Biodiesel refiner Nova Biosource Fuels, Inc. (Amex: NBF), announced limited revenues of $6,855,000 for 2Q08, as the company continues to ramp up to full capacity production.
Revenue was generated throughout the period at the company’s Clinton County refinery and began at the Seneca refinery in April 2008 as the start-up and operational testing began for the first production train. There were no biodiesel revenues for the comparable periods last year as sales first began in late September 2007 with the acquisition of the Clinton County refinery.
Nova reported net losses of $6,413,000, or $0.06 per share, and $11,714,000, or $0.11 per share, for the three and six months respectively, compared to net losses of $6,683,000, or $0.06 per share, and $10,129,000, or $0.10 per share, for the comparable periods last year.
Share-based compensation expense for the six months ending April 30, 2008 and 2007 were $3,633,000 and $4,633,000, respectively.
Kenneth T. Hern, Chairman and CEO of Nova, said "Two of our three 20 million gallon per year production trains at Seneca have been commissioned and have operated at nameplate capacity. During the start-up of the Seneca production trains, yield rates have already been demonstrated near the plant design rate. Our operating results for the quarter reflect only a month of operations of only one train at our Seneca, Illinois refinery.
"We are looking forward to reporting our results for the third quarter as we operate multiple trains and fulfill some remaining biodiesel sales commitments made when biodiesel was selling at approximately $3.54 to $4.07 per gallon compared to over $4.80 per gallon today. Along with other co-products currently being sold, sales of technical grade glycerin are anticipated to begin by the end of June.
"Our average feedstock costs since beginning operations at Seneca have been around $0.40 per pound, and we expect our costs to range from $0.40 per pound to $0.42 per pound on average for the third quarter. As we bring our production trains online, we begin by using a low free fatty acid feedstock and then gradually change the mix to incorporate lower cost, high free fatty acid feedstocks.
"Start-up operations on the third train began a few days ago, and the train is already producing biodiesel at rates above 80% of nameplate capacity. Our goal is to have all three trains running at nameplate capacity on high free fatty acid feedstock by the end of this fiscal quarter."
About Nova Biosource Fuels, Inc.
Nova Biosource Fuels, Inc. is an energy company that refines and markets ASTM standard biodiesel and related co-products through the deployment of its proprietary, patented process technology, which enables the use of a broader range of lower cost feedstocks. Nova is focused on building and operating a number of Nova-owned biodiesel refineries, with a goal of attaining production capacity of between 180 to 220 million gallons of biodiesel fuel on an annual basis. In particular, it is investing to improve the profitability of its 10 million gallon per year biodiesel refinery in Clinton, Iowa, while also completing the construction of its 60 million gallon per year biodiesel refinery in Seneca, Illinois. Nova’s business strategy for the next three years includes building up to seven biodiesel refineries with production capacities ranging from 20 to 100 million gallons each per year.
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