Earnings season: Rentech improves, Aventine down

May 11, 2011 |

In California, Rentech (RTK) announced substantially improved results for the second quarter of fiscal year 2011 over the second quarter of fiscal year 2010 and reiterated guidance for the 2011 fiscal year. For the second quarter of fiscal year 2011, Rentech reported revenue of $23.6 million, up from $19.2 million for the comparable quarter in the prior year.

Rentech reported a net loss of $7.6 million, or $0.03 per share, for the quarter ended March 31, 2011, an improvement over the net loss attributable to the Company of $16.0 million, or $0.07 per share, for the comparable period in fiscal 2010. Notable in the results, strong fertilizer margins, an increased emphasis on the Port St. Joe power generation project in Florida, and its Olympiad Project in Canada, which will produce 23 million gallons per year of renewable jet fuel and 13 million gallons of naphtha.

Pavel Molchanov of Raymond James commented: “Rentech continues to be a development-stage business, and while fertilizer sales largely cover corporate costs, there is limited visibility on its commercialization of synthetic fuels.  Given the long-term potential for the domestic implementation of the Rentech Process, balanced by the recognition of financing challenges and execution risks, we maintain our Market Perform rating.  In the absence of positive full-year EPS until 2013 at the earliest, we apply a discounted cash flow (DCF) approach to value RTK shares, the same as we do with the other advanced biofuel companies we cover.  Based on the assumptions shown on page 2 and a 15% discount rate, we estimate DCF value of $1.28 per share.”

In Illinois, Aventine Renewable Energy Holdings, (AVRW.OB) announced a Q1 net loss of  $19.3 million, or $2.24 per diluted share. Revenues were $198.1 million for the quarter. On January 21, 2011, we redeemed our $155.0 million 13% senior secured notes due 2015 at a redemption price of 105% of the principal amount, plus accrued and unpaid interest. In significant operational news the company related “On April 27, 2011, we temporarily shut down our dry mill plant in Aurora, Nebraska to make some improvements to the fermentation process at the facility. We expect this work to be completed by the third week of May 2011. After completing the improvements, we will evaluate the margin environment to determine the timing of restarting operations.”

Print Friendly, PDF & Email

Tags: ,

Category: Producer News

Thank you for visting the Digest.