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BIOX Corp. Climbs 34% As It Swings Into First Quarter Profit

Last updated: 11:56 04 Feb 2011 EST, First published: 12:56 04 Feb 2011 EST

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BIOX Corp.’s (TSX:BX) shares are up 34% on Friday afternoon after the company reported it swung to a first quarter profit, thanks to higher sales.


The operator of biodiesel production facilities earned CAD$1.76 million, or 4 cents a share, for the first quarter ended December 31.  That compares with a loss of CAD$1 million, or 5 cents a share, in the year-ago period. 


Revenues were roughly CAD$27 million, more than double the CAD$11.6 million in the same period last year. 

 
Analysts polled by Thomson Reuters expected the Vancouver-based company to lose 4 cents a share on revenues of CAD$13.15 million. 


The first quarter “was a very strong quarter as we continue to see improving fundamentals in the biodiesel market,” said BIOX’s CEO, Tim Haig. 


BIOX noted several policy developments in the past year that would seem to help increase biodiesel demand. 


In July, the U.S. Environmental Protection Agency implemented a policy that requires the use of a minimum of 800 million gallons of biodiesel in 2011, increasing to 1 billion gallons in 2012. A minimum of 1 billion gallons must also be used annually from 2012 through 2022.


Also, the Canadian federal government enacted in August regulations that require gasoline to contain 5% renewable fuel content, which biodiesel qualifies for.  The first compliance period for the requirement is from December 2010 to December 2012.


"The market is developing as we expected and with these improved market conditions, we are moving forward with our expansion plans for a second plant in Canada or the U.S," added Haig. 


The plant is designed to produce 67 million litres of biodiesel per year. 


At quarter end, BIOX had CAD$19.1 million of cash and cash equivalents. 


As of 12:32, the company’s shares are trading at CAD$1.65.

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