On March 27, Gevo Inc. released fourth quarter 2018 financial results and hosted an earnings call during which Gevo CEO Patrick Gruber discussed operations at the company’s existing facilities and highlighted the company’s future plans.

According to Gruber, Gevo is working to decarbonize its biorefinery in Luverne, Minnesota, in an effort to improve profitability. He said the company thinks it’s possible to make significant improvements in profitability over the next 18 months “maybe even becoming profitable in spite of carrying a fairly hefty burn for the market development and commercialization of IBA, isooctane, jet fuel, and other related products.”

During the call, Gruber said as Gevo works to decarbonize the Luverne facility the company will become involved with a wind project and with renewable natural gas. Initially, he said the company expects to capture the value of the low carbon index score via ethanol sold in California. But, eventually the decarbonization will also benefit isobutanol, jet and isooctane.

Gruber also discussed a long-term supply agreement Gevo entered into with HCS Group in February worth up to $180 million. Under the agreement, Gevo will exclusively supply HCS Group with its renewable isooctane for sales in high-end applications under its Haltermann Carless brand. Between Haltermann Carless and the company’s deal with Avfuel Corp., Gruber said about 50 percent of the company’s planned expansion of the Luverne facility is spoken for.  

In addition, Gruber discussed the joint development agreement Gevo signed with Renmatix in December 2018 under which the companies will evaluate the commercial feasibility of creating cellulosic hydrocarbons for jet fuel and gasoline markets. According to Gruber, Renmatix’s technology would allow wood to be used as a feedstock for Gevo’s fuel production technologies.

Regarding the Gevo’s work with Praj, Gruber said the company expects the licensing agreement to be finalized soon. Most likely, he said, that agreement will expand the relationship between the two companies to include the production of jet fuel and isooctane in India from rice straw feedstock. Overall, Gruber said there are six commercial projects currently under discussion that focus on isobutanol, jet and isooctane. He said two of those projects have signed memorandums of understanding.

Gevo reported revenues of $6.6 million for the fourth quarter, down from $6.7 million during the same period of 2017. Revenues related to ethanol sales and related products were $6.5 million, down approximately $100,000 when compared to the fourth quarter of 2017. Hydrocarbon revenues were $100,000, up from $50,000 during the same period of last year.

Gross loss for the quarter was $3 million, compared to a $2.47 million gross loss during the fourth quarter of 2017. Loss from operations was $6.7 million, compared to a loss of $4.8 million during the same period of the prior year. Net loss was $7.1 million, compared to a net loss of $4.4 million during the fourth quarter of 2017.