US biofuels producer Renewable Energy Group Inc (NASDAQ:REGI), or REG, on Wednesday cut its guidance for the third quarter of 2015, blaming a volatile commodity environment during the quarter and a significant decline in RIN prices.
The company now expects to post a net loss of between USD 8.6 million (EUR 7.5m) and USD 14.6 million and negative non-GAAP adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of USD 7 million to USD 13 million. Previously, it had guided for adjusted EBITDA of between zero and USD 10 million.
President and chief executive Daniel J Oh said that energy prices and Renewable Identification Number (RIN) prices fell more sharply than feedstock prices during the quarter as the industry maintained high production in anticipation that the federal biodiesel mixture excise tax credit will be retroactively reinstated.
REG projects a net benefit for the quarter from a potential retroactive reinstatement of the tax credit of between USD 35 million and USD 40 million.
The company also said it expected that its Geismar renewable diesel biorefinery in the state of Louisiana would be brought back online by the end of January after the September 3 fire at the plant. It said that the structural damage from the September fire was far less than a previous fire incident in April.