Pacific Ethanol Reports Fourth Quarter and Full-Year 2018 Results

SACRAMENTO, March 12, 2019 - Pacific Ethanol Inc. (NASDAQ: PEIX), a leading producer and marketer of low-carbon renewable fuels and high-quality alcohol products in the United States, reported its financial results for the three and twelve months ended December 31, 2018.

Neil Koehler, Pacific Ethanol’s president and CEO, stated: “We remain confident that the long-term demand for ethanol, both domestically and internationally, will continue to grow, and that market conditions will improve. Focused on delivering long-term sustainable growth and profitability for our investors, we have built a broad and diversified footprint through organic growth and acquisitions.

“Our financial results in the fourth quarter were negatively impacted by market conditions, regulatory uncertainty and trade disputes, which compressed production margins to record lows. Margins have improved in the first quarter but have further to go to restore profitability. In light of this and the fact that the intrinsic value of Pacific Ethanol’s platform is not fully recognized by our public equity valuation, we have initiated a strategic realignment of our business to improve liquidity and reduce our debt.

“Our vision remains to be a leading producer and marketer of low carbon renewable fuels and high-value feed and alcohol products. We have great assets and a strong team to fulfill this vision,” concluded Koehler.

Financial Results for the Three Months Ended December 31, 2018 Compared to 2017

• Net sales were $334.4 million, compared to $395.3 million.
• Total gallons sold of 209.4 million, compared to 240.0 million.
• Total production gallons sold of 131.1 million, compared to 150.4 million.
• Cost of goods sold was $355.4 million, compared to $397.3 million.
• Gross loss was $21.0 million, compared to $2.0 million.
• Selling, general and administrative expenses were $9.2 million, compared to $8.6 million.
• Operating loss was $30.2 million, compared to $10.6 million.
• Loss available to common stockholders was $32.3 million, or $0.74 per share, compared to $13.6 million, or $0.32 per share.
• Adjusted EBITDA was negative $18.0 million compared to $0.3 million.
• Cash and cash equivalents were $26.6 million at December 31, 2018, compared to $49.5 million at December 31, 2017.

Financial Results for the Twelve Months Ended December 31, 2018 Compared to 2017

• Net sales were $1,515.4 million, compared to $1,632.3 million.
• Cost of goods sold was $1,530.5 million, compared to $1,626.3 million.
• Gross loss was $15.2 million, compared to a gross profit of $5.9 million.
• Selling, general and administrative expenses were $36.4 million, compared to $31.5 million.
• Operating loss was $51.5 million, compared to $25.6 million.
• Loss available to common stockholders was $61.5 million, or $1.42 per share, compared to $36.2 million, or $0.85 per share.
• Adjusted EBITDA was negative $5.1 million, compared to a positive adjusted EBITDA of $13.6 million.

Fourth Quarter 2018 Results Conference Call
Management will host a conference call at 8:00 a.m. Pacific Time/11:00 a.m. Eastern Time on March 13, 2019. CEO Neil Koehler and CFO Bryon McGregor will deliver prepared remarks followed by a question and answer session.

The webcast for the call can be accessed from Pacific Ethanol's website at www.pacificethanol.com. Alternatively, you may dial the following number up to ten minutes prior to the scheduled conference call time: (877) 847-6066. International callers should dial 00-1 (970) 315-0267. The pass code will be 4839123. If you are unable to participate on the live call, the webcast will be archived for replay on Pacific Ethanol's website for one year. In addition, a telephonic replay will be available at 2:00 p.m. Eastern Time on Wednesday, March 13, 2019, through 11:00 a.m. Eastern Time on Wednesday, March 20, 2019. To access the replay, please dial (855) 859-2056. International callers should dial 00-1-(404) 537-3406. The pass code will be 4839123.

Use of Non-GAAP Measures
Management believes that certain financial measures not in accordance with generally accepted accounting principles ("GAAP") are useful measures of operations. The company defines Adjusted EBITDA as unaudited net income (loss) attributed to Pacific Ethanol before interest expense, provision (benefit) for income taxes, asset impairments, purchase accounting adjustments, fair value adjustments, and depreciation and amortization expense. A table is provided at the end of this release that provides a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure. Management provides this non-GAAP measure so that investors will have the same financial information that management uses, which may assist investors in properly assessing the company's performance on a period-over-period basis. Adjusted EBITDA is not a measure of financial performance under GAAP and should not be considered as an alternative to net income (loss) or any other measure of performance under GAAP, or to cash flows from operating, investing or financing activities as an indicator of cash flows or as a measure of liquidity. Adjusted EBITDA has limitations as an analytical tool and you should not consider this measure in isolation or as a substitute for analysis of the company's results as reported under GAAP.

About Pacific Ethanol, Inc.
Pacific Ethanol Inc. (PEIX) is a leading producer and marketer of low-carbon renewable fuels and high-quality alcohol products in the United States. Pacific Ethanol owns and operates nine production facilities, four in the Western states of California, Oregon and Idaho, and five in the Midwestern states of Illinois and Nebraska. The plants have a combined production capacity of 605 million gallons per year, produce over one million tons per year of ethanol co-products – on a dry matter basis – such as wet and dry distillers grains, wet and dry corn gluten feed, condensed distillers solubles, corn gluten meal, corn germ, corn oil, distillers yeast and CO2. Pacific Ethanol markets and distributes fuel-grade ethanol, high-quality alcohol products and co-products domestically and internationally. Pacific Ethanol’s subsidiary, Kinergy Marketing LLC, markets all ethanol and alcohol products for Pacific Ethanol’s plants as well as for third parties, approaching one billion gallons of ethanol marketed annually based on historical volumes. Pacific Ethanol’s subsidiary, Pacific Ag. Products LLC, markets wet and dry distillers grains. For more information please visit www.pacificethanol.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements and information contained in this communication that refer to or include Pacific Ethanol’s estimated or anticipated future results or other non-historical expressions of fact are forward-looking statements that reflect Pacific Ethanol’s current perspective of existing trends and information as of the date of the communication. Forward looking statements generally will be accompanied by words such as “anticipate,” “believe,” “plan,” “could,” “should,” “estimate,” “expect,” “forecast,” “outlook,” “guidance,” “intend,” “may,” “might,” “will,” “possible,” “potential,” “predict,” “project,” or other similar words, phrases or expressions. Such forward-looking statements include, but are not limited to, statements concerning future market fundamentals and conditions, including the supply of and domestic and international demand for ethanol and co-products; future margins; and Pacific Ethanol’s plans, objectives, expectations and intentions. It is important to note that Pacific Ethanol’s plans, objectives, expectations and intentions are not predictions of actual performance. Actual results may differ materially from Pacific Ethanol’s current expectations depending upon a number of factors affecting Pacific Ethanol’s business. These factors include, among others, adverse economic and market conditions, including for ethanol and its co-products and high-quality alcohols; export conditions and international demand for ethanol and co-products; fluctuations in the price of and demand for oil and gasoline; raw material costs, including ethanol production input costs, such as corn and natural gas. These factors also include, among others, the inherent uncertainty associated with financial and other projections; the anticipated size of the markets and continued demand for Pacific Ethanol’s products; the impact of competitive products and pricing; the risks and uncertainties normally incident to the ethanol production and marketing industries; changes in generally accepted accounting principles; successful compliance with governmental regulations applicable to Pacific Ethanol’s facilities, products and/or businesses; changes in laws, regulations and governmental policies; the loss of key senior management or staff; and other events, factors and risks previously and from time to time disclosed in Pacific Ethanol’s filings with the Securities and Exchange Commission including, specifically, those factors set forth in the “Risk Factors” section contained in Pacific Ethanol’s Form 10-Q filed with the Securities and Exchange Commission on November 2, 2018.

Pacific Ethanol Inc.
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