Today's The Joplin Globe, had the headline, RES Faces New Challenge, explaining that since Changing World Technologies (RES's parent company) announced their intention to pursue a $100 million IPO (Initial Public Offering), "investments have dried up and public offerings have ground to a standstill". Of course the current economic environment is only half of their problem. The Joplin Globe article also quotes City of Carthage Mayor, Jim Woestmann, "There is no way anybody in this city is going to recommend them to another community. I don’t think anybody would be investing in that business. I’m an investor and I would not consider investing in a business where the local people are not happy with it."
Stinky statistics:
1. RES has the capacity to convert up to 78,000 tons of animal and food processing waste per year into between 4 million and 9 million gallons of renewable diesel fuel.
2. Through September 2008, the company generated about 1.1 million gallons and sold about 684,000 gallons.
3. The average price for the fuel was $1.19 per gallon, which would produce nearly $814,000 in revenue.
4. The Carthage plant was commissioned in 2005, but it wasn’t until 2007 that it began commercial sales of its fuel and it wasn’t until this year that it began to sell fertilizer.
5. The company reported a net loss of $21.8 million in 2006, followed by a net loss of $19.9 million for 2007 and a net loss of $18.8 million through Sept. 30, 2008.
6. The company had an accumulated deficit of $117.8 million as of Sept. 30, 2008.
7. Schreiber Foods is the company’s largest customer, accounting for between 73 and 78 percent of the sales last year and in the first nine months of this year.
8. Schreiber uses the animal-based oil in industrial boilers at its plants in Monett and Mount Vernon. It recently extended its contracts with RES through May 2010.
9. Meanwhile, Dyno Nobel just signed on to a two-year deal to buy about 2 millions of the renewable fuel annually.
The Joplin Globe article references a ‘Quiet Period’. "The federal securities laws do not define the term “quiet period,” which is also referred to as the “waiting period.” However, historically, a quiet period extended from the time a company files a registration statement with the SEC until SEC staff declared the registration statement “effective.” During that period, the federal securities laws limit what information a company and related parties can release to the public. [U.S. Securities and Exchange Commission]"
Changing World Technologies may not be talking, but the citizens of the City of Carthage are talking. Just ask them.
