Green Plains swings to profit

Green Plains, a Nebraska-based, US ethanol producer, has announced financial results for the fourth quarter of 2016.

Net income attributable to the company was $18.7 million (€17.5m), or $0.47 per diluted share, for the fourth quarter of 2016 compared with net loss of $(3.6) million, or $(0.09) per diluted share, for the same period in 2015.

Revenues were $932.1 million for the fourth quarter of 2016 compared with $739.9 million for the same period last year.

"Green Plains finished 2016 on a strong note, generating $74.3 million of segment operating income in the fourth quarter as we successfully integrated the acquisitions of three ethanol plants and Fleischmann's Vinegar Company into our platform," said Todd Becker, president and CEO.

Becker added: "Each of our business units performed well during the quarter and the year, delivering strong results by continuing to focus on executing our long term strategy of diversification and achieving scale in all of our businesses."

With the addition of Fleischmann's Vinegar Company in the fourth quarter of 2016, Green Plains restructured its operating segments. The four segments include: ethanol production, agribusiness and energy services, food and food ingredients and partnership. Please see segment information below for more detail.

Ethanol production

During the fourth quarter, Green Plains produced 334.2 million gallons of ethanol compared with 260.8 million gallons for the same period in 2015. The consolidated ethanol crush margin was $81.6 million, or $0.24 per gallon, for the fourth quarter of 2016 compared with $28.9 million, or $0.11 per gallon, for the same period in 2015.

The consolidated ethanol crush margin is the ethanol production segment's operating income before depreciation and amortisation, which includes corn oil production, plus intercompany storage, transportation and other fees, net of related expenses.

Revenues were $3.4 billion for the year ended 31 December, 2016, compared with $3.0 billion for the same period in 2015. Net income attributable to the company for the year ended 31 December, 2016, was $10.7 million, or $0.28 per diluted share, compared with net income of $7.1 million, or $0.18 per diluted share, for the same period in 2015.

"US ethanol demand was strong in 2016 and we expect that to continue in 2017. In addition, exports were the strongest we have seen in five years. US ethanol remains competitively priced and export demand could be even stronger this year," Becker added.

He explained: "We expect to see solid infrastructure growth in support of E15 with new locations and more retailers expanding demand for the product. In all, we believe gasoline demand will continue to grow, leading to an improved ethanol margin environment as we approach the beginning of summer driving season in April.

"We invested over $550 million of growth capital in 2016, which we believe positions us to deliver stronger results in the future. We continue to evaluate additional growth opportunities across all of our segments and we look forward to the completion of the Jefferson Energy Terminal joint venture in the second half of this year.”

This story was written by Liz Gyekye, editor of Biofuels International.