On Wednesday, Renewable Energy Group Inc (NASDAQ: REGI) stock recorded daily change of 3.52% to close at $23.5 with the total traded volume of 975,798 shares along average volume of 798.60K shares. 52-week range of the stock remained $9.9 – 31.51 while its day low price was $22.86 and it hit its day high price at $24.38. Its previous closing value stands at $22.7. The company has 38.05M of outstanding shares and 894.18M shares were floated in the market.
Renewable Energy Group, Inc. (REGI) recently reported its financial results for the fourth quarter and full year ended December 31, 2019.
Fourth Quarter 2019 Highlights
All figures refer to the quarter ended December 31, 2019, unless otherwise noted. All comparisons are to the quarter ended December 31, 2018, unless otherwise noted.
REG sold 152.9M total gallons of fuel, a decrease of 6.3%. The decrease in gallons sold is mostly attributable to volume decreases in biodiesel and petroleum diesel of 10.4M gallons and 9.7M gallons, respectively, partially offset by increases of both REG-produced and third party renewable diesel of 5.0M gallons and 5.3M gallons, respectively. Third party renewable diesel gallons are used principally for blending with biodiesel.
REG produced 113.7M gallons of biomass-based diesel during the quarter, a decrease of 13.6%. Gallons produced reduced primarily Because of focus on producing profitable gallons, which among other things, resulted in the closure of the Company’s facility in New Boston, Texas in July 2019. In contrast, renewable diesel production increased 5.2% as the Company pursued attractive margin opportunities, most notably in the Nordics.
Revenues increased $498.4M to $1,018.2M, driven mainly by GAAP recognition of all the 2018 and 2019 BTC benefit in the fourth quarter of 2019. Revenue growth was influenced by lower RIN prices and the 6.3% decrease in gallons sold. The average price per gallon sold (not including the allocation of the 2018 and 2019 BTC) for biomass-based diesel was $2.90, a raise of 2.8%. After allocation of the BTC benefits for the period in which the gallons were sold (shown in the table below), revenue was essentially flat year over year.
Operating income was $503.9M contrast to $33.4M for the fourth quarter of 2018. The increase in operating income was mainly driven by GAAP recognition of all of the 2018 and 2019 net BTC benefit of $499.4M in the fourth quarter of 2019. Additionally, impacts on operating income included a decrease in risk management of $45.0M and a $15.9M decrease in North America biodiesel margins driven mostly by lower spreads, as shown on the table below represented by the HOBO spread including RINs. These challenges were offset by improvements to underlying performance, including a raise in total renewable diesel gallons sold of 10.3M gallons and a raise of biodiesel and renewable diesel sales into the most attractive low carbon fuel markets – North America west coast and the Nordics.
GAAP net income from continuing operations accessible to ordinary stockholders was $492.6M, or $11.52 per share, on a fully diluted basis, contrast to $30.4M, or $0.66 per share on a fully diluted basis, in the fourth quarter of 2018. After allocation of the BTC benefits for the period in which the gallons were sold, net income from continuing operations accessible to ordinary stockholders was $50.9M contrast to $87.0M.
Adjusted EBITDA was $65.0M, contrast to $103.2M in the year-earlier period. The differential drivers are the same as those described above for operating income.
At December 31, 2019, REG had cash and cash equivalents, restricted cash, and marketable securities of $53.4M. For the year, the Company’s cash and cash equivalents, restricted cash, and marketable securities reduced by $124.1M primarily as a result of cash used in operations, the repayment of debt and convertible notes, as well as capital expenditures in connection with plant upgrades. At December 31, 2019, accounts receivable were $858.9M, a raise of $777.9M from September 30, 2019. This large increase was primarily Because of the receivables associated with the 2018 and 2019 BTC. At December 31, 2019, accounts payable were $369.2M, a raise of $273.8M from September 30, 2019. The increase is primarily Because of payments Because of consumers related to sharing of the 2018 and 2019 BTC proceeds.
Its earnings per share (EPS) expected to touch remained 32.90% for this year while earning per share for the next 5-years is expected to reach at 15.00%. REGI has a gross margin of 20.10% and an operating margin of 15.10% while its profit margin remained 14.10% for the last 12 months. The price moved ahead of 16.28% from the mean of 20 days, -4.12% from mean of 50 days SMA and performed 23.86% from mean of 200 days price.