The Even Sorrier Condition of Australia’s Biofuel Stocks
All are losing a lot of money. The share prices are not doing well either.

A few weeks ago I wrote a piece, The Sorry State of the Australian Biofuel Business, looking at eight listed companies that were generally doing so badly that most had chosen to suspend operations rather than continue racking up big losses.

Now The Australian newspaper has published an article, Betting on biofuels boom is only for the brave. This states:

The boom in the Australian biofuels sector less than two years ago was short-lived. The aftermath of the bust is now coming into focus with more than $200 million of new capital lost in share price value and seven new biodiesel plants sitting idle as they wait for the market to improve.

Six Australian biodiesel businesses raised about $402 million of equity through IPOs, placements and convertible notes, almost all of it in 2005-07.

Shareholders in only one of these companies, Mission Biofuels, are ahead. [NB: No longer the case.] Shareholders in the other five companies invested about $297 million, including $158 million in four IPOs. The shares in these companies are now worth well under 10 per cent of their IPO price.

The lost capital helped build eight biodiesel plants, of which seven are fully or mostly idle, with some of them not having produced any biodiesel.

Here is a round-up of the eight companies featured in my article of last month, with their December 2007 financial status and the current share price (February 29^th), compared to the price (if available) of the company’s IPO (data taken from the article in The Australian).

Agri Energy
Suspended from share market trading on February 13^th, 2008

Australian Biodiesel Group
IPO: December 2005
Price: $1:00
Current price: 2.2 cents
December 2006 results (full year): after-tax loss of $13.9 million
December 2007 results (full year): after-tax loss of $29.5 million

Australian Renewable Fuels
IPO: May 2005
Price: $1:00
Current price: 5.2 cents
December 2006 results (half year): after-tax loss of $5.1 million
December 2007 results (half year): after-tax loss of $50.9 million

Babcock & Brown Environmental Investments
Current price: 49 cents
December 2006 results (half year): after-tax profit of $1.8 million
December 2007 results (half year): after-tax loss of $55.5 million

Jatoil
IPO: January 2008
Price: 20 cents
Current price: 10.5 cents
December 2007 results (half year): after-tax loss of $1.3 million

Mission Biofuels
IPO: May 2006
Price: $1:00
Current price: 99 cents
December 2006 results (half year): after-tax loss of $0.58 million
December 2007 results (half year): after-tax loss of $0.50 million

Natural Fuel
IPO: December 2006
Price: $1:50
Current price: 18 cents
December 2006 results (half year): after-tax loss of $24.4 million
December 2007 results (half year): after-tax loss of $40.0 million

Sterling Biofuels International
IPO: September 2006
Price: $1:00
Current price: 8 cents
December 2006 results (half year): after-tax loss of $1.6 million
December 2007 results (half year): after-tax loss of $10.1 million

March 2nd, 2008

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The Even Sorrier Condition of Australia’s Biofuel Stocks All are losing a lot of money. The share prices are not doing well either.

The Even Sorrier Condition of Australia’s Biofuel Stocks
All are losing a lot of money. The share prices are not doing well either.