Rentech Earnings: Here’s Why Investors are Ambivalent Now

Rentech, Inc. (AMEX:RTK) had a loss and met Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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Rentech, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.02 in the quarter versus EPS of $-0.01 in the year-earlier quarter.

Revenue: Rose 54.7% to $59.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Rentech, Inc. reported adjusted EPS loss of $0.02 per share. By that measure, the company missed the mean analyst estimate of $-0.02. It missed the average revenue estimate of $80.08 million.

Quoting Management: D. Hunt Ramsbottom, President and CEO of Rentech, said, “We continue to focus on disciplined capital allocation and maximizing shareholder returns. Our entry into the wood fibre processing business is expected to produce immediate cash flow, attractive returns, and significant growth.” Mr. Ramsbottom continued, “In the quarter, the nitrogen fertilizer business achieved solid product margins, although the year got off to a slow start due to bad weather. We are on track in reducing our spending in the alternative energy segment.”

Key Stats (on next page)…

Revenue decreased 35.43% from $92.46 million in the previous quarter. EPS increased to $-0.02 in the quarter versus EPS of $-0.02 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.08 to a profit $0.06. For the current year, the average estimate has moved down from a profit of $0.16 to a profit of $0.07 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]