Edible Garden AG Incorporated (“Edible Garden” or the
“Company”) (Nasdaq: EDBL), 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
March 31, 2024.
Mr. Jim Kras, Chief Executive Officer of Edible
Garden, commented, “We are excited to announce a significant 27.6%
year-over-year increase in revenue for the first quarter of 2024,
which is typically the slowest quarter in our industry. This
considerable growth showcases the dedication of the entire Edible
Garden team and our ability to perform at a high level, resulting
in high fill rates and an outstanding reputation as a trusted
supplier within the industry. It also highlights the beneficial
effects that vertical integration has had on our operations. We
have achieved consistent top-line revenue growth over recent
quarters, and more importantly, have increased our margins since we
started reducing our reliance on third-party growers in the latter
half of 2023. The benefits of this strategic shift became apparent
at the end of last year and continued into the first quarter of
2024, where our gross profit increased by 195.8%. Additionally, we
started to realize the benefits of this strategic shift in our
gross profit margin which increased by 171 basis points compared to
the same period in 2023. Our transition away from third-party
growers has accelerated, with Edible Garden now producing
approximately 95% of the Edible Garden fresh product line in
Company-owned facilities. This has been a transformative journey,
and we believe we have now reached a key inflection point in our
evolution as a Company. With all the necessary elements in place,
we believe we are poised to boost our margins in the coming
quarters.”
"We continue to utilize our platform to enhance
and expand our product range. In the first quarter, we partnered
with Uncle Giuseppe's Marketplace, part of RBest Produce, to
distribute Edible Garden herbs across their locations in New York
and New Jersey, thus broadening our footprint in the Northeastern
U.S. Perhaps more significantly, we secured a three-year contract,
unprecedented in our history, with a leading U.S. food retailer.
This contract, which we anticipate will generate approximately $18
to $20 million in revenue over its initial term, will facilitate
the expansion of our product offerings in their stores. Beyond
simply expanding our product assortment, this partnership will
introduce innovative and engaging displays that aim to increase our
brand’s visibility and prominence on the retailers’ shelves."
"In 2023, we introduced Pulp, our fresh and
fermented line of sustainable gourmet sauces and chili-based
products, venturing into the global sauces and condiments market—a
market expected to grow from $172.79 billion in 2021 to $240.7
billion by 2028, according to Research and Markets. In a relatively
brief time, Pulp has become available at Whole Foods Market, Morton
Williams, Dierbergs Markets, Target, and Woodman’s. In early March
2024, we expanded our distribution through KeHE Distributors, a
leading distributor of natural, organic, specialty, and fresh
products, and in April, we added UNFI Distributors, one of North
America’s top grocery wholesalers of health and specialty food. The
addition of these two, major distributors, further broadens access
to our ‘Bland to Bold’ Pulp product line and comes on the heels of
the launch of our Pulp e-commerce platform, allowing consumers to
directly purchase all of our distinct and flavorful products
online. The response to the Pulp line has been exceptionally
positive, with sauce lovers quickly becoming fans of its unique
peppers and the distinctive 'Bland to Bold' flavor they add to any
meal, solidifying Edible Garden’s reputation as 'The Flavor
Maker.'"
“In late April, we began distributing our Garden
Starters—a collection of potted herbs and basil bowls designed for
home gardens—to Midwest retail locations, starting with Meijer.
Introduced in 2023 due to growing interest in home gardening, these
sustainably grown herbs cater to the 35% of American households
that grow at least some of their own food and are seeking flavor
options to enhance the flavors of their meals. Our vertically
integrated Edible Garden Heartland facility in Grand Rapids,
Michigan, now fully manages the production, packaging, and
distribution of these products. By placing them next to our cut
herbs and sustainably sourced produce in supermarkets, we aim to
offer maximum convenience to our customers.”
“Earlier this month, we entered into a product
development agreement with Hermann Pickle Company, a leader in
refrigerated kosher dill pickles, sauerkraut, and other fermented
foods, which have been fixtures at delis and dinner tables
nationwide for generations. Our collaboration will focus on
leveraging both companies' strengths to research and develop
scalable commercial opportunities. This partnership will
concentrate on producing, marketing, and distributing fermented
plant-based products and non-GMO consumer packaged foods. We are
excited to work with the Hermann Pickles team, drawing on their
trusted heritage to create a contemporary line of fermented product
offerings.”
Financial results for the three months ended March 31,
2024
For the quarter ended March 31, 2024, revenue
totaled $3.1 million, an increase of 27.6%, compared to $2.5
million for the three months ended March 31, 2023. The increase was
attributable to an increase in customer demand for our cut herbs
and potted herbs products and the expansion of our product
lineup.
Cost of goods sold totaled $3.1 million for the
three months ended March 31, 2024, compared to $2.5 million for the
three months ended March 31, 2023. The increase was in line with
the increase in revenue for the same period.
Selling, general and administrative (“SG&A”)
expenses were $3.9 million for the three months ended March 31,
2024, compared to $2.7 million for the three months ended March 31,
2023. The increase was primarily driven by a one-time severance
charge and higher audit, accounting and legal fees related to the
departure of our previous Chief Financial Officer.
Net loss was $4.0 million, or ($13.65) per
share, for the three months ended March 31, 2024, compared to a net
loss of $2.9 million, or ($44.19) per share, for the three months
ended March 31, 2023. Higher SG&A expenses and approximately
$0.6 million of non-recurring and non-cash expenses contributed to
the increase in net loss. The expectation is to continue to reduce
SG&A as we continue to become more efficient.
The complete financial results for the three
months ended March 31, 2024, are available in the Company’s
Quarterly Report on Form 10-Q, which will be filed with the
Securities and Exchange Commission and 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 March 31, 2024, as well as the
Company’s corporate progress and other developments.
The conference call will be available via
telephone by dialing toll-free +1 888-506-0062 for U.S. callers or
+1 973-528-0011 for international callers and entering access code
926030. A webcast of the call may be accessed at
https://www.webcaster4.com/Webcast/Page/2914/50592 or on the
investor relations section of the company’s website,
https://ediblegardenag.com/presentations/.
A webcast replay will be available on the
investor relations section of the Company’s website at
https://ediblegardenag.com/presentations/ through May 15, 2025. A
telephone replay of the call will be available approximately one
hour following the call, through Wednesday, May 29, 2024, and can
be accessed by dialing +1 877-481-4010 for U.S. callers or +1
919-882-2331 for international callers and entering access code
50592.
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, US 11,410,249 B2 and US
11,830, 088 B2) software optimizes growing in vertical and
traditional greenhouses while seeking to reduce
pollution-generating food miles. Its proprietary patented (U.S.
Patent No. D1,010,365) Self-watering display is designed to
increase plant shelf life and provide an enhanced in-store plant
display experience. 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, including with respect to the Company’s ability to
improve its financial results, the Company’s growth strategies, the
Company’s ability to expand into new product lines, and its
performance as a public company. The words “aim,” “anticipate,”
“believe,” “design,” “expect,” “objective,” “plan,” “seek,” “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 and the Company’s ability to achieve its
growth objectives, and other factors set forth in the Company’s
filings with the Securities and Exchange Commission, including the
Company’s annual report on Form 10-K for the year ended December
31, 2023 and subsequent quarterly reports on Form 10-Q. Actual
results might differ materially from those explicit or implicit in
the forward-looking statements. 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 |
(unaudited, in thousands, except shares) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
|
2024 |
|
2023 |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash |
|
$ |
388 |
|
|
$ |
510 |
|
|
Accounts receivable, net |
|
|
1,139 |
|
|
|
1,249 |
|
|
Inventory |
|
|
814 |
|
|
|
678 |
|
|
Prepaid expenses and other current assets |
|
|
276 |
|
|
|
210 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
2,617 |
|
|
|
2,647 |
|
|
|
|
|
|
|
|
|
|
Property, equipment and leasehold improvements, net |
|
|
3,646 |
|
|
|
3,893 |
|
|
Intangible assets, net |
|
|
46 |
|
|
|
47 |
|
|
Other assets |
|
|
38 |
|
|
|
69 |
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
6,347 |
|
|
$ |
6,656 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
LIABILITIES: |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
Accounts payable and other accrued expenses |
|
$ |
5,145 |
|
|
$ |
2,517 |
|
|
Short-term debt, net of discounts |
|
|
4,438 |
|
|
|
387 |
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
9,583 |
|
|
|
2,904 |
|
|
|
|
|
|
|
|
|
|
Long-term liabilities: |
|
|
|
|
|
|
|
Long-term debt, net of discounts |
|
|
852 |
|
|
|
4,040 |
|
|
Long-term lease liabilities |
|
|
- |
|
|
|
- |
|
|
Long-term liabilities of discontinued operations |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long-term liabilities |
|
|
852 |
|
|
|
4,040 |
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
10,435 |
|
|
|
6,944 |
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' DEFICIT: |
|
|
|
|
|
|
|
Common stock ($0.0001 par value, 100,000,000 shares authorized,
307,820 and 285,283 shares outstanding as of March 31, 2024 and
December 31, 2023, respectively (1)) |
|
|
1 |
|
|
|
1 |
|
|
Series A Convertible Preferred stock ($0.0001 par value, 10,000,000
shares authorized; nil shares outstanding as of March 31, 2024 and
December 31, 2023) |
|
|
- |
|
|
|
- |
|
|
Additional paid-in capital |
|
|
30,148 |
|
|
|
29,971 |
|
|
Accumulated deficit |
|
|
(34,237 |
) |
|
|
(30,260 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' deficit |
|
|
(4,088 |
) |
|
|
(288 |
) |
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT) |
|
$ |
6,347 |
|
|
$ |
6,656 |
|
|
|
|
|
|
|
|
|
|
(1) Adjusted to reflect all stock splits |
|
|
|
|
|
|
|
EDIBLE GARDEN AG INCORPORATED |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
(unaudited, in thousands, except share and per-share
information) |
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
2024 |
|
|
2023 |
|
|
|
|
|
|
|
|
Revenue |
$ |
3,132 |
|
|
$ |
2,455 |
|
|
Cost of goods sold |
|
3,109 |
|
|
|
2,479 |
|
|
|
|
|
|
|
|
|
Gross profit (loss) |
|
23 |
|
|
|
(24 |
) |
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
3,884 |
|
|
|
2,691 |
|
|
(Gain) / Loss on sale of assets |
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(3,861 |
) |
|
|
(2,715 |
) |
|
|
|
|
|
|
|
|
Other expenses |
|
|
|
|
|
|
Interest expense, net |
|
(117 |
) |
|
|
(234 |
) |
|
Gain from extinguishment of debt |
|
- |
|
|
|
70 |
|
|
Other income / (loss) |
|
1 |
|
|
|
- |
|
|
Total other expenses |
|
(116 |
) |
|
|
(164 |
) |
|
|
|
|
|
|
|
|
NET LOSS |
$ |
(3,977 |
) |
|
$ |
(2,879 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income / (Loss) per common share - basic and diluted (1) |
$ |
(13.65 |
) |
|
$ |
(44.19 |
) |
|
|
|
|
|
|
|
|
Weighted-Average Number of Common Shares Outstanding — Basic
and Diluted (1) |
|
291,372 |
|
|
|
65,147 |
|
|
|
|
|
|
|
|
|
(1) Adjusted to reflect all stock splits |
|
|
|
|
|
|
|
|
|
|
|
|
|
EDIBLE GARDEN AG INCORPORATED |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(in thousands) |
|
|
|
Three Months Ended March 31, |
|
|
2024 |
|
|
2023 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
Net Income (Loss) |
|
$ |
(3,977 |
) |
|
$ |
(2,879 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
Bad debt expense |
|
|
9 |
|
|
|
- |
|
Depreciation and amortization |
|
|
302 |
|
|
|
334 |
|
Amortization of operating lease right of use asset |
|
|
26 |
|
|
|
22 |
|
Amortization of debt discount |
|
|
3 |
|
|
|
- |
|
Gain from extinguishment of debt |
|
|
- |
|
|
|
(70 |
) |
Stock-based compensation |
|
|
38 |
|
|
|
30 |
|
Stock issued to Directors |
|
|
- |
|
|
|
70 |
|
Change in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
100 |
|
|
|
215 |
|
Inventory |
|
|
(136 |
) |
|
|
(436 |
) |
Prepaid expenses and other current assets |
|
|
(66 |
) |
|
|
(97 |
) |
Other assets |
|
|
5 |
|
|
|
- |
|
Accounts payable and accrued expenses |
|
|
2,660 |
|
|
|
(497 |
) |
Operating lease liabilities |
|
|
(26 |
) |
|
|
(11 |
) |
NET CASH USED FOR OPERATING ACTIVITIES |
|
|
(1,062 |
) |
|
|
(3,319 |
) |
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
Purchase of property, equipment and leasehold improvements |
|
|
(55 |
) |
|
|
(361 |
) |
Purchase of intangible assets |
|
|
- |
|
|
|
- |
|
NET CASH USED FOR INVESTING ACTIVITIES |
|
|
(55 |
) |
|
|
(361 |
) |
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
Proceeds from debt, including related parties |
|
|
1,050 |
|
|
|
175 |
|
Payment of debt issuance costs |
|
|
(50 |
) |
|
|
- |
|
Payments of debt principal, including related parties |
|
|
(139 |
) |
|
|
(1,911 |
) |
Proceeds from sales of common stock from Equity Distribution
Agreement |
|
|
139 |
|
|
|
- |
|
Payment of commissions related to sale of common stock |
|
|
(5 |
) |
|
|
- |
|
Proceeds from common stock and warrants issued in public
offering |
|
|
- |
|
|
|
9,398 |
|
Payment of costs related to public offering |
|
|
- |
|
|
|
(140 |
) |
Payment of preferred stock dividends |
|
|
- |
|
|
|
(4 |
) |
NET CASH PROVIDED BY FINANCING ACTIVITIES |
|
|
995 |
|
|
|
7,518 |
|
|
|
|
|
|
|
|
NET CHANGE IN CASH |
|
|
(122 |
) |
|
|
3,838 |
|
Cash at beginning of period |
|
|
510 |
|
|
|
110 |
|
|
|
|
|
|
|
|
CASH AT END OF PERIOD |
|
$ |
388 |
|
|
$ |
3,948 |
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE FOR OPERATING
ACTIVITIES: |
|
|
|
|
|
|
Cash paid for interest |
|
$ |
35 |
|
|
$ |
247 |
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE FOR NON-CASH INVESTING AND
FINANCING ACTIVITIES: |
|
|
|
|
|
|
Trucks acquired with debt |
|
$ |
- |
|
|
$ |
152 |
|
|
|
|
|
|
|
|
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