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TheStreet Open House

Renewable Energy Group Reports First Quarter 2012 Financial Results

Stocks in this article: REGI

After receiving the proceeds of an initial public offering of common stock in January, REG purchased the previously-leased facility in Seneca Illinois and completed construction of a third production line at the facility. REG Seneca now has nameplate capacity of 60 million gallons per year operating online. REG also initiated the planned upgrade of its 30 million gallon per year biorefinery in Albert Lea, Minnesota. REG Albert Lea will be modified to process a wider range of lower cost feedstocks.

First Quarter 2012 Financial Results

Revenues for the first quarter of 2012 were $188.2 million, an 80% increase compared to Q1 2011, due to improved per-gallon pricing and an increase in gallons sold over the previous period. Gallons sold in Q1 2012 increased 69% over Q1 2011 to 34.1 million gallons of biodiesel. Biodiesel pricing and demand improved compared to the same period in 2011 due to RFS2, higher prices for petroleum-based diesel and higher RIN prices over Q1 2011.

Adjusted EBITDA, defined as earnings before interest, taxes, depreciation and amortization and further adjusted for certain items identified below under “Adjusted EBITDA Reconciliation”, grew 140% year over year to $12.7 million. The growth reflects improved margins, controlled SG&A growth and increased sales volume.

The table below summarizes REG’s results for Q1 2012:

 
REG Q1 2012 Revenue and Adjusted EBITDA Summary
(dollars and gallons in thousands except per gallon data)
            Y/Y

Q1 2012

Q1 2011

Growth

Gallons sold 34,087 20,117 +69 %
Revenues $ 188,247 $ 104,435 +80 %
 
Adjusted EBITDA $ 12,719 $ 5,297 +140 %
Adjusted EBITDA Margin       6.76 %       5.07 %      
 

Balance Sheet and Liquidity

At March 31, 2012, REG had cash and cash equivalents of $75.2 million. The company borrowed $5.7 million under the $40 million revolving line of credit with Wells Fargo.

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