Q2 sales nosedive at biofuels company Gevo

Revenues for the second quarter of 2013 were $1.9 million compared to $7.0 million in the same period in 2012. During the second quarter of 2013, the company focused on activities that culminated in the resumption of startup isobutanol production announced in June 2013.

The decrease in revenues resulted from the company ceasing ethanol production at its Luverne facility in May 2012. Revenue reported in the second quarter of 2013 included proceeds of $0.9 million from further reduction of Gevo's corn inventory, sales of biobased jet fuel to the U.S. Air Force (USAF) of $0.3 million, revenue under its agreement with The Coca-Cola Company, and revenue from ongoing research agreements. Revenue in the second quarter of 2012 primarily related to the sale of ethanol and related products.

Research and development expense was $5.8 million in the second quarter of 2013, compared to $4.7 million in the comparable period in 2012. During the second quarter of 2013, Gevo's development efforts were focused on startup operations for the production of isobutanol at its Luverne facility as well as optimization of specific parts of its isobutanol production technology to further enhance isobutanol production rates.

Selling, general and administrative expense decreased to $6.3 million in the second quarter of 2013 from $9.5 million for the second quarter of 2012. The decrease in selling, general and administrative expense in the second quarter of 2013 reflected lower compensation expenses, including cost saving benefits resulting from actions taken during 2012 to focus Gevo's operations.

Interest expense for the second quarter of 2013 was $2.3 million compared to $0.5 million in the second quarter of 2012. The increase resulted from interest incurred on the company's 7.5% convertible notes due 2022 which were issued in July 2012, including $1.1 million for non-cash charges for amortization of debt discounts recorded at the time of issuance of the convertible notes.

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Gevo