Alto Ingredients Inc (ALTO)

[Rule_62]

With less than 1M warrants left, any non-cash charges won't pose the kind of impact they had in Q2 either.

I think there might be some additional explanations for what happened. Check this out from the Q2 10-Q:

Purchase Commitments – At June 30, 2014, the Company had fixed-price purchase contracts with its suppliers to purchase $6,530,000 of ethanol and indexed-price contracts to purchase 20,776,000 gallons of ethanol. These contracts are scheduled to be satisfied throughout the remainder of 2014.

Depending on what price those fixed price contracts were based on, they could of lost a couple mil right there. CBOT ethanol was pretty high at the beginning of Q2 (I'd have to look it up but I think it was in the high $2's). Even by June 30 it was still in the $2.12 range. Come the end of Q3 is was down to the $1.60 range.

I think if we keep looking, we'll find where we were off. I did run an offset version of the production margin, where I used the corn price from the previous week. That knocked an average of $0.02 off the Q3 average price right there (the exact opposite effect is working in PEIX's favour so far for Q4).

I wonder how many people have really stopped to compare the current situation with Q2 (less the massive amount of warrants and large interest payments hit)