Southwest Iowa Renewable Energy, LLC (CIK) has reported a 409.22 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $5.63 million, or $389.97 a share in the quarter, compared with $1.11 million, or $78.29 a share for the same period last year. Revenue during the quarter went down marginally by 2.13 percent to $52.06 million from $53.20 million in the previous year period. Gross margin for the quarter expanded 907 basis points over the previous year period to 13.80 percent. Total expenses were 88.37 percent of quarterly revenues, down from 97.54 percent for the same period last year. This has led to an improvement of 917 basis points in operating margin to 11.63 percent.
Operating income for the quarter was $6.06 million, compared with $1.31 million in the previous year period.
Brian Cahill, SIRE's president and chief executive officer stated, “this first quarter of Fiscal 2017, we saw very favorable margins, continuing the trends of the previous quarter. Corn prices retreated back below $3.50; we averaged $3.36 per bushel during this first quarter of Fiscal 2017, which is a decrease over the past year's price of $3.77. However, ethanol margins in the U.S. have been very volatile towards the end of 2016. Demand for ethanol has been strong with the lower prices, both in the U.S. and abroad. The industry has continued to adjust and we expect margins to remain positive but are becoming more dependent on continued good export demand."
Working capital increases sharply
Southwest Iowa Renewable Energy Llc has recorded an increase in the working capital over the last year. It stood at $6.17 million as at Dec. 31, 2016, up 256.24 percent or $4.44 million from $1.73 million on Dec. 31, 2015. Current ratio was at 1.27 as on Dec. 31, 2016, up from 1.08 on Dec. 31, 2015. Days sales outstanding went up to 15 days for the quarter compared with 8 days for the same period last year.
Days inventory outstanding has decreased to 13 days for the quarter compared with 25 days for the previous year period.
Debt comes down significantly
Southwest Iowa Renewable Energy, LLC has recorded a decline in total debt over the last one year. It stood at $6.52 million as on Dec. 31, 2016, down 77.95 percent or $23.06 million from $29.58 million on Dec. 31, 2015. Total debt was 4.31 percent of total assets as on Dec. 31, 2016, compared with 19.35 percent on Dec. 31, 2015. Debt to equity ratio was at 0.06 as on Dec. 31, 2016, down from 0.29 as on Dec. 31, 2015. Interest coverage ratio improved to 14.28 for the quarter from 6.42 for the same period last year.
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