AppHarvest, Inc. (NASDAQ: APPH, APPHW), a leading AgTech company,
public benefit corporation and Certified B Corp building some of
the world’s largest high-tech indoor farms to grow affordable,
nutritious fruits and vegetables at scale while providing good jobs
in Appalachia, announced it entered into a $100 million common
stock purchase agreement with B. Riley Principal Capital.
“As a company in hyper-growth mode, this arrangement gives us a
smart optional tool to access liquidity to execute our business
plan, with full flexibility around issuance timing, which minimizes
dilution,” said AppHarvest President David Lee. “We have a strong
track record of raising capital in shareholder-friendly ways to
fund our growth, and this committed equity facility with B. Riley
is an incremental funding tool we are pleased to have as we ramp up
our network of four farms selling tomatoes, leafy greens and
berries by the end of next year.”
Under the agreement, AppHarvest has the right, without
obligation, to sell and issue up to $100 million of shares of its
common stock to B. Riley, subject to certain limitations and
satisfaction of certain conditions. Purchase notices may be issued
to B. Riley over a 24-month period. AppHarvest issued B. Riley
approximately 197,628 shares of common stock as consideration for
B. Riley’s commitment to purchase AppHarvest common stock under the
purchase agreement. Further details will be contained in a Current
Report on Form 8-K AppHarvest will file with the Securities and
Exchange Commission.
AppHarvest reiterated its full-year 2021 outlook of net sales of
$7 million to $9 million and full-year 2021 outlook for Adjusted
EBITDA in the range of a loss of $70 million to $75 million. The
company also announced that it remains on track with its previously
announced construction timeline and its plan to open three more
farms by the end of 2022, which are expected to produce vine crops,
berries and leafy greens, and the 10-acre Morehead North leafy
green facility that has an expected 2023 delivery.
AppHarvest currently is operating one 60-acre high-tech indoor
farm in Morehead, Ky., which can produce an estimated 40 million
pounds of tomatoes per year, serving some of the top national
grocery store chains and food service outlets. The 15-acre Berea,
Ky., leafy green facility and the 60-acre Richmond, Ky., tomato
facility are both approximately 60% complete, and the 30-acre
Somerset, Ky., berry facility is more than 40% complete.
In November, AppHarvest announced the start of its second
growing season along with the launch of its e-commerce site,
shop.appharvest.com, and a consumer-focused campaign, Fight the
Food Fight. The campaign encourages consumers to support products
that promote sustainable farm operations and good jobs in
agriculture. The company’s first value-added product, The Food
Fight Salsa, sold out within about two weeks of launch and is back
in stock and available for purchase.
About AppHarvest
AppHarvest is an applied technology company in Appalachia
developing and operating some of the world’s largest high-tech
indoor farms designed to grow non-GMO, chemical pesticide-free
produce, using up to 90 percent less water than open-field
agriculture and only rainwater while producing yields up to 30
times that of traditional agriculture on the same amount of land
without agricultural runoff. The company combines conventional
agricultural techniques with world-class technology including
artificial intelligence and robotics to improve access for all to
nutritious food, farming more sustainably, building a domestic food
supply, and increasing investment in Appalachia. The company’s
60-acre Morehead, Ky. facility is among the largest indoor farms in
the world. For more information, visit
https://www.appharvest.com/.
Non-GAAP Financial Measures
To supplement the Company’s unaudited condensed consolidated
financial statements, which are prepared and presented in
accordance with United States generally accepted accounting
principles (“GAAP”), the Company uses certain non-GAAP measures,
such as Adjusted EBITDA, to understand and evaluate the Company’s
core operating performance. The Company defines and calculates
Adjusted EBITDA as net loss before the impact of interest income or
expense, income tax expense or benefit, depreciation and
amortization, adjusted to exclude: stock-based compensation,
transaction-related costs, remeasurement of warrant liabilities and
certain other non-recurring, non-cash and non-core items. The
Company believes this non-GAAP measure of financial results
provides useful information to management and investors regarding
certain financial and business trends relating to the Company’s
financial condition and results of operations. The Company’s
management uses this non-GAAP measure for trend analyses and for
budgeting and planning purposes.
The Company believes that the use of this non-GAAP financial
measure provides an additional tool for investors to use in
evaluating projected operating results and trends. Other similar
companies may present different non-GAAP measures or calculate
similar non-GAAP measures differently. Management does not consider
this non-GAAP measure in isolation or as an alternative to
financial measures determined in accordance with GAAP. The
principal limitation of this non-GAAP financial measure is that it
excludes significant expenses that are required to be presented in
the Company’s GAAP financial statements. Because of this
limitation, you should consider Adjusted EBITDA alongside other
financial performance measures, including net loss and the
Company’s other financial results presented in accordance with
GAAP.
Adjusted EBITDA as used in connection with the Company's 2021
outlook is a non-GAAP financial measure that excludes or has
otherwise been adjusted for items impacting comparability. The
Company is unable to reconcile this forward-looking non-GAAP
financial measure to net income, its most directly comparable
forward-looking GAAP financial measure, without unreasonable
efforts, because the Company is currently unable to predict with a
reasonable degree of certainty its stock-based compensation expense
for 2021. In addition, the Company may incur additional expenses
which may impact Adjusted EBITDA. Such items may include costs and
expenses related to the business combination activities, income
taxes and other items. The unavailable information could have a
significant impact on the Company’s full year 2021 GAAP financial
results.
Forward-Looking Statements
Certain statements included in this press release that are not
historical facts are forward-looking statements for purposes of the
safe harbor provisions under the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements generally
are accompanied by words such as “believe,” “may,” “will,”
“estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,”
“would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,”
“outlook,” “can,” “goal,” “target” and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. All statements, other than
statements of present or historical fact included in this press
release, regarding AppHarvest’s value of current and future
investments, intention to build high-tech CEA farms, the
anticipated benefits of and production at such facilities,
AppHarvest’s future financial performance, as well as AppHarvest’s
growth and evolving business plans and strategy, ability to
capitalize on commercial opportunities, future operations,
estimated financial position, estimated Adjusted EBITDA, revenues
and losses, projected costs, prospects, plans and objectives of
management, the potential benefits of the committed equity line and
AppHarvest’s beliefs regarding its future capital levels, capital
requirements and sources of capital are forward-looking statements.
These statements are based on various assumptions, whether or not
identified in this press release, and on the current expectations
of AppHarvest’s management and are not predictions of actual
performance. These forward-looking statements are provided for
illustrative purposes only and are not intended to serve as, and
must not be relied on as, a guarantee, an assurance, a prediction,
or a definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of AppHarvest. These forward-looking statements
are subject to a number of risks and uncertainties, including those
discussed in the Company’s Quarterly Report on Form 10-Q filed with
the SEC by AppHarvest on November 10, 2021, under the heading “Risk
Factors,” and other documents AppHarvest has filed, or that
AppHarvest will file, with the SEC. If any of these risks
materialize or our assumptions prove incorrect, actual results
could differ materially from the results implied by these
forward-looking statements. In addition, forward-looking statements
reflect AppHarvest’s expectations, plans, or forecasts of future
events and views as of the date of this press release. AppHarvest
anticipates that subsequent events and developments will cause its
assessments to change. However, while AppHarvest may elect to
update these forward-looking statements at some point in the
future, AppHarvest specifically disclaims any obligation to do so.
These forward-looking statements should not be relied upon as
representing AppHarvest’s assessments of any date subsequent to the
date of this press release. Accordingly, undue reliance should not
be placed upon the forward-looking statements.
MEDIA CONTACT: Travis Parman,
Travis.Parman@appharvest.com
INVESTOR CONTACT: Kaveh Bakhtiari,
AppHarvestIR@appharvest.com
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