SOURCE: RiceBran Technologies

May 17, 2013 09:00 ET

RiceBran Technologies Reports 2013 First Quarter Financial Results

SCOTTSDALE, AZ--(Marketwired - May 17, 2013) - RiceBran Technologies (OTCQB: RIBT), a global leader in the production and marketing of value added products derived from rice bran, today announced its financial results for the 2013 first quarter ending March 31, 2013.

2013 Operational Highlights to Date:
 USA Segment

  • Completed a research and development project targeted at extracting protein and fiber from rice bran.
  • Raw rice bran prices hit historic highs due to worst drought in eighty years and put pressure on animal nutrition sales and margins, but began to moderate in Louisiana in March.
  • Announced the launch of two new rice protein-based products under the trademark PRORYZA™.
  • Signed agreements with affiliates of Wilmar International Ltd., one of Asia's leading agribusiness groups, to exploit RIBT's technologies in the People's Republic of China.

 Brazil Segment

  • Continued progress toward completion of the plant expansion and technology upgrade projects.
  • Operating efficiency challenges associated with the plant expansion continued in Q1.
  • Raw rice bran prices in Brazil also hit historic highs in Q1, but began to moderate in April.
  • Revenues increased on a local currency basis however, the decline in the average exchange rate between reporting periods resulted in a reportable decline in US dollar revenues.
  • Mr. Joao Eduardo Luz de Almeida was hired as the new President of Irgovel.

W. John Short, CEO & President of RiceBran Technologies, commented, "Our financial results for the quarter are not indicative of the progress we have made in both segments of our business. Over the last year at our Brazil based bio-refining facility Irgovel, we have experienced all of the typical disruptions associated with installing new equipment in a 40 year old plant. Nevertheless, we have made significant strides in the process of upgrading that plant with several phases of the project now complete. We expect to complete the last major step in the project this January. In our USA segment, high raw rice bran prices put pressure on our animal nutrition sales and margins, but prices are beginning to moderate in the mid-south and we expect similar movements in the California market in the coming months. Our new Proryza rice bran protein products are currently being sampled to existing and potential customers both domestically and internationally. While product introduction in the food ingredient market takes time, we see rice bran protein as an excellent growth opportunity. In addition, we see the partnership signed with the Wilmar Group to introduce our technologies into the China market as another high potential opportunity in the medium term. While we continue to face challenges, we are working hard to capitalize on the many significant opportunities before us."

Financial Results for the First Quarter Ending March 31, 2013:
Consolidated revenues for the three months ended March 31, 2013, were $8.7 million compared to $9.7 million in the prior year period as shown by segment in the table below:

 
2013 First Quarter Revenue Breakdown By Business Segment
March 31, 2013 2012 CHANGE
Brazil segment
% of Revenues
$5.8 million
66.6%
$6.3 million
65.0%
-8.4%
USA segment
% of Revenues
$2.9 million
33.4%
$3.4 million
35.0%
-14.7%
Total Revenues $8.7 million $9.7 million -10.6%
       

Brazil segment revenues decreased $0.5 million, or 8.4%, in the first quarter of 2013 as compared to the first quarter of 2012. Revenues decreased $0.8 million as a result of the 11.5% decline in the average exchange rate between these periods. Offsetting this $0.8 million decline was a $0.2 million net increase in animal feed revenue. As part of the capital expansion project, we improved our animal feed production capabilities and launched new products which were unavailable for sale in 2012.

USA segment revenues decreased $0.5 million, or 14.7%, in the first quarter of 2013 compared to the first quarter of 2012. Animal feed product revenues decreased $0.7 million on lower volume and human nutrition product revenues increased $0.2 million on higher volume. The decline in animal feed revenue was attributable to the loss of one customer and the impact of another customer accelerating orders into the first quarter of 2012 prior to a price increase.

Consolidated gross profit in 2013 decreased $0.8 million to $1.0 million for the three months ended March 31, 2013, compared to $1.7 million in the prior year period. The USA segment gross profit declined $0.3 million to $0.7 million in the first quarter of 2013, from $1.0 million in the first quarter of 2012. The USA segment gross profit was negatively impacted $0.3 million by higher raw bran prices in 2013 compared to 2012. The Brazil segment gross profit decreased $0.5 million. Margin was impacted by 29% higher raw bran costs and plant inefficiencies associated with the capital expansion project.

Consolidated operating expenses were $3.7 million for the first quarter of 2013, compared to $4.1 million for the first quarter of 2012, an improvement of $0.4 million.

Consolidated other expense was $4.1 million for the first quarter of 2013, compared to other expense of $7.5 million for the first quarter of 2012. A $1.2 million increase in expense from the change in the fair value of derivative warrant and conversion liabilities was offset by (i) a $0.5 million improvement in foreign currency exchange and (ii) the impact of the $4.5 million financing expense and loss on extinguishment recognized in 2012 in connection with the January 2012 issuance of the subordinated convertible notes, senior convertible debenture and related warrants.

Consolidated net loss attributable to RIBT shareholders for the three months ended March 31, 2013 was $5.8 million, or $0.03 per share, compared to $8.8 million, or $0.04 per share, for the three months ended March 31, 2012. The $0.4 million deterioration between periods in loss from operations was more than offset by a $3.5 million improvement in other expense noted above.

Shareholder Update Conference Call:
Management will host a shareholder update conference call in June. Details including dial-in and webcast information will be provided in a news release prior to the call.

Forward-Looking Statements
This release contains forward-looking statements, including, but not limited to, statements about RiceBran Technologies' expectations regarding future revenues and the completion of capital projects in Brazil. These statements are made based upon current expectations that are subject to known and unknown risks and uncertainties. RiceBran Technologies does not undertake to update forward-looking statements in this news release to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information. Assumptions and other information that could cause results to differ from those set forth in the forward-looking information can be found in RiceBran Technologies' filings with the Securities and Exchange Commission, including its most recent periodic reports.

About RiceBran Technologies
RiceBran Technologies is a human food ingredient and animal nutrition company focused on the procurement, bio-refining and marketing of numerous products derived from rice bran. Rice Bran Technologies has proprietary and patented intellectual property that allows us to convert rice bran, one of the world's most underutilized food sources, into a number of highly nutritious human food ingredient and animal nutrition products. Our target markets are human food ingredients and animal nutrition manufacturers and retailers, as well as natural food, functional food and nutraceutical supplement manufacturers and retailers, both domestically and internationally. More information can be found in our filings with the SEC and by visiting our website at www.ricebrantech.com.