Coming off record profits in 2014, Sacramento’s Pacific Ethanol Inc. hit a wall in this year’s opening quarter.
The Sacramento-based producer and marketer of low-carbon renewable fuels reported a net loss of $4.7 million for the quarter ended March 31. Still, that was a substantial improvement over a loss of $11.1 million in the first quarter of 2014.
In a statement accompanying Monday’s release of first-quarter financial results, PEI President and CEO Neil Koehler said “the ethanol industry was negatively impacted by lower production margins resulting from high ethanol inventory levels and volatile energy markets” in this year’s first quarter.
Net sales in the first quarter totaled $206.2 million, down nearly 20 percent from $254.5 million in the year-ago period. The operating loss for the first quarter of 2015 was $5.9 million, compared with operating profits of $34.9 million in last year’s first quarter.
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The local company also reported that its previously announced plans to buy Illinois-based ethanol producer Aventine Renewable Energy Holdings Inc. in a stock-for-stock transaction valued at nearly $200 million are on track to close in this year’s second quarter.
PEI reported record net income available to common shareholders of $20 million, or 88 cents a share, for all of 2014. The income represented a major improvement compared with a loss of $2 million, or 17 cents a share, in 2013. In 2012, PEI reported a loss of $19 million.