Weak ethanol production margins amid record production volumes and high inventory levels of the fuel combined to cut into the second quarter bottom line of Sacramento’s Pacific Ethanol Inc.
In its second quarter financial report released Wednesday, the local company said sales totaled $405.2 million for the quarter that ended June 30, down about 4.2 percent from $422.9 million in the second quarter of 2016.
PEI’s quarterly net loss available to common stockholders was $9.2 million, or 22 cents per share, compared with net income of $4.7 million, or 11 cents per share, in the year-ago period.
In a statement, PEI President and CEO Neil Koehler said: “Overall, we remain encouraged by the long-term demand for ethanol as supported by continued strong domestic and export markets, and the growing demand for higher ethanol blends and higher octane fuels.”
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Through the first half of this year, PEI’s net loss available to common stockholders was $22.1 million, or 52 cents a share, compared with a loss of $8.8 million, or 21 cents a share, last year.
During this year’s second quarter, PEI announced that it was acquiring Illinois Corn Processing LLC for $76 million.
Koehler cited that purchase Tuesday, saying it ultimately would enable the company to “lessen our exposure to commodity price fluctuations.”