Stryve Foods, Inc. (“Stryve” or “the Company”) (NASDAQ: SNAX), an
emerging healthy snack and eating platform disrupting traditional
consumer packaged goods (CPG) categories, and a leader in the
air-dried meat snack industry in the United States, today reports
financial and operating results for the three months ended March
31, 2023.
Chris Boever, Chief Executive Officer,
commented, “We are pleased with our first quarter results,
in line with expectations, which gives us confidence to reaffirm
full year fiscal 2023 sales guidance of $28 million to $34 million.
We are extremely excited that our product innovation and packaging
projects are in market and more are coming soon. We expect to see
significant year-over-year distribution gains and improved
consumption numbers in the upcoming periods, as reported by SPINS.
Refreshed product packaging now showcases ‘what’s in the bag’
highlighting our product benefits, improving our shelf presence,
and dramatically improving the shopping experience for our growing
consumer base.
“Several of our newly introduced product
innovations are currently in market, including the Vacadillos beef
sticks in approximately 10,000 7-Eleven and Speedway stores
nationwide, as well as a significant expansion of Kalahari Grass
Fed varieties which are now available chain-wide at the nation’s
largest natural retailer, Whole Foods Market. In addition, Kalahari
has recently gained national distribution at Sprouts, complementing
our existing Stryve distribution. The convenience channel continues
to be a strategic growth engine for us with our team securing new
and expanded distribution at numerous regional and independent
chains across the country shipping in Q2.
“We are also improving our in-store execution
and are pleased to share that we have secured a display program
which is going live in approximately 1,000 Walmart stores for both
Stryve and Vacadillos brands in May. This program is incremental to
our everyday distribution at Walmart, which has also expanded with
certain Vacadillos SKUs now available in approximately 1,800
Walmart stores across the country. Our Stryve 2.0 strategy is
customer and category focused, we are executing on the core
business fundamentals of distribution, shelving, merchandising, and
pricing. These examples provide proof points as to how we are
building the foundation to accelerate revenue and deliver a
sustainable, profitable business in the coming quarters.
“We are making tremendous progress with our
productivity initiative, attacking costs and investing responsibly
for return. The entire organization is maniacally focused on
targeted and prioritized projects and continuously improving every
actionable opportunity, including product quality. I am pleased,
confident and excited about our future as we transition to our next
phase, growth. Thank you to the entire Stryve squad for their high
level of engagement and commitment to building our brands and
serving our customers and consumers, which we expect to yield
material market share gains in the immediate future,” Boever
concluded.
Alex Hawkins, Chief Financial Officer,
said, “We know that our turnaround actions and process
improvements have taken hold across the organization as evidenced
by another quarter of improved bottom line results. With a
significantly improved value proposition on our products,
dramatically improved price-mix, repeatable operational processes,
better procurement, and improving yields, we have built a
sustainable operating company. As a part of that, we have
materially reduced cash operating expenses and narrowed losses
again this quarter. We have made further strides to establish a
leaner, more productive organization, with streamlined operations
and better offerings, and a cost structure well positioned to
deliver profitability in the future with increased revenues.
“We successfully completed a capital raise of
$4.1 million a few weeks ago, and we believe this will allow us to
execute against our near-term plans including supporting meaningful
distribution gains in the second quarter. As we said last quarter,
our planned ramp in quality revenues from Q1 to Q2 has required an
investment in working capital. Consequently, we have been building
net new inventory to support the launch of our new packaging. We
believe that Q1 represented the trough of our turnaround efforts,
and we expect to benefit from significantly better distribution
starting in the second quarter,” concluded Hawkins.
First Quarter 2023 Highlights
- Net sales of $4.6 million, compared
to $7.4 million in the year-ago quarter. Net sales
declined primarily due to the Company’s rationalization of
low-quality revenue, which included the discontinuation of
slow-moving, lower margin items as well as non-profitable
accounts.
- Gross profit of $1.0 million, or
20.7% of net sales, compared to gross profit of $1.1 million, or
15.1% of net sales, in the 2022 quarter. These results
still reflect a drag on gross margins stemming from reduced volume
and labor/overhead absorption in the quarter which management
believes should improve in future quarters as volumes continue to
grow.
- Operating loss of ($4.2) million,
compared to operating loss of ($7.2) million in the 2022 first
quarter.
- Net loss of ($4.6) million, or
($0.15) per share, compared to a net loss of ($7.3) million, or
($0.25) per share, in the 2022 first quarter.
- Adjusted loss per share of ($0.14)
1 for the first quarter of 2023, which compares favorably to
adjusted loss per share of ($0.23) for the year-ago period.
- Adjusted EBITDA loss1 of ($3.5)
million for the 2023 first quarter, compared to ($6.3) million in
the prior year quarter.
1 Adjusted EBITDA and adjusted loss per share are a non-GAAP
financial measure as defined and reconciled to GAAP below.
Conference Call The Company
will conduct a conference call today at 4:30 p.m. Eastern Time to
discuss financial and operating results for the first quarter ended
March 31, 2023. To access the call live by phone, dial (888)
886-7786 and ask for the Stryve Foods call at least 10 minutes
prior to the start time. A telephonic replay will be available
through May 29, 2023, by calling (844) 512-2921 and using passcode
ID:56407503. A webcast of the call will also be available live and
for later replay on the Company’s Investor Relations website at
https://ir.stryve.com/news-events.
About Stryve Foods, Inc.
Stryve is a premium air-dried meat snack company
that is conquering the intersection of high protein, great taste,
and health under the brands of Braaitime, Kalahari, Stryve, and
Vacadillos. Stryve sells highly differentiated healthy snacking and
food products in order to disrupt traditional snacking and CPG
categories. Stryve’s mission is “to help Americans eat better and
live happier, better lives.” Stryve offers convenient products that
are lower in sugar and carbohydrates and higher in protein than
other snacks and foods. Stryve’s current product portfolio consists
primarily of air-dried meat snack products marketed under the
Stryve®, Kalahari®, Braaitime®, and Vacadillos® brand names. Unlike
beef jerky, Stryve’s all-natural air-dried meat snack products are
made of beef and spices, are never cooked, contain zero grams of
sugar*, and are free of monosodium glutamate (MSG), gluten,
nitrates, nitrites, and preservatives. As a result, Stryve’s
products are Keto and Paleo diet friendly. Further, based on
protein density and sugar content, Stryve believes that its
air-dried meat snack products are some of the healthiest
shelf-stable snacks available today. Stryve also markets and sells
human-grade pet treats under the brand Two Tails, made with simple,
all-natural ingredients and 100% real beef with no fillers,
preservatives, or by-products.
Stryve distributes its products in major retail
channels, primarily in North America, including grocery, club
stores and other retail outlets, as well as directly to consumers
through its ecommerce websites and through the Amazon platform. For
more information about Stryve, visit www.stryve.com or follow us on
social media at @stryvebiltong.
* All Stryve Biltong and Vacadillos products
contain zero grams of added sugar, with the exception of the
Chipotle Honey flavor of Vacadillos, which contains one gram of
sugar per serving.
Cautionary Note Regarding
Forward-Looking StatementsCertain statements made herein
are “forward-looking statements” within the meaning of the “safe
harbor” provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements may be identified by the use of
words such as “anticipate”, “may”, “will”, “would”, “could”,
“intend”, “aim”, “believe”, “anticipate”, “continue”, “target”,
“milestone”, “expect”, “estimate”, “plan”, “outlook”, “objective”,
“guidance” and “project” and other similar expressions that predict
or indicate future events or trends or that are not statements of
historical matters, including, but not limited to, statements
regarding Stryve’s plans, strategies, objectives, targets and
expected financial performance. These forward-looking statements
reflect Stryve’s current views and analysis of information
currently available. This information is, where applicable, based
on estimates, assumptions and analysis that Stryve believes, as of
the date hereof, provide a reasonable basis for the information and
statements contained herein. These forward-looking statements
involve various known and unknown risks, uncertainties and other
factors, many of which are outside the control of Stryve and its
officers, employees, agents and associates. These risks,
uncertainties, assumptions and other important factors, which could
cause actual results to differ materially from those described in
these forward-looking statements, include: (i) the inability to
achieve profitability due to commodity prices, inflation, supply
chain interruption, transportation costs and/or labor shortages;
(ii) the ability to recognize the anticipated benefits of the
Business Combination or meet financial and strategic goals, which
may be affected by, among other things, competition, supply chain
interruptions, the ability to pursue a growth strategy and manage
growth profitability, maintain relationships with customers,
suppliers and retailers and retain its management and key
employees; (iii) the risk that retailers will choose to limit or
decrease the number of retail locations in which Stryve’s products
are carried or will choose not to carry or not to continue to carry
Stryve’s products; (iv) the possibility that Stryve may be
adversely affected by other economic, business, and/or competitive
factors; (v) the effect of the COVID-19 pandemic on Stryve; (vi)
the possibility that Stryve may not achieve its financial outlook;
(vii) risks around the Company’s ability to continue as a going
concern and (viii) other risks and uncertainties described in the
Company’s public filings with the SEC. Actual results, performance
or achievements may differ materially, and potentially adversely,
from any projections and forward-looking statements and the
assumptions on which those projections and forward-looking
statements are based.
Investor Relations Contact:Three Part Advisors,
LLCSandy Martin or Phillip
Kuppersmartin@threepa.com or pkupper@threepa.com214-616-2207
or 817-778-8339
-Financial Statements
Follow-
Stryve
Foods, Inc. |
Condensed
Consolidated Statement of Operations |
(In
thousands, except share and per share data) |
|
|
For The
Three Months Ended March 31, |
|
|
|
2023 |
|
2022 |
|
(In thousands) |
|
(unaudited) |
|
(unaudited) |
|
|
|
|
|
|
|
SALES, net |
|
$ |
4,646 |
|
|
$ |
7,421 |
|
|
|
|
|
|
|
|
COST OF
GOODS SOLD (exclusive of depreciation shown separately below) |
|
|
3,683 |
|
|
|
6,297 |
|
|
|
|
|
|
|
|
GROSS
PROFIT |
|
$ |
963 |
|
|
$ |
1,124 |
|
|
|
|
|
|
|
|
OPERATING
EXPENSES |
|
|
|
|
|
Selling
expenses |
|
|
1,969 |
|
|
|
4,026 |
|
|
Operations
expense |
|
|
514 |
|
|
|
1,230 |
|
|
Salaries and
wages |
|
|
2,163 |
|
|
|
2,586 |
|
|
Depreciation
and amortization expense |
|
|
552 |
|
|
|
444 |
|
|
Total
operating expenses |
|
|
5,197 |
|
|
|
8,287 |
|
|
|
|
|
|
|
|
OPERATING
LOSS |
|
$ |
(4,234 |
) |
|
$ |
(7,163 |
) |
|
|
|
|
|
|
|
OTHER
(EXPENSE) INCOME |
|
|
|
|
|
Interest
expense |
|
|
(399 |
) |
|
|
(188 |
) |
|
Change in
fair value of Private Warrants |
|
|
8 |
|
|
|
45 |
|
|
Other
expense |
|
|
(14 |
) |
|
|
- |
|
|
Total other
(expense) income |
|
|
(405 |
) |
|
|
(143 |
) |
|
|
|
|
|
|
|
NET LOSS
BEFORE INCOME TAXES |
|
|
(4,639 |
) |
|
|
(7,306 |
) |
|
|
|
|
|
|
|
Income tax
expense |
|
|
3 |
|
|
|
8 |
|
|
|
|
|
|
|
|
NET
LOSS |
|
$ |
(4,643 |
) |
|
$ |
(7,314 |
) |
|
|
|
|
|
|
|
Loss per
common share: |
|
|
|
|
|
Basic and
diluted |
|
$ |
(0.15 |
) |
|
$ |
(0.25 |
) |
|
|
|
|
|
|
|
Weighted
average shares outstanding: |
|
|
|
|
|
Basic and
diluted |
|
|
31,283 |
|
|
|
29,758 |
|
|
Stryve
Foods, Inc. |
Condensed
Consolidated Balance Sheets |
(in
thousands) |
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
2023 |
|
2022 |
(In thousands) |
|
(Unaudited) |
|
(audited) |
ASSETS |
|
|
|
|
CURRENT
ASSETS |
|
|
|
|
Cash and cash equivalent |
|
$ |
377 |
|
|
$ |
623 |
|
Accounts receivable, net |
|
|
2,978 |
|
|
|
2,489 |
|
Inventory, net |
|
|
8,251 |
|
|
|
8,259 |
|
Prepaid expenses and other current assets |
|
|
1,477 |
|
|
|
1,551 |
|
Total current assets |
|
|
13,083 |
|
|
|
12,921 |
|
|
|
|
|
|
Property and
equipment, net |
|
|
8,374 |
|
|
|
8,817 |
|
Right of use
asset, net |
|
|
4,911 |
|
|
|
5,010 |
|
Goodwill |
|
|
8,450 |
|
|
|
8,450 |
|
Intangible
asset, net |
|
|
4,301 |
|
|
|
4,362 |
|
TOTAL ASSETS |
|
$ |
39,119 |
|
|
$ |
39,560 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
Accounts
payable |
|
$ |
4,355 |
|
|
$ |
3,010 |
|
Accrued expenses |
|
|
2,028 |
|
|
|
1,728 |
|
Current portion of lease liability |
|
|
322 |
|
|
|
328 |
|
Line of credit, net of debt issuance costs |
|
|
1,652 |
|
|
|
1,046 |
|
Current portion of long-term debt |
|
|
890 |
|
|
|
969 |
|
Total current liabilities |
|
|
9,247 |
|
|
|
7,081 |
|
|
|
|
|
|
Long-term
debt, net of current portion, net of debt issuance costs |
|
|
5,639 |
|
|
|
3,697 |
|
Lease
liability, net of current portion |
|
|
4,650 |
|
|
|
4,734 |
|
Financing
obligation - related party operating lease |
|
|
7,500 |
|
|
|
7,500 |
|
Deferred tax
liability, net |
|
|
2 |
|
|
|
2 |
|
Deferred
stock compensation liability |
|
|
275 |
|
|
|
90 |
|
Warrant
liability |
|
|
12 |
|
|
|
21 |
|
TOTAL LIABILITIES |
|
|
27,326 |
|
|
|
23,124 |
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES |
|
|
|
|
STOCKHOLDERS' EQUITY |
|
|
|
|
Preferred stock - $0.0001 par value, 10,000,000 shares authorized,
0 shares issued and outstanding |
|
|
- |
|
|
|
- |
|
Class A common stock - $0.0001 par value, 400,000,000 shares
authorized, 25,881,391 and 25,727,783 shares issued and
outstanding, respectively |
|
|
3 |
|
|
|
3 |
|
Class V common stock - $0.0001 par value, 200,000,000 shares
authorized, 6,145,995 and 6,299,603 shares issued and outstanding,
respectively |
|
|
1 |
|
|
|
1 |
|
Additional paid-in-capital |
|
|
133,685 |
|
|
|
133,685 |
|
Accumulated deficit |
|
|
(121,894 |
) |
|
|
(117,252 |
) |
TOTAL
STOCKHOLDERS' EQUITY |
|
|
11,794 |
|
|
|
16,436 |
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
39,119 |
|
|
$ |
39,560 |
|
|
|
|
|
|
Stryve
Foods, Inc. |
Condensed
Consolidated Statement of Cash Flows |
(In
thousands) |
|
|
Three Months Ended |
|
|
March 31, 2023 |
|
March 31, 2022 |
(In thousands) |
|
(unaudited) |
|
(unaudited) |
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
Net loss |
|
$ |
(4,643 |
) |
|
$ |
(7,314 |
) |
Adjustments
to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
Depreciation expense |
|
|
491 |
|
|
|
384 |
|
Amortization of intangible assets |
|
|
61 |
|
|
|
61 |
|
Amortization of debt issuance costs |
|
|
40 |
|
|
|
- |
|
Amortization of right-of-use asset |
|
|
99 |
|
|
|
49 |
|
Bad debt expense |
|
|
73 |
|
|
|
55 |
|
Stock based compensation expense |
|
|
186 |
|
|
|
328 |
|
Change in fair value of Private Warrants |
|
|
(8 |
) |
|
|
(45 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
|
|
(563 |
) |
|
|
(758 |
) |
Inventory |
|
|
8 |
|
|
|
(6,031 |
) |
Vendor deposits |
|
|
- |
|
|
|
4 |
|
Prepaid expenses and other current assets |
|
|
74 |
|
|
|
69 |
|
Accounts payable |
|
|
1,345 |
|
|
|
(335 |
) |
Accrued liabilities |
|
|
301 |
|
|
|
(546 |
) |
Operating lease obligations |
|
|
(89 |
) |
|
|
(48 |
) |
Net cash used in operating activities |
|
$ |
(2,626 |
) |
|
$ |
(14,127 |
) |
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
Cash paid for purchase of equipment |
|
|
(49 |
) |
|
|
(693 |
) |
Cash received for sale of equipment |
|
|
- |
|
|
|
- |
|
Net cash used in investing activities |
|
$ |
(49 |
) |
|
$ |
(693 |
) |
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
PIPE capital raise |
|
|
- |
|
|
|
32,311 |
|
Post closing adjustment of Business Combination Agreement |
|
|
- |
|
|
|
(238 |
) |
Borrowings on long-term debt |
|
|
2,000 |
|
|
|
- |
|
Repayments on long-term debt |
|
|
(30 |
) |
|
|
(4,844 |
) |
Borrowings on short-term debt |
|
|
3,360 |
|
|
|
(0 |
) |
Repayments on short-term debt |
|
|
(2,901 |
) |
|
|
(2,000 |
) |
Net cash provided by financing activities |
|
$ |
2,429 |
|
|
$ |
25,230 |
|
|
|
|
|
|
Net change in cash and cash equivalents |
|
|
(246 |
) |
|
|
10,409 |
|
Cash and cash equivalents at beginning of period |
|
|
623 |
|
|
|
2,217 |
|
Cash and cash equivalents at end of period |
|
$ |
377 |
|
|
$ |
12,626 |
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION: |
|
|
|
|
Cash paid for interest |
|
$ |
399 |
|
|
$ |
222 |
|
NON-CASH INVESTING AND FINANCING ACTIVITY: |
|
|
|
|
Non-cash commercial premium finance borrowing |
|
$ |
291 |
|
|
$ |
- |
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Information
Stryve uses non-GAAP financial information and
believes it is useful to investors as it provides additional
information to facilitate comparisons of historical operating
results, identify trends in operating results, and provide
additional insight on how the management team evaluates the
business. Stryve’s management team uses EBITDA, Adjusted EBITDA,
and Adjusted Earnings Per Share to make operating and strategic
decisions, evaluate performance and comply with indebtedness
related reporting requirements. Below are details on this non-GAAP
measure and the non-GAAP adjustments that the management team makes
in the definition of EBITDA, Adjusted EBITDA and Adjusted Earnings
Per Share. Stryve believes this non-GAAP measure should be
considered along with net income (loss), the most closely related
GAAP financial measure. A reconciliation between EBITDA and net
income (loss) is below:
|
|
|
|
|
|
|
|
Three Months Ended |
|
(In thousands) |
|
March 31, 2023 |
|
March 31, 2022 |
|
Net loss before income taxes |
|
$ |
(4,639 |
) |
|
$ |
(7,306 |
) |
|
Interest
expense |
|
|
399 |
|
|
|
188 |
|
|
Depreciation
and amortization expense |
|
|
552 |
|
|
|
444 |
|
|
EBITDA |
|
$ |
(3,689 |
) |
|
$ |
(6,673 |
) |
|
Additional Adjustments: |
|
|
|
|
|
Stock based compensation expense |
|
|
186 |
|
|
|
328 |
|
|
Adjusted EBITDA |
|
$ |
(3,503 |
) |
|
$ |
(6,346 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
(In thousands except share and per share
information) |
|
March 31, 2023 |
|
March 31, 2022 |
|
Net
loss |
|
$ |
(4,643 |
) |
|
$ |
(7,314 |
) |
|
Weighted
average shares outstanding |
|
|
31,282,710 |
|
|
|
29,758,343 |
|
|
Basic & Diluted Net Loss per Share |
|
$ |
(0.15 |
) |
|
$ |
(0.25 |
) |
|
Additional Adjustments: |
|
|
|
|
|
Stock based compensation expense |
|
|
0.01 |
|
|
|
0.01 |
|
|
Adjusted
Earnings per Share |
|
$ |
(0.14 |
) |
|
$ |
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Stryve Foods (NASDAQ:SNAX)
Historical Stock Chart
From Jun 2024 to Jul 2024
Stryve Foods (NASDAQ:SNAX)
Historical Stock Chart
From Jul 2023 to Jul 2024