Rentech Inc. said it slipped to loss in its fiscal third quarter, as revenue from its clean synthetic fuel products fell because of lower prices.
After Monday’s markets closed, the Los Angeles developer of clean synthetic fuels and chemicals reported a net loss of $1.7 million (-1 cent per share) for the quarter ended June 30, compared with net income of $33.6 million (20 cents) a year earlier. Revenue fell 46 percent to $49.8 million.
Analysts surveyed by Thomson Reuters on average expected the company to earn 1 cent per share on revenue of $54.8 million.
Rentech had a higher sales volume, but said the gain was offset by lower sales prices for all products compared with the prior year's record highs. But the company expects its nitrogen fertilizer subsidiary, Rentech Energy Midwest Corp., to benefit from improved product prices and margins for the rest of this calendar year, largely due to higher corn prices, strong farmer income and a “reasonably priced” natural gas market.
In addition, products from the Rentech-SilvaGas biomass gasification process, which convert plant material into synthetic gas, should also benefit from rising conventional fuel prices.
“Higher crude oil prices and a global focus on new energy sources present significant market opportunities for the deployment of our energy conversion technologies for the production of low-carbon synthetic fuels and power,” Chief Executive D. Hunt Ramsbottom said in a statement.
Shares were down 9 cents, or about 9 percent, to 93 cents in midday trading on the Nasdaq.
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