increased his stake in BioFuel Energy Corp. (
) by 62.85% at the average price of $3 on 09/06/2012, according
GuruFocus Real Time Picks
. He owns 2,212,274 shares. The stock price has changed by 55%.
The purchase brings his total holding of the company to 13.6%.
Denver-based BioFuel Energy Corp. is a publicly traded company
founded in 2005 that produces and sells ethanol, distillers grain
and corn oil through two production facilities in Nebraska and
Minnesota. BioFuel Energy Corp. has a market cap of $16.2
million; its shares were traded at around $4.42.
Einhorn first bought the company in the second quarter of 2012,
acquiring 1,358,437 at that time. The company's stock has slid
significantly over the last year. In May, BioFuel announced that
it received a letter from Nasdaq providing it a time extension
for its stock to go above the required $1.00 bid price for
listing on the exchange. In June, it held a 1-for-20 reverse
In the second quarter, BioFuel posted its second quarter of
steeper losses. In the second quarter of 2012, its net loss was
$12.4 million, compared to a net loss of $8.3 million the prior
year. Revenue was $122.8 million, compared to $168.5 million the
prior year - a 27.1% decline.
Sales declined mainly due to a decrease in ethanol income from
lower market prices for ethanol and a decrease in the quantity of
ethanol produced and sold. The company reduced production toward
the end of the quarter to maintain its margin in an environment
of rising corn prices. "July was the lowest month for ethanol
production in the last two years," according to the U.S. Energy
BioFuel Corp. said in August it did not believe its crop supply
would be affected by a drought that has been afflicting the U.S.
this summer and driving up corn prices. The U.S. government
currently requires 13.2 billion gallons of ethanol to be blended
into fuel, which equates to about 40 percent of U.S. corn crops
in a normal year.
BioFuel Corp.'s stock price has increased 39% since Einhorn
disclosed his stake increase.
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