Revenues Exceed One Billion Dollars and EBITDA More than Doubles
over Q2 2007 BROOKINGS, S.D., Aug. 11 /PRNewswire-FirstCall/ --
VeraSun Energy Corporation (NYSE:VSE), one of the nation's largest
ethanol producers, today announced its financial results for the
three months ended June 30, 2008. The Company increased revenues by
499% over the second quarter of 2007, to $1.015 billion, and
generated earnings of $.15 per diluted share. EBITDA for Q2 2008
increased to $73 million as compared to $33 million for Q2 2007.
"VeraSun exceeded one billion dollars in revenues this quarter,"
said VeraSun CEO Donald L. Endres. "More importantly, our large
scale allowed us to capture $73 million in EBITDA, more than double
last year, in a challenging operating environment." During the
quarter, VeraSun completed the merger with US BioEnergy effective
April 1, adding five facilities and 420 million gallons to
operations. The company also completed construction at its
Hankinson, North Dakota, Welcome, Minnesota and Hartley, Iowa
biorefineries, with a combined capacity of 330 million gallons per
year. Upon completion of two additional ethanol production
facilities in Dyersville, Iowa and Janesville, Minnesota, the
company expects to have a capacity of 1.64 billion gallons of
ethanol through 16 production facilities by the end of 2008.
"Ethanol is playing an increasingly important and strategic role in
our country's fuel supply," Endres added. "Ethanol continues to
trade at a deep discount to gasoline providing a significant
economic incentive for refiners and gasoline marketers to develop
new markets." Second Quarter 2008 Financial Highlights Total
revenues, which include revenues from the sale of ethanol,
distillers grains, VE85(R), and corn increased by $845.6 million,
or 498.7%, to $1,015.2 million for the three months ended June 30,
2008, compared to $169.6 million for the three months ended June
30, 2007. The increase in total revenues was primarily the result
of a 420.6% increase in ethanol volume sold and an increase in
average ethanol prices of $.38 per gallon, or 17.1%, compared to
2007. For the three months ended June 30, 2008, the Company sold
329.9 million gallons of ethanol, which includes 83.4 million
gallons of ethanol that were purchased from others and resold to
our customers. Ethanol production increased by 175.0 million
gallons, or 214.8%, to 256.5 million gallons compared with the
three months ended June 30, 2007, as a result of the added capacity
from Linden, Indiana facility in August 2007, the Albion, Nebraska
facility in October 2007, the Bloomingburg, Ohio facility in March
2008 and the US BioEnergy acquisition on April 1, 2008. Net sales
from ethanol increased $710.4 million, or 499.4%, to $852.7 million
for the three months ended June 30, 2008 compared with $142.3
million for the three months ended June 30, 2007. Of the increase,
$588.2 million was driven by additional volumes of ethanol sold.
The increased volume resulted from additional production at the
Linden, Albion, and Bloomingburg facilities, which came on line
since June 30, 2007, output from the US BioEnergy facilities
acquired April 1, 2008, and ethanol that was purchased and resold
to our customers. Higher ethanol prices contributed $122.2 million
of the increased revenue. The average price of ethanol sold was
$2.59 per gallon for the three months ended June 30, 2008, compared
to $2.21 per gallon for the three months ended June 30, 2007. Net
sales from distillers grains increased $97.0 million, or 431.0%, to
$119.5 million for the three months ended June 30, 2008 compared
with $22.5 million for the three months ended June 30, 2007. The
impact of increased volume was $56.9 million and the impact of
higher prices of $48.35 per ton contributed $40.1 million of the
increased revenues. Net sales of VE85(R), our branded E85 product,
increased $8.2 million, or 206.5%, to $12.2 million for the three
months ended June 30, 2008 compared with $4.0 million for the three
months ended June 30, 2007, primarily due to an increase in the
number of retail outlets selling VE85(R) resulting in a $6.3
million increase and the impact of higher prices contributing to an
additional increase of $1.9 million. About VeraSun Energy
Corporation VeraSun Energy Corp. (NYSE:VSE), headquartered in
Brookings, S.D., is a leading producer and marketer of ethanol and
distillers grains. Founded in 2001, the company has a fleet of 16
production facilities in eight states, of which two are still under
construction. VeraSun Energy is scheduled to have an annual
production capacity of approximately 1.64 billion gallons of
ethanol and more than five million tons of distillers grains by the
end of 2008. VeraSun also markets E85, a blend of 85 percent
ethanol and 15 percent gasoline for use in Flexible Fuel Vehicles
(FFVs), directly to fuel retailers under the brand VE85(R). For
more information, please visit VeraSun Energy's websites at
http://www.verasun.com/ or http://www.ve85.com/. Forward Looking
Statement Statements included or incorporated by reference in this
document are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. They are based
upon our current beliefs and expectations, are subject to risks and
uncertainties outside of our control, and actual results might
differ materially from these estimates and statements. Factors that
may cause actual results to differ include the volatility and
uncertainty of commodity prices, results of our hedging and other
risk mitigation strategies, results of our acquisitions,
operational disruptions at our facilities; our ability to implement
our expansion strategy; development of infrastructure related to
the sale and distribution of ethanol; excess production capacity in
our industry; our ability to compete effectively in our industry;
changes in or elimination of governmental laws, tariffs, trade or
other controls or enforcement practices; environmental, health and
safety laws; our reliance on key management personnel; future
technological advances; limitations and restrictions contained in
the instruments and agreements governing our indebtedness; and our
ability to raise additional capital and secure additional
financing, as more fully described in the "Risk Factors" sections
of our annual report on Form 10-K for the year ended December 31,
2007 and our quarterly report on Form 10-Q for the quarter ended
June 30, 2008. We are not under any obligation, and expressly
disclaim any obligation, to update, alter or otherwise revise any
forward- looking statement, whether written or oral, that may be
made from time to time. VERASUN ENERGY CORPORATION CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended June 30,
2008 2007 (unaudited) (dollars in thousands) Total revenue
$1,015,168 100.0% $169,556 100.0% Cost of goods sold 943,214 92.9
137,071 80.8 Gross profit 71,954 7.1 32,485 19.2 Startup expenses
4,591 0.5 218 0.1 Restructuring charge 2,004 0.2 - 0.0 Selling,
general and administrative expenses 16,317 1.6 8,179 4.9 Operating
income 49,042 4.8 24,088 14.2 Other income (expense), net (14,654)
(1.4) (787) (0.5) Income before income taxes and minority interest
34,388 3.4 23,301 13.7 Income tax provision 10,504 1.0 8,165 4.8
Minority interest 6 0.0 - 0.0 Net income $23,890 2.4% $15,136 8.9%
Per Share Data: Income per common share - basic $0.15 $0.20 Basic
weighted average number of common shares 156,962,647 76,998,341
Income per common share - diluted $0.15 $0.19 Diluted weighted
average number of common and common equivalent shares 159,520,353
80,918,850 Six Months Ended June 30, 2008 2007 (unaudited) (dollars
in thousands) Total revenue $1,531,642 100.0% $314,066 100.0% Cost
of goods sold 1,424,570 93.0 272,337 86.7 Gross profit 107,072 7.0
41,729 13.3 Startup expenses 6,702 0.4 1,584 0.5 Restructuring
charge 2,004 0.1 - 0.0 Selling, general and administrative expenses
27,682 1.9 18,347 5.9 Operating income 70,684 4.6 21,798 6.9 Other
income (expense), net (24,052) (1.6) 1,008 0.3 Income before income
taxes and minority interest 46,632 3.0 22,806 7.2 Income tax
provision 15,175 1.0 7,982 2.5 Minority interest 6 0.0 - 0.0 Net
income $31,463 2.0% $14,824 4.7% Per Share Data: Income per common
share - basic $0.25 $0.19 Basic weighted average number of common
share 124,836,224 76,357,188 Income per common share - diluted
$0.25 $0.18 Diluted weighted average number of common and common
equivalent shares 127,349,906 80,697,289 The following table sets
forth other key data for the periods presented (in thousands,
except per unit data): Three Months Ended Six Months Ended June 30,
June 30, 2008 2007 2008 2007 (unaudited) (unaudited) Other
financial data: Net cash flows (used in) provided by operating
activities $(35,391) $4,357 $(38,712) $24,122 Other non-GAAP
financial performance data: EBITDA (1) $73,122 $33,027 $105,468
$36,817 Operating data: Ethanol sold - produced (gallons, in
thousands) (2) 246,556 63,368 388,756 123,579 Ethanol sold -
purchase/resale (gallons, in thousands) 83,353 - 132,807 - Total
ethanol sold (gallons, in thousands) 329,909 63,368 521,563 123,579
Distillers grains sold (tons, in thousands) 829.8 235.2 1,376.3
419.8 Average gross price of ethanol sold per gallon $2.59 $2.21
$2.49 $2.15 Average corn cost per bushel 5.37 3.62 5.14 3.77
Average natural gas cost per MMBTU 10.81 7.59 10.48 7.85 Average
dry distillers grains gross price per ton 144.07 95.72 131.01 92.79
(1) EBITDA is defined as earnings before interest expense, income
tax expense, depreciation and amortization. Amortization of debt
issuance costs and debt discount are included in interest expense.
(2) Excludes ethanol sold in VE85(R) sales. The following table
reconciles our EBITDA to net income for the periods presented
(dollars in thousands): Three Months Ended Six Months Ended June
30, June 30, 2008 2007 2008 2007 (unaudited)(unaudited)(unaudited)
(unaudited) Net income $23,890 $15,136 $31,463 $14,824 Depreciation
and amortization 23,227 3,547 32,516 6,080 Interest expense 15,501
6,179 26,314 7,931 Income tax provision 10,504 8,165 15,175 7,982
EBITDA $73,122 $33,027 $105,468 $36,817 VERASUN ENERGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Six Months Ended
June 30, 2008 2007 (dollars in thousands) Cash Flows from Operating
Activities Net income $31,463 $14,824 Adjustments to reconcile net
income to net cash provided by (used in) operating activities:
Depreciation 30,687 6,080 Change in derivative financial
instruments (16,996) 6,756 Accretion of contracts and long-term
debt fair valued during purchase accounting (6,374) - Deferred
income taxes 5,094 5,425 Stock-based compensation expense 4,451
2,679 Amortization 1,829 - Amortization of debt issuance cost and
debt discount 1,261 730 Gain on disposal of equipment (262) (83)
Accretion of deferred revenue (147) (48) Minority interest in net
loss of subsidiary (6) - Excess tax benefits from share-based
payment arrangements - (6,865) Changes in current assets and
liabilities, net of effects of business acquisition Trade
receivables (60,406) 18,697 Inventories (32,080) (37,920) Prepaid
expenses and other assets (32,447) (3,235) Accounts payable 54,210
11,059 Accrued expenses and other liabilities (18,989) 6,023 Net
cash (used in) provided by operating activities (38,712) 24,122
Cash Flows from Investing Activities Purchases of property and
equipment (188,857) (129,551) US BioEnergy acquisition, net of
transaction costs 45,106 - Proceeds from the sale of short-term
investments 43,175 - Change in restricted cash (14,777) - Payments
for other long-term assets and liabilities (2,040) (202) Proceeds
from sales of property and equipment 1,300 6 Purchase of short-term
investments - (249,516) Net cash used in investing activities
(116,093) (379,263) Cash Flows from Financing Activities Proceeds
from long-term debt 97,092 447,750 Principal payments on long-term
debt (19,696) - Debt issuance costs paid (3,655) (11,375) Cost of
registering equity securities (1,063) (5) Net effect of the
exercise of stock options (374) 8,285 Excess tax benefits from
share-based payment arrangements - 6,865 Net cash provided by
financing activities 72,304 451,520 Net (decrease) increase in cash
and cash equivalents (82,501) 96,379 Cash and Cash Equivalents
Beginning of period 110,942 318,049 End of period $28,441 $414,428
DATASOURCE: VeraSun Energy Corporation CONTACT: Investors, Patty
Dickerson, +1-605-696-7236 , or Media, Mike Lockrem,
+1-605-696-7527, , both of VeraSun Energy Corporation Web site:
http://www.verasun.com/
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