Rentech Inc. reported a net loss of $15.5 million ($.07 per common share) on sales of $27.1 million for the first quarter ending Dec. 31, 2009, compared to a year-ago loss of $988,000 ($.01 per common share) and $50.8 million, respectively. The company had an operating loss of $12.5 million, versus year-ago income of $1.96 million.
Rentech said the decreased results reflect significantly lower fertilizer prices. However, the company believes that fundamental factors should positively impact revenue during the fiscal year at its nitrogen facility, Rentech Energy Midwest Corp. (REMC). Rentech expects good corn acreage in 2010, as well as increased volumes of ethanol under the U.S. Environmental Protection Agency’s Renewable Fuels Standard.
Rentech is projecting REMC’s fiscal year 2010 operating income to be well in excess of $20 million and EBITDA well in excess of $30 million. By comparison, REMC’s EBITDA for the year ending Sept. 30, 2009, was $65.5 million (GM Dec. 21, 2009).
Rentech said a sizeable amount of REMC’s planned deliveries for 2010 have already been sold at fixed prices, and that demand for nitrogen is strengthening. REMC’s first-quarter operating income was $2 million, compared to the year-ago $12.7 million. The reduction was primarily due to lower sales prices, turnaround expenses of $4 million, and additional repair expenses, which were partially offset by lower natural gas prices. Turnaround expenses represent the cost of shutting down the plant in October 2009 for scheduled maintenance.
REMC’s average delivered price for ammonia during the first quarter was $323/st, which was down from the year-ago $671/st. For UAN, it was $143/st versus $336/st. The company said its latest sales for spring delivery include ammonia in the $430/st range, with UAN approaching $250/st.