LSF - Laird Superfood Reports Second Quarter 2023 Financial Results
Gross margin improved by 610 basis points and cash burn was a record low of $1.4 million
Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood,” “we” and “our”), today reported financial results for its second quarter ended June 30, 2023.
Second Quarter 2023 Highlights
- Net sales of $7.7 million compared to $8.1 million in the prior quarter, and $8.7 million in the prior year period.
- Wholesale contributed 46% of total Net sales and increased 2.6% year-over-year, driven by distribution gains in the Retail channel, pricing, as well as velocity improvements behind new packaging and the re-branding campaign launched earlier this year.
- E-commerce contributed 54% of total Net sales and decreased 20.1% year-over-year reflecting Amazon sales compression due to inventory out of stocks related to the previously discussed product quality issue experienced in Q1. We expect this out-of-stock issue to be fully resolved in the third quarter. Direct-to-consumer (“DTC”) revenues declined behind a strategic, planned reduction in Marketing spend, reflecting a 67% decrease in working media. This was offset by an increase in our subscription base which grew 10% sequentially and 21% compared to the prior year period.
- Gross margin was 24.3%, compared to 23.1% in the first quarter of 2023 and 18.2% in the prior year period. This 610 basis point margin expansion was driven by the transition to a variable cost third-party co-manufacturing business model, but was offset by incremental Trade spend intended to drive growth in Retail, specifically around innovation expansion, awareness, and trial.
- Net loss was $3.5 million, or $0.38 per diluted share compared to Net loss of $4.1 million, or $0.45 per diluted share, in the first quarter of 2023 and Net loss of $4.9 million, or $0.54 per diluted share, in the prior year period. The improvement is driven by Gross margin expansion, lower Marketing and general and administrative spend.
- Adjusted net loss, which is a non-GAAP financial measure, was $3.3 million, or $0.36 per diluted share in the second quarter of 2023 compared to $3.7 million, or $0.40 per diluted share in the first quarter of 2023 and $6.2 million, or $0.68 per diluted share in the prior year period. This sequential and prior year improvement was driven by significantly expanded Gross margins and lower Marketing and G&A spend. For more details on non-GAAP financial measures, refer to the information in the Non-GAAP financial measures section of this press release.
Jason Vieth, Chief Executive Officer, commented , "I am happy to share that we continued to make strong progress against our strategic initiatives and toward breakeven profitability during Q2. As expected, our transition to an outsourced manufacturing and distribution model has already yielded strong improvements in our Cost of Goods Sold, which fell by 18 points year-over-year as we fully overcame the raw material challenge that we had reported during the first quarter results. For the quarter, Gross Margin rose again, beating our Q1 2023 result by 120 basis points, and improving 6.1 points vs. the same period one year ago. This improvement in Gross Margin would have been even stronger in Q2, except for the investments that we have made in Trade Promotion to drive incremental awareness and trial in Retail stores."
"While the overall market remains challenging, we are confident that our strategy to grow the Wholesale channel while significantly reducing our Marketing spend is already bearing fruit, as demonstrated in the 29% year-over-year improvement in our Net Loss during Q2. We expect to make further progress on that strategy in the second half of 2023, as we seek to further refine and target our Marketing spend and ensure support of our bricks and mortar distribution. Consumer affiliation for the Laird Superfood brand and product portfolio remains extremely high, and we are as excited as ever for the long-term prospects of this brand and business."
Anya Hamill, Chief Financial Officer, commented, "In the second quarter, we continued to build on the success we achieved in the first quarter from strategic actions implemented last year. For the second quarter in a row, Adjusted gross margin was in the mid-twenties with Q2 Gross margin reaching 24.3%, a 610 basis point improvement versus same period last year. I expect margin expansion to ramp up even more in the back half of the year as we see the full benefit of the Supply Chain transformation and as other planned margin driving initiatives take hold. Additionally, our $1.4 million cash burn was a record low in Q2, driven by improved operational performance, and lower SG&A spend and working capital. Our Q2 SG&A was $1.3 million lower than the same quarter last year on an adjusted basis, demonstrating progress we made in managing costs."
"Despite the progress made improving the middle of our P&L, we had higher promotional spend in Q2 as we increased support of our Wholesale channel distribution as well as inventory out-of-stocks that impacted our Amazon performance. We expect to resolve these issues during Q3, but are updating our guidance to reflect Net sales in the range of $34 – 37 million and Gross margin of 27 – 29% for full year 2023, with second half Gross margin exceeding 30%, excluding any one-time extraordinary costs."
|
|
|
|
| Three Months Ended June 30, |
|
|
|
|
| 2023 |
|
|
| 2022 |
|
|
|
|
| $ |
|
|
| % of Total |
|
|
| $ |
|
|
| % of Total |
| Coffee creamers |
|
|
| $ |
| 4,636,807 |
|
|
|
|
|
|
| 60 |
| % |
|
|
| $ |
| 4,694,975 |
|
|
|
|
|
|
| 54 |
| % |
| Hydration and beverage enhancing supplements |
|
|
|
|
| 998,309 |
|
|
|
|
|
|
| 13 |
| % |
|
|
|
|
| 1,296,779 |
|
|
|
|
|
|
| 15 |
| % |
| Harvest snacks and other food items |
|
|
|
|
| 1,845,016 |
|
|
|
|
|
|
| 24 |
| % |
|
|
|
|
| 1,713,441 |
|
|
|
|
|
|
| 20 |
| % |
| Coffee, tea, and hot chocolate products |
|
|
|
|
| 1,973,437 |
|
|
|
|
|
|
| 26 |
| % |
|
|
|
|
| 1,568,142 |
|
|
|
|
|
|
| 18 |
| % |
| Other |
|
|
|
|
| 124,952 |
|
|
|
|
|
|
| 2 |
| % |
|
|
|
|
| 419,390 |
|
|
|
|
|
|
| 5 |
| % |
| Gross sales |
|
|
|
|
| 9,578,521 |
|
|
|
|
|
|
| 125 |
| % |
|
|
|
|
| 9,692,727 |
|
|
|
|
|
|
| 112 |
| % |
| Shipping income |
|
|
|
|
| 259,843 |
|
|
|
|
|
|
| 2 |
| % |
|
|
|
|
| 291,410 |
|
|
|
|
|
|
| 3 |
| % |
| Returns and discounts |
|
|
|
|
| (2,114,273 |
| ) |
|
|
|
|
| (27 |
| )% |
|
|
|
|
| (1,310,131 |
| ) |
|
|
|
|
| (15 |
| )% |
| Sales, net |
|
|
| $ |
| 7,724,091 |
|
|
|
|
|
|
| 100 |
| % |
|
|
| $ |
| 8,674,006 |
|
|
|
|
|
|
| 100 |
| % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| E-commerce |
|
|
|
|
| 4,139,373 |
|
|
|
|
|
|
| 54 |
| % |
|
|
|
|
| 5,178,819 |
|
|
|
|
|
|
| 60 |
| % |
| Wholesale |
|
|
|
|
| 3,584,718 |
|
|
|
|
|
|
| 46 |
| % |
|
|
|
|
| 3,495,187 |
|
|
|
|
|
|
| 40 |
| % |
| Sales, net |
|
|
| $ |
| 7,724,091 |
|
|
|
|
|
|
| 100 |
| % |
|
|
| $ |
| 8,674,006 |
|
|
|
|
|
|
| 100 |
| % |
|
|
|
|
| Six Months Ended June 30, |
|
|
|
|
| 2023 |
|
|
| 2022 |
|
|
|
|
| $ |
|
|
| % of Total |
|
|
| $ |
|
|
| % of Total |
| Coffee creamers |
|
|
| $ |
| 9,754,167 |
|
|
|
|
|
|
| 62 |
| % |
|
|
| $ |
| 10,149,382 |
|
|
|
|
|
|
| 56 |
| % |
| Hydration and beverage enhancing supplements |
|
|
|
|
| 1,669,159 |
|
|
|
|
|
|
| 11 |
| % |
|
|
|
|
| 2,754,210 |
|
|
|
|
|
|
| 15 |
| % |
| Harvest snacks and other food items |
|
|
|
|
| 3,598,042 |
|
|
|
|
|
|
| 23 |
| % |
|
|
|
|
| 3,400,232 |
|
|
|
|
|
|
| 19 |
| % |
| Coffee, tea, and hot chocolate products |
|
|
|
|
| 3,942,732 |
|
|
|
|
|
|
| 25 |
| % |
|
|
|
|
| 3,384,327 |
|
|
|
|
|
|
| 19 |
| % |
| Other |
|
|
|
|
| 154,681 |
|
|
|
|
|
|
| 1 |
| % |
|
|
|
|
| 657,713 |
|
|
|
|
|
|
| 4 |
| % |
| Gross sales |
|
|
|
|
| 19,118,781 |
|
|
|
|
|
|
| 122 |
| % |
|
|
|
|
| 20,345,864 |
|
|
|
|
|
|
| 113 |
| % |
| Shipping income |
|
|
|
|
| 563,069 |
|
|
|
|
|
|
| 2 |
| % |
|
|
|
|
| 539,602 |
|
|
|
|
|
|
| 3 |
| % |
| Returns and discounts |
|
|
|
|
| (3,844,821 |
| ) |
|
|
|
|
| (24 |
| )% |
|
|
|
|
| (2,871,447 |
| ) |
|
|
|
|
| (16 |
| )% |
| Sales, net |
|
|
| $ |
| 15,837,029 |
|
|
|
|
|
|
| 100 |
| % |
|
|
| $ |
| 18,014,019 |
|
|
|
|
|
|
| 100 |
| % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| E-commerce |
|
|
|
|
| 8,567,054 |
|
|
|
|
|
|
| 54 |
| % |
|
|
|
|
| 10,602,770 |
|
|
|
|
|
|
| 59 |
| % |
| Wholesale |
|
|
|
|
| 7,269,975 |
|
|
|
|
|
|
| 46 |
| % |
|
|
|
|
| 7,411,249 |
|
|
|
|
|
|
| 41 |
| % |
| Sales, net |
|
|
| $ |
| 15,837,029 |
|
|
|
|
|
|
| 100 |
| % |
|
|
| $ |
| 18,014,019 |
|
|
|
|
|
|
| 100 |
| % |
Balance Sheet and Cash Flow Highlights
The Company had $10.6 million of Cash, cash equivalents, and restricted cash as of June 30, 2023, and no outstanding debt.
Net cash used in operating activities was $1.4 million for the second quarter of 2023, compared to $6.1 million in the first quarter of 2023, and $3.9 million in the prior year period. Cash burn in the second quarter of 2023 was less than half of normalized quarterly cash used in operations in 2022. The reduction in cash burn was driven by the realization of the operating efficiencies gained from the transition to the variable cost co-manufacturing model and the related reductions in overhead and administrative costs. Cash used in operating activities in the first quarter of 2023 was elevated due to Sisters exit costs.
2023 Outlook
We are updating our guidance for the full year of 2023 to reflect recent results, management’s revised near-term outlook, and the current economic environment. Net sales for 2023 are now expected to be in the range of $34 million to $37 million compared to our previous guidance of $37 million to $39 million and Gross margin in the range of 27% to 29% excluding any one-time extraordinary costs as compared to previous guidance of full year Gross margin in excess of 30% .
Conference Call and Webcast Details
The Company will host a conference call and webcast at 5:00 p.m. ET today to discuss results. Participants may access the live webcast on the Laird Superfood Investor Relations website at https://investors.lairdsuperfood.com under “Events”.
About Laird Superfood
Laird Superfood, Inc. creates award-winning, plant-based superfood products that are both delicious and functional. The Company's products are designed to enhance your daily ritual and keep consumers fueled naturally throughout the day. The Company was co-founded in 2015 by the world's most prolific big-wave surfer, Laird Hamilton. Laird Superfood's offerings are environmentally conscientious, responsibly tested and made with real ingredients. Shop all products online at lairdsuperfood.com and join the Laird Superfood community on social media for the latest news and daily doses of inspiration.
Forward-Looking Statements
This press release and the conference call referencing this press release contain “forward-looking” statements, as that term is defined under the federal securities laws, including but not limited to statements regarding Laird Superfood’s future financial performance and growth. These forward-looking statements are based on Laird Superfood’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause Laird Superfood’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. We expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
The risks and uncertainties referred to above include, but are not limited to: (1) the effects of global outbreaks of pandemics or contagious diseases or fear of such outbreaks, including on our supply chain, the demand for our products, and on overall economic conditions and consumer confidence and spending levels; (2) volatility regarding our revenue, expenses, including shipping expenses, and other operating results; (3) our ability to acquire new direct and wholesale customers and successfully retain existing customers; (4) our ability to attract and retain our suppliers, distributors and co-manufacturers, and effectively manage their costs and performance; (5) effects of real or perceived quality or health issues with our products or other issues that adversely affect our brand and reputation; (6) our ability to innovate on a timely and cost-effective basis, predict changes in consumer preferences and develop successful new products, or updates to existing products, and develop innovative Marketing strategies; (7) adverse developments regarding prices and availability of raw materials and other inputs, a substantial amount of which come from a limited number of suppliers outside the United States, including in areas which may be adversely affected by climate change; (8) effects of changes in the tastes and preferences of our consumers and consumer preferences for natural and organic food products; (9) the financial condition of, and our relationships with, our suppliers, co-manufacturers, distributors, retailers and food service customers, as well as the health of the food service industry generally; (10) the ability of ourselves, our suppliers and co-manufacturers to comply with food safety, environmental or other laws or regulations; (11) our plans for future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements; (12) the costs and success of our Marketing efforts, and our ability to promote our brand; (13) our reliance on our executive team and other key personnel and our ability to identify, recruit and retain skilled and general working personnel; (14) our ability to effectively manage our growth; (15) our ability to compete effectively with existing competitors and new market entrants; (16) the impact of adverse economic conditions; and (17) the growth rates of the markets in which we compete.
| LAIRD SUPERFOOD, INC. |
| UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS |
| (Unaudited) |
|
|
|
|
| Three Months Ended |
|
|
| Six Months Ended |
|
|
|
|
| 2023 |
|
|
|
|
| 2022 |
|
|
|
|
| 2023 |
|
|
|
|
| 2022 |
|
|
| Sales, net |
|
|
| $ |
| 7,724,091 |
|
|
|
|
| $ |
| 8,674,006 |
|
|
|
|
| $ |
| 15,837,029 |
|
|
|
|
| $ |
| 18,014,019 |
|
|
| Cost of goods sold |
|
|
|
|
| (5,848,023 |
| ) |
|
|
|
|
| (7,096,068 |
| ) |
|
|
|
|
| (12,087,085 |
| ) |
|
|
|
|
| (14,486,271 |
| ) |
| Gross profit |
|
|
|
|
| 1,876,068 |
|
|
|
|
|
|
| 1,577,938 |
|
|
|
|
|
|
| 3,749,944 |
|
|
|
|
|
|
| 3,527,748 |
|
|
| General and administrative |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Impairment of goodwill and long-lived assets |
|
|
|
|
| — |
|
|
|
|
|
|
| 100,426 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
| 8,126,426 |
|
|
| Other expense |
|
|
|
|
| 2,616,177 |
|
|
|
|
|
|
| 2,535,099 |
|
|
|
|
|
|
| 5,614,621 |
|
|
|
|
|
|
| 6,337,743 |
|
|
| Total general and administrative expenses |
|
|
|
|
| 2,616,177 |
|
|
|
|
|
|
| 2,635,525 |
|
|
|
|
|
|
| 5,614,621 |
|
|
|
|
|
|
| 14,464,169 |
|
|
| Research and product development |
|
|
|
|
| 82,324 |
|
|
|
|
|
|
| 116,467 |
|
|
|
|
|
|
| 166,190 |
|
|
|
|
|
|
| 220,300 |
|
|
| Sales and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Advertising |
|
|
|
|
| 1,155,789 |
|
|
|
|
|
|
| 1,567,465 |
|
|
|
|
|
|
| 2,316,997 |
|
|
|
|
|
|
| 3,359,202 |
|
|
| Related party marketing agreements |
|
|
|
|
| 125,198 |
|
|
|
|
|
|
| 22,750 |
|
|
|
|
|
|
| 264,525 |
|
|
|
|
|
|
| 33,250 |
|
|
| Other expense |
|
|
|
|
| 1,552,185 |
|
|
|
|
|
|
| 2,162,787 |
|
|
|
|
|
|
| 3,345,698 |
|
|
|
|
|
|
| 4,332,190 |
|
|
| Total sales and marketing expenses |
|
|
|
|
| 2,833,172 |
|
|
|
|
|
|
| 3,753,002 |
|
|
|
|
|
|
| 5,927,220 |
|
|
|
|
|
|
| 7,724,642 |
|
|
| Total operating expenses |
|
|
|
|
| 5,531,673 |
|
|
|
|
|
|
| 6,504,994 |
|
|
|
|
|
|
| 11,708,031 |
|
|
|
|
|
|
| 22,409,111 |
|
|
| Operating loss |
|
|
|
|
| (3,655,605 |
| ) |
|
|
|
|
| (4,927,056 |
| ) |
|
|
|
|
| (7,958,087 |
| ) |
|
|
|
|
| (18,881,363 |
| ) |
| Other income (expense) |
|
|
|
|
| 149,109 |
|
|
|
|
|
|
| 22,536 |
|
|
|
|
|
|
| 320,103 |
|
|
|
|
|
|
| (156,785 |
| ) |
| Loss before income taxes |
|
|
|
|
| (3,506,496 |
| ) |
|
|
|
|
| (4,904,520 |
| ) |
|
|
|
|
| (7,637,984 |
| ) |
|
|
|
|
| (19,038,148 |
| ) |
| Income tax expense |
|
|
|
|
| (750 |
| ) |
|
|
|
|
| — |
|
|
|
|
|
|
| (13,172 |
| ) |
|
|
|
|
| (5,774 |
| ) |
| Net loss |
|
|
| $ |
| (3,507,246 |
| ) |
|
|
| $ |
| (4,904,520 |
| ) |
|
|
| $ |
| (7,651,156 |
| ) |
|
|
| $ |
| (19,043,922 |
| ) |
| Net loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
| $ |
| (0.38 |
| ) |
|
|
| $ |
| (0.54 |
| ) |
|
|
| $ |
| (0.83 |
| ) |
|
|
| $ |
| (2.09 |
| ) |
| Diluted |
|
|
| $ |
| (0.38 |
| ) |
|
|
| $ |
| (0.54 |
| ) |
|
|
| $ |
| (0.83 |
| ) |
|
|
| $ |
| (2.09 |
| ) |
| Weighted-average shares of common stock outstanding used in computing net loss per share of common stock, basic and diluted |
|
|
|
|
| 9,284,585 |
|
|
|
|
|
|
| 9,132,632 |
|
|
|
|
|
|
| 9,249,738 |
|
|
|
|
|
|
| 9,114,527 |
|
|
| LAIRD SUPERFOOD, INC. |
| UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS |
| (Unaudited) |
|
|
|
|
| Six Months Ended June 30, |
|
|
|
|
| 2023 |
|
|
|
|
| 2022 |
|
|
| Cash flows from operating activities |
|
|
|
|
|
|
|
|
| Net loss |
|
|
| $ |
| (7,651,156 |
| ) |
|
|
| $ |
| (19,043,922 |
| ) |
| Adjustments to reconcile net loss to net cash from operating activities: |
|
|
|
|
|
|
|
|
| Depreciation and amortization |
|
|
|
|
| 163,532 |
|
|
|
|
|
|
| 574,361 |
|
|
| Provision for inventory obsolescence |
|
|
|
|
| 627,742 |
|
|
|
|
|
|
| 140,075 |
|
|
| Impairment of goodwill and other long-lived assets |
|
|
|
|
| — |
|
|
|
|
|
|
| 8,126,426 |
|
|
| Other operating activities, net |
|
|
|
|
| 620,226 |
|
|
|
|
|
|
| 567,740 |
|
|
| Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
| Accounts receivable |
|
|
|
|
| (371,355 |
| ) |
|
|
|
|
| 24,659 |
|
|
| Inventory |
|
|
|
|
| (788,462 |
| ) |
|
|
|
|
| 1,337,457 |
|
|
| Prepaid expenses and other current assets |
|
|
|
|
| 1,328,709 |
|
|
|
|
|
|
| 1,258,290 |
|
|
| Operating lease liability |
|
|
|
|
| (62,923 |
| ) |
|
|
|
|
| (370,214 |
| ) |
| Accounts payable |
|
|
|
|
| 1,202,716 |
|
|
|
|
|
|
| (475,332 |
| ) |
| Accrued expenses |
|
|
|
|
| (2,529,105 |
| ) |
|
|
|
|
| 897,620 |
|
|
| Net cash from operating activities |
|
|
|
|
| (7,460,076 |
| ) |
|
|
|
|
| (7,536,658 |
| ) |
| Cash flows from investing activities |
|
|
|
|
|
|
|
|
| Proceeds from sale of investment securities available-for-sale |
|
|
|
|
| — |
|
|
|
|
|
|
| 8,513,783 |
|
|
| Other investing activities, net |
|
|
|
|
| 245,706 |
|
|
|
|
|
|
| 396,667 |
|
|
| Net cash from investing activities |
|
|
|
|
| 245,706 |
|
|
|
|
|
|
| 8,910,450 |
|
|
| Cash flows from financing activities |
|
|
|
|
| (19,137 |
| ) |
|
|
|
|
| 121,090 |
|
|
| Net change in cash and cash equivalents |
|
|
|
|
| (7,233,507 |
| ) |
|
|
|
|
| 1,494,882 |
|
|
| Cash, cash equivalents, and restricted cash, beginning of period |
|
|
|
|
| 17,809,802 |
|
|
|
|
|
|
| 23,049,234 |
|
|
| Cash, cash equivalents, and restricted cash, end of period |
|
|
| $ |
| 10,576,295 |
|
|
|
|
| $ |
| 24,544,116 |
|
|
| Supplemental disclosures of cash flow information |
|
|
|
|
|
|
|
|
| Right-of-use assets obtained in exchange for operating lease liabilities |
|
|
| $ |
| 344,382 |
|
|
|
|
| $ |
| 5,285,330 |
|
|
| Supplemental disclosures of non-cash investing activities |
|
|
|
|
|
|
|
|
| Receivable from sale of assets held-for-sale included in other current assets at the end of the period |
|
|
| $ |
| 450,351 |
|
|
|
|
| $ |
| — |
|
|
| Imputed interest related to operating leases |
|
|
| $ |
| 15,036 |
|
|
|
|
| $ |
| 96,976 |
|
|
| Amounts reclassified from accumulated other comprehensive loss |
|
|
| $ |
| — |
|
|
|
|
| $ |
| 61,016 |
|
|
| Amounts reclassified from property, plant, and equipment to fixed assets held-for-sale |
|
|
| $ |
| — |
|
|
|
|
| $ |
| 947,394 |
|
|
| Amounts reclassified from property, plant, and equipment to intangible assets |
|
|
| $ |
| — |
|
|
|
|
| $ |
| 153,691 |
|
|
| Purchases of equipment included in deposits at the beginning of the period |
|
|
| $ |
| — |
|
|
|
|
| $ |
| 372,507 |
|
|
| LAIRD SUPERFOOD, INC. |
| UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS |
|
|
|
|
| As of |
|
|
|
|
| June 30, |
|
|
| December 31, |
| Assets |
|
|
|
|
|
|
|
|
| Current assets |
|
|
|
|
|
|
|
|
| Cash, cash equivalents, and restricted cash |
|
|
| $ |
| 10,576,295 |
|
|
|
|
| $ |
| 17,809,802 |
|
|
| Accounts receivable, net |
|
|
|
|
| 1,814,461 |
|
|
|
|
|
|
| 1,494,469 |
|
|
| Inventory, net |
|
|
|
|
| 5,857,285 |
|
|
|
|
|
|
| 5,696,565 |
|
|
| Prepaid expenses and other current assets, net |
|
|
|
|
| 1,651,717 |
|
|
|
|
|
|
| 2,530,075 |
|
|
| Total current assets |
|
|
|
|
| 19,899,758 |
|
|
|
|
|
|
| 27,530,911 |
|
|
| Noncurrent assets |
|
|
|
|
|
|
|
|
| Property and equipment, net |
|
|
|
|
| 155,160 |
|
|
|
|
|
|
| 150,289 |
|
|
| Fixed assets held-for-sale |
|
|
|
|
| — |
|
|
|
|
|
|
| 800,000 |
|
|
| Intangible assets, net |
|
|
|
|
| 1,188,674 |
|
|
|
|
|
|
| 1,292,118 |
|
|
| Related party license agreements |
|
|
|
|
| 132,100 |
|
|
|
|
|
|
| 132,100 |
|
|
| Right-of-use assets |
|
|
|
|
| 417,172 |
|
|
|
|
|
|
| 133,922 |
|
|
| Total noncurrent assets |
|
|
|
|
| 1,893,106 |
|
|
|
|
|
|
| 2,508,429 |
|
|
| Total assets |
|
|
| $ |
| 21,792,864 |
|
|
|
|
| $ |
| 30,039,340 |
|
|
| Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
| Current liabilities |
|
|
|
|
|
|
|
|
| Accounts payable |
|
|
| $ |
| 2,282,983 |
|
|
|
|
| $ |
| 1,080,267 |
|
|
| Accrued expenses |
|
|
|
|
| 3,748,178 |
|
|
|
|
|
|
| 6,295,640 |
|
|
| Related party liabilities |
|
|
|
|
| 34,857 |
|
|
|
|
|
|
| 16,500 |
|
|
| Lease liabilities, current portion |
|
|
|
|
| 126,580 |
|
|
|
|
|
|
| 59,845 |
|
|
| Total current liabilities |
|
|
|
|
| 6,192,598 |
|
|
|
|
|
|
| 7,452,252 |
|
|
| Long-term liabilities |
|
|
|
|
|
|
|
|
| Lease liabilities |
|
|
|
|
| 305,836 |
|
|
|
|
|
|
| 76,076 |
|
|
| Total long-term liabilities |
|
|
|
|
| 305,836 |
|
|
|
|
|
|
| 76,076 |
|
|
| Total liabilities |
|
|
|
|
| 6,498,434 |
|
|
|
|
|
|
| 7,528,328 |
|
|
| Stockholders’ equity |
|
|
|
|
|
|
|
|
| Common stock, $0.001 par value, 100,000,000 shares authorized as of June 30, 2023 and December 31, 2022; 9,699,866 and 9,334,162 issued and outstanding at June 30, 2023, respectively; and 9,576,117 and 9,210,414 issued and outstanding at December 31, 2022, respectively. |
|
|
|
|
| 9,335 |
|
|
|
|
|
|
| 9,210 |
|
|
| Additional paid-in capital |
|
|
|
|
| 119,071,283 |
|
|
|
|
|
|
| 118,636,834 |
|
|
| Accumulated deficit |
|
|
|
|
| (103,786,188 |
| ) |
|
|
|
|
| (96,135,032 |
| ) |
| Total stockholders’ equity |
|
|
|
|
| 15,294,430 |
|
|
|
|
|
|
| 22,511,012 |
|
|
| Total liabilities and stockholders’ equity |
|
|
| $ |
| 21,792,864 |
|
|
|
|
| $ |
| 30,039,340 |
|
|
Non-GAAP Financial Measures
In this press release, we report Adjusted gross margin, Adjusted net loss, and Adjusted net loss per diluted share, which are financial measures not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (“GAAP”). Management uses these adjusted metrics to evaluate financial performance because they allow for period-over-period comparisons of the Company’s ongoing operations before the impact of certain items described below. Management believes this information may also be useful to investors to compare the Company’s results period-over-period. We define Adjusted net loss and Adjusted net loss per diluted share to exclude certain one-time costs defined in detail in the tables to follow. We define Adjusted gross margin to exclude the Net sales and Cost of goods sold components of one-time costs defined in the tables to follow. Please be aware that Adjusted gross margin, Adjusted net loss, and Adjusted net loss per diluted share have limitations and should not be considered in isolation or as a substitute for Gross margin, Net loss, or Net loss per diluted share. In addition, we may calculate and/or present Adjusted gross margin, Adjusted net loss, and Adjusted net loss per diluted share differently than measures with the same or similar names that other companies report, and as a result, the non-GAAP measures we report may not be comparable to those reported by others.
These non-GAAP measures are reconciled to the most directly comparable GAAP measures in the table that follows.
| LAIRD SUPERFOOD, INC. |
| NON-GAAP FINANCIAL MEASURES |
| (Unaudited) |
|
|
|
|
| Three Months Ended |
|
|
| Six Months Ended |
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
| June 30, |
| Net loss |
|
|
| $ |
| (4,143,910 |
| ) |
|
|
| $ |
| (3,507,246 |
| ) |
|
|
| $ |
| (7,651,156 |
| ) |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
| Strategic organizational shifts |
| (a) |
|
|
| (135,380 |
| ) |
|
|
|
|
| 74,690 |
|
|
|
|
|
|
| (60,690 |
| ) |
| Product quality issue |
| (b) |
|
|
| 491,861 |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
| 491,861 |
|
|
| Company-wide rebranding costs |
| (c) |
|
|
| 61,451 |
|
|
|
|
|
|
| 102,355 |
|
|
|
|
|
|
| 163,806 |
|
|
| Adjusted net loss |
|
|
| $ |
| (3,725,978 |
| ) |
|
|
| $ |
| (3,330,201 |
| ) |
|
|
| $ |
| (7,056,179 |
| ) |
| Adjusted net loss per share, diluted: |
|
|
|
|
| (0.40 |
| ) |
|
|
|
|
| (0.36 |
| ) |
|
|
|
|
| (0.76 |
| ) |
| Weighted-average shares of common stock outstanding used in computing adjusted net loss per share of common stock, diluted |
|
|
|
|
| 9,213,723 |
|
|
|
|
|
|
| 9,284,585 |
|
|
|
|
|
|
| 9,249,738 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (a) Costs incurred as part of the strategic downsizing of the Company's operations, including severances, forfeitures of stock-based compensation, and other personnel costs, IT integration costs, and freight costs to move inventory to third-party facilities. |
| (b) In the first month of the first quarter of 2023, we identified a product quality issue with raw material from one vendor and we voluntarily withdrew any affected finished goods. We incurred costs associated with product testing, discounts for replacement orders, and inventory obsolescence costs. |
| (c) Costs incurred as part of the company-wide rebranding efforts that launched in Q1 2023. |
|
|
|
|
| Three Months Ended |
|
|
| Six Months Ended |
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
| June 30, |
| Net loss |
|
|
| $ |
| (14,139,402 |
| ) |
|
|
| $ |
| (4,904,520 |
| ) |
|
|
| $ |
| (19,043,922 |
| ) |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
| Impairment of goodwill and long-lived assets |
| (a) |
|
|
| 8,026,000 |
|
|
|
|
|
|
| 100,426 |
|
|
|
|
|
|
| 8,126,426 |
|
|
| Strategic organizational shifts |
| (b) |
|
|
| (581,351 |
| ) |
|
|
|
|
| (803,405 |
| ) |
|
|
|
|
| (1,384,756 |
| ) |
| Gain on sale of land held-for-sale |
| (c) |
|
|
| — |
|
|
|
|
|
|
| (573,818 |
| ) |
|
|
|
|
| (573,818 |
| ) |
| Other, net |
| (d) |
|
|
| (22,296 |
| ) |
|
|
|
|
| — |
|
|
|
|
|
|
| (22,296 |
| ) |
| Adjusted net loss |
|
|
| $ |
| (6,717,049 |
| ) |
|
|
| $ |
| (6,181,317 |
| ) |
|
|
| $ |
| (12,898,366 |
| ) |
| Adjusted net loss per share, diluted: |
|
|
|
|
| (0.74 |
| ) |
|
|
|
|
| (0.68 |
| ) |
|
|
|
|
| (1.42 |
| ) |
| Weighted-average shares of common stock outstanding used in computing adjusted net loss per share of common stock, diluted |
|
|
|
|
| 9,095,441 |
|
|
|
|
|
|
| 9,132,632 |
|
|
|
|
|
|
| 9,114,527 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (a) Impairment charges to goodwill and long-lived intangible assets assumed in the acquisition of Picky Bars which occurred Q2 2021, in the amounts of $6.5 million and $1.5 million, respectively, and of assets held-for-sale of $0.1 million in Q2 2022. |
| (b) Costs incurred as part of the strategic downsizing of the Company's operations, including severances, forfeitures of stock-based compensation, and other personnel costs arising from the resignations of certain members of executive leadership. |
| (c) Gains on the sale of unused plots of land in Sisters, Oregon. |
| (d) Realized losses on the liquidation of all of the Company's available-for-sale securities included in other income in Q1 2022. Recovery of costs incurred in connection with an insurance claim following loss of product during handling by a third party included in cost of goods sold in Q1 2022. |
| LAIRD SUPERFOOD, INC. |
| NON-GAAP FINANCIAL MEASURES |
| (Unaudited) |
|
|
|
|
| Three Months Ended |
| Six Months Ended |
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
| June 30, |
| Net sales |
|
|
| $ |
| 8,112,938 |
|
|
|
|
| $ |
| 7,724,091 |
|
|
|
|
| $ |
| 15,837,029 |
|
|
| Cost of goods sold |
|
|
|
|
| (6,239,062 |
| ) |
|
|
|
|
| (5,848,023 |
| ) |
|
|
|
|
| (12,087,085 |
| ) |
| Gross profit |
|
|
| $ |
| 1,873,876 |
|
|
|
|
| $ |
| 1,876,068 |
|
|
|
|
| $ |
| 3,749,944 |
|
|
| Gross margin |
|
|
|
|
| 23.1 |
| % |
|
|
|
|
| 24.3 |
| % |
|
|
|
|
| 23.7 |
| % |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
| Strategic organizational shifts |
| (a) |
|
|
| -0.2 |
| % |
|
|
|
|
| — |
|
|
|
|
|
|
| -0.1 |
| % |
| Product quality issue |
| (b) |
|
|
| 4.1 |
| % |
|
|
|
|
| — |
|
|
|
|
|
|
| 2.6 |
| % |
| Adjusted gross margin |
|
|
|
|
| 27.0 |
| % |
|
|
|
|
| 24.3 |
| % |
|
|
|
|
| 26.2 |
| % |
| (a) Costs incurred as part of the strategic downsizing of the Company's operations, including severances, forfeitures of stock-based compensation, and other personnel costs, and freight costs to move inventory to third-party facilities. |
| (b) In the first month of the first quarter of 2023, we identified a product quality issue with raw material from one vendor and we voluntarily withdrew any affected finished goods. We incurred costs associated with discounts for replacement orders and inventory obsolescence costs. |
|
|
|
|
| Three Months Ended |
| Six Months Ended |
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
| June 30, |
| Net sales |
|
|
| $ |
| 9,340,013 |
|
|
|
|
| $ |
| 8,674,006 |
|
|
|
|
| $ |
| 18,014,019 |
|
|
| Cost of goods sold |
|
|
|
|
| (7,390,203 |
| ) |
|
|
|
|
| (7,096,068 |
| ) |
|
|
|
|
| (14,486,271 |
| ) |
| Gross profit |
|
|
| $ |
| 1,949,810 |
|
|
|
|
| $ |
| 1,577,938 |
|
|
|
|
| $ |
| 3,527,748 |
|
|
| Gross margin |
|
|
|
|
| 20.9 |
| % |
|
|
|
|
| 18.2 |
| % |
|
|
|
|
| 19.6 |
| % |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
| Other |
| (a) |
|
|
| -2.2 |
| % |
|
|
|
|
| — |
|
|
|
|
|
|
| -1.1 |
| % |
| Adjusted gross margin |
|
|
|
|
| 18.7 |
| % |
|
|
|
|
| 18.2 |
| % |
|
|
|
|
| 18.5 |
| % |
| (a) Recovery of costs incurred in connection with an insurance claim following loss of product during handling by a third party included in cost of goods sold in Q1 2022. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230809778106/en/
Investor Relations Contact
Trevor Rousseau
trousseau@lairdsuperfood.com