(Source: The Sacramento Bee)
By Dale Kasler, The Sacramento Bee, Calif.
May 13--Pacific Ethanol Inc. reported a 50 percent drop in revenue Monday and warned again of a bankruptcy filing.
The Sacramento ethanol producer, in a filing with the Securities and Exchange Commission, said it will likely file for bankruptcy protection if it can't restructure its debts or "obtain sufficient liquidity in the very near term."
The company said in late March that it was running dangerously low on cash.
In the SEC filing, Pacific Ethanol said its executives have been so busy scrambling for money they had to delay the first-quarter financial report to next Monday.
Preliminary results showed a loss of $23.9 million in the quarter vs. a loss of $35.2 million a year earlier. The per-share loss came to 43 cents, down from 90 cents a year ago.
To cut costs, Pacific Ethanol has halted production at three of its plants. The decision showed up in the operating results: Revenue fell to $86.7 million from $161.5 million. While average sale price was down 28 percent, the volume of ethanol sold dropped 24 percent.
Like practically everyone in the industry, Pacific Ethanol has been hurt by a slump in the market price for ethanol, which tends to rise and fall with oil prices. The company also is hurt by high prices for corn, the main ingredient in ethanol.
Ethanol maker VeraSun Energy Corp. sold seven Midwestern plants to Texas oil refiner Valero Energy Corp. after filing for Chapter 11 bankruptcy in October. Midwest ethanol maker Aventine Renewable Energy Holdings Inc. also has filed for Chapter 11.
Pacific Ethanol shares closed at 61 cents, down 11 cents, on the Nasdaq market.
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Call The Bee's Dale Kasler at (916) 321-1066. Read his blog on the economy, Home Front, at www.sacbee.com/blogs.
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