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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Laird Superfood Inc | AMEX:LSF | AMEX | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.08 | 3.07% | 2.69 | 2.6699 | 2.44 | 2.59 | 69,475 | 22:39:29 |
Positive Net Income and Operating Cash Flows for the first time in the Company's history.
Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood,” the "Company", “we”, and “our”), today reported financial results for its fourth quarter and year ended December 31, 2023.
Jason Vieth, Chief Executive Officer, commented, "I am delighted to share that our Q4 results are by far the best ever reported by Laird Superfood as a public company. During this quarter, we increased our Gross Margin to greater than 40%, achieved both positive Net Income and positive Cash Flow, and grew the company versus both year-ago and prior period. These results were driven by a broad-based improvement in our business, including strong execution across our commercial teams as well as by our internal supply chain resources and affiliated manufacturing and distribution partners. We also won significant and strategic increases in retail distribution during the fourth quarter, and saw a substantial increase in the efficiency of our marketing activity across all channels. Heading into 2024, we are positioned to build upon this success. The past years have obviously been challenging to small food companies, and I am proud of the efforts of our team to fundamentally reinvent Laird Superfood and position us as a strong survivor that can win market share and achieve sustained profitability in the foreseeable future."
Anya Hamill, Chief Financial Officer, commented, "I am pleased to report outstanding fourth quarter financial results. Net Sales grew across both wholesale and e-commerce, fueled by a return to growth in our direct to consumer (DTC) channel, which grew 10% versus prior year. In the fourth quarter, Gross Margin rose to 40.4%, representing a 9-point improvement sequentially versus Q3 2023, and a 45-point improvement versus Q4 2022 as reported or a 21-point improvement on an adjusted basis. Driven by sales growth and strong cost management, we delivered Q4 Net Income of $0.1 million and positive Q4 Cash Flow of $0.3 million. Our balance sheet remains strong, and with no debt and a $7.7 million cash balance as of December 31, 2023, we now project that we will have enough cash to fund our operations into 2026 and beyond and our Annual Report on Form 10-K will not contain the going concern language that was included in our prior quarterly reports."
Fourth Quarter 2023 Highlights
Three Months Ended December 31,
2023
2022
$
% of Total
$
% of Total
Coffee creamers
$
4,831,008
52
%
$
4,934,397
55
%
Hydration and beverage enhancing supplements
1,924,368
21
%
1,061,721
12
%
Harvest snacks and other food items
1,533,728
17
%
1,855,273
21
%
Coffee, tea, and hot chocolate products
2,084,375
23
%
1,808,361
20
%
Other
148,422
2
%
710,990
8
%
Gross sales
10,521,901
115
%
10,370,742
116
%
Shipping income
121,870
1
%
270,251
3
%
Returns and discounts
(1,436,383
)
(16
)%
(1,671,465
)
(18
)%
Sales, net
$
9,207,388
100
%
$
8,969,528
101
%
Three Months Ended December 31,
2023
2022
$
% of Total
$
% of Total
E-commerce
$
6,034,442
66
%
$
5,902,285
66
%
Wholesale
3,172,946
34
%
3,067,243
34
%
Sales, net
$
9,207,388
100
%
$
8,969,528
100
%
Fiscal Year 2023 Highlights
Year Ended December 31,
2023
2022
$
% of Total
$
% of Total
Coffee creamers
$
20,381,166
60
%
$
19,800,429
55
%
Hydration and beverage enhancing supplements
5,320,039
16
%
4,877,067
14
%
Harvest snacks and other food items
6,879,643
20
%
7,191,316
20
%
Coffee, tea, and hot chocolate products
8,017,121
23
%
6,648,576
19
%
Other
435,423
1
%
1,805,914
5
%
Gross sales
41,033,392
120
%
40,323,302
113
%
Shipping income
899,921
3
%
1,099,358
3
%
Returns and discounts
(7,709,115
)
(23
)%
(5,594,268
)
(16
)%
Sales, net
$
34,224,198
100
%
$
35,828,392
100
%
Year Ended December 31,
2023
2022
$
% of Total
$
% of Total
E-commerce
$
19,443,885
57
%
$
22,313,241
62
%
Wholesale
14,780,313
43
%
13,515,151
38
%
Sales, net
$
34,224,198
100
%
$
35,828,392
100
%
Balance Sheet and Cash Flow Highlights
The Company had $7.7 million of cash, cash equivalents, and restricted cash as of December 31, 2023, and no outstanding debt.
Cash provided by operating activities was $0.2 million for the fourth quarter of 2023, compared to cash used of $3.5 million and $3.2 million in the third quarter of 2023 and the fourth quarter of 2022, respectively. The improvement in cash flows was driven by margin expansion and significant reductions in general and administrative costs. Cash burn in the third quarter of 2023 relative to the fourth quarter was due to planned inventory build to meet stepped up demand in the retail and club channels and the timing of accounts receivable collections.
Cash used in operating activities was $10.8 million in 2023, compared to $14.3 million 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 offset in part by our Sisters, Oregon exit and disposal costs incurred in the first quarter of 2023.
2024 Outlook
Based on management's best assessment of the environment today, the Company is providing the following outlook for the full year 2024:
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 anticipated cash runway and 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, including our ability to continue as a going concern; (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; (17) the growth rates of the markets in which we compete, and (18) the other risks described in our Annual Report on Form 10-K for the year ended December 31, 2023 and other filings we make with the Securities and Exchange Commission.
LAIRD SUPERFOOD, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended
December 31,
2023
2022
Sales, net
$
34,224,198
$
35,828,392
Cost of goods sold
(23,910,921
)
(30,641,125
)
Gross profit
10,313,277
5,187,267
General and administrative
Salaries, wages and benefits
4,203,613
6,414,481
Impairment of goodwill and long-lived assets
—
12,814,441
Loss on lease termination
—
3,596,365
Other expense
5,370,024
7,769,876
Total general and administrative expenses
9,573,637
30,595,163
Research and product development
219,723
427,537
Sales and marketing
Advertising
3,825,969
6,914,706
General marketing
3,721,973
3,797,761
Related party marketing agreements
213,051
51,812
Other expense
3,457,910
3,764,425
Total sales and marketing expenses
11,218,903
14,528,704
Total operating expenses
21,012,263
45,551,404
Operating loss
(10,698,986
)
(40,364,137
)
Other income
551,064
47,088
Loss before income taxes
(10,147,922
)
(40,317,049
)
Income tax expense
(15,195
)
(20,269
)
Net loss
$
(10,163,117
)
$
(40,337,318
)
Net loss per share:
Basic
$
(1.09
)
$
(4.41
)
Diluted
$
(1.09
)
$
(4.41
)
Weighted-average shares of common stock outstanding used in computing net loss per share of common stock, basic and diluted
9,297,226
9,146,008
LAIRD SUPERFOOD, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31,
2023
2022
Cash flows from operating activities
Net loss
$
(10,163,117
)
$
(40,337,318
)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization
306,176
1,118,071
Gain on sale of assets held-for-sale
—
(577,058
)
Stock-based compensation
1,092,146
631,227
Provision for inventory obsolescence
1,273,171
2,761,476
Allowance for credit losses
165,980
77,436
Impairment of goodwill and other long-lived assets
—
12,814,441
Loss on lease termination
—
3,596,365
Noncash lease costs
152,339
1,065,591
Other operating activities, net
38,098
169,914
Changes in operating assets and liabilities:
Accounts receivable
306,117
(303,187
)
Inventory
(1,899,165
)
1,763,302
Prepaid expenses and other current assets
1,244,511
1,604,880
Operating lease liability
(126,434
)
(742,111
)
Accounts payable
570,094
191,499
Accrued expenses
(3,725,797
)
1,853,033
Net cash from operating activities
(10,765,881
)
(14,312,439
)
Cash flows from investing activities
Purchase of property, plant, and equipment
(144,023
)
(1,154,219
)
Proceeds on sale of property, plant, and equipment
34,330
17,677
Proceeds from sale of assets held-for-sale
800,000
1,596,212
Proceeds from sale of investment securities available-for-sale
—
8,513,783
Purchase of intangible assets
—
(2,713
)
Net cash from investing activities
690,307
8,970,740
Cash flows from financing activities
Common stock issuances, net of taxes
(27,422
)
9,464
Recovery of short-swing profits
—
28,555
Stock options exercised, net of taxes
—
64,248
Net cash from financing activities
(27,422
)
102,267
Net change in cash and cash equivalents
(10,102,996
)
(5,239,432
)
Cash, cash equivalents, and restricted cash, beginning of period
17,809,802
23,049,234
Cash, cash equivalents, and restricted cash, end of period
$
7,706,806
$
17,809,802
Supplemental disclosures of cash flow information
Cash paid for interest
$
13,994
$
8,338
Cash paid for income taxes
$
17,625
$
5,404
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 accrued expenses at the end of the period
$
—
$
28,240
Amounts reclassified from accumulated other comprehensive loss
$
—
$
61,016
Amounts reclassified from property, plant, and equipment to fixed assets held-for-sale
$
—
$
1,847,394
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.
CONSOLIDATED BALANCE SHEETS
As of
December 31, 2023
December 31, 2022
Assets
Current assets
Cash, cash equivalents, and restricted cash
$
7,706,806
$
17,809,802
Accounts receivable, net
1,022,372
1,494,469
Inventory, net
6,322,559
5,696,565
Prepaid expenses and other current assets, net
1,285,564
2,530,075
Total current assets
16,337,301
27,530,911
Noncurrent assets
Property and equipment, net
122,595
150,289
Fixed assets held-for-sale
—
800,000
Intangible assets, net
1,085,231
1,292,118
Related party license agreements
132,100
132,100
Right-of-use assets
354,732
133,922
Total noncurrent assets
1,694,658
2,508,429
Total assets
$
18,031,959
$
30,039,340
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable
$
1,647,673
$
1,080,267
Accrued expenses
2,586,343
6,295,640
Related party liabilities
2,688
16,500
Lease liabilities, current portion
138,800
59,845
Total current liabilities
4,375,504
7,452,252
Lease liabilities
243,836
76,076
Total liabilities
4,619,340
7,528,328
Stockholders’ equity
Common stock, $0.001 par value, 100,000,000 shares authorized as of December 31, 2023 and December 31, 2022; 9,749,326 and 9,383,622 issued and outstanding at December 31, 2023, respectively; and 9,576,117 and 9,210,414 issued and outstanding at December 31, 2022, respectively.
9,384
9,210
Additional paid-in capital
119,701,384
118,636,834
Accumulated deficit
(106,298,149
)
(96,135,032
)
Total stockholders’ equity
13,412,619
22,511,012
Total liabilities and stockholders’ equity
$
18,031,959
$
30,039,340
Non-GAAP Financial Measures
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 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
Year Ended
March 31, 2023
June 30, 2023
September 30, 2023
December 31, 2023
December 31, 2023
Net loss
$
(4,143,910
)
$
(3,507,246
)
$
(2,654,884
)
$
142,923
$
(10,163,117
)
Adjusted for:
Strategic organizational shifts
(a)
(135,380
)
74,690
5,342
42,030
(13,318
)
Product quality issue
(b)
491,861
—
(140,019
)
(69,842
)
282,000
Company-wide rebranding costs
(c)
61,451
102,355
—
—
163,806
Other
(d)
—
—
—
(95,000
)
(95,000
)
Adjusted net loss
$
(3,725,978
)
$
(3,330,201
)
$
(2,789,561
)
$
20,111
$
(9,825,629
)
Adjusted net loss per share, diluted:
(0.40
)
(0.36
)
(0.30
)
0.00
(1.06
)
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
9,337,789
11,977,293
9,297,226
(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 January 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. We reached settlement with a supplier and recorded recoveries in the third quarter of 2023.
(c) Costs incurred as part of a company-wide rebranding efforts that launched in Q1 2023.
(d) Estimated legal settlement costs related to a class action lawsuit which was included in general and administrative expenses in Q4 2022 and released in Q4 2023 with no further costs incurred.
Three Months Ended
Year Ended
March 31, 2022
June 30, 2022
September 30, 2022
December 31, 2022
December 31, 2022
Net loss
$
(14,139,402
)
$
(4,904,520
)
$
(5,738,209
)
$
(15,555,187
)
$
(40,337,318
)
Adjusted for:
Impairment of goodwill and long-lived assets
(a)
8,026,000
100,426
—
1,479,006
9,605,432
Strategic organizational shifts
(b)
(581,351
)
(803,405
)
112,974
8,683,331
7,411,549
Gain on sale of land held-for-sale
(c)
—
(573,818
)
—
—
(573,818
)
Company-wide rebranding costs
(d)
—
—
—
455,475
455,475
Product quality issue
(e)
—
—
—
559,042
559,042
Other, net
(f)
(22,296
)
—
51,400
95,000
124,104
Adjusted net loss
$
(6,717,049
)
$
(6,181,317
)
$
(5,573,835
)
(4,283,333
)
$
(22,755,534
)
Adjusted net loss per share, diluted:
(0.74
)
(0.68
)
(0.61
)
(0.47
)
(2.49
)
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
9,178,533
9,199,597
9,136,071
(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, early termination of service contracts, 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) Costs incurred as part of the company-wide rebranding efforts that occurred in Q4 2022, launching in Q1 2023.
(e) Inventory reserves recorded to account for the product quality issue that was discovered in the first quarter of 2023, related to finished goods and raw material inventories on hand as of December 31, 2022.
(f) 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 costs of goods sold in Q1 2022. Losses incurred on prepaid inventories which were not recoverable following the bankruptcy of the supplier and costs incurred as a result of the early termination of a long-term service contract as part of a strategic initiative to relieve future cash obligations included in general and administrative expenses in Q3 2022. Estimated legal settlement costs related to an ongoing class action lawsuit included in general and administrative expenses in Q4 2022.
LAIRD SUPERFOOD, INC.
NON-GAAP FINANCIAL MEASURES
(Unaudited)
Three Months Ended
Year Ended
March 31, 2023
June 30, 2023
September 30, 2023
December 31, 2023
December 31, 2023
Gross margin
23.1%
24.3%
31.0%
40.4%
30.1%
Adjusted for:
Strategic organizational shifts
(a)
-0.2%
—
—
—
0.0%
Product quality issue
(b)
4.1%
—
-1.5%
-0.8%
0.3%
Adjusted gross margin
27.0%
24.3%
29.5%
39.6%
30.4%
(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 January 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. We reached settlement with a supplier and recorded recoveries in the third quarter of 2023.
Three Months Ended
Year Ended
March 31, 2022
June 30, 2022
September 30, 2022
December 31, 2022
December 31, 2022
Gross margin
20.9%
18.2%
23.4%
-4.6%
14.5%
Adjusted for:
Strategic organizational shifts
(a)
—
—
—
13.1%
3.3%
Product quality issue
(b)
—
—
—
6.2%
1.6%
Company-wide rebranding costs
(c)
—
—
—
4.3%
1.1%
Other
(d)
-2.2%
—
—
—
-0.7%
Adjusted gross margin
18.7%
18.2%
23.4%
19.0%
19.8%
(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 January 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. We reached settlement with a supplier and recorded recoveries in the third quarter of 2023.
(c) Costs incurred as part of the company-wide rebranding efforts that launched in Q1 2023.
(d) 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/20240312479621/en/
Investor Relations Contact Trevor Rousseau investors@lairdsuperfood.com
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