Record Net Sales of $11.8 million, growth of
28%. Gross Margin at 43.0%. Cash increased $0.4 million.
Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood,”
the “Company”, “we”, and “our”), today reported financial results
for the third quarter ended September 30, 2024.
Jason Vieth, Chief Executive Officer, commented, “I am pleased
to report that Laird Superfood is once again among the fastest
growing food companies in the US, with Net Sales increasing by over
28% in the third quarter of 2024. Year-to-date our 2024 Net Sales
growth rate is nearly 27% and has been driven by positive growth
across both e-commerce and wholesale channels, and across all of
our core categories including Creamers, Coffee, and Hydration
products. Even more impressive, we have done this while expanding
our Gross Margin to more than 41% during 2024, which is also among
best-in-class companies in the Food industry. We continue to see
strong uptake among retailers nationwide, and the growth rate in
our ecommerce business demonstrates our ability to maintain a
leading position in omnichannel food sales.”
Vieth continued: “It is a clear trend that consumers continue to
accelerate their focus on the impact of food ingredients to their
own health and wellness, and I believe that Laird Superfood is now
among the best positioned brands to support them on this
journey.”
Third Quarter 2024 Highlights
- Net Sales of $11.8 million compared to $9.2 million in the
corresponding prior year period and $10.0 million in the second
quarter of 2024.
- E-commerce sales increased by 42% year-over-year and
contributed 58% of total Net Sales, with significant improvements
in media efficiency in this channel. Sales on Amazon.com increased
by 133% year-over-year, building on the strong performance over the
last two quarters as compared to the reduced prior year sales
volume stemming from out-of-stock products caused by the quality
event in 2023. Direct-to-Consumer (“DTC”) platform sales grew 10%
year-over-year, driven by strong performance in both subscription
revenue and repeat consumer purchases, higher average order value,
and improved discount rates due to strategic shifts in our
promotional strategies.
- Wholesale sales increased by 13% year-over-year and contributed
42% of total Net Sales, driven by growth in grocery due to velocity
improvement and distribution expansion, as well as more efficient
promotional spend.
- Gross Margin was 43.0% compared to 31.0% in the corresponding
prior year period, and 41.8% in the second quarter of 2024. This
margin expansion was driven by lower ingredient costs due to a
shift to the direct procurement of key raw materials, settlement
recoveries, as well as planned reductions in trade spend.
- Net Loss was $0.2 million, or $0.02 per diluted share, compared
to Net Loss of $2.7 million, or $0.28 per diluted share, in the
corresponding prior year period and Net Loss of $0.2 million, or
$0.02 per diluted share, in the second quarter of 2024. The
improvement was driven by Gross Margin expansion, as well as lower
marketing, and general and administrative (G&A) costs.
- Adjusted earnings before interest, taxes, depreciation,
amortization, stock-based compensation, and non-recurring items
(“Adjusted EBITDA”), which is a non-GAAP financial measure, was
($11.4) thousand, or $0.00 per diluted share, compared to ($2.5)
million, or ($0.27) per diluted share, in the corresponding prior
year period and ($41.8) thousand, or ($0.00) per diluted share, in
the second quarter of 2024. This improvement was driven by
significantly expanded Gross Margins and lower sales and marketing
and G&A costs. For more details on non-GAAP financial measures,
refer to the information in the non-GAAP financial measures section
of this press release.
Year-to-Date 2024 Highlights
- Net Sales of $31.7 million compared to $25.0 million in the
corresponding prior year period, representing 27% growth.
- E-commerce sales increased by 41% year-over-year and
contributed 59% of total Net Sales, with significant improvements
in media efficiency in this channel. Sales on Amazon.com and the
DTC platform increased year-over-year by 85% and 22%, respectively,
driven by growth in subscription revenue and repeat consumer
purchases, as well as higher order values.
- Wholesale sales increased by 11% year-over-year and contributed
41% of total Net Sales, driven by velocity improvement and
distribution expansion in grocery, as well as more efficient
promotional spend.
- Gross Margin was 41.7% compared to 26.4% in the corresponding
prior year period. This margin expansion was driven by the full
realization of the cost savings resulting from our transition to a
variable cost third-party co-manufacturing business model, lower
ingredient costs due to a shift to the direct procurement of key
raw materials, as well as planned reductions in trade spend.
- Net Loss was $1.4 million, or $0.14 per diluted share, compared
to Net Loss of $10.3 million, or $1.11 per diluted share, in the
corresponding prior year period. The improvement was driven by
Gross Margin expansion, and lower marketing, and G&A
costs.
- Adjusted EBITDA was ($0.8) million, or ($0.08) per diluted
share, compared to ($9.2) million, or ($0.99) per diluted share, in
the corresponding prior year period. This improvement was driven by
significantly expanded Gross Margins and lower marketing and
G&A costs. For more details on non-GAAP financial measures,
refer to the information in the non-GAAP financial measures section
of this press release.
Revenue Disaggregation
Three Months Ended September
30,
2024
2023
$
% of Total
$
% of Total
Coffee creamers
$
6,273,157
53
%
$
5,804,273
63
%
Coffee, tea, and hot chocolate
products
3,298,363
28
%
1,981,731
22
%
Hydration and beverage enhancing
supplements
2,520,402
21
%
1,726,512
19
%
Harvest snacks and other food items
1,558,611
13
%
1,747,908
19
%
Other
75,339
1
%
132,284
1
%
Gross sales
13,725,872
116
%
11,392,708
124
%
Shipping income
142,002
1
%
214,982
2
%
Discounts and promotional activity
(2,091,528
)
(17
)%
(2,427,909
)
(26
)%
Sales, net
$
11,776,346
100
%
$
9,179,781
100
%
Three Months Ended September
30,
2024
2023
$
% of Total
$
% of Total
E-commerce
$
6,887,356
58
%
$
4,842,389
53
%
Wholesale
4,888,990
42
%
4,337,392
47
%
Sales, net
$
11,776,346
100
%
$
9,179,781
100
%
Nine Months Ended September
30,
2024
2023
$
% of Total
$
% of Total
Coffee creamers
$
16,540,456
52
%
$
15,583,969
62
%
Coffee, tea, and hot chocolate
products
7,977,157
25
%
5,894,632
24
%
Hydration and beverage enhancing
supplements
6,855,274
22
%
3,395,671
14
%
Harvest snacks and other food items
4,546,448
14
%
5,350,252
21
%
Other
289,261
1
%
286,965
1
%
Gross sales
36,208,596
114
%
30,511,489
122
%
Shipping income
373,832
1
%
778,051
3
%
Discounts and promotional activity
(4,893,490
)
(15
)%
(6,272,730
)
(25
)%
Sales, net
$
31,688,938
100
%
$
25,016,810
100
%
Nine Months Ended September
30,
2024
2023
$
% of Total
$
% of Total
E-commerce
$
18,854,020
59
%
$
13,409,443
54
%
Wholesale
12,834,918
41
%
11,607,367
46
%
Sales, net
$
31,688,938
100
%
$
25,016,810
100
%
Balance Sheet and Cash Flow
Highlights
We had $8.2 million of cash, cash equivalents, and restricted
cash as of September 30, 2024, and no outstanding debt.
Cash provided by operating activities was $0.5 million for the
nine months of 2024, compared to cash used in operating activities
of $10.9 million in the same period in 2023. The improvement in
cash used relative to the corresponding prior year period was
driven by Gross Margin expansion and significant reductions in
marketing and G&A costs. Cash increased by $0.4 million in the
third quarter of 2024, marking the second consecutive quarter of
positive cash flow.
2024 Outlook
Based on the year-to-date 2024 results and management's best
assessment of the environment today, we are raising the guidance
for the full year 2024:
- Net Sales are expected to be in the range of approximately $43
to $44 million, representing growth of 26% to 29% compared to
2023.
- Gross Margin is expected to expand to approximately 41% to 42%,
representing an 11 to 12-point improvement compared to 2023.
2025 Outlook
In 2025, management strategy is to drive growth well in excess
of consumer goods and food industry averages:
- Net Sales are expected to grow between 20 to 25%, driven by
continued expansion across Wholesale accounts and further
penetration of consumers on ecommerce platforms.
- Management intends to maintain slightly positive EBITDA and
Cash Flow during 2025, investing incremental margin back into the
business to strategically drive topline growth initiatives.
Conference Call and Webcast Details
We will host a conference call and webcast at 5:00 p.m. ET today
to discuss our financial results. Participants may access the live
webcast on the Laird Superfood Investor Relations website at
https://investors.lairdsuperfood.com under “Events”. The webcast
will be archived on the Company's website and will be available for
replay for at least two weeks.
About Laird Superfood
Laird Superfood, Inc. creates award-winning, plant-based
superfood products that are clean, delicious, and functional. Our
products are designed to enhance a consumer's daily ritual and keep
them fueled naturally throughout the day. Laird Superfood 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 www.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, future financial performance, and growth. Such
forward-looking statements may be identified by words such as
"anticipates," "believes," "continues," "could," "estimates,"
"expects," "intends," "may," "outlook," "plans," "potential,"
predicts," "projects," "seeks," "should," "will," "would", or the
antonyms of these terms or other comparable terminology. 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
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2024
2023
2024
2023
Sales, net
$
11,776,346
$
9,179,781
$
31,688,938
$
25,016,810
Cost of goods sold
(6,712,214
)
(6,332,624
)
(18,483,424
)
(18,419,709
)
Gross profit
5,064,132
2,847,157
13,205,514
6,597,101
General and administrative
Salaries, wages, and benefits
1,247,066
937,198
3,145,282
3,342,913
Other general and administrative
1,377,628
1,311,138
3,785,332
4,686,234
Total general and administrative
expenses
2,624,694
2,248,336
6,930,614
8,029,147
Sales and marketing
Marketing and advertising
1,579,763
2,320,752
5,016,446
6,505,099
Selling
1,057,800
990,437
2,757,695
2,565,271
Related party marketing agreements
70,465
74,701
196,532
242,740
Total sales and marketing expenses
2,708,028
3,385,890
7,970,673
9,313,110
Total operating expenses
5,332,722
5,634,226
14,901,287
17,342,257
Operating loss
(268,590
)
(2,787,069
)
(1,695,773
)
(10,745,156
)
Other income
107,891
132,185
321,957
452,288
Loss before income taxes
(160,699
)
(2,654,884
)
(1,373,816
)
(10,292,868
)
Income tax expense
(5,421
)
—
(47,902
)
(13,172
)
Net loss
$
(166,120
)
$
(2,654,884
)
$
(1,421,718
)
$
(10,306,040
)
Net loss per share:
Basic and diluted
$
(0.02
)
$
(0.28
)
$
(0.14
)
$
(1.11
)
Weighted-average shares of common stock
outstanding used in computing net loss per share of common stock,
basic and diluted
10,256,802
9,337,789
9,831,927
9,279,541
LAIRD SUPERFOOD, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(unaudited)
Nine Months Ended September
30,
2024
2023
Cash flows from operating
activities
Net loss
$
(1,421,718
)
$
(10,306,040
)
Adjustments to reconcile net loss to net
cash from operating activities:
Depreciation and amortization
204,419
235,025
Stock-based compensation
1,073,698
818,647
Provision for inventory obsolescence
560,519
1,260,580
Allowance for credit losses
54,607
245,700
Noncash lease costs
114,254
114,254
Other operating activities, net
—
38,098
Changes in operating assets and
liabilities:
Accounts receivable
(839,991
)
(937,876
)
Inventory
(393,402
)
(1,958,157
)
Prepaid expenses and other current
assets
113,083
1,061,879
Operating lease liability
(97,520
)
(94,679
)
Accounts payable
50,377
810,908
Accrued expenses
1,107,932
(2,217,484
)
Net cash from operating activities
526,258
(10,929,145
)
Cash flows from investing
activities
(19,178
)
567,459
Cash flows from financing
activities
(12,495
)
(23,066
)
Net change in cash and cash
equivalents
494,585
(10,384,752
)
Cash, cash equivalents, and restricted
cash, beginning of period
7,706,806
17,809,802
Cash, cash equivalents, and restricted
cash, end of period
$
8,201,391
$
7,425,050
Supplemental disclosures of cash flow
information
Right-of-use assets obtained in exchange
for operating lease liabilities
$
—
$
344,382
Supplemental disclosures of non-cash
investing activities
Settlement recovery from business
interruption claims included in other current assets
$
—
$
158,429
Receivable from sale of assets
held-for-sale included in other current assets at the end of the
period
$
—
$
126,268
LAIRD SUPERFOOD, INC.
CONSOLIDATED BALANCE
SHEETS
(unaudited)
As of
September 30, 2024
December 31, 2023
Assets
Current assets
Cash, cash equivalents, and restricted
cash
$
8,201,391
$
7,706,806
Accounts receivable, net
1,807,756
1,022,372
Inventory, net
6,155,442
6,322,559
Prepaid expenses and other current
assets
1,172,481
1,285,564
Total current assets
17,337,070
16,337,301
Noncurrent assets
Property and equipment, net
81,408
122,595
Intangible assets, net
941,177
1,085,231
Related party license agreements
132,100
132,100
Right-of-use assets
258,490
354,732
Total noncurrent assets
1,413,175
1,694,658
Total assets
$
18,750,245
$
18,031,959
Liabilities and Stockholders’
Equity
Current liabilities
Accounts payable
$
1,682,851
$
1,647,673
Accrued expenses
3,682,495
2,586,343
Related party liabilities
29,667
2,688
Lease liabilities, current portion
141,504
138,800
Total current liabilities
5,536,517
4,375,504
Lease liabilities
161,624
243,836
Total liabilities
5,698,141
4,619,340
Stockholders’ equity
Common stock, $0.001 par value,
100,000,000 shares authorized at September 30, 2024 and December
31, 2023; 10,644,946 and 10,270,662 issued and outstanding at
September 30, 2024, respectively; and 9,749,326 and 9,383,622
issued and outstanding at December 31, 2023, respectively.
10,271
9,384
Additional paid-in capital
120,761,700
119,701,384
Accumulated deficit
(107,719,867
)
(106,298,149
)
Total stockholders’ equity
13,052,104
13,412,619
Total liabilities and stockholders’
equity
$
18,750,245
$
18,031,959
LAIRD SUPERFOOD, INC. NON-GAAP
FINANCIAL MEASURES (unaudited)
In this press release, we report Adjusted EBITDA and Adjusted
EBITDA 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”). The
Company’s management uses non-GAAP financial measures, both
internally and externally, to assess and communicate the financial
performance of the Company. The Company defines Adjusted EBITDA as
net income (loss), adjusted to exclude: (1) interest expense and
other (income) loss, (2) income tax (benefit) expense, (3)
depreciation and amortization expenses, (4) stock-based
compensation, (5) expenses related to a product quality issue, (6)
costs incurred as part of the strategic downsizing of the Company’s
operations, and (7) rebranding costs. The Company believes Adjusted
EBITDA is useful to investors because it facilitates comparisons of
its core business operations, excluding non-cash costs and
non-recurring events, across periods on a consistent basis.
Management uses Adjusted EBITDA internally in analyzing the
Company’s financial results to assess operational performance and
to determine the Company’s future capital requirements. The
presentation of this financial information is not intended to be
considered in isolation or as a substitute for the financial
information prepared in accordance with GAAP. The Company believes
that both management and investors benefit from referring to
Adjusted EBITDA in assessing its performance and when planning,
forecasting and analyzing future periods. The Company believes
Adjusted EBITDA is useful to investors and others to understand and
evaluate the Company’s operating results and it allows for a more
meaningful comparison between the Company’s performance and that of
competitors. Our use of Adjusted EBITDA has limitations as an
analytical tool, and you should not consider this performance
measure in isolation from or as a substitute for analysis of our
results as reported under GAAP. Some of these limitations are that
Adjusted EBITDA does not reflect, among other things: cash capital
expenditures for assets underlying depreciation and amortization
expense that may need to be replaced or for new capital
expenditures; interest expense; income tax expense from continuing
operations; our working capital requirements; the potentially
dilutive impact of stock-based compensation; and the provision for
income taxes. Other companies, including companies in our industry,
may calculate Adjusted EBITDA differently, which reduces its
usefulness as a comparative measure.
Because of these limitations, you should consider Adjusted
EBITDA along with other financial performance measures, including
Net Sales, net loss, cash and cash equivalents, restricted cash,
net cash used in operating activities and our financial results
presented in accordance with GAAP.
The following table presents a reconciliation of net income
(loss), the most directly comparable financial measure stated in
accordance with GAAP, to adjusted EBITDA, for each of the periods
presented:
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Net loss
$
(166,120
)
$
(2,654,884
)
$
(1,421,718
)
$
(10,306,040
)
Adjusted for:
Depreciation and amortization
65,840
71,493
204,419
235,025
Stock-based compensation
540,425
364,937
1,073,698
818,648
Income tax expense
5,421
—
47,902
13,172
Interest expense and other (income)
expense, net
(107,891
)
(132,185
)
(321,957
)
(452,288
)
Product quality issue (a)
(349,115
)
(140,019
)
(384,329
)
351,842
Strategic organizational shifts (b)
—
5,342
—
(55,348
)
Company-wide rebranding costs (c)
—
—
—
163,806
Adjusted EBITDA
$
(11,440
)
$
(2,485,316
)
$
(801,985
)
$
(9,231,183
)
Net loss per share, diluted:
$
(0.02
)
$
(0.28
)
$
(0.14
)
$
(1.11
)
Adjusted EBITDA per share,
diluted:
$
(0.00
)
$
(0.27
)
$
(0.08
)
$
(0.99
)
Weighted-average shares of common stock
outstanding used in computing adjusted EBITDA per share of common
stock, diluted
10,256,802
9,337,789
9,831,927
9,279,541
(a) In January 2023, we identified a
product quality issue with raw material from one vendor and we
voluntarily withdrew any affected finished goods. We previously
incurred costs associated with product testing, discounts for
replacement orders, and inventory obsolescence costs. We reached
settlement with a supplier in the third quarter of 2023 and
recorded recoveries in 2024.
(b) Costs incurred and recovered during
the three and nine months ended September 30, 2023, as part of the
strategic downsizing of our 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.
(c) Costs incurred as part of the
company-wide rebranding efforts that launched in Q1 2023.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241106654172/en/
Investor Relations Contact Trevor Rousseau
investors@lairdsuperfood.com
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