Edible Garden AG Incorporated (“Edible Garden” or the
“Company”) (Nasdaq: EDBL, EDBLW), a leader in controlled
environment agriculture (CEA), locally grown, organic, and
sustainable produce and products, today provided a business update
and reported financial results for the three months ended September
30, 2023.
Mr. Jim Kras, Chief Executive Officer of Edible
Garden, stated, "We are pleased to report year-over-year revenue
growth of 19.4% for the third quarter of 2023. We believe this
growth is a testament to our growing distribution network and
quality produce that customers trust. We continue to be a leader in
our industry, in terms of both service and reliability.
Additionally, Edible Garden is enhancing its infrastructure and
refining its data analytics capabilities, as we pursue
opportunities to boost profit margins. As a result, more retailers
are turning to Edible Garden for their organic and sustainable
produce needs.”
“The Company has been steadily expanding our
relationships with existing retailers, and adding new retailers to
our network, thereby broadening our footprint and reinforcing our
status as a premier provider in the industry. As an example, we
partnered with Woodman’s Markets, which introduced Edible Garden
produce and products to their 19 stores throughout Wisconsin and
Illinois. This addition to our retail distribution network
significantly enhances our Midwest presence and positions us to
utilize our Edible Garden Heartland facility in Grand Rapids,
Michigan. Additionally, Tops Friendly Markets has joined the Edible
Garden distribution network, featuring our sustainable herbs across
their 149 locations in New York, Pennsylvania, and Vermont. In
addition, as we have previously reported, the Company expanded its
relationship with Walmart to provide a wider variety of Edible
Garden’s sustainably grown produce in their Northeast locations, as
well as initiating distribution in their East South Central US
retail stores.”
“We have also continued rolling out our new line
of Pulp sustainable gourmet sauces. All 16 Morton Williams retail
locations across the New York Metropolitan area have introduced the
Pulp line, representing the Company’s initial venture into the
substantial and influential New York City marketplace. Building on
this momentum, the Company has also brought Dierbergs Markets into
our distribution network, introducing the Pulp gourmet sauces to
all 26 of their outlets in the greater St. Louis Metropolitan area,
as well as their location at Missouri’s Lake of the Ozarks. During
the third quarter, Edible Garden introduced EG Direct, which is
dedicated to sourcing and supplying partner-grown produce to its
retail distribution network partners. The Company has consistently
outperformed our competitors, as demonstrated by order fulfillment
rates which routinely exceed industry averages. We view EG Direct
as a strategic move to capitalize on the Company’s existing retail
relationships, potentially opening up additional revenue streams by
distributing essential, high-volume produce such as broccoli,
carrots, and potatoes, among others. We believe EG Direct could
have a substantial effect on both the revenue and profits of Edible
Garden, by leveraging our established infrastructure.”
“Edible Garden also began shipping fall
ornamentals from our new Edible Garden Heartland facility in Grand
Rapids, Michigan, just in time for the fall gardening season. These
plants were delivered to leading big-box stores throughout the
Company’s distribution network. Since acquiring Edible Garden
Heartland last year, the Company has integrated cutting-edge
technologies, like our proprietary GreenThumb greenhouse management
system, to boost our supply chain’s efficiency, in addition to
leveraging our advanced growing techniques, in line with Edible
Garden’s philosophy of maximizing the Company’s available assets.
We are working towards making the most of the expanded growing
capacity that our Edible Garden Heartland facility provides.”
“The Company was also granted a Notice of
Allowance from the U.S. Patent and Trademark Office for our
proprietary Self-Watering Display, demonstrating our commitment to
innovation. The Self-Watering Display has proven to be a
game-changer in extending the shelf life of plants, maintaining
peak freshness, and notably diminishing spoilage at retail outlets.
The implementation of this cutting-edge technology allows retailers
to showcase plants at their freshest, minimizing waste and
delivering superior products to the consumer. These displays were
initially launched chain-wide at Meijer retail locations and, as a
result of their successful implementation, we have begun a broader
national deployment.”
“Lastly, the Company launched two exciting new
flavors of its Vitamin Whey product line, Ice Cream Cake and Orange
Creamsicle, now available at Meijer stores across the Midwest.
These flavor-forward additions enhance our high-performance,
Vitamin Whey collection, known for supporting muscle recovery and
overall health with a great taste. Overall, we believe that
continued execution of our strategic plan will enable the Company
to maintain strong organic revenue growth, as well as achieve our
target of positive cash flow on a quarterly basis before the year's
end.”
Financial results for the three months
ended September 30, 2023
For the quarter ended September 30, 2023,
revenue totaled $3.3 million, an increase of 19.4% compared to $2.8
million for the three months ended September 30, 2022. The 22.8%
increase in the herbs, produce and floral business was primarily
due to a net increase in orders received from our existing customer
base based on the demand from the retail consumer and a slight
increase in orders for herbs received from new distribution
partners. This increase was slightly offset by a decrease of 0.8%
in the vitamins and supplements revenue.
Cost of goods sold was $3.3 million for the
three months ended September 30, 2023, compared to $2.6 million for
the three months ended September 30, 2022. We continued to use
contract growers to grow herbs for our customers as we ramped up
production in Edible Garden Heartland, which resulted in higher
costs of goods sold. Additional labor and materials costs required
to grow the products sold into the retail channel also contributed
to the increase.
Gross profit was $12 thousand or 0.4% of sales
for the three months ended September 30, 2023, compared with $182
thousand or 6.6% of sales for the three months ended September 30,
2022. Gross profit decreased by $170 thousand or 93.4% for the
three months ended September 30, 2023. Lower margins for herbs,
produce and floral in the current quarter reflect the impact of
additional labor and materials costs incurred at the Edible Garden
Heartland facility as production ramps up and retail shrink in
floral sales. During the period, we sold through lower margin
inventory in vitamins and supplements, which had a negative impact
on gross profit.
Selling, general and administrative (“SG&A”)
expenses were $2.4 million for the three months ended September 30,
2023, an increase of $459 thousand compared to $1.9 million for the
three months ended September 30, 2022. The increase was primarily
driven by an increase in costs incurred as it relates to the
ramping up and operation of the Edible Garden Heartland facility,
which was acquired in August 2022, as well as an increase in
depreciation cost, due to the acquisition of the facility. We also
increased production of cut herbs at Edible Garden Heartland and
our Belvidere, New Jersey facility, for which we purchased
equipment intended to increase our efficiency.
Net loss was $2.4 million or ($0.69) per share,
for the three months ended September 30, 2023, compared to a net
loss of $2.1 million, or ($7.13) per share, for the three months
ended September 30, 2022.
The complete financial results for the quarter
ended September 30, 2023, are available in the Company’s Quarterly
Report on Form 10-Q, which has been filed with the Securities and
Exchange Commission and is available at: www.sec.gov.
Conference Call
Edible Garden will host a conference call today
at 8:00 A.M. Eastern Time to discuss the Company’s financial
results for the quarter ended September 30, 2023, as well as the
Company’s corporate progress and other developments.
The conference call will be available via
telephone by dialing toll-free 888-506-0062 for U.S. callers or +1
973-528-0011 for international callers and using entry code:
174900. A webcast of the call may be accessed at
https://www.webcaster4.com/Webcast/Page/2914/49437 or on the
investor relations section of the Company’s website at
https://ediblegardenag.com/presentations.
A webcast replay will also be available on the
Company’s Investors section of the website at
https://ediblegardenag.com/presentations/. A telephone replay of
the call will be available approximately one hour following the
call, through November 13, 2024, and can be accessed by dialing
877-481-4010 for U.S. callers or +1 919-882-2331 for international
callers and entering conference ID: 49437.
ABOUT EDIBLE GARDEN®
Edible Garden AG Incorporated is a leader in
controlled environment agriculture (CEA), locally grown, organic
and sustainable produce and products backed by Zero-Waste Inspired®
next generation farming. Offered at over 5,000 stores in the US,
Edible Garden is disrupting the CEA and sustainability technology
movement with its safety-in-farming protocols, use of sustainable
packaging, patented GreenThumb software and self-watering in-store
displays. The Company currently operates its own state-of-the-art
greenhouses and processing facilities in Belvidere, New Jersey and
Grand Rapids, Michigan, and has a network of contract growers, all
strategically located near major markets in the U.S. Its
proprietary GreenThumb 2.0 patented (US Nos.: US 11,158,006 B1 and
US 11,410,249 B2) software optimizes growing in vertical and
traditional greenhouses while seeking to reduce
pollution-generating food miles. Edible Garden is also a developer
of ingredients and proteins, providing an accessible line of plant
and whey protein powders under the Vitamin Way® and Vitamin Whey®
brands. In addition, the Company offers a line of sustainable food
flavoring products such as Pulp gourmet sauces and chili-based
products. For more information on Edible Garden go to
https://ediblegardenag.com/.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that involve risks, uncertainties and
assumptions that are difficult to predict including with respect to
the Company’s growth strategies, the Company’s financial
performance, the Company’s expansion into new distribution
networks, the Company’s dependence on growers, and performance as a
public company. The words “believe,” “continue,” “could,” “expect,”
"opportunity," “potential,” “seeking,” “strategy,” “target,”
“will,” and similar expressions are intended to identify
forward-looking statements. These forward-looking statements are
subject to a number of risks, uncertainties, and assumptions,
including market and other conditions, the Company’s ability to
achieve its growth objectives, and other factors set forth in the
Company’s filings with the Securities and Exchange Act Commission,
including the Company’s annual report on Form 10-K for the year
ended December 31, 2022 and subsequent quarterly reports on Form
10-Q. Actual results might differ materially from those explicit or
implicit in the forward-looking statements. You should not rely
upon forward-looking statements as predictions of future events.
The Company undertakes no obligation to update any such
forward-looking statements after the date hereof to conform to
actual results or changes in expectations, except as required by
law.
Investor Contacts:Crescendo
Communications, LLC212-671-1020EDBL@crescendo-ir.com
(tables follow)
EDIBLE
GARDEN AG, INCORPORATED |
CONDENSED
CONSOLIDATED BALANCE SHEETS |
(in
thousands, except shares) |
|
|
|
|
|
|
|
September
30, |
|
December
31, |
|
|
2023 (unaudited) |
|
2022 |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash |
|
$ |
2,578 |
|
|
$ |
110 |
|
Accounts receivable, net |
|
|
1,691 |
|
|
|
1,105 |
|
Inventory |
|
|
549 |
|
|
|
586 |
|
Prepaid expenses and other current assets |
|
|
361 |
|
|
|
62 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
5,179 |
|
|
|
1,863 |
|
|
|
|
|
|
|
|
Property,
equipment and leasehold improvements, net |
|
|
4,752 |
|
|
|
4,891 |
|
Intangible
assets, net |
|
|
47 |
|
|
|
50 |
|
Other
assets |
|
|
93 |
|
|
|
161 |
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
10,071 |
|
|
$ |
6,965 |
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT) |
LIABILITIES: |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable and other accrued expenses |
|
$ |
1,604 |
|
|
$ |
2,787 |
|
Short-term debt, net of discounts |
|
|
382 |
|
|
|
2,042 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
1,986 |
|
|
|
4,829 |
|
|
|
|
|
|
|
|
Long-term liabilities: |
|
|
|
|
|
|
Long-term debt, net of discounts |
|
|
4,135 |
|
|
|
4,282 |
|
Long-term lease liabilities |
|
|
- |
|
|
|
34 |
|
|
|
|
|
|
|
|
Total long-term liabilities |
|
|
4,135 |
|
|
|
4,316 |
|
|
|
|
|
|
|
|
Total liabilities |
|
|
6,121 |
|
|
|
9,145 |
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES (Note 10) |
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY (DEFICIT): |
|
|
|
|
|
|
Common stock ($0.0001 par value, 10,000,000 shares authorized,
5,702,808 and 362,716 shares outstanding as of September 30, 2023
and December 31, 2022, respectively |
|
|
1 |
|
|
|
- |
|
Series A Convertible Preferred stock ($0.0001 par value, 10,000,000
shares authorized; nil shares outstanding as of September 30, 2023
and December 31, 2022) |
|
|
- |
|
|
|
- |
|
Additional paid-in capital |
|
|
29,969 |
|
|
|
17,892 |
|
Accumulated deficit |
|
|
(26,020 |
) |
|
|
(20,072 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity (deficit) |
|
|
3,950 |
|
|
|
(2,180 |
) |
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT) |
|
$ |
10,071 |
|
|
$ |
6,965 |
|
|
|
|
|
|
|
|
EDIBLE
GARDEN AG, INC. |
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2023 |
|
2022 |
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
|
|
$ |
3,288,514 |
|
|
$ |
2,753,662 |
|
|
|
$ |
9,964,526 |
|
|
$ |
8,475,766 |
|
Cost of
goods sold |
|
|
|
3,277,402 |
|
|
|
2,572,136 |
|
|
|
|
9,424,913 |
|
|
|
8,183,374 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
|
11,112 |
|
|
|
181,527 |
|
|
|
|
539,613 |
|
|
|
292,393 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses |
|
|
|
2,387,470 |
|
|
|
1,928,335 |
|
|
|
|
7,457,998 |
|
|
|
6,268,295 |
|
Impairment
of assets |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
(Gain) /
Loss on sale of assets |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
|
|
(2,376,358 |
) |
|
|
(1,746,809 |
) |
|
|
|
(6,918,385 |
) |
|
|
(5,975,903 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
/ (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
|
(56,955 |
) |
|
|
(87,664 |
) |
|
|
|
(334,386 |
) |
|
|
(1,824,953 |
) |
Gain from debt extinguishment |
|
|
|
(0 |
) |
|
|
- |
|
|
|
|
70,420 |
|
|
|
(826,203 |
) |
Other income / (loss) |
|
|
|
1,166 |
|
|
|
(235,000 |
) |
|
|
|
1,233,695 |
|
|
|
(823,606 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income / (expense) |
|
|
|
(55,788 |
) |
|
|
(322,664 |
) |
|
|
|
969,730 |
|
|
|
(3,474,762 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income /
(loss) |
|
|
$ |
(2,432,147 |
) |
|
|
(2,069,473 |
) |
|
|
$ |
(5,948,656 |
) |
|
|
(9,450,665 |
) |
|
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME / (LOSS) |
|
|
$ |
(2,432,147 |
) |
|
$ |
(2,069,473 |
) |
|
|
$ |
(5,948,656 |
) |
|
$ |
(9,450,665 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income /
(Loss) per common share - basic and diluted |
|
|
$ |
(0.69 |
) |
|
$ |
(7.13 |
) |
|
|
$ |
(2.38 |
) |
|
$ |
(40.84 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-Average Number of Common Shares Outstanding - Basic and
Diluted |
|
|
|
3,515,245 |
|
|
|
290,380 |
|
|
|
|
2,494,658 |
|
|
|
231,427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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