in the ethanol industry," stated Todd Becker, president and CEO. "We achieved a record quarter for non-ethanol operating income of $20.8 million which helped offset the weakness in the ethanol segment. We are encouraged to see results in our ethanol segment gradually improving on a sequential basis since the first quarter of this year."

"Our rail car initiative helped deliver strong results in our marketing and distribution segment. Operating income from our agribusiness segment was particularly strong with early plantings and dry conditions allowing producers to harvest corn and soybeans earlier than expected. Because of this, handling margins were stronger than usual as our Tennessee businesses were well positioned to capture end of crop-year market conditions," said Becker.

Revenues for the nine-month period ended Sept. 30, 2012 were $2.6 billion, down slightly from the same period in 2011. Net loss attributable to Green Plains for the nine months ended Sept. 30, 2012 was $21.2 million, or 70 cents per diluted share, compared to net income of $25.2 million, or 66 cents per diluted share, for the same period in 2011.

"We believe our disciplined approach to margin management and strength in our non-ethanol segments will continue to benefit our financial results for the remainder of the year. As a result, we expect to return to profitability in the fourth quarter, before considering the gain we expect to realize on the agribusiness transaction," added Becker.

"The sale of a large component of our agribusiness segment does not mean we are exiting the grain storage and handling business. This transaction was a compelling opportunity to unlock value for our shareholders and will place us in the strongest financial position in the Company's history. Looking forward, we plan to aggressively take advantage of growth opportunities around all of our businesses, including agribusiness through grain storage expansion at or near our ethanol plants," added Becker.

Third quarter 2012 EBITDA, which is defined as earnings before interest, income taxes, noncontrolling interests, depreciation and amortization, was $21.7 million compared to $41.6 million for the same period in 2011. Green Plains had $159.8 million total cash and equivalents and $154.5 million available under committed loan agreements at subsidiaries (subject to satisfaction of specified lending conditions and covenants) at Sept. 30, 2012.


Third Quarter 2012 Business Highlights

  • - On Oct. 28, 2012, Green Plains announced that it has entered into an asset purchase agreement to sell 12 of its grain elevators located in northwestern Iowa and western Tennessee. The sale includes approximately 32.6 million bushels, or 83 percent, of the company's reported agribusiness grain storage capacity, and all of its agronomy and retail petroleum operations. Net cash proceeds, including working capital liquidation, are expected to be approximately $103.8 million. Green Plains expects to report a pre-tax gain from this sale of approximately $46 million. The closing of the transaction, which is expected to occur during the fourth quarter of 2012, is subject to customary closing conditions and regulatory approvals.
  • - Construction of the BlendStar unit train terminal in Birmingham, Alabama is nearing completion. Green Plains expects the terminal will provide additional throughput capacity of 300 million gallons per year and be operational to receive the first unit train of ethanol in late November.
  • - Phase III of BioProcess Algae's build-out is also close to completion. Construction of the reactors on three of the five acres is complete and the facilities were inoculated with algae in October. First harvest from the new facilities is expected in early November.