2Q Analysis

2Q ACTUAL/SKUNK Predictions

$5,187,749/$4.2M in equipment and technology sales;
Skunk was under by 24%

Expect this area to shrink for the remainder of the year as we concentrate on our own construction. This area, with its large margins but short term nature, has been a perfect short term cash cow that has enabled GERS to bridge the gap from garbage sorting to a new American Energy company.
***********
$2,523,489/$1.88M in culinary oil production & sales;
Skunk was under by 34%

This area will be steady or increase slowly until the expansion is financed and completed. The timeline is now pushed well into 2009 for the new capacities. Expect this to be a steady contributor to revenues. There was a one time reduction in revenues in 4th Quarter 2007. Not sure if that was seasonal and will be repeated again this year in the 4Q - or if it was due to an anomaly.
***********
$3,804,553/$2,610,142 in biofuel production and sales
Skunk was under by 46%

For those who have read this blog before, you know that I am here for the COES. Everything else is important, but only so much as they support the installation of as many COES as quickly as possible. That's just the facts of life. I am not saying that everything else is not important - but they will only survive and prosper if the COES are first successful. So that makes this next section, on the production of corn oil, the most important.

Overall in the 1Q we produced $331,371 of corn oil revenues. Based on $2.25 revenues/gal of corn oil that was 147,276 gallons. The Skunk had believed in 2Q we would produce, prorated, from the two operational COES at 40.5% of capacity or 303,750 gallons. (This was average rate between 1Q production and Kreisler Interview 1 July - and prorated commissioned dates.)

We can now evaluate the Skunk's estimate of 147,276 gallons of corn oil in the first quarter. In "Results of Operations" on page 30 we now have "Operating Data". We see that GERS extracted 152,787 gallons in the first quarter and 296,727 in the second for a total of 449,514 in the first 6 months of 2008. Even with the 1Q revenue numbers I had under calculated the first quarter production by almost 4%. Then with nothing but the 1Q numbers; the Kreisler 1 July interview and a finger in the wind; I predicted 303,750 gallons of corn oil for 2Q. I was just 2.4% over in my prediction for corn oil production. This being the most important part of this growing company, I will take a deep bow now for getting that close. As you are standing applauding my overall luckiness, however, I must point out that that this number must dramatically improve. I am confident production will increase close to capacity as the upgrades are installed and the new COES come online fully equipped.

All shareholders should appreciate this new "Operating Section" that allows us to closely follow the PRODUCTION as well as the capabilities of this company. Many others, and including the Skunk, wanted to see this new communication with shareholders. Also the idea of a web cam viewing a COES production meter in real time as investors watch the creation of wealth (I mean corn oil!) is an idea that should excite everyone of you GER-sters.

So what did we produce at NextDiesel??
"Since completing this acquisition on May 15, 2008, we produced and sold about 631,000 gallons of corn oil and waste animal fat derived biodiesel to clients for use instead of diesel fuel." p.28 2Q.
This tells us we operated the NextDiesel plant at just over 50.5% of capacity for the half of the 2nd quarter we owned it. Not incredible. But considering we had to switch between two feedstocks on the same line, and the white grease later became too expensive to aggressively run - not bad at all. The 631,000 total gallons was certainly better than the 504,094 gallons of combined corn oil/fats the Skunk expected.
************
$11,515,790/$8,690,142
Total revenues

Skunk was under by nearly a third or 33%. That is two quarters in a row I significantly underestimated revenues! This Greenshift Team is one that I would not bet against. Apparently I need to get a little more optimistic when it comes to my predictions!
**************
Skunknote:
It looks like the Press Release Section of the GERS web site is preset to drop off Press Releases after six months. After they mentioned it on i-hub, I have watched all the Feb press releases drop off as the six month time limit was reached. The web site now has no press releases listed. As stated in the Kreisler 1 July Interview it looks like no PRs until we are profitable. The Skunk guesses "Team Greenshift" is tired of being accused of pumping when they talk of their vast potential. The next time they talk, they want to be able to show results. Namely profit. Then no one can afford to ignore the potential.

This is a big quarterly with a lot of information and news. Most of it is good. Without a close on new financing and a COES producing solidly over an entire quarter we remain perched a atop the Golden Gate in a wind storm. This 2Q has provided us a hand rail. No safety net yet. But I think I see them starting to erect one. Man, what a view up here! With high risk comes . . . .

Summer and my many other commitments have pulled me away from my duties here. I intend to take one bite of this alligator at a time. Revenues today, tomorrow??. Of course, with the help of alert readers, I will try to continue to post any breaking news as well.
We are a big step closer,
More as I complete it,
Skunk