SOURCE: RiceBran Technologies

RiceBran Technologies

August 15, 2013 16:15 ET

RiceBran Technologies Reports 2013 Second Quarter Financial Results

SCOTTSDALE, AZ--(Marketwired - Aug 15, 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 second quarter ended June 30, 2013.

2013 Operational Highlights to Date:

  • Proryza™ rice bran protein products were launched at the Institute of Food Technologies Annual Meeting in Chicago, marking RIBT's entry into the vegetable protein market using sustainable raw materials.
  • Strong demand for Stage 2 products both domestically and internationally has resulted in additional shifts being added at RIBT's Dillon, Montana plant beginning in August.
  • Phase I of the plant expansion project in Brazil continues: new bran receiving facilities are scheduled to be completed in September, new bran preparation systems in October and extractor upgrades/expansion in January 2014.
  • Extruders have been delivered to Wilmar for installation in their Harbin, China rice mill.
  • RIBT secured a revolving credit facility with TCA Global Credit Master Fund to support working capital needs.

Financial Results for the Second Quarter Ended June 30, 2013:
Consolidated revenues for the three months ended June 30, 2013, were $9.4 million compared to $9.7 million in the prior year period, a decrease of $0.3 million, or 3.3%. USA segment revenues remained largely unchanged from the second quarter of 2012. Brazil segment revenues decreased $0.3 million, or 4.5%, as a result of a 5.3% decline in the average exchange rate (US dollar to Brazilian real) between these periods. 

Consolidated gross profit in 2013 decreased $0.5 million to $1.3 million for the three months ended June 30, 2013, compared to the prior year period primarily due to higher raw bran costs, which were approximately 22% higher in the USA Segment and 19% higher in the Brazil segment. Raw bran prices have begun to moderate compared to all time highs experienced in 2012 and early 2013, but remain at high levels.

Consolidated operating expenses were $2.6 million, compared to $4.6 million for the second quarter of 2012, an improvement of $2.1 million resulting from a reduction in USA segment impairment charges between period of $1.1 million and gains on sales of equipment of $0.7 million predominantly related to sale of extruders to Wilmar. Brazil segment operating expense improved slightly by $0.2 million on lower professional fees.

Consolidated other expense was $1.8 million for the second quarter of 2013, compared to other income of $1.9 million for the second quarter of 2012. The increase in other expense of $3.7 million was comprised of the following:

  • A USA segment $1.8 million increase in expense from the change in the fair value of derivative warrant and conversion liabilities, primarily as a result of changes in the price of our common stock between valuation dates. The decrease in the price of our common stock from March 31 to June 30 in each period, was the primary reason the derivative warrant and conversion liabilities fair value decreased, resulting in the recognition of other income in the second quarters of 2013 and 2012.
  • USA segment $0.5 million loss on extinguishment in 2013, comprised of losses on the conversion of $0.3 million of our senior debenture and the prepayment of $0.3 million on those debentures;
  • USA segment $0.5 million financing expense in 2013 associated with issuances of the subordinated convertible notes and related warrants.
  • A $0.6 million increase in interest expense, as a result of (i) an increase in average debt outstanding in both the USA and Brazil segments and (ii) the increase in interest expense in the USA segment as a result of amortizing the debt discount on a senior debenture when the principal was paid in 2013.

W. John Short, CEO & President, commented, "Revenue on a quarter-over-quarter basis was largely unchanged considering the decline in the Brazilian Real. We continue to push forward with the introduction of new human food ingredient products while growing existing lines. The animal nutrition market continues to be challenging due to high bran costs. In Brazil, we look forward to completing the plant expansion early next year. We are confident that we will resume growth as the Brazil expansion comes on line and as new and existing USA segment products gain traction."

Conference Call Details:
Date: Thursday, August 15th 
Time: 4:15 p.m. Eastern
Participant Dial-In: (480) 629-9713
Live Webcast: http://www.ricebrantech.com/InvestorRelations or http://public.viavid.com/index.php?id=105792

It is recommended that participants dial in approximately 10 minutes prior to the start of the 4:15 p.m. Eastern call. There will also be a simultaneous live webcast of the conference call which can be accessed through the following audio feed link and archived recording of the conference call available under the Investor Relations section of the company website at http://www.ricebrantech.com/InvestorRelations or by clicking on the following link, http://public.viavid.com/index.php?id=105792.

Forward-Looking Statements
This release contains forward-looking statements, including, but not limited to, statements about RiceBran Technologies' expectations regarding future growth, acceptance in the market of our products 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.

   
   
RiceBran Technologies  
Condensed Consolidated Statements of Operations  
Three and Six Months Ended June 30, 2013 and 2012  
(Unaudited) (in thousands, except per share amounts)  
   
   
    Three Months Ended     Six Months Ended  
    2013     2012     2013     2012  
                                 
Revenues   $ 9,388     $ 9,711     $ 18,097     $ 19,457  
Cost of goods sold     8,110       7,948       15,853       15,953  
Gross profit     1,278       1,763       2,244       3,504  
                                 
Operating expenses:                                
  Selling, general and administrative     2,355       3,058       5,261       6,703  
  Professional fees     223       516       730       987  
  Impairment of property     -       1,069       300       1,069  
    Total operating expenses     2,578       4,643       6,291       8,759  
                                 
Loss from operations     (1,300 )     (2,880 )     (4,047 )     (5,255 )
                                 
Other income (expense):                                
  Interest income     16       16       26       63  
  Interest expense     (1,024 )     (387 )     (1,653 )     (805 )
  Foreign currency exchange, net     (538 )     (576 )     (288 )     (782 )
  Change in fair value of derivative warrant and conversion liabilities     1,044       2,868       (2,494 )     506  
  Loss on extinguishment     (494 )     -       (526 )     (2,986 )
  Financing expense     (564 )     (20 )     (564 )     (1,544 )
  Other income     2       3       5       7  
  Other expense     (223 )     (23 )     (348 )     (117 )
    Total other income (expense)     (1,781 )     1,881       (5,842 )     (5,658 )
                                 
Loss before income taxes     (3,081 )     (999 )     (9,889 )     (10,913 )
Income tax benefit     571       369       1,081       911  
Net loss     (2,510 )     (630 )     (8,808 )     (10,002 )
Net loss attributable to noncontrolling interest in Nutra SA     543       429       1,028       972  
Net loss attributable to RiceBran Technologies shareholders   $ (1,967 )   $ (201 )   $ (7,780 )   $ (9,030 )
                                 
Loss per share attributable to RiceBran Technologies shareholders                                
  Basic   $ (0.01 )   $ (0.00 )   $ (0.04 )   $ (0.04 )
  Diluted   $ (0.01 )   $ (0.00 )   $ (0.04 )   $ (0.04 )
                                 
Weighted average number of shares outstanding                                
  Basic     214,733       204,589       211,729       203,634  
  Diluted     214,733       204,589       211,729       203,634  
                                 
                                 
                                 
RiceBran Technologies  
Condensed Consolidated Balance Sheets  
June 30, 2013 and December 31, 2012  
(Unaudited) (in thousands, except share amounts)  
   
   
    June 30,     December 31,  
    2013     2012  
ASSETS                
Current assets:                
  Cash and cash equivalents   $ 213     $ 1,040  
  Restricted cash     1,919       1,919  
  Accounts receivable, net of allowance for doubtful accounts of $409 and $518 (variable interest entity restricted $2,645 and $2,505)     4,003       3,487  
  Inventories     1,731       1,994  
  Deferred tax asset     223       234  
  Income and operating taxes recoverable     523       1,167  
  Deposits and other current assets     846       975  
      Total current assets     9,458       10,816  
Property, net (variable interest entity restricted $5,245 and $5,757)     25,909       28,457  
Goodwill     4,374       4,773  
Intangible assets, net     1,951       2,575  
Other long-term assets     867       385  
      Total assets   $ 42,559     $ 47,006  
                 
LIABILITIES, TEMPORARY EQUITY AND EQUITY                
Current liabilities:                
  Accounts payable   $ 3,623     $ 3,021  
  Accrued expenses     4,744       4,509  
  Current maturities of debt (variable interest entity nonrecourse $7,277 and $7,013)     8,801       8,003  
      Total current liabilities     17,168       15,533  
Long-term liabilities:                
  Long-term debt, less current portion (variable interest entity nonrecourse $6,935 and $7,454)     12,334       11,581  
  Deferred tax liability     559       1,674  
  Derivative warrant liabilities     6,782       4,520  
      Total liabilities     36,843       33,308  
                 
Commitments and contingencies                
                 
Temporary Equity:                
  Redeemable noncontrolling interest in Nutra SA     7,836       9,262  
  Redeemable common stock (2,118,644 shares outstanding)     178       -  
      Total temporary equity     8,014       9,262  
                 
Equity:                
  Equity (deficit) attributable to RiceBran Technologies shareholders:                
    Preferred stock, 20,000,000 shares authorized and none issued     -       -  
    Common stock, no par value, 1,200,000,000 shares authorized, 220,300,654, and 207,616,097 shares issued and outstanding     211,856       210,396  
    Accumulated deficit     (212,200 )     (204,420 )
    Accumulated other comprehensive loss     (1,954 )     (1,540 )
      Total equity (deficit) attributable to RiceBran Technologies shareholders     (2,298 )     4,436  
      Total liabilities, temporary equity and equity   $ 42,559     $ 47,006