SOURCE: Aemetis, Inc.

Aemetis, Inc.

November 05, 2015 08:30 ET

Aemetis, Inc. Reports Third Quarter 2015 Financial Results

CUPERTINO, CA--(Marketwired - Nov 5, 2015) - Aemetis, Inc. (NASDAQ: AMTX), an advanced renewable fuels and renewable chemicals company, today announced its financial results for the three and nine months ended September 30, 2015.

"Our India biodiesel revenues grew 56% sequentially quarter over quarter through the development of a sustainable domestic customer base, which was made possible by key government policy changes earlier in the year. On October 21, 2015, the Indian Government removed a key tax barrier for the production of biodiesel, enabling Aemetis to source feedstock worldwide and expand our business in India much more rapidly," stated Eric McAfee, Chairman and CEO of Aemetis. "Our US ethanol business is showing steady signs of improvement driven by increased demand, but low prices caused by excess supply due to the two year delay by the EPA in establishing the Renewable Fuel Standard mandate."

"Importantly, we received an additional $2.0 million of EB-5 subordinated debt funding during the third quarter, totaling $23.5 million of funding released to Aemetis. As of September 30, 2015, our escrow account holds an additional $11.5 million of EB-5 funding. With one investor approved for funding and one investor identified for the last available unit, the offering is nearly complete. This 3% interest rate funding will be used to redeem higher rate senior debt," said McAfee.

Financial Results for the Three Months Ended September 30, 2015

Revenues were $38.5 million for the third quarter of 2015, compared to $48.3 million for the third quarter of 2014. Decreases in ethanol and wet distiller's grain average selling prices and volumes resulted in revenue declining during the third quarter as compared to the same period of the prior year. Gross profit for the third quarter of 2015 was $1.0 million, compared to $7.7 million in the third quarter of 2014. During this period, ethanol and wet distiller's grain pricing fell more rapidly than feedstock purchase costs.

Selling, general and administrative expenses were $2.8 million in the third quarter of 2015, compared to $3.0 million in the third quarter of 2014. The decrease in selling, general and administrative expenses was driven by improved efficiencies and lower spending compared to the same period of the prior year.

Operating loss was $1.9 million for the third quarter of 2015, compared to operating income of $4.6 million for the same period in 2014.

Net loss was $5.8 million for the third quarter of 2015, compared to net income of $0.5 million for the third quarter of 2014.

Adjusted EBITDA for the third quarter of 2015 was a loss of $0.5 million, compared to Adjusted EBITDA of $6.1 million for the same period in 2014.

Cash at the end of the third quarter of $2.5 million compared favorably to $0.3 million at the close of 2014.

During the third quarter of 2015, the EB-5 program provided $2.0 million of low-cost debt funding. Interest costs during the third quarter of 2015 were $3.9 million, compared to interest cost of $4.3 million during the third quarter of 2014.

Financial Results for the Nine Months Ended September 30, 2015

Revenues were $111.3 million for the nine months of 2015, compared to $166.2 million for nine months of 2014. Decreases in ethanol and wet distiller's grain average selling prices and volumes in the nine months of 2015 compared to same period in 2014 resulted in revenue declining for the first nine months of 2015. Gross profit for the nine months of 2015 was $2.8 million, compared to $34.7 million during the same period in 2014. During this period, ethanol and wet distiller's grain pricing fell more rapidly than feedstock purchase costs.

Selling, general and administrative expenses were $9.6 million during the nine months of 2015, compared to $9.3 million during the nine months of 2014. The increase in selling, general and administrative expenses was primarily attributable to financial advisory fees.

Operating loss was $7.1 million for the nine months of 2015, compared to operating income of $25.1 million for the same period in 2014.

Net loss was $20.7 million for the nine months of 2015, compared to net income of $10.9 million for the same period in 2014.

Adjusted EBITDA for the nine months of 2015 was loss of $3.0 million, compared to Adjusted EBITDA of $29.4 million for the same period in 2014.

During the nine months of 2015, the EB-5 program provided $22.0 million of low-cost EB-5 debt funding. Interest costs during the nine months of 2015 were $13.4 million, compared to $14.4 during the nine months of 2014 due to the lower cost of EB-5 funds in the capitalization structure.

About Aemetis

Headquartered in Cupertino, California, Aemetis is an advanced renewable fuels and renewable chemicals company focused on the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products by the conversion of second-generation ethanol and biodiesel plants into advanced biorefineries. Founded in 2006, Aemetis owns and operates a 60 million gallon per year ethanol production facility in the California Central Valley near Modesto. Aemetis also owns and operates a 50 million gallon per year renewable chemical and advanced fuel production facility on the East Coast of India producing high quality distilled biodiesel and refined glycerin for customers in India and Europe. Aemetis operates a research and development laboratory at the Maryland Biotech Center, and holds a portfolio of patents and related technology licenses for the production of renewable fuels and biochemicals. For additional information about Aemetis, please visit www.aemetis.com.

NON-GAAP FINANCIAL INFORMATION

We have provided non-GAAP measures as a supplement to financial results based on GAAP. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures is included in the accompanying supplemental data. Adjusted EBITDA is defined as net income/(loss) plus (to the extent deducted in calculating such net income) interest and amortization (income)/expense, depreciation expense, income/(expense) from share-based compensation and (gains)/losses resulting from debt extinguishment.

Adjusted EBITDA is not calculated in accordance with GAAP and should not be considered as an alternative to net income/(loss), operating income or any other performance measures derived in accordance with GAAP or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA is presented solely as a supplemental disclosure because management believes that it is a useful performance measure that is widely used within the industry in which we operate. In addition, management uses Adjusted EBITDA for reviewing financial results and for budgeting and planning purposes. EBITDA measures are not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure for comparison.

Safe Harbor Statement

This news release contains forward-looking statements, including statements regarding our assumptions, projections, expectations, targets, intentions or beliefs about future events or other statements that are not historical facts. Forward-looking statements in this news release include, without limitation, expectations for growth in India, the impact that the recent regulatory changes in India will have on our business expectations for uses of EB-5 funding and expectations for receipt of additional EB-5 funding. Words or phrases such as "anticipates," "may," "will," "should," "believes," "estimates," "expects," "intends," "plans," "predicts," "projects," "targets," "will likely result," "will continue" or similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on current assumptions and predictions and are subject to numerous risks and uncertainties. Actual results or events could differ materially from those set forth or implied by such forward-looking statements and related assumptions due to certain factors, including, without limitation, competition in the ethanol and other industries in which we operate, commodity market risks including those that may result from current weather conditions, financial market risks, customer adoption, counter-party risks, risks associated with changes to federal policy or regulation, and other risks detailed in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2014, our Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and in our subsequent filings with the SEC. We are not obligated, and do not intend, to update any of these forward-looking statements at any time unless an update is required by applicable securities laws.

                         
AEMETIS, INC.             
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS        
(unaudited, in thousands except per share data)           
   
    For the three months ended Sept. 30,     For the nine months ended Sept. 30,  
(in thousands, except per share)   2015     2014     2015     2014  
Revenues   $ 38,510     $ 48,348     $ 111,303     $ 166,208  
Cost of goods sold     37,476       40,633       108,548       131,516  
Gross profit     1,034       7,715       2,755       34,692  
                                 
Research and development expenses     117       101       330       342  
Selling, general and administrative expenses     2,774       2,972       9,556       9,263  
Operating income/(loss)     (1,857 )     4,642       (7,131 )     25,087  
                                 
Interest rate expense     (2,610 )     (2,287 )     (7,641 )     (7,737 )
Amortization expense     (1,258 )     (741 )     (5,386 )     (5,361 )
Loss on debt extinguishment     -       (1,231 )     (330 )     (1,346 )
Loss on sale or disposal of assets     -       -       -       (119 )
Other income/(expense)     (30 )     81       (191 )     355  
                                 
Income/(loss) before income taxes     (5,755 )     464       (20,679 )     10,879  
                                 
Income tax expense     -       -       (6 )     (6 )
                                 
Net income/(loss)   $ (5,755 )   $ 464     $ (20,685 )   $ 10,873  
                                 
Net Income/(loss) per common share*                                
  Basic   $ (0.29 )   $ 0.02     $ (1.04 )   $ 0.54  
  Diluted   $ (0.29 )   $ 0.02     $ (1.04 )   $ 0.52  
                                 
Weighted average shares outstanding*                                
  Basic     19,521       20,555       19,898       20,284  
  Diluted     19,521       21,476       19,898       20,946  
                                   
* The Earnings per share and Weighted average shares outstanding for all periods presented reflect the one-for-ten reverse split, which took effect May 15, 2014.
 
 
             
AEMETIS, INC.            
CONSOLIDATED CONDENSED BALANCE SHEETS            
(unaudited, in thousands)            
             
    September 30, 2015     December 31, 2014  
Assets                
Current assets:                
  Cash and cash equivalents   $ 2,516     $ 332  
  Accounts receivable     2,229       1,262  
  Inventories     3,771       4,491  
  Prepaid expenses and Other current assets     1,044       1,848  
Total current assets     9,560       7,933  
                 
Property, plant and equipment, Net     71,934       75,810  
Goodwill, Intangibles and Other assets     5,473       5,433  
Total assets   $ 86,967     $ 89,176  
                 
Liabilities and stockholders' equity/(deficit)                
Current liabilities:                
  Accounts payable     7,725       8,339  
  Current portion of long term debt, notes and working capital     5,555       6,032  
  Short term borrowings     7,075       6,714  
  Mandatorily redeemable Series B convertible preferred stock     2,716       2,641  
  Other current liabilities     4,048       3,590  
Total current liabilities     27,119       27,316  
                 
Long term liabilities                
  Senior secured notes     59,558       57,648  
  EB-5 notes     23,500       1,534  
  Other long term liabilities     5,818       5,650  
                 
Stockholders' deficit     (29,028 )     (2,972 )
                 
Total liabilities and stockholders' equity/(deficit)   $ 86,967     $ 89,176  
                 
                 
 
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME/(LOSS)
(unaudited, in thousands)
         
    For the three months ended Sept. 30,   For the nine months ended Sept. 30,
    2015     2014   2015     2014
Net income/(loss)   $ (5,755 )   $ 464   $ (20,685 )   $ 10,873
Adjustments:                            
  Interest rate expense     2,610       2,287     7,641       7,737
  Amortization expense     1,258       741     5,386       5,361
  Loss on debt extinguishment     -       1,231     330       1,346
  Income tax expense     -       -     6       6
  Intangibles and other amortization expense     32       31     96       95
  Depreciation expense     1,172       1,184     3,560       3,486
  Share-based compensation     161       157     694       447
Total adjustments     5,233       5,631     17,713       18,478
Adjusted EBITDA   $ (522 )   $ 6,095   $ (2,972 )   $ 29,351
                             
                             
 
PRODUCTION AND PRICE PERFORMANCE
(unaudited)
         
    For the three months ended Sept. 30,   For the nine months ended Sept. 30,
    2015   2014   2015   2014
Ethanol                        
Gallons Sold (in millions)     14.2     14.7     42.6     45.7
Average Sales Price/Gallon   $ 1.76   $ 2.29   $ 1.74   $ 2.65
                         
WDG                        
Tons Sold (in thousands)     88.6     96.0     275.9     310.4
Average Sales Price/Ton   $ 75   $ 85   $ 82   $ 100
                         
Biodiesel                        
Metric tons sold (in thousands)     7.6     3.8     12.1     7.6
Average Sales Price/Metric ton   $ 685   $ 992   $ 734   $ 1,003
                         
Refined Glycerin                        
Metric tons sold (in thousands)     1.2     0.7     4.0     1.6
Average Sales Price/Metric ton   $ 714   $ 932   $ 667   $ 997
                         
                         

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