BioFuel Energy posts Q2 profit, shares surge

(Reuters) - Ethanol producer BioFuel Energy Corp (BIOF.O) reported a quarterly profit, helped by a gain on derivatives, sending its shares up more than 47 percent during morning trade.

The company, which went public in April 2007, reported second-quarter net income of $948,000, or 3 cents a share, while analysts on average were expecting a loss, before special items, of 11 cents a share, according to Reuters Estimates.

The company reported revenue of $292,000 that was way below consensus estimates of $19.5 million.

Results included an unrealized gain of $10.1 million on derivatives, the company said.

On Tuesday, BioFuel shares lost more than half their value, after the company said it did not have enough liquidity to meet huge hedging losses of $26.1 million.

BioFuel said it had realized these losses due to closing out various corn, ethanol and natural gas hedges with Cargill Inc CARG.UL, a U.S. agribusiness giant.

Based on current commodity prices, the company said it also lost an additional $19.9 million in mark-to-market hedging agreements and sees possible margin calls and additional losses in the future.

Shares of the Denver, Colorado-based company were trading up 33 cents at $1.26 in midday session Wednesday on Nasdaq.

(Reporting by Shradhha Sharma in Bangalore; Editing by Anil D'Silva)