Benson Hill(US:BHIL)2022-05-16 17:22Financial Data and Key Metrics Changes - The company reported consolidated revenues of $92 million for Q1 2022, representing a nearly 200% increase year-over-year [12] - Consolidated gross margins were in line with expectations, despite approximately $8 million in losses related to mark-to-market hedge contracts [14][16] - Cash used to fund operations during the quarter was $53 million, which included a temporary timing effect of approximately $15 million for margin calls [20] Business Line Data and Key Metrics Changes - The ingredients segment reported revenues of $66 million, up nearly 400% year-over-year, driven by strong operational execution and market demand [12][13] - Proprietary revenues in the ingredients segment were $14 million, a 161% increase over the prior year, driven by strong sales demand for specialty meal and oil products [17] - The fresh segment saw revenues increase to $26 million, with double-digit gross margins due to improved pricing and volume growth [19] Market Data and Key Metrics Changes - The company is experiencing growing interest in its CleanCRUSH ingredients derived from Ultra-High Protein soy varieties, which offer sustainability and supply chain efficiency benefits [7] - The geopolitical situation and rising inflation are increasing the urgency to enhance supply chain reliability and reduce costs in the food system [10] Company Strategy and Development Direction - The company is focused on scaling the commercialization of its proprietary soy ingredients portfolio and has reaffirmed its guidance for the full year [6] - Partnerships with companies like Kellogg's MorningStar Farms and Denofa are aimed at helping customers meet sustainability objectives while supplying high-quality soy ingredient products [8] - The company plans to increase the number of acres of non-GMO, high oleic soybean varieties in response to supply chain disruptions [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting guidance commitments for the year, citing strong demand in all relevant target markets [41][42] - The company views execution as its biggest challenge and is focused on operational excellence to address this risk [45] - Inflationary pressures are being managed, with innovation seen as a key factor in mitigating deflationary effects in the food system [46] Other Important Information - The company is positioned well to help customers navigate challenges in the food system due to its integrated go-to-market model [10] - The first quarter results are seen as a strong indicator of the company's ability to capitalize on market dynamics and customer needs [41] Q&A Session Summary Question: Update on 2022 plantings and risks - Management noted that while planting has been delayed due to weather, there is currently no material concern regarding the ability to plant [22][23] Question: Dynamics within the ingredients business and revenue contributions - Management indicated that proprietary revenue streams will see material pickup over the year, particularly on the protein side [28][29] Question: Breakdown of operating expenses - The increase in operating expenses was attributed to the full build-out of commercial and administrative teams, with a significant portion being non-cash and one-time items [31] Question: Operational improvements in facilities - Management highlighted strong operational performance and ongoing improvements in efficiency at their facilities [35] Question: Contribution to 2023 and pricing dynamics - Management expects to see additional inventory for 2023 and is experiencing significant interest in long-term contracting due to geopolitical events [38] Question: Overall business outlook and execution - Management expressed confidence in meeting revenue and margin expectations, with strong demand across all target markets [41][42]