Local Bounti (LOCL) - 2024 Q1 - Quarterly Results

Executive Summary & Highlights Local Bounti's Q1 2024 results met expectations, driven by production growth and new facility shipments, reiterating 2024 sales guidance and targeting positive adjusted EBITDA by early 2025 - Provides full year 2024 sales guidance of $50 million to $60 million, representing a doubling of revenue versus 2023[2] - First customer deliveries from new Washington and Texas facilities are shipping in the second quarter[1][7] - Expanded retail presence with new customers, including Albertsons Seattle and Brookshire's, strengthening distribution in the Pacific Northwest and Texas[1][3] - The company remains on track to achieve positive adjusted EBITDA generation in early 2025, supported by significant production increases at its Georgia facility (3x year-over-year)[3][6] Financial Performance Q1 2024 sales grew 25% to $8.4 million, with improved gross profit, reduced SG&A, and a narrowed adjusted EBITDA loss of $6.9 million Q1 2024 Financial Results Q1 2024 Key Financial Metrics | Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Sales | $8.4 million | $6.7 million | +25% | | Gross Profit | $0.8 million | $0.3 million | +167% | | Adjusted Gross Margin % | 24% | 33% | -9 p.p. | | SG&A Expenses | $7.6 million | $16.0 million | -52.5% | | Net Loss | ($24.1 million) | ($23.5 million) | Increased Loss | | Adjusted EBITDA Loss | ($6.9 million) | ($7.4 million) | Improved | - The 25% increase in sales was primarily due to increased production and growth from the Georgia facility[4] - Adjusted gross margin performance was driven by costs associated with ongoing facility optimization and scaling[4][5] - Selling, general, and administrative (SG&A) expenses decreased by $8.4 million, driven by Q4 2023 cost savings and lower stock-based compensation[10] Consolidated Financial Statements Consolidated Balance Sheet Highlights | Account | March 31, 2024 (Thousands USD) | | :--- | :--- | | Total Assets | $413,407 | | Cash and cash equivalents | $8,242 | | Property and equipment, net | $344,112 | | Total Liabilities | $422,854 | | Long-term debt, net | $329,775 | | Total Stockholders' (Deficit) | ($9,447) | Consolidated Statements of Operations Highlights | Account | Three Months Ended Mar 31, 2024 (Thousands USD) | | :--- | :--- | | Sales | $8,383 | | Gross Profit | $786 | | Loss from Operations | ($10,299) | | Net Loss | ($24,050) | | Basic and Diluted EPS (USD) | ($2.89) | Non-GAAP Reconciliations - The company uses non-GAAP measures like adjusted EBITDA and adjusted gross profit to enhance performance understanding by excluding stock-based compensation, depreciation, and non-core costs[24][25] Adjusted EBITDA Reconciliation | Item | Amount (Thousands USD) | | :--- | :--- | | Net loss | ($24,050) | | Stock-based compensation expense | ($934) | | Interest expense, net | $9,608 | | Depreciation and amortization | $3,228 | | Change in fair value of warrant liability | $4,180 | | Other adjustments | $1,094 | | Adjusted EBITDA | ($6,874) | Adjusted Gross Profit Reconciliation | Item | Amount (Thousands USD) | | :--- | :--- | | Gross profit | $786 | | Depreciation | $1,203 | | Stock-based compensation | $21 | | Adjusted gross profit | $2,010 | Operational & Strategic Updates Local Bounti is expanding its facility footprint, increasing production, launching new sites, developing products, and securing a patent for its Stack & Flow Technology Commercial Facility Expansion - The Byron, Georgia facility increased production by an additional 50% compared to December 2023, reaching approximately three times the production of a year ago[6] - New facilities in Mount Pleasant, TX, and Pasco, WA, commenced operations in late January and began shipping first products to customers in Q2[7] - The company plans to build its next high-tech Stack & Flow facility in the Midwestern U.S., with construction targeted to begin in Q3 2024[9] - Plans are underway to build additional capacity at existing facilities, with construction anticipated to begin late in Q2 2024[8] Product Development and Distribution - Starting in Q2 2024, the company will expand distribution of its Grab-and-Go Salad Kits to approximately 700 new stores[12] - The company is set to expand its baby leaf assortment in Q3 2024 with offerings like Arugula, Baby Spinach & Spring Mix Blend, and Power Greens[13] - The first shipment of Spinach from the Georgia facility was delivered to customers in March[6][13] Technology and Facility Optimization - In February 2024, the U.S. Patent and Trademark Office issued a patent for the company's proprietary Stack & Flow Technology[14] - The Hamilton, Montana facility is on track to transition from R&D to commercial production by mid-year 2024[11] - A scaled trial is underway in Georgia to test a differentiated use of Stack towers, which in a smaller trial demonstrated a potential yield increase of at least 10%[3][6] Capital Structure & Outlook Local Bounti ended Q1 with $14.7 million cash, expects $228 million Q2 financing for expansion, and reiterates $50-$60 million full-year sales guidance Capital Structure - Ended Q1 2024 with cash and cash equivalents and restricted cash of $14.7 million[15] - Expects to close on $228 million in financing commitments in Q2 2024 to fund facility expansions, a new Midwest facility, and repay existing construction financing[1][15] Fully Diluted Shares Outstanding | Security Type | Count (Millions) | | :--- | :--- | | Shares Outstanding | ~8.4 | | Warrants Outstanding | ~6.2 | | Restricted Stock Units | ~0.5 | | Fully Diluted Shares | ~15.1 | 2024 Financial Outlook - Management provided full-year 2024 sales guidance of $50 million to $60 million[2][18] - This guidance reflects expected production from fully operational Georgia, California, and Montana facilities, plus partial year contribution from new Texas and Washington facilities[18]