REG: Geismar plant continues to run above nameplate capacity
Renewable Energy Group Inc.
August 7, 2017
BY Erin Voegele
The Renewable Energy Group Inc. has releases second quarter financial results, providing an update on operations at the company’s renewable diesel plant and briefly discussing the strategic review of its Life Sciences division.
During an investor call, Randy Howard, interim president and CEO, noted the company sold 160 million gallons of fuel during the quarter, generated $530 million of revenue, and produced 117 million gallons of fuel, including 14 million gallons of renewable hydrocarbon diesel at the company’s Geismar plant.
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Howard said Geismar is performing well, operating at 103 percent capacity utilization during the first quarter of this year. The facility began a catalyst turnaround on June 19. According to Howard, the turnaround was completed in a timely manner, with the plant back up and running on July 16. He also noted the facility took advantage of the downtime to make other high-return upgrades, including upgrades to a reactor and improvements to the hydrogen compressor. “Geismar is now back to running over nameplate,” he said.
Regarding the Life Sciences division, Howard said indicated the strategic review is now fully underway. He also said the company is continuing to advance product development with the support of partner agreements.
REG reported revenues of $535.1 million for the quarter on 160.2 million gallons of fuel sold. When compared to the second quarter of 2016, REG sold 6.8 percent more fuel, while revenues decreased $4.2 percent. The decrease in revenues is primarily attributed to the lapse of the federal Biodiesel Mixture Excise Tax Credit (BTC) on Jan. 1 and the impact of imported gallons. Net loss attributable to common stockholders was $34.8 million, compared to a net income of $7.4 million during the same period of 2016.
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“The financial performance demonstrates the substantial earnings power of our business," Howard said. "With a retroactive reinstatement of the BTC, we would be on track to meet or exceed the financial goals we put forth at our recent analyst day. If the BTC is reinstated retroactively as expected similar to prior years, both our second quarter and first half performance would be the best in company history."
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