PETROTEC AG / Quarter Results/Profit Warning 21.05.2008 Release of a Adhoc News, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Ad hoc disclosure pursuant to section 15, German Securities Trading Act Petrotec keeps sales steady despite severe market conditions - Sales of EUR 15.7 million on a par with prior year - Accrual for pending losses of EUR 4.6 million squeezes earnings - Own collection of used cooking oil rose 31 % Borken, May 21, 2008 Petrotec AG (ISIN DE000PET1111), the manufacturer of biodiesel from used cooking oil feedstock, looks back on a tough Q1 2008. Following re-commencement of the biodiesel plant at Oeding in early January for technical reasons sales came to EUR 15.7 million and were thus slightly down on the prior year figure of EUR 16.3 million. Owing to an accrual set up for pending losses from biodiesel contracts concluded at the end of 2007, Petrotec booked a first-quarter loss before interest, taxes, depreciation/amortization of EUR 6.1 million (prior-year loss: EUR 0.7 million). After depreciation/amortization, the loss before interest and tax for the quarter was EUR 7.6 million (prior-year loss: EUR 2.9 million). The after-tax loss was EUR 7.4 million (prior-year loss: EUR 3.2 million), which translates into a loss per share of EUR 0.71 (prior-year loss per share: EUR 0.30). Liquid funds stood at EUR 10.1 million as at March 31, 2008 and are currently close to EUR 13 million. The Management Board is correcting the forecast for business 2008 for sales to EUR 90-100 million (from EUR 100-110 million) and the loss before interest, taxes, depreciation/amortization to about EUR 5 million (from 'break-even'). Own collection capacity for used cooking oil feedstock expanded by 31% In Q1, Petrotec successfully moved forward its own collection capacity for the used cooking oil feedstock by participations, alliances and its in-company capacity. Thus, the company acquired a majority in a Polish waste disposal company for used cooking oils and has signed a disposal deal with a Hamburg company covering the collection of used cooking oil in North Germany. Petrotec boosted its own collecting capacity by 30.8% on the same period the year before. Petrotec subsidiary Vital Fettrecycling now collects used cooling oil from over 16,000 hospitality outlets and food producers throughout Europe. Biodiesel from used cooking oil: 77% reduction in CO2 emissions The biodiesel Petrotec produces with its proprietary technology from the refined used cooking oil feedstock is by far the most climate-friendly and sustainable biodiesel that can be produced. It is made from waste and does not compete with food production, as do fresh vegetable oil feedstocks. At the end of January 2008, the EU Commission confirmed in its EU Directive on 'Promoting the Use of Renewable Energy Sources' that biodiesel made from used cooking oils has a CO2 reduction potential of at least 77%. Meaning that biodiesel derived from used cooking oil contributes more than twice as much to avoiding CO2 emissions than does biodiesel based on rapeseed oil feedstock (36 %). High utilization rate In Q1 2008, Petrotec produced close to 15,800 t of biodiesel (Q1 2007: 17,100 t) and capacity utilization came to 74% (down from 82%). The loss before interest, taxes, depreciation/amortization of EUR 6.1 million EUR is shaped by the accrual for pending losses of EUR 4.6 million and by the high prices for the used cooking oil feedstock. The accruals were set up for biodiesel selling contracts primarily concluded in Q4 2007 for periods through September 2008 at fixed prices and can at present no longer be met at prices that are viable. The ratio of cost of materials to sales of 90% was slightly down on the figure of 93.5% for Q1 2007. However, this is primarily the result of the fact that unlike the prior year no RME biodiesel was required for wholesales in the B100 segment. The higher energy tax on pure-fuel biodiesel of EUR 0.15 per liter in force since Jan. 1, 2008 has meant that the B100 sales market has as good as collapsed. Petrotec was able to sell less than 10% of its production output to forwarding agents as against 45% a year earlier. New staff hired Petrotec has almost doubled its payroll from 53 in Q1 2007 to 95 staff members, anticipating further growth and turnkey of the biodiesel plant in the deep-sea port of Emden during Q2 2008, the pan-European expansion of its own used cooking oil collecting capacity and the greater international distribution of biodiesel. As a consequence, the personnel expense rose 147% on the year to EUR 1.4 million. Assets and financial position The Petrotec AG equity/assets ratio as at March 31, 2008 came to 57.3% (Dec. 31, 2007: 63.6%) and liquid funds to EUR 10.1 million (Dec. 31, 2007: EUR 20.5 million). As at March 31, 2008 Petrotec had a balance sheet total of EUR 77.0 million, EUR 4 million down on the figure on Dec. 31, 2007. In first-quarter 2008, Petrotec invested EUR 1.6 million in the construction of the new biodiesel plant in Emden. The equity capital fell, in particular owing to the loss for the period, to EUR 44.1 million (Dec. 31, 2007: EUR 51.5 million). Liabilities due to banks as at March 31, 2008 totaled EUR 18.1 million. Outlook: Pending losses influence income for the year In the short term, Petrotec expects a solution to fix the pending losses for which accruals were made in the quarter under review. This will give Petrotec the opportunity to operate its biodiesel business profitably in line with the market and on the basis of the two key variables of biodiesel price and the price of used cooking oil. On the selling side, the trend for oil prices of as much as over USD 120 per barrel of late has pulled the price for biodiesel of FAME 0 quality up to 850-950 a ton in recent weeks. On the buying side, prices for used cooking oils have continued to rise. On balance, the current price trends for biodiesel and used cooking oil and the relatively stable spread between the two in recent months suggest that at the EBITDA level profitable biodiesel production is possible for 'back-to-back' deals. And production for sales to the B100 biodiesel market are likewise profitable at the current oil price For business 2008 the Management Board is correcting its forecast issued at the end of March given the probable realization of pending losses and the reduced contribution to production for the year as a whole by the Emden biodiesel plant to sales of about 90-100 million (previously: 100-110 million) and a loss before interest, taxes, depreciation and amortization of about 5 million (previously: 'break even'). Disclaimer This press information constitutes neither an offer to buy or to sell shares or other securities issued by Petrotec AG, nor a call for submission of offers to buy or subscribe to securities. The shares offered during the IPO have already been placed. About PETROTEC Since November 2006, Petrotec AG has been listed in the first-tier market of the Frankfurt Stock Exchange under WKN PET111, ISIN DE000PET1111. Petrotec is one of the pioneers of the German biodiesel industry. The company started as long ago as 1998 in developing a process to produce biodiesel from used frying and deep-frying oil. Petrotecs first industrial biodiesel production plant went turn-key in 2000. Petrotecs proprietary technology is able in a single fully continuous process to transform virgin vegetable oils such as rapeseed, soybean or palm oil as well as hard-to-process oils and fats such as used cooking oils, animal fats and oils or fish oil into biodiesel. In other words, it is truly a multi-feedstock technology. The annual capacity of the plant in Borken (Westphalia), Germany, is 85,000 t biodiesel. In the first half of 2008 a second production plant will go into operation in the deep-sea port of Emden with an annual capacity of 100,000 t. Unlike many of its competitors, Petrotec has for years now in its ongoing operations primarily produced biodiesel from used cooking oils in a fully continuous process. Treated used cooking oils as the feedstock for biodiesel production are up to 50 percent cheaper to procure than the rapeseed oil predominantly used by our rivals in Europe. This gives Petrotec a costs edge over other manufacturers of biodiesel, as 70-90 percent of biodiesel production costs relate to the feedstock. For further information, please contact PETROTEC AG Falk von Kriegsheim Head of Investor Relations / Public Relations Fürst-zu-Salm-Salm Strasse 18 46325 Borken Germany Tel +49 (0)2862 910060 Fax +49 (0)2862 910099 Mobil +49 (0)173 6291344 f.kriegsheim@petrotec.de www.petrotec.de DGAP 21.05.2008 --------------------------------------------------------------------------- Language: English Issuer: PETROTEC AG Fürst-zu- Salm-Salm-Str. 18 46325 Borken-Burlo Deutschland Phone: +49 (0)2862 9100 19 Fax: +49 (0)2862 9100 99 E-mail: info@petrotec.de Internet: www.petrotec.de ISIN: DE000PET1111 WKN: PET111 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, München, Hamburg, Düsseldorf, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------
DGAP-Adhoc: PETROTEC AG: Q1 sales steady despite severe market conditions
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