November 11, 2008

Pacific Ethanol incurs 3Q losses on higher corn prices and project halt


Pacific Ethanol Inc. said its third-quarter loss widened on higher corn prices and an impairment charge for suspending construction on a project.


Pacific Ethanol reported a net loss of US$54.9 million, or 98 cents per share, compared with US$4.8 million, or 15 cents per share, in the third quarter of 2007.


The company recorded a non-cash asset impairment charge of US$26.6 million for suspending construction on a plant near Calipatria, Calif.


Revenue climbed 56 percent to US$184 million from US$118.1 million in the year-ago quarter.


Analysts surveyed by Thomson Reuters, on average, expected a loss of 16 cents per share on revenue of US$218.6 million. Analysts typically exclude one-time items from their estimates.


Neil Koehler, the company's president and chief executive said that they saw unprecedented volatility in the corn and ethanol markets during the quarter and are disappointed with the resulting impact on margins.


Average corn prices for the company rose 54 percent year over year, Pacific Ethanol said.

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