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Local Bounti (LOCL) - 2024 Q4 - Earnings Call Transcript
2025-03-31 20:30
Financial Data and Key Metrics Changes - Sales for the full year increased by 38% to $38.1 million compared to $27.6 million in 2023 [26] - Adjusted gross margin for the full year remained consistent at approximately 27%, excluding depreciation and stock-based compensation [28] - Fourth quarter adjusted gross margin improved by 200 basis points year-over-year, impacted by increased labor costs associated with production ramp-ups [30] Business Line Data and Key Metrics Changes - The company opened two new facilities in Washington and Texas, completed the Georgia build-out, and transitioned Montana to commercial operations [14] - The Texas facility is undergoing reconfiguration to produce both living head products and cut products, which temporarily impacted full utilization [27][40] - The company expanded its distribution network, including partnerships with Walmart and other retailers, enhancing its product offerings [24][25] Market Data and Key Metrics Changes - The company is experiencing strong demand for controlled environment agriculture (CEA) products, with retailers increasingly interested in these offerings [46] - The ongoing challenges in traditional outdoor agriculture, such as food safety issues, are reinforcing the value proposition of the company's CEA approach [25] Company Strategy and Development Direction - The company is focused on achieving positive adjusted EBITDA and has implemented a strategy to optimize its product mix with high-value specialty greens [19][32] - The company is considering acquisitions to accelerate market entry and customer reach while evaluating existing infrastructure for potential repurposing [21] - A disciplined capital allocation philosophy is being prioritized, with investments aimed at delivering the fastest path to positive returns [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strengthened financial position and operational improvements, positioning it well for future growth [18][34] - The company anticipates achieving positive adjusted EBITDA in the third quarter of 2025, supported by operational efficiencies and a new capital structure [32][33] - Management emphasized the importance of adaptability and customer-centric operations in response to evolving market demands [27] Other Important Information - The company secured $27.5 million in new funding, including $25 million in equity, and restructured its existing credit agreement, resulting in a nearly 40% reduction in debt [15][16] - The restructured agreement allows for no cash payments until April 2027 and a significantly reduced interest rate of approximately 6% [17] Q&A Session Summary Question: Changes in Georgia and Texas production and impact on unit economics - Management indicated that changes primarily occurred in Texas, where half of the facility ships cut products under a long-term agreement, while the other half is being converted for dual production [38][39] Question: Pricing power and volume benefits - Management noted that as customers become more familiar with their products, it enhances their ability to negotiate better pricing, with a price increase set to take effect in April [42] Question: Relationship with Walmart and shelf space dynamics - Management highlighted that major retailers are increasingly interested in CEA products, and the company's restructuring positions it favorably compared to other providers [47] Question: Variable cost structure in Georgia facility - Management reported that the Georgia facility has successfully reduced seed and labor costs, contributing to improved variable cost management [54] Question: Update on Midwest expansion initiative - Management confirmed that the Midwest expansion is still a priority, with ongoing discussions with retailers to ensure alignment with their product needs [57] Question: Build versus buy dynamic in expansion strategy - Management expressed a preference for acquiring existing greenhouses that can be quickly utilized, as demonstrated by their approach in Georgia [60][61]
Local Bounti (LOCL) - 2024 Q4 - Earnings Call Transcript
2025-04-01 02:07
Financial Data and Key Metrics Changes - Sales for the full year increased by 38% to $38.1 million compared to $27.6 million in 2023, driven by increased production from the Georgia facility and contributions from new facilities in Texas and Washington [26][27] - Adjusted gross margin for the full year remained consistent at approximately 27%, excluding depreciation and stock-based compensation [28] - Fourth quarter adjusted gross margin improved by 200 basis points year-over-year, impacted by increased labor costs associated with production ramp-ups [30] Business Line Data and Key Metrics Changes - The company opened two new facilities in Washington and Texas, completed the Georgia build-out, and transitioned Montana to commercial operations [14] - The Texas facility is undergoing reconfiguration to produce both living head products and cut products, which temporarily impacted full utilization [27][40] - Distribution of high-value specialty greens expanded, including partnerships with Walmart and other retailers [24][25] Market Data and Key Metrics Changes - The company is experiencing strong demand for controlled environment agriculture (CEA) products, with retailers increasingly interested in these offerings [46] - The restructuring of the balance sheet positions the company favorably compared to other CEA providers, enhancing relationships with customers [47] Company Strategy and Development Direction - The company aims to achieve positive adjusted EBITDA by the third quarter of 2025, focusing on operational efficiency and an optimized product mix [32][34] - A strategic approach to expansion is being adopted, balancing build versus buy considerations, with a focus on advantageous acquisition opportunities [21][20] - The company is prioritizing investments that deliver the fastest path to positive returns, aligning production capabilities with specific customer needs [19][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to innovate and optimize operations under new leadership [8][9] - The company is committed to meeting growing customer demand for sustainable, locally grown produce, emphasizing the importance of operational excellence [34] - Management anticipates a sequential revenue lift beginning in Q2 2025 as the Texas facility completes its reconfiguration [31] Other Important Information - The company secured $27.5 million in new funding, including $25 million in equity, and restructured its existing credit agreement, resulting in a nearly 40% reduction in debt [15][16] - The restructured agreement allows for no cash payments until April 2027 and a significantly reduced interest rate of approximately 6% [17][18] Q&A Session Summary Question: Changes in Georgia and Texas production and impact on unit economics - Management indicated that changes primarily occurred in Texas, where half of the facility ships cut products under a long-term agreement, while the other half is being converted to produce both living head and cut products [37][39] Question: Pricing power and volume benefits - Management noted that as customers become more familiar with their products, it provides leverage to negotiate better pricing, with a price increase set to take effect in April [41][42] Question: Relationship with Walmart and shelf space dynamics - Management highlighted that major retailers are increasingly interested in CEA products, and the company's restructuring positions it favorably to solidify relationships with customers [44][47] Question: Variable cost structure of the Georgia facility - Management reported that the Georgia facility has successfully reduced seed and labor costs, contributing to improved variable cost management [52][54] Question: Update on Midwest expansion initiative - Management confirmed that the Midwest expansion is still an intention, with ongoing discussions with retailers to ensure the facility design meets their needs [56][57] Question: Build versus buy dynamic in expansion strategy - Management expressed a preference for acquiring existing greenhouses that can be quickly utilized, as demonstrated with the Georgia facility, which increased productivity significantly [58][60]
Local Bounti (LOCL) - 2024 Q4 - Earnings Call Presentation
2025-03-31 20:23
©2024 Local Bounti Corporation Investor presentation TRADEMARKS AND TRADE NAMES Local Bounti owns or has rights to various trademarks, service marks and trade names that it uses in connection with the operation of its business. This presentation also contains trademarks, service marks and trade names of third parties, which are the property of their respective owners. The use or display of third parties' trademarks, service marks, trade names or products in this presentation is not intended in, and does not ...
Local Bounti (LOCL) - 2024 Q4 - Annual Results
2025-03-31 20:10
Financial Performance - Sales increased by 38% to $38.1 million in 2024, compared to $27.6 million in the prior year, driven by production growth from facilities in Georgia, Texas, and Washington[5] - Gross profit for 2024 was $4.1 million, with an adjusted gross margin of approximately 27%, consistent with the prior year, reflecting production ramp-up at new facilities[5] - Operating loss improved by $57.9 million to $59.0 million in 2024, compared to a loss of $116.9 million in 2023, which included a non-cash goodwill impairment charge[9] - Net loss for 2024 was $119.9 million, slightly improved from a net loss of $124.0 million in the prior year[9] - Sales for Q4 2024 reached $10,070,000, a 46% increase from $6,866,000 in Q4 2023[34] - The net loss for Q4 2024 was $36,258,000, an improvement from a net loss of $65,554,000 in Q4 2023[34] - The company reported a basic and diluted net loss per share of $4.21 for Q4 2024, compared to $8.10 for Q4 2023[34] Expenses and Costs - Research and development expenses increased to $22.3 million in 2024, with expectations for future decreases as production thresholds for new product lines are reached[9] - Total operating expenses for Q4 2024 were $17,314,000, down from $59,932,000 in Q4 2023, primarily due to a reduction in goodwill impairment[34] - Research and development expenses for Q4 2024 were $7,185,000, significantly higher than $3,983,000 in Q4 2023[34] - Selling, general and administrative expenses for Q4 2024 were $10,129 thousand, down from $17,468 thousand in Q4 2023, representing a decrease of 42.4%[36] - Adjusted selling, general and administrative expenses for the twelve months ended December 31, 2024, were $28,185 thousand, down from $30,200 thousand in 2023, a decrease of 6.7%[36] - Stock-based compensation expense for Q4 2024 was $1,247 thousand, down from $2,616 thousand in Q4 2023, a reduction of 52.3%[37] - Interest expense, net for the twelve months ended December 31, 2024, increased to $58,923 thousand from $25,745 thousand in 2023, an increase of 128.5%[37] - Depreciation and amortization for the twelve months ended December 31, 2024, was $18,871 thousand, up from $13,132 thousand in 2023, an increase of 43.7%[37] - Business acquisition and strategic transaction costs for the twelve months ended December 31, 2024, were $2,479 thousand, down from $6,902 thousand in 2023, a decrease of 64.0%[37] - Loss on disposal of fixed assets for the twelve months ended December 31, 2024, was $1,651 thousand, compared to $4,709 thousand in 2023, a decrease of 64.9%[37] Funding and Capital Structure - The company secured $27.5 million in new funding, including $25 million in equity and $2.5 million in capex financing, while restructuring $197 million in debt with a nearly 40% reduction[2][4] - Total assets increased to $428,035,000 as of December 31, 2024, up from $381,752,000 in 2023[32] - Current liabilities rose to $55,436,000 in Q4 2024, compared to $31,941,000 in Q4 2023[32] - Long-term debt increased to $416,577,000 in Q4 2024, up from $277,985,000 in Q4 2023[32] Future Outlook - The company expects first quarter 2025 sales of approximately $11.5 million, reflecting ongoing product mix transitions at its Texas facility[21] - Local Bounti aims to achieve positive adjusted EBITDA by the third quarter of 2025, supported by improved capital structure and operational efficiencies[22] Leadership Changes - Leadership transition occurred with Kathleen Valiasek appointed as CEO, succeeding Craig Hurlbert, who became Executive Chairman[18] Gross Profit and Margins - Adjusted gross profit for Q4 2024 was $2,478,000, with an adjusted gross margin percentage of 25%[35] - Gross profit for Q4 2024 was $540,000, compared to $680,000 in Q4 2023, reflecting a decrease in gross margin percentage[34] - Adjusted EBITDA for the twelve months ended December 31, 2024, was $(32,084) thousand, slightly improved from $(34,082) thousand in 2023[37] Goodwill Impairment - Goodwill impairment recorded in Q4 2023 was $38,481 thousand, with no impairment reported in Q4 2024[37]
Local Bounti to Release Full Year 2024 Financial Results on Monday, March 31, 2025
Prnewswire· 2025-03-28 13:00
Core Viewpoint - Local Bounti Corporation is set to release its financial results for the fiscal year ended December 31, 2024, on March 31, 2025, after market close [1] Financial Results Announcement - The financial results will be discussed in a conference call with the executive management team scheduled for 4:30 p.m. ET on March 31, 2025 [2] - The call will be accessible via telephonic participation for North American and international listeners, with specific dial-in numbers provided [2] Webcast and Playback Information - The conference call will be broadcast live on the Company's website and will be archived for later access [3] - A telephonic playback will be available until April 7, 2025, with dedicated numbers for North American and international listeners [3] Company Overview - Local Bounti is innovating indoor farming through its patented Stack & Flow Technology®, enhancing crop turns and improving unit economics [4] - The Company operates advanced indoor growing facilities across the U.S., servicing approximately 13,000 retail doors [4] - Local Bounti employs sustainable growing methods that use 90% less land and 90% less water compared to conventional farming [4] - The mission of Local Bounti is to revolutionize agriculture by ensuring access to fresh, sustainable, locally grown produce [4]
Local Bounti Announces Multi-Year Award with Large Multinational Retailer
Prnewswire· 2024-12-16 13:00
Core Insights - Local Bounti Corporation has secured a two-year contract with a large multinational retailer to supply living butter lettuce to 13 distribution centers, highlighting the company's customer-centric approach and commercial momentum [1][2] - The CEO emphasized the demand for fresh, sustainable, locally grown produce and the company's strategy to align capacity with customer demand, which is expected to drive performance and lead to positive adjusted EBITDA by Q2 2025 [2][3] Company Overview - Local Bounti is innovating indoor farming through its patented Stack & Flow Technology®, which enhances crop turns, output, and unit economics, operating advanced facilities across the U.S. and servicing approximately 13,000 retail doors [3] - The company utilizes sustainable growing methods that consume 90% less land and water compared to traditional farming, aiming to revolutionize agriculture and ensure accessibility to fresh produce [3] Strategic Approach - The award from the retailer is a result of strategic discussions with both new and existing customers, ensuring that facilities are optimized for specific products that align with customer distribution plans [2] - This customer-centric strategy allows Local Bounti to maximize synergies across its growing footprint and customer network, enhancing overall performance [2]
Local Bounti (LOCL) - 2024 Q3 - Earnings Call Transcript
2024-11-15 01:25
Financial Data and Key Metrics Changes - In Q3 2024, the company reported sales of $10.2 million, a 50% increase year-over-year, but below expectations due to strategic adjustments [6][28] - Adjusted gross margin reached 32%, reflecting a 300 basis point sequential improvement from Q2 2024 [12][30] - The adjusted EBITDA loss improved by $600,000 to $8.4 million compared to the previous year [36] Business Line Data and Key Metrics Changes - The company is shifting its growing plans to focus on high-demand specialty products like Arugula and Spinach, impacting production mix and revenue contributions [7][13] - The Texas facility's production is not yet fully optimized, with expectations for achieving optimized run rates pushed to early Q2 2025 [29][41] Market Data and Key Metrics Changes - The company has expanded its commercial relationships, shipping to over 180 Brookshire Grocery Company locations and fulfilling agreements with Sam's Club [14][15] - The controlled environment agriculture industry is facing challenges, but the company's ability to provide safe, high-quality produce positions it favorably against traditional agriculture [17] Company Strategy and Development Direction - The company is adopting a more measured approach to expansion, aligning production capabilities with verified customer demand to ensure sustainable growth [9][18] - Strategic initiatives include optimizing operations and facility networks to maximize revenue-generating potential in a capital-efficient manner [20][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive adjusted EBITDA by Q2 2025, emphasizing a customer-driven approach to operational excellence [18][58] - The company is focused on deepening relationships with customers and enhancing operational efficiencies to improve margins [55][57] Other Important Information - The company has cash, cash equivalents, and restricted cash amounting to $6.8 million as of September 30, 2024, with additional funding provided by lenders [36][38] - The company is evaluating financing arrangements to support strategic initiatives while ensuring flexibility for near-term objectives [26][27] Q&A Session Summary Question: What are the drivers of revenue ramp from Q3 to Q4 and into 2025? - Management highlighted the ramp in production and throughput, pricing, and the introduction of new SKUs as key drivers of revenue growth [47][48] Question: What are the corporate goals for 2025? - Goals include increasing utilization of existing facilities, operational efficiencies, and aligning expansions with customer feedback [52][53] Question: Where does the Texas facility stand compared to Georgia and Washington facilities? - Georgia and Washington facilities are at full capacity, while Texas is expected to reach optimized run rates by early Q2 2025 [61] Question: What is the status of conversations with potential capital providers? - Management is actively engaged with multiple capital providers and is optimistic about securing capital once customer feedback is solidified [62][64] Question: What is the status of the Midwest expansion? - The site for the Midwest expansion is confirmed, but the size and internal configuration are under consideration based on customer demand [68][69]
Local Bounti (LOCL) - 2024 Q3 - Quarterly Report
2024-11-14 21:26
Sales Performance - Sales for the three months ended September 30, 2024, increased by $3.4 million (50%) to $10.2 million compared to $6.8 million for the same period in 2023[70] - Sales for the nine months ended September 30, 2024, increased by $7.4 million (36%) to $28.1 million compared to $20.7 million for the same period in 2023[70] Gross Profit - Gross profit for the three months ended September 30, 2024, was $1.4 million, a 249% increase from $405,000 in the same period in 2023[70] - Gross profit for the nine months ended September 30, 2024, was $3.6 million, a 131% increase from $1.5 million in the same period in 2023[70] Cost of Goods Sold - Cost of goods sold for the three months ended September 30, 2024, increased by $2.4 million (38%) to $8.8 million compared to $6.4 million for the same period in 2023[70] - Cost of goods sold for the nine months ended September 30, 2024, increased by $5.4 million (28%) to $24.5 million compared to $19.2 million for the same period in 2023[70] Production and Expansion Plans - The company completed the transition of its Montana facility to commercial production in Q3 2024, aiming for positive adjusted EBITDA by Q2 2025[64] - The company plans to expand its production capacity and product offerings, including new varieties of fresh greens and herbs, through new facilities and acquisitions[63] - The company signed an offtake agreement with Sam's Club in October 2022 for leafy greens production, which runs through September 2028[62] - The company introduced new Grab & Go Salad Kits and expanded its product assortment with several high-velocity offerings in Q3 2024[66] Research and Development Expenses - Research and development expenses increased by $2.1 million for the three months ended September 30, 2024, compared to the same period in 2023, and by $3.0 million for the nine months ended September 30, 2024[80] Selling, General, and Administrative Expenses - Selling, general, and administrative expenses decreased by $2.1 million for the three months ended September 30, 2024, primarily due to a $1.6 million decrease in stock-based compensation expense[82] - Selling, general, and administrative expenses decreased by $16.4 million for the nine months ended September 30, 2024, mainly due to a $10.1 million decrease in stock-based compensation expense[83] Interest Expense - Interest expense, net increased by $11.2 million for the three months ended September 30, 2024, primarily due to a significant increase in the principal amount outstanding on the Senior Facility[86] - Interest expense, net increased by $22.5 million for the nine months ended September 30, 2024, mainly due to a $21.0 million increase in the principal amount outstanding on the Senior Facility[87] Financial Position - As of September 30, 2024, the company had an accumulated deficit of $387.0 million and cash and cash equivalents of $6.8 million[88] - Outstanding debt principal totaled $431.7 million as of September 30, 2024, with required quarterly principal payments beginning April 1, 2025[89] Cash Flow - Net cash used in operating activities was $28.3 million for the nine months ended September 30, 2024, primarily due to a net loss of $83.6 million[100] - Net cash used in investing activities was $72.6 million for the nine months ended September 30, 2024, due primarily to purchases for the Washington, Texas, and Georgia facilities[102] - The company plans to renegotiate credit facility terms to provide additional working capital and defer principal payments through November 30, 2025[92] - Net cash provided by financing activities for the nine months ended September 30, 2024, was $90.8 million, primarily from $90.9 million of net proceeds from debt issuance[103] - In comparison, net cash provided by financing activities for the nine months ended September 30, 2023, was $136.6 million, which included $101.9 million from debt issuance and $35.0 million from a sale and leaseback transaction[103]
Local Bounti Corporation (LOCL) Reports Q3 Loss, Misses Revenue Estimates
ZACKS· 2024-11-14 14:25
Financial Performance - Local Bounti Corporation reported a quarterly loss of $4.01 per share, which was worse than the Zacks Consensus Estimate of a loss of $2.78, and compared to a loss of $3.02 per share a year ago, indicating a significant decline in performance [1] - The company posted revenues of $10.24 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 21.22%, and this represents an increase from year-ago revenues of $6.81 million [2] - Over the last four quarters, Local Bounti has surpassed consensus EPS estimates only once, indicating challenges in meeting market expectations [2] Stock Performance and Outlook - Local Bounti shares have increased by approximately 12.9% since the beginning of the year, underperforming compared to the S&P 500's gain of 25.5% [3] - The current consensus EPS estimate for the upcoming quarter is -$2.57 on revenues of $21.2 million, and for the current fiscal year, it is -$11.24 on revenues of $52 million [7] Industry Context - The Agriculture - Operations industry, to which Local Bounti belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a relatively strong position within the sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Local Bounti's stock performance [5]
Local Bounti (LOCL) - 2024 Q3 - Quarterly Results
2024-11-14 12:25
Financial Performance - Sales increased by 50% to $10.2 million in Q3 2024, compared to $6.8 million in the prior year period, driven by increased production and sales growth from facilities in Georgia, Texas, and Washington[3]. - Net loss for Q3 2024 was $34.3 million, compared to a net loss of $24.3 million in the prior year period[7]. - Adjusted EBITDA loss improved to $8.4 million, compared to a loss of $9.0 million in the prior year period[8]. - Total sales for Q3 2024 reached $10,242,000, a 50.5% increase from $6,810,000 in Q3 2023[25]. - Basic and diluted net loss per share for Q3 2024 was $(4.01), compared to $(3.02) in Q3 2023, reflecting increased losses per share[25]. - Net loss for September 2024 was $34,327,000 compared to a loss of $24,258,000 in September 2023, representing a 41.5% increase in losses year-over-year[30]. - Adjusted EBITDA for September 2024 was $(8,355,000), slightly improved from $(8,982,000) in September 2023[30]. Revenue and Growth Projections - The company anticipates Q4 2024 revenues of approximately $11 million, reflecting year-over-year growth of about 67%[16]. - Adjusted gross margin percentage improved to approximately 32%, up by about 300 basis points sequentially, with gross profit reported at $1.4 million[3][4]. - Adjusted gross profit for Q3 2024 was $3,253,000, with an adjusted gross margin of 32%, compared to 25% in Q3 2023[28]. Research and Development - Research and development expenses rose to $7.1 million in Q3 2024, compared to $5.0 million in the prior year, with expectations for future decreases as production thresholds for new product lines are reached[6]. - Research and development expenses for Q3 2024 were $7,096,000, up from $5,001,000 in Q3 2023, highlighting increased investment in innovation[25]. Assets and Liabilities - Total current assets decreased to $17,303,000 in 2024 from $26,988,000 in 2023, primarily due to a reduction in cash and cash equivalents[24]. - Total liabilities increased to $496,427,000 in 2024 from $366,479,000 in 2023, reflecting higher accounts payable and long-term debt[24]. - Total stockholders' equity showed a deficit of $(65,613,000) in 2024, down from a positive equity of $15,273,000 in 2023, indicating financial distress[24]. Inventory and Production - The transition of the Hamilton, Montana facility to commercial production was completed in Q3 2024, supporting the goal of achieving positive adjusted EBITDA by Q2 2025[9]. - The company reported a significant increase in inventory, rising to $6,547,000 in 2024 from $4,210,000 in 2023, indicating potential overstock issues[24]. - The company expanded its product assortment in Q3 2024, introducing several high-velocity offerings, including Arugula and Spinach[11]. Financing and Strategic Initiatives - The company is evaluating financing arrangements to support strategic initiatives while maintaining a focus on achieving positive adjusted EBITDA[2]. - As of September 30, 2024, the company had cash and cash equivalents of $6.8 million, with an additional $6 million received from a lender for working capital[13]. Expenses and Cost Management - Stock-based compensation expense decreased to $1,387,000 in September 2024 from $3,265,000 in September 2023, a reduction of 57.5%[30]. - Interest expense, net increased significantly to $18,312,000 in September 2024 from $7,105,000 in September 2023, marking a 157.5% rise[30]. - Depreciation and amortization expenses rose to $5,868,000 in September 2024 from $3,405,000 in September 2023, an increase of 72.3%[30]. - Business acquisition and strategic transaction costs amounted to $614,000 in September 2024, down from $1,975,000 in September 2023, a decrease of 68.9%[30]. - Loss on disposal of fixed assets was $1,610,000 in September 2024, consistent with the same amount in September 2023[30]. - Utilities price spike and inclement weather related costs were recorded at $727,000 in the previous year, with no current costs reported[30]. - Change in fair value of warrant liability showed a loss of $(1,921,000) in September 2024 compared to $(1,766,000) in September 2023[30]. - Restructuring and business realignment costs were $152,000 in September 2023, with no current costs reported for September 2024[30].