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Southwest Iowa Renewable Energy Announces Its First Quarter 2011 Results

February 14, 2011

COUNCIL BLUFFS, Iowa, Feb. 14, 2011 /PRNewswire/ — On February 9, 2011, Southwest Iowa Renewable Energy, LLC (“SIRE“) announced its financial results for the first fiscal quarter ending December 31, 2010. SIRE reported a net loss of $396,318, or $30.16 per unit, compared to a net loss of $1,555,257 or $118.37 per unit, during the same period in 2010. Revenues totaled $62,265,743 for SIRE’s first fiscal quarter of 2011 compared to $50,748,439 for the same period in 2010. For the three months ended December 31, 2010, 82% of revenues were earned from the sale of denatured ethanol with the remaining 18% of revenues earned from the sale of dry distiller’s grains. In the prior year, for the three month period ending December 31, 2009, 85% of revenues were earned from the sale of denatured ethanol and 15% from the sale of dry distiller’s grains.

(Logo: http://photos.prnewswire.com/prnh/20100806/AQ47222LOGO)

Cash and cash equivalents decreased from $3,432,544 on September 30, 2010 to $1,390,737 on December 31, 2010. Inventory increased from $8,013,153 on September 30, 2010 to $14,651,723 as of December 31, 2010. The continuing increases in corn prices resulted in a current ratio decrease from 1.41 to 1.16 for the three months ending on December 31, 2010.

Brian Cahill, SIRE’s General Manager and CEO stated, “Ethanol margins opened up during the quarter ended December 31, 2010; we were able to increase our gross margin from the previous quarter with the help of our risk management strategy. We continue to work on increasing ethanol production levels and efficiencies here at SIRE.”

About Southwest Iowa Renewable Energy, LLC:

SIRE is an Iowa limited liability company, located in Council Bluffs, Iowa, formed in March, 2005 to construct and operate a 110 million gallon capacity ethanol plant. SIRE began producing ethanol in February, 2009 and sells its ethanol, modified wet distillers grains with solubles, and corn syrup in the continental United States. SIRE also sells its dried distillers grains with solubles in the continental United States, Mexico, and the Pacific Rim.

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “1995 Act“). Such statements are made in good faith by SIRE and are identified as including terms such as “may,” “will,” “should,” “expects,” “anticipates,” “estimates,” “plans,” or similar language. In connection with these safe-harbor provisions, SIRE has identified in its Annual Report to Shareholders for the fiscal year ended September 30, 2010, important factors that could cause actual results to differ materially from those contained in any forward-looking statement made by or on behalf of SIRE, including, without limitation, the risk and nature of SIRE’s business ,and the effects of general economic conditions on SIRE. The forward-looking statements contained in this Press Release are excluded from the safe harbor protection provided by Section 27A of the Securities Act of 1933, as amended (the “1933 Act“) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act“). SIRE further cautions that such factors are not exhaustive or exclusive. SIRE does not undertake to update any forward-looking statement which may be made from time to time by or on behalf of SIRE.

The following are condensed statements of operations for SIRE:

                                   SOUTHWEST IOWA RENEWABLE ENERGY, LLC

                                              Statements of Operations
                          ------------------------

                                   Three Months Ended  Three Months Ended
                                   December 31, 2010   December 31, 2009
                                       (Unaudited)         (Unaudited)
                                       -----------         -----------

    Revenues                               $62,265,743      $50,748,439
    Cost of Goods Sold
        Cost of goods sold-non
         hedging                            58,144,413       48,935,950
        Realized & unrealized hedging
         (gains and losses)                    887,819          (81,799)
                                               -------          -------
    Cost of Goods Sold                      59,032,232       48,854,151
                                            ----------       ----------

                   Gross Margin              3,233,511        1,894,288
                                             ---------        ---------

        Selling, General, and
         Administrative Expenses             1,200,888        1,138,298
                                             ---------        ---------

                   Operating Income          2,032,623          755,990
                                             ---------          -------

    Other Income (Expense)
        Interest income                          3,972           13,163
        Interest expense                    (2,439,563)      (2,330,384)
        Miscellaneous income                     6,650            5,974
                                                 -----            -----
                   Total                    (2,428,941)      (2,311,247)
                                            ----------       ----------

    Net (Loss)                               $(396,318)     $(1,555,257)
                                             =========      ===========

    Weighted Average Units
    Outstanding-Basic & Diluted                 13,139           13,139
                                                ======           ======
    Net (loss) per unit -basic &
     diluted                                   $(30.16)        $(118.37)
                                               =======         ========


    Below are condensed balance sheets:

    Balance Sheets
    ASSETS                              December 31, 2010   September 30, 2010
                                              (Unaudited)
    Current Assets
      Cash and cash equivalents                  $1,390,737        $3,432,544
      Restricted cash                               175,000                 0
      Accounts receivable                            85,528                 0
      Accounts receivable, related party         17,241,373        23,392,670
      Due from broker                             4,859,546         2,260,015
      Inventory                                  14,651,723         8,013,153
      Derivative financial instruments,
       related party                             12,135,270           688,039
      Prepaid expenses and other                  1,225,177           533,513
                                                  ---------             -----
                 Total current assets          51,764,354   --   38,319,934
                                               ----------        ----------

    Property, Plant, and Equipment
      Land                                      2,064,090         2,064,090
      Plant, Building and Equipment           203,289,513       199,771,260
      Office and Other Equipment                  720,716           720,529
                                                  -------           -------
      Total Cost                              206,074,319       202,555,879
                                              -----------       -----------
      Accumulated Depreciation               (33,606,514)      (28,757,303)
                                              -----------       -----------
                  Net property and equipment  172,467,805       173,798,576

    Other Assets
      Other                                       125,000         1,142,388
      Financing costs, net of amortization
       of $2,047,586 and $1,949,651             1,832,545         1,930,482
             Total other assets                 1,957,545         3,072,870
                                                ---------         ---------
           Total Assets                      $226,189,704      $215,191,380


                               Balance Sheets
    LIABILITIES AND MEMBERS' EQUITY        December 31,   September 30,
                                                    2010           2010
                                            (Unaudited)
     Current Liabilities
      Accounts payable                         $1,035,499      $978,388
      Accounts payable, related parties         3,171,062     2,542,055
      Derivative financial instruments          3,769,750        75,125
      Accrued expenses                          2,345,012     2,624,916
      Accrued expenses, related parties         5,098,267     2,913,206
      Current maturities of notes payable      29,276,492    18,058,574
                                               ----------    ----------
         Total current liabilities             44,696,082    27,192,264
                                               ----------    ----------

     Long Term Liabilities
          Notes payable, less current
           maturities                         129,783,911   135,868,087
          Other                                   675,007       700,006
                                                  -------       -------
                 Total long term liabilities  130,458,918   136,568,093
                                              -----------   -----------

     Commitments and Contingencies

     Members' Equity
       Members' capital, 13,139 Units issued
        and outstanding                        76,474,111    76,474,111
       Accumulated (deficit)                  (25,439,407)  (25,043,088)
                                              -----------   -----------
         Total members' equity                 51,034,704    51,431,023
                                               ----------    ----------
    Total Liabilities and Members' Equity    $226,189,704  $215,191,380
                                             ============  ============

SOURCE Southwest Iowa Renewable Energy, LLC


Source: newswire



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