1.4.2008: Meldung: Xethanol Announces Fiscal 2007 Financial Results

Xethanol Corporation, a renewable energy company, today reported financial results for the fiscal year ended December 31, 2007.

For the twelve months ended December 31, 2007, the company reported a net loss of $31.3 million, or ($1.09) per share, as compared to a $20.2 million net loss, or ($0.93) per share, for the same period of the prior year. The increase in the net loss was primarily related to non-cash charges of $18.3 million, including a $12.2 million impairment charge on property previously held for development. For the fiscal year ended December 31, 2007, the weighted average number of shares outstanding was 28.6 million as compared to 21.6 million weighted average shares for the comparable period in 2006.

David Ames, President and CEO of Xethanol, commented, “2007 was a transition year for the company. It was a year in which we took necessary and sometimes difficult actions that worsened our financial results in the near-term, but which we believe will better position the company for growth. 2007 was also a year in which we made progress on initiatives undertaken in prior years.” Added Mr. Ames, “There are numerous opportunities in the market for alternate energy, and we are already in discussion with some potential partners.”

Review of the Year

The company reported net sales of $11.0 million in 2007, flat with the prior year. The company’s Blairstown, Iowa plant produced 5.4 million gallons of ethanol during 2007 at an average price of $1.87 per gallon. By-products generated additional revenue of $1.0 million. This compares to 5.2 million gallons of ethanol sold at an average price of $1.99 per gallon and $664,000 from the sale of by-products in 2006.

Cost of goods sold was $12.7 million for the year as compared to $10.1 million in the prior year. The increase was attributable to the higher cost of corn and fuel compared to the same period in the prior year.

General and administrative (G&A) costs were $10.1 million in 2007 as compared to $7.9 million for the comparable period in the prior year. The increase in G&A was primarily due to an increase in legal and accounting fees as well as a full year of ownership in the Spring Hope, North Carolina facility in 2007 as compared to just two months in 2006.

During 2007, the company incurred impairment losses of $12.2 million, which were comprised of:

1. a $7.0 million impairment of the Spring Hope facility;

2. a $2.6 million impairment of a previously planned second facility at Blairstown;

3. a $2.1 million impairment of the Augusta, Georgia facility; and

4. a $521,000 impairment loss on the Permeate assets, which was sold in November 2007.

On December 31, 2007, the company had cash, cash equivalents and marketable securities of $12.3 million. Cash and cash equivalents were $9.5 million on March 14, 2008.

Business Update

During 2007, the company broadened its business strategy to pursue opportunities in renewable energy and clean technology, including biomass gasification for electricity production, wind power, solar power, energy storage, energy infrastructure, energy efficiency, waste recycling and agricultural processes. As part of this initiative, subsequent to year-end 2007, Xethanol made an investment in Carbon Motors Corporation, a new American automaker developing a specially built law enforcement vehicle featuring a clean diesel engine that can run on biodiesel fuel. The company also made a $500,000 investment in Consus Ethanol, LLC., which has a permitted site in western Pennsylvania, where it plans to build the first of several ethanol plants. Its business model calls for a cogeneration plant using waste coal to power the companion ethanol plant -- allowing significant energy cost savings.

In addition:

* As previously announced, the company is planning to build a demonstration plant in Florida to convert citrus peel waste into ethanol. Xethanol is pursuing financing options for this facility.
* Because of the continued high prices for corn and natural gas, as well as the changing ethanol market and volatile capital markets, the company has indefinitely deferred construction of a second corn-to-ethanol facility next to its Blairstown facility and is considering cutting back its production of ethanol at its Blairstown facility until market prices for ethanol improve and costs decline.
* With the change in strategy, the company’s Spring Hope, North Carolina and Augusta, Georgia sites no longer fit into its long-term business plan. Xethanol recorded a $9.1 million impairment expense for these facilities and has decided to sell both of them.
* The company has also decided not to manufacture and sell a diesel biofuel based on technology from H2Diesel and has begun liquidating its share position in H2Diesel.

About Xethanol Corporation

Xethanol Corporation is a renewable energy company focused on alternate energy products and technologies as well as producing ethanol and other co-products. Xethanol is focusing on renewable energy and clean technology, including biomass gasification for electricity production, wind power, solar power, energy storage, energy infrastructure, energy efficiency, waste recycling and agricultural processes.

Xethanol has research agreements in place, including several aimed at efficient production of cellulosic ethanol. The company is working with some of the nation’s leading scientific institutions, including the National Renewable Energy Lab in Golden, Colorado; Virginia Tech in Blacksburg, Virginia; the USDA Forest Products Lab in Madison, Wisconsin; and the Energy and Environmental Research Lab in Grand Forks, North Dakota.

For more information about Xethanol, please visit its website at http://www.xethanol.com.

Forward Looking Statements

Some of the statements made in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and include known and unknown risks, uncertainties and other factors, many of which the company is unable to predict or control, that may cause the company’s actual results or performance to differ materially from any future results or performance expressed or implied by such forward-looking statements. These statements involve risks and uncertainties, including risks and uncertainties associated with the company’s development and financing plans, business strategy and research projects, including whether the projects will produce the anticipated results; whether the company will be able to sell two of its facilities as it plans; and whether the company’s investments will prove to be successful. These risks and uncertainties are in addition to other factors detailed from time to time in the company’s filings with the SEC, including the section entitled “Risk Factors” in its annual report on Form 10-K for the year ended December 31, 2007 filed with the SEC on March 31, 2008. The company cautions investors that any forward-looking statements made by the company are not necessarily indicative of future performance. The company is not responsible for updating the information contained in this press release beyond the published date, or for changes made to this document by wire services or Internet services.

XETHANOL CORPORATION

Consolidated Statement of Operations

(in thousands, except per share data)

Year Ended December 31,
2007 2006


Net sales $ 11,037 $ 11,029

Cost of sales, including depreciation of $461 and $451 for 2007 and 2006, respectively
12,686 10,091
Gross (loss) profit (1,649 ) 938


Operating expenses:
General and administrative expenses 10,110 7,932
Equity compensation 3,974 7,022
Depreciation and amortization 338 341
Impairment loss on property 12,249 514
Research and development 601 852
Total operating expenses 27,272 16,661

Loss from operations before other (expense) income (28,921 ) (15,723 )

Other (expense) income:
Interest income 746 1,184
Interest expense (55 ) (217 )
Loss on marketable securities (1,589 ) -
Impairment loss - investment in H2Diesel Holdings, Inc. - (2,322 )
Loss on equity of H2Diesel Holdings, Inc. (1,236 ) (1,626 )
Loss on royalty note conversion - (1,967 )
Legal settlement costs (400 ) -
Other income 178 492
Total other (expense) income (2,356 ) (4,456 )

Net loss $ (31,277 ) $ (20,179 )

Basic and diluted net loss per share $ (1.09 ) $ (0.93 )

Weighted average number of
shares outstanding 28,592,919 21,604,355

XETHANOL CORPORATION

Consolidated Balance Sheets

(in thousands)



December 31,
2007


December 31,
2006

ASSETS
Current assets:
Cash and cash equivalents $ 12,322 $ 24,183
Receivables 564 582
Inventories 294 291
Other current assets 879 846
Total current assets 14,059 25,902


Property and equipment, net 4,316 8,596
Property held for development 554 12,553
Property previously held for development 5,416 -
Investment in and advances to H2Diesel Holdings, Inc. 647 1,963

Research and license agreements, net of amortization of $409 and $136 in 2007 and 2006, respectively
623 895
Other assets 403 1,537
TOTAL ASSETS $ 26,018 $ 51,446


LIABILITIES AND STOCKHOLDERS" EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 3,221 $ 1,229
Accounts payable - related parties - 318
Total current liabilities 3,221 1,547

Note payable 295 310
Minority interest 116 116
Capitalized lease obligation 14 22
Total liabilities 3,646 1,995

Commitments and contingencies

Stockholders" equity:


Preferred stock, $0.01 par value, 1,000,000 shares authorized; 0 shares issued and outstanding
- -


Common stock, $0.001 par value, 100,000,000 shares authorized; 28,609,103 and 28,497,648 shares issued and outstanding in 2007 and 2006, respectively
29 28
Additional paid-in-capital 89,171 84,974
Accumulated deficit (66,828 ) (35,551 )
Total stockholders" equity 22,372 49,451
TOTAL LIABILITIES AND STOCKHOLDERS" EQUITY $ 26,018 $ 51,446


Contact:
Kathleen Heaney, 203-803-3585
ir@xethanol.com
Source: Xethanol Corporation
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