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78% biofuels execs more bullish; strong job, revenue growth expected in 2012


Jim Lane, Biofuels Digest

 In Florida, Biofuels Digest reports that 78 percent of bioenergy executives are more optimistic both about their organization’s prospects for growth and industry growth, than 12 months ago, and that 72 percent are more optimistic about the industry’s prospects than at this time in 2011.

The findings were among the highlights of the Q1 2012 Bioenergy Business Outlook Survey conducted by the publication and co-sponsored by the Biotechnology Industry Organization (BIO). The quarterly survey drew responses from 572 Digest subscribers.

Highlights from the survey include:

Revenue growth

Respondents said that they expect their firms to grow by a median 8.59 percent over the next 12 months, down from a median of 11.60 percent in the last 2011 survey. Industry revenue is expected to grow 8.97 percent, up slightly from 8.45 percent in the previous survey.

IPO and merger activity

57 percent of respondents said that they expect to see more completed IPOs in the next 12 months, compared to the past 12. In the past 12 months, the IPO window has re-opened, with Ceres and Renewable Energy Group completing industrial biotech IPOs this year, and Enerkem is expected to price this week.

76 percent of respondents said that they expected to see more mergers and consolidations in the next 12 months.

Markets

Respondents, asked to cite the markets outside of their home country which were key to their growth, cited the US (43 percent), Brazil (41 percent), the EU (41 percent) and Canada (36 percent).

Job growth

The median job growth rate expected, over the next 12 months, is 9.59 percent, up from 4.2 percent in the Q1 survey.

Financing

47 percent of respondents tried for new financing in the past 12 months, down from 54 percent, and 52 percent of those who attempted financing were successful. 56 percent of respondents said that they would seek new financing in the next 12 months.

Growth drivers

55 percent said that rising demand for alternative fuels was an important driver for their growth over the next 12 months, while 43 percent said that new technology was a growth driver for them, down from 48 percent. 30 percent credited new partnerships, down from 40 percent, 28 percent pointed to new finance and 15 percent to more aggressive marketing, down from 37 percent and 20 percent in the last survey.

Policy

Despite clouds over government activity in the US and EU, 34 percent said government mandates and tax credits would be a key growth driver, down from 32 percent in the last survey, and 63 percent described the government attitude as supportive, down from 67 percent in the previous survey.

Among preferred policies, executives pointed strongly towards increased grants, production subsidies or incentives, with 42 percent citing this as a major driver, while 37 percent called for carbon price legislation. Only 28 percent pointed to better loan guarantee programs, down from 41 percent in the last survey, while 20 percent indicated blender pumps assistance, compared to 30 percent in the previous survey.

Fuels

Among fuels, 50 percent of executives said they expect cellulosic ethanol, to reach 1 billion gallons by 2020, down from 67 percent in the last survey. Other fuels that were expected to break the billion gallon barrier by 2020: renewable diesel (down sharply from 67 to 51 percent), and aviation biofuels at 48 percent.. Algal fuel was flat at 28 percent, compared to 29 percent in the previous poll.

Complete survey results are available here.

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