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Dynamic Fuels supplied renewable jet fuel to Alaska Airlines for 75 regularly scheduled commercial airline flights in the U.S.
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Dynamic Fuels received EPA regulatory approval for 100% neat renewable diesel use in diesel engines.
- Dynamic Fuels produced 3.4 million gallons of renewable fuel products in October.
TULSA, Okla., Nov. 8, 2011 (GLOBE NEWSWIRE) -- Syntroleum Corporation (Nasdaq:SYNM) a renewable and synthetic fuels technology company, today announced renewable fuels production for October and financial results for the quarter and nine months ended September 30, 2011.
Highlights for the Third Quarter
During October, Dynamic Fuels, our 50/50 venture with Tyson Foods, Inc., produced approximately 75,000 gallons of on spec renewable jet fuel for a contract with SkyNRG. The first of 75 commercial airline flights in the U.S. to use biofuel produced by Dynamic Fuels, conducted by Alaska Airlines, will begin in Seattle this week. The renewable jet fuel produced at Dynamic Fuels is chemically identical to traditional jet fuel and compared to petroleum based jet fuel offers the benefits of; better cold flow properties; lower particulate matter emissions; lower engine deposits, resulting in reduced engine maintenance; and reduced carbon dioxide emissions.
Recently, Dynamic Fuels received approval for registration of its neat renewable diesel from the Environmental Protection Agency. The registration of neat renewable diesel allows combustion in regular on-road engines of up to 100% renewable diesel, which means no blending of petroleum based diesel is required. Prior, we had registration approval for blends up to 20% renewable diesel. This neat fuel registration allows Dynamic Fuels to market its fuel directly to third party fuel end-users, such as operators of on-road fleet vehicles.
Dynamic Fuels achieved production of 3.4 million gallons of renewable fuels in October and 12.0 million gallons of renewable fuels for the quarter ended September 30, 2011. On October 24, the plant experienced a failure on a critical pump due to excessive vibration. The pump has been removed for repair and the plant was in hot standby through November 7. The plant is now operating at reduced rates until the critical pump reinstallation, which is expected by the end of this week.
Financial Highlights
For the quarter ended September 30, 2011, the Company reported an operating loss of $452 thousand resulting from total revenues of $1.2 million and operating expenses of $1.6 million. For the nine months ended September 30, 2011, the company reported an operating loss of $2.3 million resulting from total revenues of $3.2 and operating expenses of $5.5 million. Our revenues relate to engineering services provided to Dynamic Fuels and other customers for process design and research support and revenues for royalties from the Dynamic Fuels commercial production of renewable fuels.
For the quarter ended and nine months ended June 30, 2011, we reported a loss from Dynamic Fuels of $5.3 million and $12.3 million respectively. This compares to a loss of $4.8 million for the quarter ended March 31, 2011. During the quarter and nine months ended June 30, 2011 the plant produced 7.5 million and 14.0 million gallons of renewable fuels, respectively, of which 7.3 million and 13.0 million gallons were sold, respectively for the same periods.
We report Dynamic Fuels on a three month lag and the loss reflected in our income statement from Dynamic Fuels represents the loss incurred for the period ending June 30, 2011. Our 10Q filing includes Dynamic financials for their nine months ended June 30, 2011.
Net loss was $4.6 million or $0.05 per share and $14.0 million or $0.16 per share, respectively, for the three month and nine month periods ended September 30, 2011, compared with a net loss of $3.9 million or $0.05 per share and $4.5 million or $0.06 per share, respectively for the corresponding periods in 2010.
As of September 30, 2011 Syntroleum's available cash position was $28.4 million.
Conference Call
The conference call will be held on Thursday, November 10, 2011, at 10:00 a.m. Central time (11:00 a.m. Eastern). A webcast of the call will be available via the Internet by accessing www.syntroleum.com. Listeners should allow a few minutes for registration into the web site. To participate in the teleconference, investors should dial 1-877-317-6789 about 10 minutes before the start time and reference the Syntroleum conference call. International callers should dial 1-412-317-6789. A replay of this conference call will be available on the web site under the Syntroleum Investor Relations tab.
For additional information see the Company's Form 10-Q for the nine months ended September 30, 2011, filed with the SEC on Tuesday, November 8, 2011. The 10-Q is available through the Investor Relations section of the Company's Web site, www.syntroleum.com.
About Syntroleum
Syntroleum Corporation owns the Syntroleum® Process for Fischer-Tropsch (FT) conversion of synthesis gas derived from biomass, coal, natural gas and other carbon-based feedstocks into liquid hydrocarbons, the Synfining® Process for upgrading FT liquid hydrocarbons into middle distillate products such as synthetic diesel and jet fuels, and the Bio-Synfining™ technology for converting animal fat and vegetable oil feedstocks into middle distillate products such as renewable diesel and jet fuel using inedible fats and greases as feedstock. The 50/50 venture – known as Dynamic Fuels – was formed to construct and operate multiple renewable synthetic fuels facilities, with production on the first site beginning in 2010. The Company plans to use its portfolio of technologies to develop and participate in synthetic and renewable fuel projects. For additional information, visit the Company's web site at www.syntroleum.com
The Syntroleum Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5984
Forward Looking Statements
This document includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as well as historical facts. These forward‑looking statements may include statements relating to the Syntroleum® Process, the Synfining® Process, our renewable fuels Bio-Synfining ™technology, plans to use the Company's various technologies, operational activities of the Company, commercialization of the Company's technologies, certification of Fischer-Tropsch and renewable fuels, performance and use of Syntroleum's cobalt catalyst, and performance and use of fuels derived from the Syntroleum® Process and technology test results. When used in this document, the words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "project," "should" and similar expressions are intended to be among the statements that identify forward‑looking statements. Although we believe that the expectations reflected in these forward‑looking statements are reasonable, these kinds of statements involve risks and uncertainties. Actual results may not be consistent with these forward‑looking statements. Syntroleum undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time. Important factors that could cause actual results to differ from these forward-looking statements include the potential that debt or equity financing for anticipated plants may not be available, the schedule for development, construction and operation of proposed plants may not be met, anticipated appropriation and expenditure of federal monies does not occur, commercial-scale plants do not achieve the same results as those demonstrated on a laboratory or pilot basis or that such plants experience technological and mechanical problems, the potential that improvements to Syntroleum's various technologies currently under development may not be successful, the impact on plant economics of operating conditions (including energy prices), construction risks, risks associated with investments and operations in foreign countries, our dependence on strategic relationships with manufacturing and engineering companies, volatility of energy prices, the ability to implement corporate strategies, including the continued availability of adequate working capital, competition, intellectual property risks, our ability to obtain financing and other risks described in the Company's filings with the Securities and Exchange Commission.
®"Syntroleum" is registered as a trademark and service mark in the U.S. Patent and Trademark Office.
| SYNTROLEUM CORPORATION AND SUBSIDIARIES | ||
| UNAUDITED CONSOLIDATED BALANCE SHEETS | ||
| (in thousands, except par value) | ||
| September 30, | December 31, | |
| 2011 | 2010 | |
| ASSETS | ||
| CURRENT ASSETS: | ||
| Cash and cash equivalents | $28,430 | $12,513 |
| Restricted cash | 671 | 484 |
| Accounts receivable | 105 | 556 |
| Accounts receivable from Dynamic Fuels, LLC | 2,178 | 729 |
| Other current assets | 299 | 361 |
| Total current assets | 31,683 | 14,643 |
| PROPERTY AND EQUIPMENT – at cost, net | 88 | 97 |
| INVESTMENT IN AND LOANS TO DYNAMIC FUELS, LLC | 35,737 | 43,523 |
| OTHER ASSETS, net | 1,122 | 1,133 |
| $68,630 | $59,396 | |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| CURRENT LIABILITIES: | ||
| Accounts payable | $111 | $1,090 |
| Accrued employee costs | 586 | 119 |
| Deposits | 671 | 484 |
| Total current liabilities | 1,368 | 1,693 |
| NONCURRENT LIABILITIES OF DISCONTINUED OPERATIONS | 603 | 603 |
| DEFERRED REVENUE | 23,741 | 24,300 |
| COMMITMENTS AND CONTINGENCIES | ||
| STOCKHOLDERS' EQUITY: | ||
| Preferred stock, $0.01 par value, 5,000 shares authorized, no shares issued | -- | -- |
| Common stock, $0.01 par value, 150,000 shares authorized, 97,903 and 81,683 shares issued and outstanding at September 30, 2011 and December 31, 2010, respectively | 979 | 817 |
| Additional paid-in capital | 398,335 | 374,397 |
| Accumulated deficit | (356,396) | (342,414) |
| Total stockholders' equity | 42,918 | 32,800 |
| $68,630 | $59,396 | |
| SYNTROLEUM CORPORATION AND SUBSIDIARIES | ||||
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (in thousands, except per share data) | ||||
|
For the Three months Ended September 30, |
For the Nine Months Ended September 30, |
|||
| 2011 | 2010 | 2011 | 2010 | |
| REVENUES: | ||||
| Technology | $150 | $150 | $450 | $3,450 |
| Technical services | 430 | 651 | 1,314 | 2,064 |
| Technical services from Dynamic Fuels, LLC | 286 | 461 | 800 | 1,276 |
| Royalties from Dynamic Fuels, LLC plant production | 310 | -- | 649 | -- |
| Total revenues | 1,176 | 1,262 | 3,213 | 6,790 |
| COSTS AND EXPENSES: | ||||
| Engineering | 562 | 828 | 1,706 | 1,952 |
| Depreciation and amortization | 49 | 50 | 148 | 166 |
|
General, administrative and other (including non-cash equity compensation of $69 and $273 for the three months ended September 30, 2011 and 2010, respectively, and $528 and $1,299 for the nine months ended September 30, 2011 and 2010, respectively.) |
1,017 | 1,577 | 3,612 | 5,404 |
| OPERATING LOSS | (452) | (1,193) | (2,253) | (732) |
| INVESTMENT AND INTEREST INCOME | 4 | 11 | 10 | 25 |
| LOSS IN EQUITY OF DYNAMIC FUELS, LLC | (5,348) | (980) | (12,286) | (2,845) |
| OTHER EXPENSE, net | 2 | 4 | 6 | 66 |
| FOREIGN CURRENCY EXCHANGE | 1,206 | (1,701) | 558 | (1,155) |
| LOSS FROM CONTINUING OPERATIONS | (4,588) | (3,859) | (13,965) | (4,641) |
| INCOME (LOSS) FROM DISCONTINUED OPERATIONS | (9) | (24) | (17) | 136 |
| NET LOSS | $ (4,597) | $ (3,883) | $ (13,982) | $ (4,505) |
| BASIC NET INCOME (LOSS) PER SHARE: | ||||
| Loss from continuing operations | $ (0.05) | $ (0.05) | $ (0.16) | $ (0.06) |
| Income (loss) from discontinued operations | $ -- | $ -- | $ -- | $ -- |
| Net loss | $ (0.05) | $ (0.05) | $ (0.16) | $ (0.06) |
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
| Basic | 91,843 | 78,222 | 87,020 | 77,205 |
| Diluted | 91,843 | 78,222 | 87,020 | 77,205 |
| SYNTROLEUM CORPORATION AND SUBSIDIARIES | ||
| UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (in thousands) | ||
| For the Nine Months Ended September 30, | ||
| 2011 | 2010 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||
| Net loss | $ (13,982) | $ (4,505) |
| Income (loss) from discontinued operations | (17) | 136 |
| Net loss from continuing operations | (13,965) | (4,641) |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
| Depreciation and amortization | 148 | 166 |
| Abandoned patent write-off | -- | 466 |
| Foreign currency exchange | (558) | 1,155 |
| Non-cash compensation expense | 528 | 1,299 |
| Other | -- | -- |
| Non-cash interest costs on long-term debt | -- | -- |
| Non-cash loss in equity method investee | 12,286 | 2,845 |
| Changes in assets and liabilities: | ||
| Accounts receivable | 451 | 2,899 |
| Changes in trading securities | -- | -- |
| Accounts receivable from Dynamic Fuels, LLC | (1,449) | (48) |
| Other assets | (30) | 106 |
| Accounts payable | (979) | (18) |
| Accrued liabilities and other | 467 | 212 |
| Deferred revenue | -- | (3,217) |
| Net cash provided by (used in) continuing operations | (3,101) | 1,224 |
| Net cash used in discontinued operations | (18) | (281) |
| Net cash provided by (used in) operating activities | (3,119) | 943 |
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||
| Purchase of property and equipment | (37) | (14) |
| Investment in and loans to Dynamic Fuels, LLC | (4,500) | (10,000) |
| Net cash used in investing activities | (4,537) | (10,014) |
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||
| Proceeds from sale of common stock, warrants and option exercises | 35 | 191 |
| Proceeds from sale of common stock | 23,538 | -- |
| Proceeds from common stock purchase agreement | -- | 4,695 |
| Net cash provided by financing activities | 23,573 | 4,886 |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | 15,917 | (4,185) |
| CASH AND CASH EQUIVALENTS, beginning of period | 12,513 | 25,012 |
| CASH AND CASH EQUIVALENTS, end of period | $28,430 | $20,827 |