Announces preliminary and unaudited fiscal
2022 sales of $19.5 million, adjusted
gross margin* of 38%, net loss of $111.1
million, and adjusted EBITDA loss* of $29.8 million
Company to hold fiscal 2022 earnings
conference call on March 29, 2023 at
8 am ET
HAMILTON, Mont., March 17,
2023 /PRNewswire/ -- Local Bounti Corporation (NYSE:
LOCL, LOCL WS) ("Local Bounti" or the "Company"), a breakthrough
U.S. indoor agriculture company combining the best aspects of
vertical and greenhouse growing technologies, today announced that
it amended its existing credit facility with Cargill Financial
Services, Inc. ("Cargill"). Additionally, the Company
announced select preliminary financial results for the year ended
December 31, 2022. The Company
expects to file its 2022 Annual Report on Form 10-K on or about
March 29, 2023.
Kathleen Valiasek, CFO of Local
Bounti, commented, "The amendment we announced today provides us
added flexibility to meet our near-term capital needs associated
with the buildout of our facilities. This represents the
first of several thoughtful steps we expect to take to ensure that
we have access to capital to support our growth strategies and keep
our current development on track while we scale up our enterprise,
including through potential sale-leaseback transactions or similar
strategies. We look forward to sharing additional
perspectives on our full fiscal 2022 performance and our 2023
outlook during our upcoming call."
Amended Credit Agreement
On March 13, 2023, the Company,
along with certain subsidiaries of the Company, entered into a
Fifth Amendment to Credit Agreements (the "Fifth Amendment") with
Cargill to further amend the Company's existing credit facility
agreements (the "Credit Agreements"). The Fifth Amendment (i)
reduces the amount of cash required to be held in the debt service
reserve account for the Credit Agreements by approximately
$11.0 million until April 2, 2024, at which time the amount of cash
required to be held in the debt service reserve account will be an
amount equal to the sum of interest and principal payments that
would be required under the Credit Agreements for two calendar
quarters, (ii) allows for the payment in kind of the quarterly
interest payment due and payable for the quarter ending
March 31, 2023, (iii) allows for the
payment in kind of the unused commitment fee payable for the
quarter ending March 31, 2023; and
(iv) reduces the minimum liquidity covenant in each of the Credit
Agreements from $11.0 million to
$1.0 million. The aggregate amount of
outstanding loans and undrawn commitments under the Credit
Agreements remains at $170.0 million
(plus interest paid in kind).
Select Preliminary Full Year Fiscal 2022 Results
For the full year ended December 31,
2022, the Company generated sales of $19.5 million, adjusted gross margin of 38%, net
loss of $111.1 million, and adjusted
EBITDA loss of $29.8 million.
*See reconciliation of the non-GAAP measures at the end of this
press release.
About Local Bounti
Local Bounti is redefining indoor farming with an innovative
method – its proprietary Stack & Flow Technology™ – that
significantly improves crop turns, increases output and improves
unit economics. Local Bounti operates advanced indoor growing
facilities across the United
States, servicing approximately 10,000 retail doors with its
two brands: Local Bounti® and Pete's®. Local
Bounti grows healthy food utilizing a hybrid approach that
integrates the best attributes of controlled environment
agriculture with natural elements. Local Bounti's sustainable
growing methods are better for the planet, using 90% less land and
90% less water than conventional farming methods. With a mission to
'bring our farm to your kitchen in the fewest food miles possible,'
Local Bounti's food is fresher, more nutritious, and lasts longer
than traditional agriculture. To find out more, visit
localbounti.com or follow Local Bounti on LinkedIn for the latest
news and developments.
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the "safe harbor" provisions of the United States
Private Securities Litigation Reform Act of 1995. In some cases,
you can identify these forward-looking statements by the use of
terms such as "expect," "will," "continue," "believe," expect,"
"estimate," "project," "intend," "should," "is to be," or similar
expressions, and variations or negatives of these words, but the
absence of these words does not mean that a statement is not
forward-looking. All statements other than statements of historical
fact are statements that could be deemed forward-looking
statements, including, but not limited to: statements regarding the
Company's ability to access additional capital, entering into
potential sale-leaseback transactions and the timing of filing of
the Company's Annual Report on Form 10-K for the year ended
December 31, 2022. These statements
are subject to known and unknown risks, uncertainties and other
factors that may cause our actual results, levels of activity,
performance or achievements to differ materially from results
expressed or implied in this press release. The following factors,
among others, could cause actual results to differ materially from
those described in these forward-looking statements: the risk that
Local Bounti will fail to obtain additional necessary capital when
needed on acceptable terms, or at all; Local Bounti's ability to
effectively integrate the acquired operations of Pete's into its
existing operations; the ability of Local Bounti to retain and hire
key personnel; the uncertainty of projected financial information;
Local Bounti's increased leverage as a result of additional
indebtedness incurred in connection with the recent acquisition of
Pete's or as the result of the incurrence of additional future
indebtedness; restrictions contained in Local Bounti's debt
facility agreements with Cargill; Local Bounti's ability to repay,
refinance, restructure and/or extend its indebtedness as it comes
due; and unknown liabilities that may be assumed in the
transaction; Local Bounti's ability to generate revenue; the risk
that Local Bounti may never achieve or sustain profitability; the
risk that Local Bounti could fail to effectively manage its future
growth; Local Bounti's ability to build out additional facilities;
reliance on third parties for construction, delays relating to
material delivery and supply chains, and fluctuating material
prices; Local Bounti's ability to decrease its cost of goods sold
over time; potential for damage to or problems with Local Bounti's
CEA facilities; Local Bounti's ability to attract and retain
qualified employees; Local Bounti's ability to develop and maintain
its brand or brands it may acquire; Local Bounti's ability to
maintain its company culture or focus on its vision as it grows;
Local Bounti's ability to execute on its growth strategy; the risks
of diseases and pests destroying crops; Local Bounti's ability to
compete successfully in the highly competitive natural food market;
Local Bounti's ability to defend itself against intellectual
property infringement claims; changes in consumer preferences,
perception and spending habits in the food industry; seasonality;
Local Bounti's ability to achieve its sustainability goals; and
other risks and uncertainties indicated from time to time,
including those under "Risk Factors" and "Forward-Looking
Statements" in Local Bounti's Annual Report on Form 10-K for the
year ended December 31, 2021, filed
with the SEC on March 30, 2022, as
supplemented by subsequent Quarterly Reports on Form 10-Q and
Annual Reports on Form 10-K, and other reports and documents Local
Bounti files from time to time with the SEC. Local Bounti cautions
that the foregoing list of factors is not exclusive and cautions
readers not to place undue reliance upon any forward-looking
statements, which speak only as of the date hereof. Local Bounti
does not undertake or accept any obligation or undertaking to
update or revise any forward-looking statements to reflect any
change in its expectations or any change in events, conditions, or
circumstances on which any such statement is based.
Non-GAAP Financial Information
This press release contains references to adjusted EBITDA,
adjusted gross profit and adjusted gross margin percentage, which
are adjusted from results based on generally accepted accounting
principles in the United States
("GAAP") and exclude certain expenses, gains and losses. The
Company defines and calculates adjusted EBITDA as net loss
attributable to Local Bounti before the impact of interest expense,
depreciation, amortization, and adjusted to exclude stock-based
compensation expense, business combination fair value basis
adjustment to inventory, business acquisition and strategic
transaction due diligence and integration related costs,
restructuring and business realignment costs, gain/loss from
disposal of fixed assets and certain other non-core items. The
Company defines and calculates adjusted gross profit as gross
profit excluding depreciation, stock-based compensation, utilities
commodity price spike and inclement weather related costs, business
combination related integration costs, and business combination
fair value basis adjustment to inventory. The Company defines and
calculates adjusted gross margin percentage as adjusted gross
profit as a percent of sales.
These non-GAAP financial measures are provided to enhance the
user's understanding of the Company's prospects for the future and
the historical performance for the context of the investor. The
Company's management team uses these non-GAAP financial measures in
assessing performance, as well as in planning and forecasting
future periods. These non-GAAP financial measures are not computed
according to GAAP and the methods the Company uses to compute them
may differ from the methods used by other companies. Non-GAAP
financial measures are supplemental, should not be considered a
substitute for, or superior to, financial information presented in
accordance with GAAP and should be read only in conjunction with
the Company's consolidated financial statements prepared in
accordance with GAAP.
Refer to the attached financial supplement for a reconciliation
of these non-GAAP financial measures to their most directly
comparable GAAP measures for the twelve months ended
December 31, 2022.
LOCAL BOUNTI
CORPORATION UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP
FINANCIAL INFORMATION (in thousands)
RECONCILIATION OF
NET LOSS TO ADJUSTED EBITDA (Preliminary and
Unaudited)
|
|
|
Year Ended
December 31,
|
|
2022
|
Net loss
|
$
(111,071)
|
Stock-based
compensation expense
|
39,166
|
Interest expense,
net
|
16,734
|
Depreciation and
amortization
|
10,427
|
Utilities commodity
price spike and inclement weather related costs
|
369
|
Business combination
with Leo Holdings III Corp transaction costs
|
—
|
Business combination
fair value basis adjustment to inventory
|
1,042
|
Business acquisition
and strategic transaction due diligence and integration related
costs
|
10,135
|
Restructuring and
business realignment costs
|
1,052
|
Convertible notes fair
value adjustment
|
—
|
Gain/loss from
disposal of fixed assets
|
2,568
|
Other income and
expense
|
(189)
|
Adjusted
EBITDA
|
$
(29,767)
|
|
|
RECONCILIATION OF
GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS MARGIN
PERCENTAGE (Preliminary and Unaudited)
|
|
|
Year
Ended
December,
31
|
|
2022
|
Sales
|
$
19,474
|
Cost of goods
sold
|
17,259
|
Gross profit
|
2,215
|
Depreciation
|
2,957
|
Stock-based
compensation
|
104
|
Utilities commodity
price spike and inclement weather related costs
|
369
|
Business combination
related integration costs
|
736
|
Business combination
fair value basis adjustment to inventory
|
1,042
|
Adjusted gross
profit
|
$
7,423
|
Adjusted gross margin
%
|
38 %
|
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SOURCE Local Bounti