Financial Performance - Sales increased by $3.2 million to $11.6 million for the three months ended March 31, 2025, representing a 38% increase compared to the same period in 2024[78] - Gross profit rose to $1.5 million, an 86% increase from $786,000 in the prior year[78] - The net loss for the three months ended March 31, 2025, was $37.7 million, a 57% increase from the net loss of $24.1 million in the same period in 2024[78] - Interest expense increased by $9.2 million for the three months ended March 31, 2025, primarily due to a $3.4 million increase in the principal amount outstanding on the Senior Facility and a $5.6 million decrease in capitalized interest compared to the prior year[90] - As of March 31, 2025, the company had an accumulated deficit of $460.9 million and cash and cash equivalents of $28.4 million[91] - Net cash used in operating activities was $9.6 million for the three months ended March 31, 2025, due to a net loss of $37.7 million[102] - Net cash provided by financing activities was $35.5 million for the three months ended March 31, 2025, including $21.5 million from the issuance of Series A Preferred Stock[105] - Net cash used in investing activities was $5.0 million for the three months ended March 31, 2025, primarily for purchases related to the Washington and Texas facilities[104] - The company has incurred losses and generated negative cash flows from operations since inception, indicating ongoing financial challenges[91] Operational Developments - The company operates six facilities, with significant production increases from the Georgia, Texas, and Washington facilities[79] - The Texas facility is undergoing a reconfiguration to produce both head lettuce and cut products, expected to begin commercial production in Q2 2025[72] - The company plans to expand its product offerings to include new varieties of fresh greens, herbs, and berries[71] - The company has secured an offtake agreement with Sam's Club for leafy greens production through September 2028[70] Sustainability Initiatives - The company utilizes 90% less water and land compared to traditional agriculture, enhancing sustainability[69] Financial Obligations - The principal amount due under the credit facility with Cargill Financial totaled $312.0 million, with various financial covenants that could risk default if not complied with[92] - Future aggregate financing obligation payments total $141.2 million, with significant payments due in the years following 2025[100] - The maturity date of the Senior Facility is December 31, 2035, with specific repayment terms starting from 2027[98] - The company expects interest expense to decrease by at least 50% following the Eleventh Amendment to the Senior Facility with Cargill Financial, which resulted in a lower principal balance and reduced interest rate[95] Expense Trends - Research and development expenses surged by $3.5 million to $7.0 million, a 100% increase year-over-year[78] - General and administrative expenses increased by $2.3 million to $8.1 million, a 39% rise compared to the previous year[78]

Core Insights - Local Bounti Corporation reported a quarterly loss of $4.32 per share, significantly worse than the Zacks Consensus Estimate of a loss of $1.31, marking an earnings surprise of -229.77% [1] - The company generated revenues of $11.61 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 4.55% and showing an increase from $8.38 million year-over-year [2] - Local Bounti shares have increased by approximately 25.1% since the beginning of the year, outperforming the S&P 500's gain of 0.1% [3] Financial Performance - Over the last four quarters, Local Bounti has surpassed consensus EPS estimates only once [2] - The current consensus EPS estimate for the upcoming quarter is -$1.22 on revenues of $12.3 million, and for the current fiscal year, it is -$4.35 on revenues of $59.2 million [7] Market Outlook - The estimate revisions trend for Local Bounti is currently favorable, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The Agriculture - Operations industry, to which Local Bounti belongs, is currently ranked in the bottom 38% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Local Bounti (LOCL) Q1 2025 Earnings Call May 14, 2025 08:00 AM ET Company Participants Jeff Sonnek - Managing DirectorCraig Hurlbert - Co-Founder, Director & Executive ChairmanKathleen Valiasek - President, CEO & CFOKristen Owen - Managing Director Conference Call Participants Ben Klieve - Senior Equity Research Analyst Operator Good morning and welcome to Local Bounty's First Quarter twenty twenty five Earnings Conference Call. All participants will be in a listen only mode. After today's presentation, th ...

Financial Data and Key Metrics Changes - First quarter sales were $11.6 million, representing a 38% increase compared to the first quarter of 2024 and a 15% sequential increase compared to the fourth quarter of 2024 [12] - Adjusted gross margin improved approximately 500 basis points year-over-year and approximately 400 basis points sequentially [13] - Net loss for the quarter was $37.7 million compared to a net loss of $24.1 million in the prior year period, largely reflecting higher interest expense [13] - Adjusted EBITDA loss for the quarter was $8.8 million compared to $6.9 million in the prior year period, but improved by $500,000 from the fourth quarter of 2024 [14] Business Line Data and Key Metrics Changes - Yields in the Georgia facility increased by 20% in the first quarter compared to the fourth quarter, attributed to the refinement of the growing system with the STACK phase [9] - The product mix recalibration at the Texas facility is expected to begin full commercial production this month, which is anticipated to drive operational efficiencies and margin improvement [8] Market Data and Key Metrics Changes - The company is actively engaged in discussions with multinational and national retailers to include the Midwest region in their sourcing plans, indicating strong market interest [10] - The relationship with Walmart has strengthened, with additional commitments to serve 13 Walmart distribution centers [11] Company Strategy and Development Direction - The company aims to achieve positive adjusted EBITDA in the third quarter of 2025, with a focus on operational efficiencies, product diversification, and cost management [7] - Plans to enter the Midwest with a new facility are progressing, with promising discussions with retailers [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive adjusted EBITDA in the near term, driven by operational improvements and increased retail demand for CEA products [6][7] - The company expects revenue in the second quarter to be in the range of $12 million to $12.5 million, reflecting the impact of the Texas facility transition [17] Other Important Information - The company ended the quarter with cash and cash equivalents of $28.4 million, and a significant debt restructuring was completed, eliminating approximately $197 million of debt [16] - The restructuring will reduce interest expense over time, with no cash interest or amortization payments required for two years [28] Q&A Session Summary Question: What is driving the material lift coming into the back half of the year? - Management highlighted the Texas transition, Georgia yield improvement, and new products as key drivers for growth [21][22] Question: Can you elaborate on the Georgia yield improvement? - The yield increase is due to an R&D program focused on light optimization, which has exceeded expectations [22][23][34] Question: How will the debt restructuring impact interest expense? - The restructuring will allow for a gradual reduction in interest expense over ten years, with no cash interest payments for two years [27][28]

Financial Performance - Sales increased 38% to $11.6 million in Q1 2025, compared to $8.4 million in the prior year period, driven by production growth in Georgia and new facilities in Texas and Washington [4]. - Net loss for Q1 2025 was $37.7 million, compared to a net loss of $24.1 million in the prior year, primarily due to increased interest expense [10]. - Adjusted EBITDA loss was $8.8 million in Q1 2025, compared to a loss of $6.9 million in the prior year period [10]. - Total sales for the three months ended March 31, 2025, were $11,605,000, representing a 38.5% increase from $8,383,000 in the same period of 2024 [28]. - Net loss attributable to common stockholders for Q1 2025 was $38,078,000, compared to a net loss of $24,050,000 in Q1 2024, with a basic and diluted loss per share of $4.32 versus $2.89 [28]. - Adjusted EBITDA for Q1 2025 was $(8,782,000), compared to $(6,874,000) in Q1 2024, indicating a worsening operational performance [31]. Operational Highlights - Adjusted gross margin percentage improved to approximately 29% in Q1 2025, up from 24% in the prior year period, with expectations for further increases as the business scales [4]. - The Texas facility is transitioning to produce both head lettuce and cut products, with commercial production expected to begin in Q2 2025 [5]. - Local Bounti aims to achieve positive adjusted EBITDA in Q3 2025, driven by sales growth and cost reduction initiatives [17]. - The company continues to pursue capacity expansion projects and product development to meet growing demand from retailers and consumers [6][9]. Investment and Debt Management - The company secured a $25 million equity investment and restructured its debt, resulting in a new $312 million senior secured debt agreement [12]. - Long-term debt increased to $480,047,000 as of March 31, 2025, compared to $416,577,000 as of December 31, 2024 [27]. Cash Flow and Assets - Cash and cash equivalents rose significantly to $18,008,000 as of March 31, 2025, from $937,000 at the end of 2024 [27]. - Total current assets increased to $40,629,000 as of March 31, 2025, from $18,823,000 as of December 31, 2024 [27]. Expenses - Total operating expenses for Q1 2025 were $17,195,000, up from $11,085,000 in Q1 2024, driven by increased research and development costs [28]. - General and administrative expenses were adjusted to $5,815,000 for Q1 2025, compared to $4,305,000 in Q1 2024, reflecting increased operational costs [30]. Distribution and Partnerships - Local Bounti expanded its distribution with notable wins, including partnerships with Walmart and regional retailers in the Pacific Northwest [7][8]. - The company expects Q2 2025 sales to be approximately $12.0 to $12.5 million, with acceleration anticipated in the second half of 2025 [16].

Core Viewpoint - The market anticipates Local Bounti Corporation (LOCL) to report a year-over-year increase in earnings driven by higher revenues for the quarter ended March 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The consensus estimate indicates a quarterly loss of $1.31 per share, reflecting a year-over-year improvement of +54.7%. Revenues are projected to reach $11.1 million, representing a 32.5% increase from the previous year [3]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst assessments during this period [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate aligns with the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%, indicating no recent differing analyst views [10]. Zacks Rank and Predictive Power - Local Bounti holds a Zacks Rank of 2 (Buy), but this combination with a 0% Earnings ESP makes it challenging to predict an earnings beat conclusively [11]. Historical Performance - In the last reported quarter, Local Bounti was expected to post a loss of $3.89 per share but reported a loss of $4.21, resulting in a surprise of -8.23%. Over the past four quarters, the company has only beaten consensus EPS estimates once [12][13]. Conclusion - While the potential for an earnings beat exists, Local Bounti does not appear to be a strong candidate for such an outcome. Investors should consider additional factors when evaluating the stock ahead of the earnings release [16].

Group 1 - Local Bounti Corporation (LOCL) is a notable stock within the Consumer Staples sector, which consists of 177 individual stocks and holds a Zacks Sector Rank of 9 [2] - LOCL currently has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook based on earnings estimates and revisions [3] - The Zacks Consensus Estimate for LOCL's full-year earnings has increased by 30.4% in the past quarter, reflecting improved analyst sentiment and a stronger earnings outlook [4] Group 2 - Year-to-date, LOCL has returned approximately 13.5%, outperforming the Consumer Staples sector's average return of 4.9% [4] - Local Bounti Corporation is part of the Agriculture - Operations industry, which includes 14 stocks and is currently ranked 76 in the Zacks Industry Rank, while this industry has seen an average loss of 1.6% this year [6] - In comparison, Nomad Foods (NOMD), another stock in the Consumer Staples sector, has a year-to-date return of 15.7% and belongs to the Food - Miscellaneous industry, which is ranked 83 and has declined by 4% this year [5][6]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [1] - Identifying the right entry point for fast-moving stocks is challenging, and investors may end up with expensive shares that have limited upside [1] Group 2: Bargain Stocks with Momentum - Investing in bargain stocks that have recently shown price momentum may be a safer strategy [2] - The Zacks Momentum Style Score helps identify strong momentum stocks, while the 'Fast-Paced Momentum at a Bargain' screen highlights attractively priced fast-moving stocks [2] Group 3: Local Bounti Corporation (LOCL) Analysis - Local Bounti Corporation (LOCL) has seen a significant price increase of 86.8% over the past four weeks, indicating growing investor interest [3] - LOCL's stock gained 55.7% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [4] - The stock has a beta of 2.14, suggesting it moves 114% higher than the market in either direction [4] Group 4: Valuation and Earnings Estimates - LOCL has a Momentum Score of B, indicating a favorable time to invest based on momentum [5] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [6] - LOCL is trading at a Price-to-Sales ratio of 0.99, suggesting it is reasonably valued at 99 cents for each dollar of sales [6] Group 5: Additional Investment Opportunities - Besides LOCL, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting additional investment opportunities [7] - Zacks offers over 45 Premium Screens tailored to different investing styles, aiding in stock selection [8]

Group 1 - Local Bounti Corporation (LOCL) is outperforming the Consumer Staples sector with a year-to-date gain of approximately 68.1%, while the sector average is only 0.8% [4] - LOCL is ranked 12 in the Zacks Sector Rank, which includes 177 companies, indicating a relatively strong position within the Consumer Staples group [2] - The Zacks Rank for LOCL is 2 (Buy), reflecting positive analyst sentiment and a favorable earnings outlook, with a 30.4% increase in the consensus estimate for full-year earnings over the past 90 days [3][4] Group 2 - Local Bounti Corporation is part of the Agriculture - Operations industry, which has seen a decline of about 10.4% year-to-date, highlighting LOCL's relative strength in this sector [6] - Another stock in the Consumer Staples sector, Primo Brands (PRMB), has a year-to-date return of 7.2% and a Zacks Rank of 1 (Strong Buy), with a 51.4% increase in the consensus EPS estimate over the past three months [5]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Characteristics - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [3] Group 2: Local Bounti Corporation (LOCL) Analysis - LOCL has shown a price increase of 18% over the past four weeks, indicating growing investor interest [4] - The stock gained 31.2% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [5] - LOCL has a beta of 2.14, suggesting it moves 114% higher than the market in either direction, indicating fast-paced momentum [5] - LOCL has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [6] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [7] - LOCL is trading at a Price-to-Sales ratio of 0.64, indicating it is reasonably valued at 64 cents for each dollar of sales [7] Group 3: Investment Opportunities - LOCL appears to have significant potential for growth at a fast pace, alongside other stocks that meet the 'Fast-Paced Momentum at a Bargain' criteria [8] - There are over 45 Zacks Premium Screens available to help identify winning stock picks based on various investing styles [9]