Verenium, GPRE report third quarter financial results

By Erin Voegele
Posted November 13, 2009, at 7:48 a.m. CST

Cambridge, Mass.-based Verenium Corp. and Omaha, Neb.-based Green Plains Renewable Energy Inc. have released their financial results for the third quarter 2009.

Verenium's total revenues for the quarter ended Sept. 30 were $11 million and total revenues for the first nine months of 2009 totaled $32.1 million. This represents a decrease of 11 percent for the quarter and 13 percent for the first nine months of 2009 when compared to the prior year. According to Verenium, the decrease in total revenues reflects the current economic recession as well as discontinuation of the company's Bayovac-SRS and Quantum product lines during early 2008. However, a decrease in product revenue from these discontinued product lines was partially offset by increased revenues from Fuelzyme, the company's alpha amylase for corn ethanol.

Excluding the cost of product revenues, total operating expenses decreased to $28 million and $81.9 million for the three- and nine-month periods ending Sept. 30, compared to $135.1 million and $183.7 million for the same periods in 2008.

Net loss attributed to Verenium for the quarter and nine months ended Sept. 30 was $2.3 million and $18.9 million, respectively, compared to $126.1 million and $164.6 million for the same periods in 2008.

As of the end of the third quarter, the company had unrestricted cash and cash equivalents totaling approximately $21 million, of which $6.4 million was held by Vercipia, the company's consolidated joint venture with BP plc. On July 1, the company received a payment of $14 million from BP, which was the final installment of the transaction fee due as part of the Galaxy Biofuels Joint Development and License Agreement.

Since the beginning of the year, a significant portion of the company's 8 percent convertible notes have been converted by various note holders in exchange for common stock, which decreased the aggregate face value of the remaining 8 percent notes. In September, note holders exchanged approximately $30.5 million in aggregate principal of 5.5 percent notes for approximately $13.7 million of 9 percent convertible senior secured notes. This resulted in a $16.8 million reduction of the face value of the company's debt outstanding.

"I am very pleased with the considerable progress Verenium has made over the last quarter in both our biofuels and our specialty enzyme business," said Carlos A. Riva, the company's president and CEO. "I am particularly enthusiastic about the ongoing discussions with the [U.S.] DOE for a loan guarantee for our first commercial facility, as well as the significant improvements we made to our overall capital structure, which I believe better position the company for future growth and success."

While Verenium continues to struggle to climb out of the red, GPRE reported third quarter revenues that equal a 27 percent increase over the preceding quarter, resulting in a third-quarter net income of $5.5 million.

Earnings before interest, income taxes, depreciation and amortization (EBITDA) were $19.3 million for the third quarter. As of Sept. 30, GPRE had available liquidity of $112.6 million, including $69.1 million in cash and equivalents and $43.5 million available under committed loan agreements.

For the nine months ended Sept. 30, revenues were $867.5 million, with a net loss of $3.3 million. EBITDA for the first three quarters of 2009 was $29.9 million.

"We experienced significant improvement in our ethanol production segment during the quarter, said GPRE President and CEO Todd Becker. "Ethanol margins have continued to improve and we expect the ethanol production segment to generate better results in the fourth quarter."