Financial Highlights
Revenues for the first quarter of 2015 were $5.9 million compared to $0.9 million in the same period in 2014. The increase in revenue during 2015 is primarily a result of the production and sale of approximately $5.1 million of ethanol and distiller's grains following the transition of the Luverne plant to the SBS configuration.
During the first quarter of 2015, hydrocarbon revenues were $0.5 million, primarily related to the shipment of bio-jet fuel to the U.S. military during the quarter. Gevo also continued to generate revenue of $0.3 million during the first quarter of 2015 associated with ongoing research agreements.
Cost of goods sold increased by $4.6 million during the three months ended March 31, 2015, as compared to the same quarter in 2014, due primarily to the increased production activity at the Luverne plant under the SBS configuration. Gross loss was $3.3 million for the three months ended March 31, 2015. After deducting $1.5 million of depreciation expense, the non-GAAP cash gross margin was a negative $1.9 million for the first quarter of 2015, as compared to a negative $3.2 million in the same quarter in 2014.
Research and development expense decreased by $2.4 million during the three months ended March 31, 2015, as compared to the same quarter in 2014, due primarily to a $1.4 million reduction in employee-related expenses, a $0.4 million decrease in consultant and lab-related expenses and a $0.5 million decrease in expenses incurred at the hydrocarbons demo facility located in Silsbee.
Selling, general and administrative expense decreased $0.6 million during the three months ended March 31, 2015, as compared to the same quarter in 2014, due primarily to a decrease of $0.4 million in miscellaneous SG&A expense items.
Interest expense in the first quarter of 2015 was $2.0 million, as compared to interest expense of $1.6 million during the same quarter of 2014. The increase was due primarily to the issuance of the convertible notes to Whitebox in June of 2014 (2017 Notes).
The company reported a non-cash gain of $0.2 million during the first quarter of 2015, as compared to a non-cash gain of $2.5 million during the same period in 2014, related to changes in the fair value of its derivative warrant liabilities and embedded derivatives contained in the convertible notes issued in 2012 (2022 Notes).
There were $2.0 million of 2022 Notes that were converted into 170,041 shares of Gevo common stock (shares expressed on a post-reverse split basis) during the three months ended March 31, 2015. As a result, the company recognized a $0.3 million gain upon the conversion of the debt.
The company also reported a non-cash gain of $3.8 million during the first quarter of 2015 related to a change in the fair value of the 2017 Notes.
The net loss for the first quarter of 2015 was $7.3 million compared to $12.0 million during the same period in 2014.