FORM 8-K PRIVATE
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Date of Report (Date of earliest event reported) April 15, 1998.
HIGH PLAINS CORPORATION
(Exact name of registrant as specified in its charter)
Kansas #1-8680
(State or other jurisdiction of (Commission File
incorporation) Number)
200 W. Douglas #48-0901658
Suite #820 (IRS Employer
Wichita, Kansas 67202 Identification No.)
(Address of principal
executive offices)
(316)269-4310
(Registrant's telephone number)
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Item 5 Other Information
Wichita, KS, April 15, 1998 -- High Plains Corporation (NASDAQ:HIPC) today
reported a net loss of $(299,425) or $(.02) per diluted share on sales of $19.1
million for the fiscal third quarter ended March 31, 1998. This compares to
net income of $427,922 or $.03 per diluted share on sales of $20.6 million for
the same quarter last year.
The Company also reported net income of $1.5 million or $.09 per diluted share
for the nine-month period ended March 31, 1998, on sales of $63.4 million.
This compares to net income of $1.6 million or $.10 per diluted share on
revenues of $38.7 million for the same nine-month period last year. The
Company's diluted per share numbers are the same as its basic per share
figures, both for the quarter, and the nine-month period ended March 31, 1998.
<TABLE>
Financial Highlights
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Sales $19,123,056 $20,570,905 $63,354,876 $38,699,005
Net (Loss) Income $ (299,425) $ 427,922 $ 1,476,863 $ 1,602,394
Diluted (Loss) Earnings
per share $ (.02) $ .03 $ .09 $ .10
Diluted shares
outstanding 16,009,802 15,996,437 16,018,715 16,065,434
</TABLE>
"The completion of the wintertime oxygen program, combined with low gasoline
prices and high maintenance expenses all contributed to our loss this quarter,"
said Gary Smith, Chief Executive Officer of High Plains. "High Plains and many
other ethanol producers reduced production to approximately 80% of capacity
mid-way through this quarter. However, completion of two major projects during
the quarter should improve production efficiencies for the future."
"Specifically, installation of the bio-methanation unit in our York, Nebraska
plant was completed in January and is operating as expected to increase our
wastewater treatment capacity, as well as our production efficiency. A major
modification to the feed dryer was also completed at our Colwich, Kansas plant,
which will increase drying capacity and allow us to capture more value from by-
products previously sold as liquid feed."
"Industry-wide, grain prices have continued to trend downward, and we have
expanded our grain purchases in accordance with our risk management strategy.
We currently have futures contracts for almost 40% of our projected grain
requirements through March of 1999. These contracts, combined with the grain
price protection traditionally provided by our feed by-products, should operate
to cover approximately 70% of our grain price exposure through March 1999.
Record planting and good crops are still projected for this grain year, but our
risk management plan is in place to help limit our exposure to unexpected price
increases. Sales of our Industrial Grade Ethanol continue in the spot market
after a mid-quarter interruption due to market softness.
<PAGE>
However, Industrial Grade prices are still significantly higher than those of
our Fuel Grade product."
Mr. Smith added, "After completing refurbishments, the Portales, New Mexico
plant is now operating smoothly at 80% of full capacity, and this expansion of
our Company's overall production capacity should help High Plains in its quest
to become a long-term leader in the Ethanol industry."
High Plains also announces the completion of a tentative agreement with Wichita
Gas Producers, LLC, to purchase gas produced by the local landfill for use at
our Colwich, Kansas plant. This agreement is the culmination of almost two
years of negotiations to utilize this resource which otherwise would simply be
vented into the air and wasted. Mr. Smith further stated, "Our hope is that
this landfill gas will replace most, if not all of our natural gas requirements
at the Colwich plant. The project will be completed at no cost to High Plains,
and will allow us to purchase gas at significantly reduced costs over the five
year term of the agreement. At our current contracted natural gas rates, and
assuming that the landfill can produce 80% of our gas needs, savings to High
Plains should exceed $600,000 per year. The anticipated completion date for
the collection system and pipeline is prior to the end of this calendar year."
A conference call is being held by High Plains at 11:00 a.m. Eastern Standard
Time on Thursday, April 16, 1998, to discuss these issues and others relevant
to the Company. To participate in the call, dial 888-331-0044 approximately 15
minutes prior to its starting time, and ask for conference call ID# Q526.
Based in Wichita, Kansas, High Plains Corporation is among the nation's largest
producers of Ethanol. The Company operates production facilities in Colwich,
Kansas; York, Nebraska; and Portales, New Mexico.
This press release contains forward-looking statements that are made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Investors are cautioned that all forward-looking statements involve
risks and uncertainties, including without limitation risks of fluctuations in
feedstock commodity prices, changes in the market prices or demand for motor
fuels and Ethanol, legislative changes regarding air quality, fuel
specifications or incentive programs, as well as general market conditions,
competition and pricing. The Company believes that forward-looking statements
made by it are based upon reasonable expectations. However, no assurances can
be given that actual results will not differ materially from those contained in
such forward-looking statements. Additional information concerning these and
other factors is contained in the Company's Securities and Exchange Commission
filings, including its annual 10K, Proxy Statement, and quarterly 10Q filings,
copies of which are available from the Company without charge.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant had duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date April 15, 1998 HIGH PLAINS CORPORATION
/s/Gary R. Smith
CEO
