Kalera Public Limited Company (“Kalera” or the
“Company”) (Nasdaq: KAL), a vertical farming company headquartered
in Orlando, Florida, provided an update on the steps it has
taken and its plans going forward to achieve cash flow break-even
by the end of fiscal year 2023.
“I continue to be very pleased with the commercial side of our
business, specifically sales and operations. Demand for our
products is stronger than ever across all channels, and our
facilities are operating better than ever and very consistently,”
said Jim Leighton, President and Chief Executive Officer of Kalera.
“The cost cutting measures we’re undertaking should result in total
annual cost savings of approximately 74% in 2023 compared to
expenses incurred in 2022. With these savings and the improvements
in our sales and operations, we expect to achieve cash flow
break-even by the end of fiscal year 2023, which is our #1
priority.”
To accelerate profitability at the Houston and Denver farms and
to make configuration updates at the Orlando and Atlanta farms for
efficiency and increased loose-leaf production capacity, Kalera
plans to temporarily halt production at the Orlando and Atlanta
farms, which will result in an annual run rate reduction of
operating expenses of approximately $4.9 million until such time as
the facilities are re-opened. In the interim, these measures will
consolidate all retail volume in the southeast and be serviced by
our Houston farm. The Houston and Denver farms will be near
capacity with the optimized product mix for retail and foodservice
accelerating these farms’ path to profitability. We have
worked closely with our customers to ensure we continue with strong
growth while we reposition the Orlando and Atlanta farms to better
serve our customers with the right products in the future.
Our US Foods partnership continues to be a strong driver and an
important aspect of Kalera’s commercial strategy. We are working
closely with the US Foods marketing and category management team to
launch new and innovative products that will drive incremental
value and sales to the category for both US Foods and Kalera.
To save costs, Kalera is relocating its corporate offices from
Orlando to the Denver farm, reducing corporate General &
Administrative (G&A) expenses by approximately $0.8 million
annually.
The previously announced divestiture of Kalera’s international
assets in Kuwait and Singapore and the Vindara seed genetics
business is underway. Operations at Kalera’s international
businesses, including in Germany, Kuwait, and Singapore, have been
shut down, which will reduce Kalera’s annual G&A expenses by
approximately 50% annually. In addition, while Kalera has not
yet received any definitive offers for the purchase of Vindara, the
due diligence process with a number of interested parties is
currently ongoing. By entering these processes and assuming a
successful sale of Vindara by February 2023, Kalera expects to
reduce its G&A expenses and operating losses in 2023 by
approximately 65% compared to 2022. Expenses related to the
business combination with Agrico Acquisition Corp. in June 2022
were one-time in nature, which will mean approximately $7.5 million
less in expenses in 2023 compared to 2022.
“The macro environment supporting Kalera’s business model has
been validated,” Mr. Leighton said. “We continue to gain new
customers and new distribution points, and we continue to have the
support of major retailers in addition to our agreement with US
Foods. Vertical farming can and should play an important role in
the future of food production.”
About Kalera As a leader in controlled
environment agriculture, Kalera is driven by our belief
that vertical farming can play an important role in securing access
to fresh produce for a growing world population facing climate
change and concerns about the future of traditional farming.
Through our proprietary technology, we sustainably grow local,
delicious, nutrient-rich, pesticide-free, non-GMO leafy greens
year-round. Our automated, data-driven, hydroponic vertical farms
produce higher yields and, use approximately 95% less water, and
99% less land than traditional farming. Sold under the Kalera
brand, our leafy greens are “better than organic” and priced
competitively, always with the end consumer in
mind. Kalera is headquartered in Orlando,
Florida with farms in Orlando; Atlanta,
Georgia; Houston, Texas; and Denver, Colorado, with
additional farms under development. More information is available
at www.kalera.com.
Forward-Looking Statements This communication
includes certain statements that are not historical facts but are
forward-looking statements for purposes of the safe harbor
provisions under the applicable securities laws. 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," and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters.
These forward-looking statements include, but are not limited
to, statements regarding Kalera’s share structure and Nasdaq
listing status. These statements are based on various assumptions
and/or on the current expectations
of Kalera's management. These forward-looking statements
are provided for illustrative purposes only and are not intended to
serve as and must not be relied on by any investor or other person
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 Kalera. These forward-looking statements are
subject to a number of risks and uncertainties, including but not
limited to general economic, financial, legal, political and
business conditions and changes in domestic and foreign markets;
changes in the assumptions
underlying Kalera's expectations regarding its future
business; the effects of competition on Kalera's future
business; and the outcome of judicial proceedings to
which Kalera is, or may become a party.
If the risks materialize or assumptions prove incorrect, actual
results could differ materially from the results implied by these
forward-looking statements. There may be additional risks
that Kalera presently do not know or currently believe
are immaterial that could also cause actual results to differ
materially from those contained in the forward-looking statements.
In addition, forward-looking statements reflect expectations,
assumptions, plans or forecasts of future events and views as of
the date of this communication. Kalera anticipates that
subsequent events and developments will cause these assessments to
change. However, while Kalera may elect to update these
forward-looking statements at some point in the
future, Kalera specifically disclaims any obligation to
do so, except as required by applicable law. These forward-looking
statements should not be relied upon as
representing Kalera's assessments as of any date
subsequent to the date of this written communication. Accordingly,
undue reliance should not be placed upon the forward-looking
statements.
Contact:Financial Profiles,
Inc.KaleraIR@finprofiles.com310.622.8256
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