Nov. 6 (Bloomberg) — Solazyme Inc., a producer of
renewable oils from algae, declined the most on record after its
third-quarter revenue fell short expectations and it said sales
next year will miss estimates even more.
Solazyme tumbled 58 percent to $3.14 at the close in New
York, the most since its May 2011 initial public offering and
the lowest price on record.
Revenue in the third quarter was $17.6 million, South San
Francisco, California-based Solazyme said in a statement after
the close of trading yesterday. That was lower than the $19.6
million average of eight analysts’ estimates compiled by
Production issues at the company’s plant in Moema, Brazil,
led Solazyme to lower its revenue forecast for 2015 to about $75
million, well short of the $300 million estimate from Jeff
Osborne, an analyst with Cowen & Co.
“The loss of Moema’s rapid volume-growth expectations”
were among the “primary concerns for our more cautious view on
the stock,” Osborne wrote in a note to investors today. He
lowered his rating to the equivalent of hold with a 12-month
price target of $7. Solazyme also was downgraded today by Robert
W. Baird & Co. and yesterday by Pacific Crest Securities LLC.
Excluding some items, the company’s loss of 45 cents a
share was three cents more than the average of nine estimates
compiled by Bloomberg.
The company began commercial production of oil and
lubricants at Moema in May, and said it expected to reach full
capacity of 100,000 metric tons a year within 12 to 18 months.
“Management has noted that despite delays, it expects to
fully bring Moema onto its balance sheet in 2016, albeit not
producing at the previously intended annual capacity,” Osborne
said. “We expect the Moema run rate to fall short of 20,000
metric tons a year by 2016.”
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Will Wade, Carlos Caminada