Gross profit for the 2Q was $42.3 million, a decrease of $3.3 million compared to the prior-year period.
Operating income for the three months ended June 30, 2013 was $25.1 million, a decline of $4.4 million compared to the prior-year period.
Consolidated Adjusted EBITDA for the 2Q was $31.9 million, which was flat in comparison to the prior-year period.
2Q net income was $32.8 million or $0.14 per basic share. Excluding loss on debt extinguishment, the gain on fair value adjustment to earn-out consideration and the income tax benefit, net income allocated to common shareholders for the current period was $8.1 million or $0.04 per basic share. A reconciliation of net income exclusive of these items is provided below. This compares to net income of $9.5 million or $0.04 per basic share for the same period last year.
Consolidated revenues for the six months ended June 30, 2013 increased by $70.5 million to $179.8 million compared to the prior-year period.
Gross profit for the six months ended June 30, 2013 was $65.1 million, a decrease of $3.2 million compared to the prior-year period.
Operating income for the six months ended June 30, 2013 was $27.1 million, a decline of $8.9 million compared to the prior-year period.
Adjusted consolidated EBITDA for the six months ended June 30, 2013 was $37.8 million, compared to $43.0 for the prior-year period.
For the six months ended June 30, 2013, the Company recorded a net income tax benefit of approximately $25.8 million which is comprised of an income tax benefit for Rentech of approximately $26.0 million and an income tax expense for Rentech Nitrogen of approximately $0.2 million. The income tax benefit for Rentech was due to the release of valuation allowance of $26.3 million that had been recorded against Rentech’s net operating loss carryforwards. The release of the valuation allowance resulted from recording of deferred tax liabilities related to the Fulghum Fibres acquisition.
Net income for the six months ended June 30, 2013 was $27.6 million or $0.12 per basic share. Excluding loss on debt extinguishment, the gain on fair value adjustment to earn-out consideration and the income tax benefit, net income allocated to common shareholders for the current period was $2.5 million or $0.01 per basic share. This compares to net income of $6.3 million or $0.03 per basic share for the same period last year.
D. Hunt Ramsbottom, President and CEO of Rentech, said, “Our financial results for the quarter demonstrate the dramatic transformation we have undertaken at Rentech. Our new business at the parent, which is wood fibre processing, generated positive EBITDA, and we had no R&D expenditures this quarter. Our focus is now on opportunities with attractive returns within the wood fibre processing and nitrogen fertilizer segments, as we continue our low-cost efforts to monetize our energy technologies.” Mr. Ramsbottom continued, “Demand for nitrogen remains healthy although results for the quarter in that business were affected by the delayed and abbreviated spring application period and softer nitrogen prices.”
Mr. Ramsbottom continued, “Our integration of Fulghum Fibres into Rentech has been smooth, and we have been pleased with Fulghum Fibres’ financial performance and growth prospects relative to our conservative assumptions at the time of the acquisition.” Mr. Ramsbottom added, “Conversions of the decommissioned wood fibre mills to pellet production in Eastern Canada are progressing and are within budget.”
Rentech, Inc. owns and operates wood fibre processing and nitrogen fertilizer manufacturing businesses. The wood fibre processing business consists of the provision of wood chipping services and the manufacture and sale of wood chips, through a wholly-owned subsidiary, Fulghum Fibres, Inc., and the development of wood pellet production facilities.