BioFuels Journal

VeraSun Reports First Quarter Revenues of $516.5 Million, Up 257% From 1Q 2007

Brookings, SD—VeraSun Energy Corporation (NYSE: VSE), one of the nation’s largest ethanol producers, announced May 12 its financial results for the three months ended March 31, 2008.

The Company increased revenues by 257% from the first quarter of 2007, to $516.5 million and generated earnings of $0.08 per diluted share.

EBITDA for Q1 2008 increased to $32.3 million, or 6.3% of revenues, as compared to $3.8 million, or 2.6% of revenues for Q1 2007.

“VeraSun continues to execute on its long-term growth strategy with significantly higher production, resulting in increased revenues and earnings,” said VeraSun CEO Donald L. Endres.

“Our team also successfully commissioned VeraSun’s production facility at Bloomingburg, Ohio during the quarter, adding another 110 million gallons of production capacity.”

VeraSun completed its merger with US BioEnergy effective April 1, giving the company 11 operating facilities with a combined ethanol production capacity in excess of one billion gallons.

Five additional facilities are under construction with a combined capacity of 550 million gallons. Upon completion of the new facilities by the end of the year, VeraSun expects to have an annual production capacity of approximately 1.64 billion gallons.

“Demand for ethanol continues to increase with conventional blending expanding throughout the country,” explained Endres.

“Ethanol provides an immediate, strategic and economic benefit for refiners and gasoline marketers by providing a high octane, low cost blend component.”

First Quarter 2008 Financial Highlights

Total revenues, which include revenues from the sale of ethanol, distillers grains and VE85®, increased by $372 million, or 257.4% to $516.5 million for the three months ended March 31, 2008, compared to $144.5 million for the three months ended March 31, 2007.

The increase in total revenues was primarily the result of a 223.5% increase in ethanol volume sold and an increase in average ethanol prices of $0.20 per gallon, or 10.2%, compared to 2007.

For the three months ended March 31, 2008, the company sold 191.7 million gallons of ethanol, which includes 49.5 million gallons of ethanol that were purchased from others and resold to our customers.

Ethanol production increased by 82.4 million gallons, or 138.6%, compared with the three months ended March 31, 2007, as a result of the added capacity from the Charles City, Iowa facility in April 2007, the Linden, Indiana facility in August 2007, and the Albion, Nebraska facility in October 2007.

Net sales from ethanol increased $321.6 million, or 256.3%, to $447.1 million for the three months ended March 31, 2008 compared with $125.5 million for the three months ended March 31, 2007.

Of the increase, $280.4 million was driven by additional volume of ethanol sold.

The increased volume resulted from additional production at Charles City, Linden, and Albion facilities, which came on line since March 31, 2007 and gallons of ethanol that were purchased and resold to our customers.

In addition, higher ethanol prices contributed $41.2 million of the increased revenue.

The average price of ethanol sold was $2.33 per gallon for the three months ended March 31, 2008, compared to $2.13 per gallon for the three months ended March 31, 2007.

Net sales from distillers grains increased $44.4 million, or 269.6%, to $60.8 million for the three months ended March 31, 2008 compared with $16.4 million for the three months ended March 31, 2007.

The impact of increased volume from the additional Charles City, Linden, and Albion capacity was $23.2 million and the impact of higher prices contributed $21.1 million of the increased revenues.

Net sales of VE85®, our branded E85 product, increased $5.5 million, or 285.3%, to $7.4 million for the three months ended March 31, 2008 compared with $1.9 million for the three months ended March 31, 2007, primarily due to an increase in the number of retail outlets selling VE85®.

Corn costs increased $154.0 million to $238.6 million for the three months ended March 31, 2008 compared with $84.6 million for the three months ended March 31, 2007.

Corn costs were $1.68 per manufactured gallon sold for the three months ending March 31, 2008, compared with $1.43 per gallon produced for the same period in 2007.

The increase in total corn costs for the three months ended March 31, 2008 was driven by $100.3 million of increased corn purchases resulting from additional production from our Charles City, Linden, and Albion facilities and $50.2 million of the increased corn costs resulted from higher corn prices per bushel.

Net income increased to $7.6 million for the three months ended March 31, 2008 from a net loss of $0.3 million for the three months ended March 31, 2007.

For more information, call 605-696-7236.