28 May 2009 16:15 [Source: ICIS news]
HOUSTON (ICIS news)--US biodiesel company GreenHunter Energy posted on Thursday a first-quarter loss of $8.5m (€6.1m) and said the situation could lead to bankruptcy amid higher feedstock costs and a lack of customers.
The company, which owns the largest biodiesel refinery in the US, said the drop in demand for the renewable fuel, plus rising feedstock costs, was interfering with its hefty debt load and could lead it to bankruptcy.
“These factors raise substantial doubt about our ability to continue as a going concern,” the company said in its filing with the Securicty and Exchange Commission (SEC).
The first-quarter results compared with an $8m loss in the first quarter of 2008.
GreenHunter’s net revenues for the quarter ended 31 March were $3.2m, compared with $178,000 the same period last year. Sales were $2.8m, compared with $130,000 in first-quarter 2008.
The revenue increase was not enough to make a dent in its debt, however. As GreenHunter’s sales disappointed and the cost of soybeans rose, the company’s working capital deficit grew to $53.m, which included $42.9m owed to bondholders, GreenHunter said in its filing.
The Grapevine, Texas-based company idled its 105m gal/year Houston refinery in March due to poor sales. After the EU slapped tariffs on US biodiesel imports in March, trade across the Atlantic stopped.
The rise in feedstock grain prices and the lack of a steady customer base is damaging the biodiesel industry as a whole. Biodiesel major Imperium Renewables idled its 100m gal/year Grays Harbor plant earlier this year amid slow sales, while Nova Biosource Fuels filed for bankruptcy in March.
GreenHunter stock sold at $1.26/share in morning trading on the American Stock Exchange, up from $1.25/share at market close Wednesday.
($1 = €0.72)
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