Pacific Ethanol : to present at the H.C. Wainwright Conference slides.

Pacific Ethanol, Inc. (NASDAQ: PEIX)

HC WAINWRIGHT 22ND GLOBAL INVESTMENT CONFERENCE

SEPTEMBER 14, 2020

Safe Harbor Statement

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 conditions, including the supply of and domestic and international demand for Pacific Ethanol's products; future margins, anticipated Adjusted EBITDA and other expected financial performance metrics; the expansion of high quality alcohol production capacity; 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 Pacific Ethanol's products; export conditions and international demand for Pacific Ethanol's products; fluctuations in the price of and demand for oil and gasoline; raw material costs, including production input costs, such as corn and natural gas; the continuing effects of the coronavirus pandemic on travel and related demand for transportation fuels; and the ability of Pacific Ethanol to timely and successfully execute on its strategic initiatives and comply with its debt covenants. 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 high‐quality alcohol and 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, including the outcome of litigation concerning small refinery exemptions; 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 Quarterly Report on Form 10‐Q filed with the Securities and Exchange Commission on August 13, 2020.

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Pacific Ethanol: Seizing Opportunity, Driving Ahead

Founding focus on renewable biofuel production and marketing, expanding to production of high‐quality alcohol, dried yeast, and low‐carbon biofuel products

• Board announced CEO transition in May, effective September 30, 2020
• Michael Kandris rising from 7 years as COO

Building upon position as high‐quality alcohols specialist in leveraging key differentiators, product capability and product quality, to drive higher and more consistent profit margins

• Confirmed a significant number of fixed‐price contracts for HQ alcohol

Refining go‐forward business strategy:

• Optimizing high value, differentiated assets
• Reducing corporate costs
• Repositioning, repurposing, rationalizing and/or monetizing Western assets in H2 2020

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Diversified Product Portfolio Drives Profitable Growth

Significant scale and superior logistical capabilities

• Maximizing high‐quality

Boardman, OR

40mmgy

Dry Mill

Burley, ID

60mmgy

Dry Mill

Stockton, CA

60mmgy

Dry Mill

Madera, CA

40mmgy

Dry Mill

HQ

Operational Plants

Idled Plants

Pekin, IL

100mmgy

Wet Mill

Pekin, IL

60mmgy

Dry Mill

(ICP) Pekin, IL

90mmgy

Dry Mill

alcohol and feed output at

Pekin campus

• Reinvesting in Pekin campus

to increase production of

USP grade alcohol

• Pekin dry mill idled for river

closures, expected to

restart in Q4

• Idled plants only opened

upon projected positive

forward operating margins

Source: Company Data

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Expanding Production of High‐Quality Alcohol

• 100+ years producing industrial, chemical and beverage grade alcohol at Pekin campus
• Significant increase in demand for products used in sanitizers and disinfectants due to COVID‐19
• • Higher demand expected to continue
  • Q2 annual production capacity of 85 million gallons expanding to 140 million gallons entering 2021
• Stringent quality control delivers products that continue to meet or exceed customer and regulatory standards
• Relationships deepening long‐standing ties with key domestic and international customers and establishing new affiliations with large, recognized names

5

Building Out High Value Feed and Food Business

Opportunity for increased production of yeast and corn gluten meal

Yeast

Corn Gluten Meal & Feed

Corn Germ

• 50M+ pounds annually
• Wet mill extracts, processes, dries and bags yeast
• AIB food grade and Kosher certified
• Sold for pet and human food, specialty animal feed applications

• 38k tons of corn gluten feed, 182k tons of corn gluten meal produced annually
• High protein feed sold for pet food, poultry and aquaculture markets
• High fiber, mid protein feed sold for cattle

• 70k tons annually
• Separated from the corn oil in wet milling process
• Sold to processors for production of oils and meal into human food markets

Source: Company data, historical volumes

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Financial Highlights

Q2'20 FINANCIAL HIGHLIGHTS

• Net sales of $212M
• Net income $14.6M
• Adjusted EBITDA* $28.8M
• Reduced total debt outstanding by $34.4M, including $25.5M in plant related debt

GUIDANCE

• 2H 2020 Adjusted EBITDA to range between $50M ‐ $70M
• Reduce total term debt outstanding at year end by at least $70 million

* A reconciling table for Q2 and 1H 2020 Adjusted EBITDA is available in the Appendix of this presentation
Guidance provided on Q2 2020 Conference Call on August 12, 2020	7

Revolving and Term Debt Snapshot

Q2 2020 $25.5M reduction in plant related debt

($ in thousands)

At: 06/30/20 03/31/20

Kinergy line of credit	$	41,441	$	60,182
Parent senior notes	$	65,782	$	65,782
CARES Act Loans	$	9,860		‐

Pekin term debt	$	26,000	$	39,500
Pekin Revolving debt	$	32,000	$	32,000
ICP Term debt		‐	$	12,000
ICP Revolving debt	$	18,000	$	18,000
Total plant related debt	$	76,000	$	101,500
Total debt	$	193,083	$	227, 464

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Investment Highlights

Established market leader with diversified product portfolio,

significant scale and superior logistical capabilities

Increasing emphasis on high‐quality alcohol and

expanding production capacity

Seasoned management team with proven operational expertise in

high‐quality alcohol, dried yeast, and low‐carbon renewable fuel products

Longstanding, established relationships with

blue‐chip client and vendor base

Growth investment opportunities in diversified product lines at existing facilities and new adjacent high return markets

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Thank You

Appendix

Seasoned Management Team

Pacific Ethanol is led by a management team rich in experience, knowledge and relationships

Mike Kandris	Neil Koehler	Bryon McGregor	Jim Sneed	Christopher Wright
Director & CEO	Co‐Founder, Director & CO‐CEO	CFO	Chief Commercial Officer	VP & General Counsel
• Brings 12+ years of	• Brings 30+ years of	• Brings 12+ years of	• Brings 20+ years of	• Brings 14+ years of
experience in the industry	experience in industry,	experience in the industry	experience in various	experience in the industry
• Brings 30+ years of general	particularly ethanol	• Brings 25+ years of	senior management and	• Brings 30+ years of
management, experience	production, sales and	treasury and finance	executive positions in the	experience in managing the
in the transportation and	marketing	experience	industry, particularly	legal affairs of growth
logistics industry	• Will retire on September	• Formerly Senior Director of	ethanol	companies
• Formerly President and	30th as Co‐CEO	Treasury for E*TRADE	• Formerly served as Vice	• Formerly served as Partner‐
COO of Ruan	• Formerly co‐founder and	Financial	President - Ethanol	in‐Charge of the Pacific
Transportation	general manager of Parallel	• Served as project finance	Marketing & Trading for	Northwest office of Cooley
Management Systems	Products and founder of	head for BP (formerly	Hawkeye Gold, LLC and as	Godward
• Served on the Executive	Kinergy Marketing	ARCO) and as a Director at	Vice President, Marketing	• Has acted as general
Committee of the	• Serves on the board of	Credit Suisse	& Logistics of Aventine	counsel for numerous
American Trucking	Renewable Fuels		Renewable Energy	technology enterprises in
Association board for the	Association and is its			all aspects of corporate
National Tank Truck	incoming Chairman			development
Organization
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Operating Results Summary

				Three Months Ended		Six Months Ended
	($ in thousands, except per share amounts)				June 30	2019			June 30	2019
				2020				2020
	Net sales	$	212,074	$	346,301	$	523,478	$	702,104
	Cost of goods sold			180,892			342,330		505,186		700,422
	Gross profit			31,182			3,971			18,292		1,682
	Selling, general and administrative expenses				8,629				6,708		18,841		14,943
	Income (loss) from operations			22,553			(2,737)			(549)		(13,261)
	Interest expense, net			(4,647)			(5,115)			(9,954)		(9,851)
	Fair value adjustments			(1,314)						‐		(641)			‐
	Other income (expense), net			(1,738)				(438)			(1,158)		661
	Income (loss) before benefit for income taxes			14,854			(8,290)			(12,302)		(22,451)
	Benefit for income taxes				‐						‐		‐			‐
	Consolidated net income (loss)			14,854			(8,290)		(12,302)		(22,451)
	Net loss attributed to noncontrolling interests				110				644		2,166		1,915
	Net income (loss) attributed to Pacific Ethanol, Inc.	$		14,964	$	(7,646)		$	(10,136)	$	(20,536)
	Preferred stock dividends	$	(315)	$	(315)			$ (630)		$ (627)
	Income (loss) available to common stockholders	$	14,649	$	(7,961)		$	(10,766)	$	(21,163)
	Net income (loss) per share, basic and diluted	$	0.27	$	(0.17)			$ (0.20)		$ (0.45)
	Weighted‐average shares outstanding, basic and diluted			54,498			47,771		54,163		46,651
	Adjusted EBITDA*	$	28,842	$	7,243	$	16,492	$	8,795
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	* A reconciling table for Adjusted EBITDA is available in the Appendix of this presentation
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Balance Sheet Summary

($ in thousands)

At: 06/30/20 12/31/19

Cash & cash equivalents	$	29,783	$	18,997
Current assets		131,790		232,064
Total assets		497,129		612,495
Current liabilities		146,954		160,398
Total liabilities		286,388		385,450
Stockholders' equity		210,741		227,045
Total liabilities & stockholders' equity	$	497,129	$	612,495

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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, Inc. before interest expense, provision (benefit) for income taxes, asset impairments, loss on extinguishment of debt, 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, net income (loss) attributed to Pacific Ethanol, Inc. 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) attributed to Pacific Ethanol, Inc. 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.

Information reconciling forward-looking Adjusted EBITDA to forward-looking net income (loss) attributed to Pacific Ethanol, Inc. would require a forward-looking statement of net income (loss) attributed to Pacific Ethanol, Inc. prepared in accordance with GAAP, which is unavailable to the company without unreasonable effort. The company is not able to provide a quantitative reconciliation of forward- looking Adjusted EBITDA to forward-looking net income (loss) attributed to Pacific Ethanol, Inc. because certain items required for reconciliation are uncertain, outside of the company's control and/or cannot be reasonably predicted, such as fair value adjustments, asset impairments, if any, and provision (benefit) for income taxes, which the company views as the most material components of net income (loss) attributed to Pacific Ethanol, Inc. that are not presently estimable.

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Adjusted EBITDA Reconciliation

			3 Mos.		3 Mos.		6 Mos.		6 Mos.
			6/30/20			6/30/19			6/30/20		6/30/19
(Figures below in thousands)
Net income (loss) attributed to Pacific Ethanol, Inc.	$	14,964	$	(7,646)		$	(10,136)	$	(20,536)
Adjustments:			(172)			‐		(172)		‐
Interest income
Interest expense*			4,647			5,115			9,954		9,851
Fair value adjustments			1,314			‐		641		‐
Depreciation and amortization expense*			8,089		9,774		16,205		19,480
Total adjustments			13,878			14,889		26,628		29,331
Adjusted EBITDA	$		28,842	$	7,243	$	16,492	$	8,795

* Adjusted for noncontrolling interest.

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