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Oct 31, 2008 – Earnings reports are coming in for publicly traded companies that have 45 days from the end of quarter to report.  30 days have passed so the next 2 weeks should be busy.

Aventine [NYSE: AVR] a producer, marketer and end-to-end provider of renewable energy, released results for the 3Q & nine months ended September 30, 2008.  They had record shipments of 226.6 million gallons of ethanol in 3Q 2008 vs 220.3 million gallons in the 2Q.  Revenues in 3Q 2008 were flat at $599.5 million, as compared to $601.6 million in the 2Q with higher volumes offset by lower pricing.

Corn costs in the 3Q 2008 increased to $5.78 per bushel, higher than its 2Q cost of $5.38 per bushel.  Of course, if you have been reading this blog, you know that one of the factors increasing the price of corn has been the increased production and use of ethanol as a biofuel.  You would also know this from all the little stickers appearing on your local gas pump that says that the fuel may contain up to 10% ethanol.

Net income for the 3Q was $2.5 million, or $0.06 per diluted share, as compared to a net loss of $1.9 million, or $0.05 per diluted share, in the 2Q.  Be careful interpreting these figures as there are different effects from feedstock pricing, hedging activities, fuel surcharges, etc., etc.  Read the full financial report before you consider any investment activities.  Ironically, their costs were impacted by fuel surcharges to move their products to expanding markets further away from their facilities.

Aventine reports that it is extending the construction period and pushing out the start-up date of its ethanol facility expansion in Aurora, Nebraska as previously announced.  They continue to evaluate a number of other actions designed to increase the amount of liquidity available to them, including; reducing inventory levels, seeking additional debt and equity financing, potentially delaying construction or start-up of its Mt. Vernon, Indiana expansions and other strategic initiatives.  They say, “We cannot assure you that any of these initiatives will generate additional liquidity for us on acceptable terms or at all.”  That doesn’t sound what one would like to hear from a growing company in the expanding biofuel business.  Unfortunately, the economic environment changes as rapidly as the weather in Nebraska.  They continue, “The current difficult operating environment for ethanol production has led to some curtailments of production and may also force some of our marketing alliance partners to reduce or temporarily cease production.  We have experienced some disruptions in contracted supply volumes in the fourth quarter.”