Local Bounti Announces Second Quarter 2024 Financial Results
Recently began shipping to
Negotiating an additional
Reiterates full year 2024 sales guidance of
"We celebrated a significant milestone for
Second Quarter 2024 Financial Summary
- Sales increased 31% to
$9.4 million in the second quarter of 2024, as compared to$7.2 million in the prior year period. The increase was primarily due to increased production and growth in sales from the Company's facility inGeorgia , and to a lesser degree, the partial quarter contribution from the Company'sWashington andTexas facilities. Growth was partially offset by downtime at itsMontana facility associated with the Company's transition to commercial operations. - Gross profit was
$1.4 million in the second quarter of 2024. Adjusted gross margin percentage1 was approximately 29% excluding depreciation and stock-based compensation. Adjusted gross margin performance was driven by costs associated with the ongoing optimization and scaling up of the Company's facilities. The Company expects that, over time, its adjusted gross margin will increase as a percentage of sales, as a result of the continued scaling of the business and initiatives to optimize production costs. - Selling, general, and administrative expenses decreased by
$6.0 million to$10.7 million in the second quarter of 2024, as compared to$16.7 million in the prior year period, driven primarily by cost saving actions the Company took in the fourth quarter of 2023 and the first quarter of 2024 to streamline its organizational structure, as well as lower stock-based compensation expense. The Company expects to continue to benefit from its lower cost base through the end of 2024. - Operating loss improved
$5.5 million versus the prior year period to$13.9 million , as compared to a loss of$19.4 million in the second quarter of 2023. - Net loss was
$25.3 million in the second quarter of 2024 as compared to net loss of$10.7 million for the prior year period; net loss in the second quarter of 2023 included a$15.2 million benefit associated with a non-cash mark-to-market change in fair value of a warrant liability. - Adjusted EBITDA1 loss improved to
$7.5 million , as compared to a loss of$8.3 million in the prior year period. Second quarter 2024 adjusted EBITDA excludes$1.6 million in stock-based compensation,$12.5 million in interest expense,$3.9 million of depreciation and amortization,$1.1 million gain on change in fair value of warrant liability, and$0.8 million of strategic transaction due diligence and integration related costs.
1See reconciliation of the non-GAAP measures at the end of this press release.
Commercial Facility Expansion Update
Now Shipping Product from
The Company commenced operations at both its
Capacity Expansion Project Update
Plans remain underway to build additional capacity across the Company's network of facilities enabled with its Stack & Flow Technology. The planned expansions are designed to provide additional capacity and allow for the Company's growing product assortment to meet existing demand from
The transition of the Company's
In the second quarter, the Company expanded its distribution with
Starting in the second quarter of 2024,
The Company is set to expand its product assortment in the third quarter of 2024 by introducing several high-velocity offerings including Arugula, Spring Mix & Spinach Blend, Power Greens, and Basil.
Capital Structure
The Company ended with cash and cash equivalents and restricted cash of
As of
The Company continues to pursue opportunities to lower its cost of capital and replace its construction financing, including sale leaseback transactions and its work with a licensed
Financial Outlook
Management is reiterating its full year 2024 sales guidance of
The Company believes that it has access to capital to fund its operations, complete the construction of its ongoing projects, and reach positive adjusted EBITDA in early 2025. This includes cash on the balance sheet and construction financing arrangements.
Conference Call
The Company will host a conference call with members of the
In addition, the call will be broadcast live via webcast, hosted at the "Investors" section of the Company's website at localbounti.com and will be archived online.
About
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify these forward-looking statements by the use of terms such as "expect," "will," "continue," "believe," "anticipate," "estimate," "project," "intend," "should," "is to be," or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to statements regarding funding pursuant to the CCLs; shipments at the
Non-GAAP Financial Information
This press release contains references to adjusted EBITDA, adjusted gross profit, adjusted gross margin percentage and adjusted selling, general and administrative expense, which are adjusted from results based on generally accepted accounting principles in
These non-GAAP financial measures are provided to enhance the user's understanding of the Company's prospects for the future and the historical performance for the context of the investor. The Company's management team uses these non-GAAP financial measures in assessing performance, as well as in planning and forecasting future periods. These non-GAAP financial measures are not computed according to GAAP and the methods the Company uses to compute them may differ from the methods used by other companies. Non-GAAP financial measures are supplemental, should not be considered a substitute for, or superior to, financial information presented in accordance with GAAP and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.
Refer to the attached financial supplement for a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures for the quarter ended
CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) |
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|
2024 |
|
2023 |
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ 9,685 |
|
$ 10,326 |
Restricted cash |
6,489 |
|
6,569 |
Accounts receivable, net |
2,501 |
|
3,078 |
Inventory, net |
5,474 |
|
4,210 |
Prepaid expenses and other current assets |
2,618 |
|
2,805 |
Total current assets |
26,767 |
|
26,988 |
Property and equipment, net |
368,261 |
|
313,166 |
Finance lease right-of-use assets |
308 |
|
— |
Operating lease right-of-use assets |
137 |
|
172 |
Intangible assets, net |
39,568 |
|
41,353 |
Other assets |
3,058 |
|
73 |
Total assets |
$ 438,099 |
|
$ 381,752 |
|
|
|
|
Liabilities and stockholders' equity |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
$ 13,744 |
|
$ 14,640 |
Accrued liabilities |
22,817 |
|
17,204 |
Short-term debt |
6,734 |
|
— |
Financing obligation |
33 |
|
— |
Operating lease liabilities |
77 |
|
97 |
Finance lease liabilities |
81 |
|
— |
Total current liabilities |
43,486 |
|
31,941 |
Long-term debt, net of debt issuance costs |
367,294 |
|
277,985 |
Financing obligation, noncurrent |
49,555 |
|
49,225 |
Operating lease liabilities, noncurrent |
76 |
|
114 |
Finance lease liabilities, noncurrent |
229 |
|
— |
Warrant liability |
10,298 |
|
7,214 |
Total liabilities |
470,938 |
|
366,479 |
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
Stockholders' (deficit) equity |
|
|
|
Common stock, 0.0001 par value, 400,000,000 shares authorized,
8,574,249 and 8,311,237 issued and outstanding as of
|
1 |
|
1 |
Additional paid-in capital |
319,805 |
|
318,600 |
Accumulated deficit |
(352,645) |
|
(303,328) |
Total stockholders' (deficit) equity |
(32,839) |
|
15,273 |
Total liabilities and stockholders' (deficit) equity |
$ 438,099 |
|
$ 381,752 |
CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) |
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Three Months Ended
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Six Months Ended
|
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
Sales |
$ 9,443 |
|
$ 7,183 |
|
$ 17,826 |
|
$ 13,881 |
Cost of goods sold(1)(2) |
8,092 |
|
6,331 |
|
15,689 |
|
12,750 |
Gross profit |
1,351 |
|
852 |
|
2,137 |
|
1,131 |
Operating expenses: |
|
|
|
|
|
|
|
Research and development(1)(2) |
4,519 |
|
3,526 |
|
8,006 |
|
7,102 |
Selling, general and administrative(1)(2) |
10,696 |
|
16,704 |
|
18,294 |
|
32,685 |
Total operating expenses |
15,215 |
|
20,230 |
|
26,300 |
|
39,787 |
Loss from operations |
(13,864) |
|
(19,378) |
|
(24,163) |
|
(38,656) |
Other income (expense): |
|
|
|
|
|
|
|
Change in fair value of warrant liability |
1,096 |
|
15,151 |
|
(3,084) |
|
15,151 |
Interest expense, net |
(12,500) |
|
(6,472) |
|
(22,108) |
|
(10,771) |
Other income |
1 |
|
23 |
|
38 |
|
73 |
Net loss |
$ (25,267) |
|
$ (10,676) |
|
$ (49,317) |
|
$ (34,203) |
|
|
|
|
|
|
|
|
Net loss applicable to common stockholders per common share: |
|
|
|
|
|
|
|
Basic and diluted |
$ (3.00) |
|
$ (1.35) |
|
$ (5.89) |
|
$ (4.37) |
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
Basic and diluted |
8,411,226 |
|
7,930,371 |
|
8,368,596 |
|
7,829,673 |
(1) Amounts include stock-based compensation as follows: |
|
Three Months Ended
|
|
Six Months Ended
|
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
Cost of goods sold |
$ 39 |
|
$ (11) |
|
$ 60 |
|
$ 76 |
Research and development |
71 |
|
595 |
|
164 |
|
1,333 |
Selling, general and administrative |
1,538 |
|
3,850 |
|
490 |
|
8,984 |
Total stock-based compensation expense, net of amounts capitalized |
$ 1,648 |
|
$ 4,434 |
|
$ 714 |
|
$ 10,393 |
(2) Amounts include depreciation and amortization as follows: |
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Cost of goods sold |
$ 1,352 |
|
$ 894 |
|
$ 2,555 |
|
$ 1,830 |
Research and development |
1,382 |
|
466 |
|
2,179 |
|
1,032 |
Selling, general and administrative |
1,155 |
|
1,956 |
|
2,383 |
|
3,912 |
Total depreciation and amortization |
$ 3,889 |
|
$ 3,316 |
|
$ 7,117 |
|
$ 6,774 |
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION (in thousands) |
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RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS MARGIN PERCENTAGE |
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|
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Three Months Ended
|
|
Six Months Ended
|
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
Sales |
$ 9,443 |
|
$ 7,183 |
|
$ 17,826 |
|
$ 13,881 |
Cost of goods sold |
8,092 |
|
6,331 |
|
15,689 |
|
12,750 |
Gross profit |
1,351 |
|
852 |
|
2,137 |
|
1,131 |
Depreciation |
1,352 |
|
894 |
|
2,555 |
|
1,830 |
Stock-based compensation |
39 |
|
(11) |
|
60 |
|
76 |
Utilities price spike and inclement weather related costs |
— |
|
— |
|
— |
|
727 |
Acquisition related integration costs |
— |
|
266 |
|
— |
|
423 |
Adjusted gross profit |
$ 2,742 |
|
$ 2,001 |
|
$ 4,752 |
|
$ 4,187 |
Adjusted gross margin % |
29 % |
|
28 % |
|
27 % |
|
30 % |
RECONCILIATION OF SELLING, GENERAL AND ADMINISTRATIVE EXPENSE TO ADJUSTED SELLING, GENERAL AND ADMINISTRATIVE EXPENSE |
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Three Months Ended
|
|
Six Months Ended
|
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
Selling, general and administrative |
$ 10,696 |
|
$ 16,704 |
|
$ 18,294 |
|
$ 32,685 |
Stock-based compensation |
(1,538) |
|
(3,850) |
|
(490) |
|
(8,984) |
Depreciation and amortization |
(1,155) |
|
(1,956) |
|
(2,383) |
|
(3,912) |
Business acquisition and strategic transaction due diligence and integration related costs |
(783) |
|
(2,364) |
|
(1,625) |
|
(3,916) |
Restructuring and business realignment costs |
(9) |
|
(724) |
|
(298) |
|
(724) |
Adjusted selling, general and administrative |
$ 7,211 |
|
$ 7,810 |
|
$ 13,498 |
|
$ 15,149 |
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION (in thousands) |
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RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA |
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|
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|
Three Months Ended
|
|
Six Months Ended
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Net loss |
$ (25,267) |
|
$ (10,676) |
|
$ (49,317) |
|
$ (34,203) |
Stock-based compensation expense |
1,648 |
|
4,434 |
|
714 |
|
10,393 |
Interest expense, net |
12,500 |
|
6,472 |
|
22,108 |
|
10,771 |
Depreciation and amortization |
3,889 |
|
3,316 |
|
7,117 |
|
6,774 |
Utilities price spike and inclement weather related costs |
— |
|
— |
|
— |
|
727 |
Business acquisition and strategic transaction due diligence and integration related costs |
783 |
|
2,630 |
|
1,625 |
|
4,339 |
Restructuring and business realignment costs |
9 |
|
724 |
|
298 |
|
724 |
Change in fair value of warrant liability |
(1,096) |
|
(15,151) |
|
3,084 |
|
(15,151) |
Other income |
(1) |
|
(23) |
|
(38) |
|
(73) |
Adjusted EBITDA |
$ (7,535) |
|
$ (8,274) |
|
$ (14,409) |
|
$ (15,699) |
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