Retail Sales Velocity Increasing +23.2% Year-over-Year1
Improved Adj. EBITDA Loss by 35.2% Year-over-Year3
Reiterating Net Sales Guidance Range of
Q1 2024 – Improved Mix and Growing Momentum
The Company has continued its strategic transformation in the first quarter of 2024 showing meaningful year-over-year improvements in sales mix with higher gross margins, lower operating expenses, and significantly narrowed losses resulting in the Company’s the lowest loss quarter ever in terms of Adjusted EBITDA. Management’s strategy has been to transform the business to put it in a position to reap the benefits of high-quality growth and operating leverage. The Company rationalized its topline considerably throughout the last two years in an effort to focus on quality core revenue streams, cut back underperforming SKUs and accounts. In doing so, it has strengthened its unit economics and looks to ramp the last phase of the overall transformation in 2024, accelerating quality growth.
Retail Performance
In measured channels, the Company’s retail brands in the aggregate continue to outperform the overall meat snack category and that trend has continued to accelerate. Recent 12-Week SPINS data reflects meaningful year-over-year improvement in measured channels for the Stryve family of brands with retail dollar sales increasing 23.5%, total dollar velocities increasing 23.2%, and market share increasing 9.7bps1. Each of those year-over-year measures was exceeded in the 4-Week SPINS data of the same date, which reflects an increase in retail dollar sales of 29.5%, increase in total dollar velocities of 37.5%, and an increase in market share of 10.7bps2. Management believes that this acceleration is a sign of the impact of the Company’s transformation efforts, and in particular the new packaging and refreshed branding as well as the significant improvements in quality that have been achieved. Retail sales velocity and other retail metrics are derived from check-out register scan data reported by retailers and management believes they are indicative that the Company’s strategy is resonating with consumers and retailers alike.
Reiterating Fiscal Year 2024 Outlook
For fiscal year 2024,
Convertible Bridge Notes
The Company previously announced on
First Quarter 2024 Highlights
- Net sales of
$4.6 million , similar to the first quarter a year ago. Net sales were largely flat in part due to the Company’s discontinuation of certain retail programs, rationalization of low-quality revenue, which included the discontinuation of slow-moving and margin losing items some of which was still present in the prior year period. However, the Company’s packaging transitions, improved sell-through, and growth in quality core accounts offset the majority of the rationalized revenues in the first quarter. - Gross profit of
$1.0 million compared to gross profit of$0.96 million in the 2023 first quarter. First quarter 2024 improved performance is primarily attributable to improved mix partially offset by higher commodity beef costs than in the prior year period. Other factors contributing to the first quarter of 2024’s gross profit include under absorption of fixed costs in the Company’s manufacturing facilities as a result of the strategic rationalization efforts of management, and phase-out of legacy items. - Operating loss of
($3.0) million for the first quarter of 2024, compared to operating loss of($4.2) million in the 2023 first quarter. - Other Expense of
$0.9 million for the 2024 first quarter includes$0.6 million of interest expense and approximately$0.3 million of a non-cash loss on the extinguishment of debt related to the accounting treatment of the repricing of the warrants connected to the extension of the promissory notes issued onApril 19, 2023 . - Net loss of
($3.9) million , or ($1.42 ) per share for the first quarter of 2024 as compared to a net loss of($4.6) million , or ($2.23 ) per share, in the 2023 first quarter. - Adjusted loss per share3 of (
$1.20 ) for the first quarter of 2024, which compares favorably to adjusted loss per share of ($2.14 ) for the year-ago period. - Adjusted EBITDA loss3 of
($2.3) million for the 2024 first quarter, compared to($3.5) million in the prior year quarter.
1 Source: SPINS data for the 12-week period ending
2 Source: SPINS data for the 4-week period ending
3 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
About
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 brands Two Tails and Primal Paws, 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
* 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 Statements
Certain 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
Investor Relations Contact:
Investor Relations
ir@stryve.com
-Financial Statements Follow-
Condensed Consolidated Statement of Operations | ||||||||
(In thousands, except share and per share data) | ||||||||
For The Three Months Ended | ||||||||
2024 | 2023 | |||||||
Unaudited | ||||||||
SALES, net | $ | 4,598 | $ | 4,646 | ||||
COST OF GOODS SOLD (exclusive of depreciation shown separately below) | 3,582 | 3,683 | ||||||
GROSS PROFIT | 1,016 | 963 | ||||||
OPERATING EXPENSES | ||||||||
Selling expenses | 1,597 | 1,969 | ||||||
Operations expense | 353 | 514 | ||||||
Salaries and wages | 1,607 | 2,163 | ||||||
Depreciation and amortization expense | 462 | 552 | ||||||
Total operating expenses | 4,019 | 5,197 | ||||||
OPERATING LOSS | (3,003 | ) | (4,234 | ) | ||||
OTHER (EXPENSE) INCOME | ||||||||
Interest expense | (583 | ) | (399 | ) | ||||
Loss on extinguishment of debt | (334 | ) | - | |||||
Change in fair value of Private Warrants | - | 8 | ||||||
Other expense | - | (14 | ) | |||||
Total other (expense) income | (917 | ) | (405 | ) | ||||
NET LOSS BEFORE INCOME TAXES | (3,920 | ) | (4,639 | ) | ||||
Income tax expense | 9 | 3 | ||||||
NET LOSS | $ | (3,929 | ) | $ | (4,643 | ) | ||
Loss per common share: | ||||||||
Basic and diluted | $ | (1.42 | ) | $ | (2.23 | ) | ||
Weighted average shares outstanding: | ||||||||
Basic and diluted | 2,775,259 | 2,085,514 | ||||||
Condensed Consolidated Balance Sheets | ||||||||
(in thousands) | ||||||||
2024 | 2023 | |||||||
(unaudited) | (audited) | |||||||
ASSETS | ||||||||
CURRENT ASSETS | ||||||||
Cash and cash equivalent | $ | 280 | $ | 369 | ||||
Accounts receivable, net | 2,320 | 2,092 | ||||||
Inventory, net | 5,021 | 5,200 | ||||||
Prepaid expenses and other current assets | 537 | 720 | ||||||
Total current assets | 8,158 | 8,381 | ||||||
Property and equipment, net | 6,765 | 7,151 | ||||||
Right of use assets, net | 4,506 | 4,610 | ||||||
8,450 | 8,450 | |||||||
Intangible assets, net | 4,059 | 4,120 | ||||||
TOTAL ASSETS | $ | 31,938 | $ | 32,712 | ||||
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | ||||||||
CURRENT LIABILITIES | ||||||||
Accounts payable | $ | 6,334 | $ | 4,460 | ||||
Accrued expenses | 2,447 | 2,688 | ||||||
Current portion of lease liability | 376 | 362 | ||||||
Line of credit, net of debt issuance costs | 3,796 | 3,568 | ||||||
Promissory notes payable, net of debt discount and debt issuance costs | 2,914 | 2,914 | ||||||
Promissory notes payable due to related parties, net of debt discount and debt issuance costs | 1,175 | 1,175 | ||||||
Current portion of long-term debt and other short-term borrowings | 479 | 606 | ||||||
Total current liabilities | 17,521 | 15,773 | ||||||
Long-term debt, net of current portion, net of debt issuance costs | 3,421 | 3,475 | ||||||
Lease liability, net of current portion | 4,270 | 4,372 | ||||||
Financing obligation - related party operating lease | 7,500 | 7,500 | ||||||
TOTAL LIABILITIES | 32,712 | 31,120 | ||||||
COMMITMENTS AND CONTINGENCIES (Note 12) | ||||||||
STOCKHOLDERS' (DEFICIT) EQUITY | ||||||||
Preferred stock - | - | - | ||||||
Class A common stock - | - | - | ||||||
Class V common stock - | - | - | ||||||
Additional paid-in-capital | 139,447 | 137,885 | ||||||
Accumulated deficit | (140,221 | ) | (136,293 | ) | ||||
TOTAL STOCKHOLDERS' (DEFICIT) EQUITY | (774 | ) | 1,592 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY | $ | 31,938 | $ | 32,712 | ||||
Condensed Consolidated Statement of Cash Flows | ||||||||
(In thousands) | ||||||||
For The Three Months Ended | ||||||||
2024 | 2023 | |||||||
(unaudited) | ||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net loss | $ | (3,929 | ) | $ | (4,643 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation expense | 402 | 491 | ||||||
Amortization of intangible assets | 60 | 61 | ||||||
Amortization of debt issuance costs | 55 | 40 | ||||||
Amortization of right-of-use asset | 104 | 99 | ||||||
Loss on extinguishment of debt | 335 | - | ||||||
Reserve for credit losses | 154 | 73 | ||||||
Stock based compensation expense | 270 | 186 | ||||||
Change in fair value of Private Warrants | - | (8 | ) | |||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (381 | ) | (563 | ) | ||||
Inventory | 179 | 8 | ||||||
Income tax receivables and payables, net | 2 | - | ||||||
Prepaid expenses and other current assets | 183 | 74 | ||||||
Accounts payable | 1,858 | 1,345 | ||||||
Accrued liabilities | 4 | 301 | ||||||
Operating lease obligations | (87 | ) | (90 | ) | ||||
Net cash used in operating activities | $ | (791 | ) | $ | (2,626 | ) | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Cash paid for purchase of equipment | - | (49 | ) | |||||
Net cash used in investing activities | $ | - | $ | (49 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Proceeds from the issuance of common stock, net | 712 | - | ||||||
Borrowings on long-term debt | - | 2,000 | ||||||
Repayments on long-term debt | (22 | ) | (30 | ) | ||||
Borrowings on short-term debt | 3,923 | 3,360 | ||||||
Repayments on short-term debt | (3,911 | ) | (2,901 | ) | ||||
Net cash provided by financing activities | $ | 702 | $ | 2,429 | ||||
Net change in cash and cash equivalents | (89 | ) | (246 | ) | ||||
Cash and cash equivalents at beginning of period | 369 | 623 | ||||||
Cash and cash equivalents at end of period | $ | 280 | $ | 377 | ||||
SUPPLEMENTAL INFORMATION: | ||||||||
Cash paid for interest | $ | 405 | $ | 399 | ||||
NON-CASH INVESTING AND FINANCING ACTIVITY: | ||||||||
Non-cash commercial premium finance borrowing | $ | - | $ | 291 | ||||
Common stock issued for accrued expenses | $ | 147 | $ | - | ||||
Common stock issued for accrued expenses - related party | $ | 100 | $ | - | ||||
Accrued fixed assets | $ | 16 | $ | - | ||||
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 Loss Before Income Taxes, and Net Loss, the most closely related GAAP financial measure. Reconciliation between EBITDA, Adjusted EBITDA, Adjusted Earnings per Share, Net Loss Before Income Taxes, and Net Loss are below:
For The Three Months Ended | ||||||||
2024 | 2023 | |||||||
(unaudited) | ||||||||
(In thousands) | ||||||||
Net loss before income taxes | $ | (3,920 | ) | $ | (4,639 | ) | ||
Interest expense | 583 | 399 | ||||||
Depreciation and amortization expense | 462 | 552 | ||||||
EBITDA | $ | (2,875 | ) | $ | (3,689 | ) | ||
Additional Adjustments: | ||||||||
Loss on Extinguishment of Debt | 334 | - | ||||||
Stock Based Compensation Expense | 270 | 186 | ||||||
Adjusted EBITDA | $ | (2,271 | ) | $ | (3,503 | ) | ||
For The Three Months Ended | ||||||||
2024 | 2023 | |||||||
(unaudited) | ||||||||
(In thousands except share and per share information) | ||||||||
Net loss | $ | (3,929 | ) | $ | (4,643 | ) | ||
Weighted average shares outstanding | 2,775,259 | 2,085,514 | ||||||
Basic & Diluted Net Loss per Share | $ | (1.42 | ) | $ | (2.23 | ) | ||
Additional Adjustments: | ||||||||
Loss on Extinguishment of Debt | 0.12 | — | ||||||
Stock Based Compensation Expense | 0.10 | 0.09 | ||||||
Adjusted Earnings per Share | $ | (1.20 | ) | $ | (2.14 | ) | ||
Source:
2024 GlobeNewswire, Inc., source