Laird Superfood Reports First Quarter 2024 Financial Results
First Quarter 2024 Highlights
-
Net Sales of$9.9 million compared to$9.2 million in the prior quarter, and$8.1 million in the corresponding prior year period. -
Wholesale sales increased by 10% year-over-year and contributed 41% of total
Net Sales , driven by sales growth in club, velocity improvement and distribution expansion in grocery, and more efficient promotional spend. -
E-commerce sales increased by 33% year-over-year and contributed 59% of total
Net Sales , despite a significant, planned reduction in media spend in this channel. Sales through Amazon increased by 48% year-over-year, building on the strong performance in the fourth quarter of 2023, and continued strong inventory levels and media efficiency, as compared to the reduced sales volume during the first quarter of 2023 stemming from out-of-stock products associated with the quality event last year. Direct-to-consumer (DTC) achieved double-digit growth of 25% year-over-year driven by strong performance in both subscription and repeat orders, higher average order value, and improved discount rates due to strategic shifts in our promotional strategies. - Gross Margin was 40.0%, compared to 40.4% in the fourth quarter of 2023 and 23.1% in the corresponding prior year period. This margin expansion was driven by the full realization of the cost savings due to our transition to a variable cost third-party co-manufacturing business model, as well as planned reductions in trade spend intended to improve promotional effectiveness.
-
Net Loss was
$1.0 million , or$0.11 per diluted share, compared to Net Loss of$4.1 million , or$0.45 per diluted share, in the corresponding prior year period. The improvement was driven by Gross Margin expansion, and lower marketing, and general and administrative (G&A) spend. -
Adjusted Net Loss, which is a non-GAAP financial measure, was
$1.0 million , or$0.11 per diluted share, compared to$3.7 million , or$0.40 per diluted share in the corresponding prior year period. This improvement was driven by significantly expanded Gross Margins and lower marketing and G&A costs. For more details on non-GAAP financial measures, refer to the information in the non-GAAP financial measures section of this press release.
Revenue Disaggregation
|
|
Three Months Ended |
||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
||||||||
|
|
$ |
|
% of Total |
|
$ |
|
% of Total |
||||||||
Coffee creamers |
|
$ |
5,570,321 |
|
|
|
56 |
% |
|
$ |
5,132,143 |
|
|
|
63 |
% |
Coffee, tea, and hot chocolate products |
|
|
2,175,265 |
|
|
|
22 |
% |
|
|
1,955,140 |
|
|
|
24 |
% |
Hydration and beverage enhancing supplements |
|
|
2,025,272 |
|
|
|
20 |
% |
|
|
670,851 |
|
|
|
8 |
% |
Harvest snacks and other food items |
|
|
1,304,060 |
|
|
|
13 |
% |
|
|
1,752,397 |
|
|
|
22 |
% |
Other |
|
|
122,012 |
|
|
|
1 |
% |
|
|
29,729 |
|
|
|
— |
% |
Gross sales |
|
|
11,196,930 |
|
|
|
112 |
% |
|
|
9,540,260 |
|
|
|
117 |
% |
Shipping income |
|
|
111,428 |
|
|
|
1 |
% |
|
|
303,226 |
|
|
|
4 |
% |
Returns and discounts |
|
|
(1,399,420 |
) |
|
|
(13 |
)% |
|
|
(1,730,548 |
) |
|
|
(21 |
)% |
Sales, net |
|
$ |
9,908,938 |
|
|
|
100 |
% |
|
$ |
8,112,938 |
|
|
|
100 |
% |
|
|
Three Months Ended |
|||||||||||||||
|
|
2024 |
|
|
2023 |
|
|||||||||||
|
|
$ |
|
% of Total |
|
$ |
|
% of Total |
|||||||||
E-commerce |
|
$ |
5,868,337 |
|
|
59 |
% |
|
$ |
4,427,681 |
|
|
55 |
% |
|||
Wholesale |
|
|
4,040,601 |
|
|
41 |
% |
|
|
3,685,257 |
|
|
45 |
% |
|||
Sales, net |
|
$ |
9,908,938 |
|
|
100 |
% |
|
$ |
8,112,938 |
|
|
100 |
% |
Balance Sheet and Cash Flow Highlights
The Company had
Cash used in operating activities was
2024 Outlook
Based on management's best assessment of the environment today, the Company is providing the following outlook for the full year 2024:
-
Net Sales are expected to be in the range of approximately$38 to$42 million , representing growth of 11% to 23% compared to 2023. - Gross Margin is expected to expand to approximately 37% to 41%, excluding any one-time charges, representing a 7 to 11-point improvement compared to 2023.
Conference Call and Webcast Details
The Company will host a conference call and webcast at
About
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 anticipated cash runway, future financial performance, and growth. Such forward-looking statements may be identified by words such as "anticipates," "believes," "continues," "could," "estimates," "expects" "intends," "may," "outlook," "plans," "potential," predicts," "projects," "seeks," "should," "will," "would", or the antonyms of these terms or other comparable terminology. 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
|
||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||
(unaudited) |
||||||||
|
|
Three Months Ended |
||||||
|
|
|
||||||
|
|
|
2024 |
|
|
|
2023 |
|
Sales, net |
|
$ |
9,908,938 |
|
|
$ |
8,112,938 |
|
Cost of goods sold |
|
|
(5,944,837 |
) |
|
|
(6,239,062 |
) |
Gross profit |
|
|
3,964,101 |
|
|
|
1,873,876 |
|
General and administrative |
|
|
|
|
||||
Salaries, wages, and benefits |
|
|
922,407 |
|
|
|
1,315,449 |
|
Other general and administrative |
|
|
1,235,341 |
|
|
|
1,766,861 |
|
Total general and administrative expenses |
|
|
2,157,748 |
|
|
|
3,082,310 |
|
Sales and marketing |
|
|
|
|
||||
Marketing and advertising |
|
|
2,053,258 |
|
|
|
2,203,035 |
|
Selling expenses |
|
|
779,156 |
|
|
|
853,204 |
|
Related party marketing agreements |
|
|
62,501 |
|
|
|
37,809 |
|
Total sales and marketing expenses |
|
|
2,894,915 |
|
|
|
3,094,048 |
|
Total operating expenses |
|
|
5,052,663 |
|
|
|
6,176,358 |
|
Operating loss |
|
|
(1,088,562 |
) |
|
|
(4,302,482 |
) |
Other income |
|
|
110,997 |
|
|
|
170,994 |
|
Loss before income taxes |
|
|
(977,565 |
) |
|
|
(4,131,488 |
) |
Income tax expense |
|
|
(38,957 |
) |
|
|
(12,422 |
) |
Net loss |
|
$ |
(1,016,522 |
) |
|
$ |
(4,143,910 |
) |
Net loss per share: |
|
|
|
|
||||
Basic and diluted |
|
$ |
(0.11 |
) |
|
$ |
(0.45 |
) |
Weighted-average shares of common stock outstanding used in computing net loss per share of common stock, basic and diluted |
|
|
9,401,605 |
|
|
|
9,213,723 |
|
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(unaudited) |
||||||||
|
|
Three Months Ended |
||||||
|
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities |
|
|
|
|
||||
Net loss |
|
$ |
(1,016,522 |
) |
|
$ |
(4,143,910 |
) |
Adjustments to reconcile net loss to net cash from operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
71,435 |
|
|
|
87,953 |
|
Stock-based compensation |
|
|
279,565 |
|
|
|
147,635 |
|
Provision for inventory obsolescence |
|
|
43,204 |
|
|
|
234,394 |
|
Allowance for credit losses |
|
|
26,865 |
|
|
|
23,668 |
|
Noncash lease costs |
|
|
38,083 |
|
|
|
38,546 |
|
Other operating activities, net |
|
|
— |
|
|
|
(32,007 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
||||
Accounts receivable |
|
|
(1,069,238 |
) |
|
|
(1,438,063 |
) |
Inventory |
|
|
646,231 |
|
|
|
72,007 |
|
Prepaid expenses and other current assets |
|
|
217,889 |
|
|
|
402,299 |
|
Operating lease liability |
|
|
(32,254 |
) |
|
|
(31,315 |
) |
Accounts payable |
|
|
84,880 |
|
|
|
1,312,821 |
|
Accrued expenses |
|
|
287,551 |
|
|
|
(2,728,290 |
) |
Net cash from operating activities |
|
|
(422,311 |
) |
|
|
(6,054,262 |
) |
Cash flows from investing activities |
|
|
— |
|
|
|
135,737 |
|
Cash flows from financing activities |
|
|
4,791 |
|
|
|
(4,410 |
) |
Net change in cash and cash equivalents |
|
|
(417,520 |
) |
|
|
(5,922,935 |
) |
Cash, cash equivalents, and restricted cash, beginning of period |
|
|
7,706,806 |
|
|
|
17,809,802 |
|
Cash, cash equivalents, and restricted cash, end of period |
|
$ |
7,289,286 |
|
|
$ |
11,886,867 |
|
Supplemental disclosures of cash flow information |
|
|
|
|
||||
Right-of-use assets obtained in exchange for operating lease liabilities |
|
$ |
— |
|
|
$ |
344,382 |
|
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 |
|
$ |
— |
|
|
$ |
581,835 |
|
|
||||||||
CONSOLIDATED BALANCE SHEETS |
||||||||
(Unaudited) |
||||||||
|
|
As of |
||||||
|
|
|
|
|
||||
Assets |
|
|
|
|
||||
Current assets |
|
|
|
|
||||
Cash, cash equivalents, and restricted cash |
|
$ |
7,289,286 |
|
|
$ |
7,706,806 |
|
Accounts receivable, net |
|
|
2,064,745 |
|
|
|
1,022,372 |
|
Inventory, net |
|
|
5,633,124 |
|
|
|
6,322,559 |
|
Prepaid expenses and other current assets |
|
|
1,067,675 |
|
|
|
1,285,564 |
|
Total current assets |
|
|
16,054,830 |
|
|
|
16,337,301 |
|
Noncurrent assets |
|
|
|
|
||||
Property and equipment, net |
|
|
102,881 |
|
|
|
122,595 |
|
Intangible assets, net |
|
|
1,033,510 |
|
|
|
1,085,231 |
|
Related party license agreements |
|
|
132,100 |
|
|
|
132,100 |
|
Right-of-use assets |
|
|
323,007 |
|
|
|
354,732 |
|
Total noncurrent assets |
|
|
1,591,498 |
|
|
|
1,694,658 |
|
Total assets |
|
$ |
17,646,328 |
|
|
$ |
18,031,959 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
||||
Current liabilities |
|
|
|
|
||||
Accounts payable |
|
$ |
1,718,574 |
|
|
$ |
1,647,673 |
|
Accrued expenses |
|
|
2,862,394 |
|
|
|
2,586,343 |
|
Related party liabilities |
|
|
28,167 |
|
|
|
2,688 |
|
Lease liabilities, current portion |
|
|
148,598 |
|
|
|
138,800 |
|
Total current liabilities |
|
|
4,757,733 |
|
|
|
4,375,504 |
|
Lease liabilities |
|
|
208,142 |
|
|
|
243,836 |
|
Total liabilities |
|
|
4,965,875 |
|
|
|
4,619,340 |
|
Stockholders’ equity |
|
|
|
|
||||
Common stock, |
|
|
9,520 |
|
|
|
9,384 |
|
Additional paid-in capital |
|
|
119,985,604 |
|
|
|
119,701,384 |
|
Accumulated deficit |
|
|
(107,314,671 |
) |
|
|
(106,298,149 |
) |
Total stockholders’ equity |
|
|
12,680,453 |
|
|
|
13,412,619 |
|
Total liabilities and stockholders’ equity |
|
$ |
17,646,328 |
|
|
$ |
18,031,959 |
|
NON-GAAP FINANCIAL MEASURES
(unaudited)
In this press release, we report 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
These non-GAAP measures are reconciled to the most directly comparable GAAP measures in the tables that follow:
|
|
Three Months Ended |
||||||
|
|
|
|
|
||||
Net loss |
|
$ |
(1,016,522 |
) |
|
$ |
(4,143,910 |
) |
Adjusted for: |
|
|
|
|
|
|
||
Product quality issue (a) |
|
|
(11,195 |
) |
|
|
491,861 |
|
Strategic organizational shifts (b) |
|
|
— |
|
|
|
(135,380 |
) |
Company-wide rebranding costs (c) |
|
|
— |
|
|
|
61,451 |
|
Adjusted net loss |
|
$ |
(1,027,717 |
) |
|
$ |
(3,725,978 |
) |
Net loss per share, diluted: |
|
$ |
(0.11 |
) |
|
$ |
(0.45 |
) |
Adjusted net loss per share, diluted: |
|
$ |
(0.11 |
) |
|
$ |
(0.40 |
) |
Weighted-average shares of common stock outstanding used in computing adjusted net loss per share of common stock, diluted |
|
|
9,401,605 |
|
|
|
9,213,723 |
|
(a) In |
||||||||
(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, IT integration costs, and freight costs to move inventory to third-party facilities. |
||||||||
(c) Costs incurred as part of a company-wide rebranding efforts that launched in Q1 2023. |
|
|
Three Months Ended |
||||||
|
|
|
|
|
||||
Gross margin |
|
|
40.0 |
% |
|
|
23.1 |
% |
Adjusted for: |
|
|
|
|
|
|
||
Product quality issue (a) |
|
|
-0.1 |
% |
|
|
4.1 |
% |
Strategic organizational shifts (b) |
|
|
— |
|
|
|
-0.2 |
% |
Adjusted gross margin |
|
|
39.9 |
% |
|
|
27.0 |
% |
(a) In |
||||||||
(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. |
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