Lifecore Biomedical, Inc. (Nasdaq: LFCR) (“Lifecore” or the
“Company”), a fully integrated contract development and
manufacturing organization (“CDMO”), reported results for the
fiscal 2023 fourth quarter and full year ended May 28, 2023.
CEO COMMENTS:
James G. Hall, President and Chief Executive
Officer of Lifecore, commented, "We completed a very busy fourth
quarter finalizing our transition to a stand-alone life sciences
company with the final divestitures of the Curation Foods segment,
strong growth in our development portfolio, and the comprehensive
strategic refinancing and expanded supply agreement with our key
customer Alcon. Our entire organization is now aligned toward a
common goal of expanding Lifecore's position as a leading, fully
integrated CDMO that offers highly differentiated capabilities in
the development, fill and finish of complex sterile injectable
pharmaceutical products in syringes and vials and injectable grade
Hyaluronic Acid ("HA")."
Mr. Hall continued, "We advanced our development
portfolio in the fiscal fourth quarter with the addition of five
projects affiliated with five new customers, which demonstrates the
impact that our expanded commercial strategy and targeted sales
approach is having on our opportunity pipeline. Concurrently, we
are preparing our organization for the significant anticipated
growth embedded in our portfolio, both in terms of capacity and
people. To that end, our multi-use fillers remain on track for
delivery in the coming months which will allow us to double our
theoretical filling capacity to approximately 45 million units and
put Lifecore in a great position to meet market needs and optimize
our production across our manufacturing footprint. We also invested
in our HA fermentation capacity during the fourth quarter and are
in the process of moving from a single-shift fermentation
production staff to a full 24/7 staffing model, which we expect
will increase our sterile HA capacity by up to 50% by June 2024,
allowing us to fulfill the increased HA volume orders associated
with our expanded demand."
"Looking ahead to our fiscal 2024 first quarter,
our commercial momentum has continued, and we will add several new
projects to our development portfolio for the period ended August
27, 2023. We believe this activity will begin to meaningfully
contribute to our financial performance in fiscal 2024 second
quarter and to a greater degree in the second half of the fiscal
year."
LIFECORE FISCAL
FOURTH QUARTER 2023 FINANCIAL
HIGHLIGHTS:
- Consolidated revenues of $31.5
million, an increase of 12.2% year-over-year.
- Consolidated gross profit of $8.4
million, a decrease of $4.3 million, or 33.9% year-over-year
- Consolidated net loss from
continuing operations of $33.8 million, which includes a $23.8
million loss on debt refinancing, $6.8 million of restructuring and
other non-recurring charges such as legal expenses, both net of
tax, as compared to a net loss from continuing operations of $1.0
million in the prior year period, which included $5.2 million of
restructuring and other non-recurring charges, net of tax.
- Consolidated adjusted EBITDA of
$3.7 million, compared to $9.1 million in the prior year
period.
- Lifecore segment adjusted EBITDA of
$6.1 million, compared to $10.7 million in the prior year period,
which reflects the timing of shipments to customers; lower
development revenue associated with a delay in onboarding new
customer projects as well as a higher mix of earlier stage, lower
revenue projects; and inflation associated with legacy commercial
products.
LIFECORE FISCAL YEAR 2023 FINANCIAL
HIGHLIGHTS:
- Consolidated revenues of $103.3
million, a decrease of 7.2% year-over-year.
- Consolidated gross profit of $27.3
million, a decrease of $15.6 million, or 36.4% year-over-year.
- Consolidated net loss from
continuing operations of $69.0 million, which includes $20.0
million of restructuring and other non-recurring charges such as
legal expenses, both net of tax, as compared to a net loss from
continuing operations of $12.0 million in the prior year period,
which included $15.8 million of restructuring and other
non-recurring charges, net of tax.
- Consolidated adjusted EBITDA of
$5.8 million, compared to $22.9 million in the prior year
period.
- Lifecore segment adjusted EBITDA of
$14.7 million, compared to $30.7 million in the prior year
period.
Discontinued Operations
As previously reported, the Company closed on
the sales of certain businesses which are now included in
discontinued operations including the following:
- December 13, 2021, Curation Foods'
fresh packaged salads and vegetables business (the “Eat Smart
Disposition”)
- February 7, 2023, Curation Foods'
avocado products business (the “Yucatan Disposition”)
- April 6, 2023, Curation Foods' O
Olive Oil and Vinegar business (the "O Olive Disposition")
The results of the above dispositions are
reflected as discontinued operations in all periods presented
within the Company’s financial statements reported herein.
CONSOLIDATED FISCAL
FOURTH QUARTER 2023 RESULTS:
Fiscal fourth quarter 2023 results compared to
fiscal fourth quarter 2022 are as follows:
(Unaudited and in thousands,
except per-share data) |
|
Three Months Ended |
|
Change |
|
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
Revenues |
|
$ |
31,546 |
|
|
$ |
28,107 |
|
|
$ |
3,439 |
|
|
12 % |
Gross profit |
|
|
8,391 |
|
|
|
12,690 |
|
|
|
(4,299 |
) |
|
(34)% |
Net loss from continuing
operations |
|
|
(33,795 |
) |
|
|
(1,010 |
) |
|
|
(32,785 |
) |
|
(3246)% |
Adjusted net income
(loss)* |
|
|
(26,977 |
) |
|
|
4,203 |
|
|
|
(31,180 |
) |
|
N/M |
Diluted net loss per
share |
|
|
(1.11 |
) |
|
|
(0.03 |
) |
|
|
(1.08 |
) |
|
(3600)% |
Adjusted diluted net income
(loss) per share* |
|
|
(0.89 |
) |
|
|
0.15 |
|
|
|
(1.04 |
) |
|
N/M |
EBITDA* |
|
|
(5,498 |
) |
|
|
(47,087 |
) |
|
|
41,589 |
|
|
88 % |
Adjusted EBITDA* |
|
|
3,727 |
|
|
|
9,149 |
|
|
|
(5,422 |
) |
|
(59)% |
* See “Non-GAAP Financial Information” at the end of this
release as to how the Company defines these non-GAAP financial
measures and for a reconciliation thereof.
Revenues increased $3.4 million year-over-year,
which was primarily a result of a $3.9 million increase in Lifecore
segment revenues.
Gross profit decreased $4.3 million
year-over-year, which was driven by a $5.0 million decrease in the
Lifecore segment and a $0.7 million increase in the Curation Foods
segment.
Net loss from continuing operations was $33.8
million for fiscal fourth quarter 2023, which includes $6.8 million
of restructuring and non-recurring charges, net of taxes, related
to consolidating and optimizing operations associated with the
Company's strategy to divest its Curation Foods businesses. This
compares to a net loss from continuing operations of $1.0 million
in the prior year period, which includes $5.2 million of
restructuring and non-recurring charges, net of tax, similarly
related to consolidating and optimizing its Curation Foods
businesses.
SEGMENT RESULTS:
Lifecore Segment:
(Unaudited and in
thousands) |
|
Three Months Ended |
|
Change |
|
Twelve Months Ended |
|
Change |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CDMO |
|
$ |
24,290 |
|
$ |
22,362 |
|
$ |
1,928 |
|
9 |
% |
|
$ |
76,378 |
|
$ |
86,313 |
|
$ |
(9,935 |
) |
|
(12 |
)% |
Fermentation |
|
|
7,256 |
|
|
5,251 |
|
|
2,005 |
|
38 |
% |
|
|
26,891 |
|
|
23,007 |
|
|
3,884 |
|
|
17 |
% |
Total revenue |
|
$ |
31,546 |
|
$ |
27,613 |
|
$ |
3,933 |
|
14 |
% |
|
$ |
103,269 |
|
$ |
109,320 |
|
$ |
(6,051 |
) |
|
(6 |
)% |
Lifecore is the Company’s CDMO business focused
on product development and manufacturing of sterile injectable
products. Lifecore continues to expand its presence in the robust
CDMO marketplace by utilizing its specialized capabilities to
partner with and provide value-added services to biopharmaceutical
and medical device companies. Lifecore continues to seek to drive
growth with a focus on building its business development pipeline,
maximizing capacity and advancing product commercialization for
innovative new therapies that improve patients’ lives.
In the fiscal fourth quarter 2023, Lifecore
realized total revenues of $31.5 million, representing an increase
of 14.2% as compared to the prior year period, primarily driven by
a 38.2% increase in its HA raw material manufacturing
(fermentation) business and an 8.6% increase in its CDMO business.
The increase in HA raw material manufacturing revenue was primarily
due to the higher demand in the current year. The increase in CDMO
revenues was primarily due to the timing of customer shipments, as
well as a higher mix of earlier phase development projects
onboarded at the earlier lower initial revenue stage.
Lifecore's development pipeline in the fourth
quarter of fiscal 2023 increased by five to 29 active development
programs under contract as of the end of the fiscal 2023 fourth
quarter. These projects are delineated as follows: early phase or
proof of concept (seven projects), Phase 1 and Phase 2 clinical
development (eight projects), and Phase 3 clinical development or
scale-up/commercial validation activity (fourteen projects).
Lifecore currently manufactures 29 commercial products for 14
clients, which is unchanged from fiscal third quarter 2023.
Curation Foods Segment:
(Unaudited and in
thousands) |
|
Three Months Ended |
|
Change |
|
Twelve Months Ended |
|
Change |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Technology |
|
|
— |
|
|
494 |
|
|
(494 |
) |
|
(100)% |
|
|
— |
|
|
1,910 |
|
|
(1,910 |
) |
|
(100)% |
Total revenue |
|
$ |
— |
|
$ |
494 |
|
$ |
(494 |
) |
|
(100)% |
|
$ |
— |
|
$ |
1,910 |
|
$ |
(1,910 |
) |
|
(100)% |
The remaining revenues associated with the
Company’s Curation Foods segment relate to the BreatheWay
technology operations, which have been divested, and are included
in continuing operations within the Company’s financial
statements.
CASH FLOW & BALANCE
SHEETCash used in operations was $34.5 million for the
fiscal year ended May 28, 2023 compared to $23.2 million in
the prior year period. Cash provided by investing activities
decreased $84.1 million compared to the prior year period to $4.2
million used in investing activities in 2023, primarily due to the
timing of Curation Foods' businesses dispositions. Capital
expenditures were $20.8 million for the fiscal year ended
May 28, 2023 which were primarily focused on investing in
Lifecore’s long-term growth initiatives. The results for fiscal
year 2023 and 2022 included herein reflect adjustments to increase
capitalized interest by $2.5 million and $1.8 million,
respectively, which have the effect of increasing capital
expenditures and reducing interest expense by offsetting amounts
for the respective periods. These adjustments remain subject to the
completion of the audit of the Company’s financial statements,
including with respect to any final adjustments to capitalized
interest for those periods. Cash provided by financing activities
was $56.1 million for the fiscal year ended May 28, 2023,
driven primarily by the previously announced sale of common and
convertible preferred stock and proceeds from the debt
refinancing.
The Company had cash and cash equivalents of
$19.1 million as of May 28, 2023. Total term debt, net of
cash, at May 28, 2023, was $147.2 million, consisting of its
line of credit, term debt and debt derivative liability associated
with the new term debt, compared to $137.2 million in the prior
year. With the debt refinancing in the fourth quarter of fiscal
year 2023, debt has been characterized as a long-term liability as
compared to a current liability in the prior year.
As previously announced, on May 22, 2023, the
Company entered into $150 million of new credit arrangements with
Alcon, including a six-year credit agreement and a sale and
leaseback of certain HA fermentation equipment which replaced its
existing term loan. The term facility bears interest at the rate of
10%, which is payable in kind (“PIK”) for the first three years,
and payable 3% in cash interest and 7% PIK interest thereafter
until maturity. Alcon and the Company also entered into an
equipment sale and leaseback transaction related to certain HA
fermentation assets, with a lease term of ten years, subject to
certain repurchase rights.
CONFERENCE CALLThe live webcast
can be accessed via Lifecore's website on the Investor Events &
Presentations page. The webcast will be available for 30 days.
Date: Thursday, August 31,
2023
Time: 7:30 a.m. Central time
(8:30 a.m. Eastern time)
Webcast link:
http://ir.lifecore.com/events-presentations
To participate in the conference call via
telephone, dial toll-free: (877) 407-3982 or (201) 493-6780. Please
call the conference telephone number 5-10 minutes prior to the
start time so the operator can register your name and
organization.
A replay of the call will be available through
Thursday, September 07, 2023 by calling toll-free: (844) 512-2921
or direct (412) 317-6671, and entering code 13740691.
About Lifecore
BiomedicalLifecore Biomedical, Inc. is a fully integrated
contract development and manufacturing organization (CDMO) that
offers highly differentiated capabilities in the development, fill
and finish of complex sterile injectable pharmaceutical products in
syringes and vials. As a leading manufacturer of premium,
injectable grade Hyaluronic Acid, Lifecore brings more than 40
years of expertise as a partner for global and emerging
biopharmaceutical and biotechnology companies across multiple
therapeutic categories to bring their innovations to market. For
more information about the Company, visit Lifecore’s website at
www.lifecore.com.
Non-GAAP Financial
InformationThis press release contains non-GAAP financial
information, including with respects to EBITDA, adjusted EBITDA,
Lifecore segment adjusted EBITDA, Curation Foods segment adjusted
EBITDA, and Other segment adjusted EBITDA. The Company has included
reconciliations of these non-GAAP financial measures to their
respective most directly comparable financial measures calculated
in accordance with GAAP. See the section entitled “Non-GAAP
Financial Information and Reconciliations” in this release for
definitions of EBITDA, adjusted EBITDA, Lifecore segment adjusted
EBITDA, Curation Foods segment adjusted EBITDA, and Other segment
adjusted EBITDA.
The Company has disclosed these non-GAAP
financial measures to supplement its consolidated financial
statements presented in accordance with GAAP. These non-GAAP
financial measures exclude/include certain items that are included
in the Company’s results reported in accordance with GAAP.
Management believes these non-GAAP financial measures provide
useful additional information to investors about trends in the
Company’s operations and are useful for period-over-period
comparisons. These non-GAAP financial measures should not be
considered in isolation or as a substitute for the comparable GAAP
measures. In addition, these non-GAAP financial measures may not be
the same as similar measures provided by other companies due to the
potential differences in methods of calculation and items being
excluded/included. These non-GAAP financial measures should be read
in conjunction with the Company’s consolidated financial statements
presented in accordance with GAAP.
Important Cautions Regarding
Forward-Looking Statements This press release
contains forward-looking statements regarding future events and our
future results that are subject to the safe harbor created under
the Private Securities Litigation Reform Act of 1995 and other safe
harbors under the Securities Act of 1933 and the Securities
Exchange Act of 1934. Words such as “anticipate”, “estimate”,
“expect”, “project”, “plan”, “intend”, “believe”, “may”, “might”,
“will”, “should”, “can have”, “likely” and similar expressions are
used to identify forward-looking statements. All forward-looking
statements involve certain risks and uncertainties that could cause
actual results to differ materially, including such factors among
others, as the outcome of any evaluation of the Company’s strategic
alternatives or any discussions with any potential bidders related
thereto the ability of the Company to continue as a going concern,
the ability of the Company to conduct its strategic review process
in a timely manner or at all, the timing and needs related to
capital expenditures, any future relationship between Alcon and the
Company, if any, the ability of the Company to conduct its
strategic review process in a timely manner or at all, the
Company’s ability to successfully complete the transition of the
Company’s business and operations to focus on Lifecore, the timing
and needs related to capital expenditures, the timing and expenses
associated with operations, the ability to achieve acceptance of
the Company’s new products in the market place, government
regulations affecting our business, the timing of regulatory
approvals, uncertainties related to COVID-19 and the impact of our
responses to it, and the mix between domestic and international
sales. For additional information about factors that could cause
actual results to differ materially from those described in the
forward-looking statements, please refer to our filings with the
Securities and Exchange Commission, including the risk factors
contained in our most recent Quarterly Report on Form 10-Q and
Annual Report on Form 10-K/A. Forward-looking statements represent
management’s current expectations and are inherently uncertain.
Except as required by law, we do not undertake any obligation to
update forward-looking statements made by us to reflect subsequent
events or circumstances.
LIFECORE BIOMEDICAL, INC.CONSOLIDATED
CONDENSED BALANCE SHEETS(In thousands, except par
value) |
|
|
May 28, 2023 |
|
May 29, 2022 |
|
(Unaudited) |
|
|
ASSETS |
|
|
|
Current Assets: |
|
|
|
Cash and cash equivalents |
$ |
19,091 |
|
|
$ |
991 |
|
Accounts receivable, less allowance for credit losses |
|
29,708 |
|
|
|
38,836 |
|
Inventories |
|
45,384 |
|
|
|
40,711 |
|
Prepaid expenses and other current assets |
|
5,078 |
|
|
|
5,158 |
|
Current assets, discontinued operations |
|
— |
|
|
|
38,016 |
|
Total Current Assets |
|
99,261 |
|
|
|
123,712 |
|
|
|
|
|
Property and equipment,
net |
|
129,671 |
|
|
|
116,441 |
|
Operating lease right-of-use
assets |
|
4,922 |
|
|
|
5,646 |
|
Goodwill |
|
13,881 |
|
|
|
13,881 |
|
Trademarks/tradenames |
|
4,200 |
|
|
|
4,200 |
|
Other assets |
|
3,215 |
|
|
|
2,889 |
|
Other assets, discontinued
operations |
|
— |
|
|
|
12,843 |
|
Total Assets |
$ |
255,150 |
|
|
$ |
279,612 |
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current Liabilities: |
|
|
|
Accounts payable |
$ |
22,144 |
|
|
$ |
12,952 |
|
Accrued compensation |
|
3,921 |
|
|
|
8,941 |
|
Other accrued liabilities |
|
6,900 |
|
|
|
6,847 |
|
Current portion of lease liabilities |
|
1,270 |
|
|
|
4,368 |
|
Deferred revenue |
|
4,055 |
|
|
|
919 |
|
Line of credit |
|
— |
|
|
|
40,000 |
|
Current portion of long-term debt, net |
|
488 |
|
|
|
98,178 |
|
Current liabilities, discontinued operations |
|
— |
|
|
|
4,605 |
|
Total Current Liabilities |
|
38,778 |
|
|
|
176,810 |
|
|
|
|
|
Long-term debt, net |
|
101,273 |
|
|
|
— |
|
Debt derivative liability |
|
64,500 |
|
|
|
Long-term lease
liabilities |
|
9,709 |
|
|
|
7,658 |
|
Deferred taxes, net |
|
373 |
|
|
|
126 |
|
Other non-current
liabilities |
|
3,114 |
|
|
|
190 |
|
Non-current liabilities,
discontinued operations |
|
— |
|
|
|
2,063 |
|
Total Liabilities |
|
217,747 |
|
|
|
186,847 |
|
|
|
|
|
Convertible Preferred stock,
$0.001 par value; 2,000 shares authorized; 39 and 0 shares issued
and outstanding at May 28, 2023 and May 29, 2022, respectively |
|
39,245 |
|
|
|
— |
|
|
|
|
|
Stockholders’ Equity: |
|
|
|
Common stock, $0.001 par
value; 50,000 shares authorized; 29,513 and 29,333 shares issued
and outstanding at May 28, 2023 and May 29, 2022, respectively |
|
30 |
|
|
|
30 |
|
Additional paid-in
capital |
|
174,349 |
|
|
|
167,352 |
|
Accumulated deficit |
|
(176,221 |
) |
|
|
(74,031 |
) |
Accumulated other
comprehensive loss |
|
— |
|
|
|
(586 |
) |
Total Stockholders’
Equity |
|
(1,842 |
) |
|
|
92,765 |
|
Total Liabilities and
Stockholders’ Equity |
$ |
255,150 |
|
|
$ |
279,612 |
|
LIFECORE BIOMEDICAL, INC.CONSOLIDATED
CONDENSED STATEMENTS OF COMPREHENSIVE (LOSS)
INCOME(Unaudited) (In thousands, except per share
amounts) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
May 28, 2023 |
|
May 29, 2022 |
|
May 28, 2023 |
|
May 29, 2022 |
Product sales |
$ |
31,546 |
|
|
$ |
28,107 |
|
|
$ |
103,269 |
|
|
$ |
111,230 |
|
Cost of product sales |
|
23,155 |
|
|
|
15,417 |
|
|
|
75,977 |
|
|
|
68,301 |
|
Gross profit |
|
8,391 |
|
|
|
12,690 |
|
|
|
27,292 |
|
|
|
42,929 |
|
|
|
|
|
|
|
|
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
Research and development |
|
2,116 |
|
|
|
2,023 |
|
|
|
8,240 |
|
|
|
7,712 |
|
Selling, general and administrative |
|
11,686 |
|
|
|
9,767 |
|
|
|
43,018 |
|
|
|
35,622 |
|
Gain on sale of BreatheWay |
|
— |
|
|
|
— |
|
|
|
(2,108 |
) |
|
|
— |
|
Restructuring costs |
|
(385 |
) |
|
|
1,431 |
|
|
|
4,225 |
|
|
|
8,961 |
|
Total operating costs and
expenses |
|
13,417 |
|
|
|
13,221 |
|
|
|
53,375 |
|
|
|
52,295 |
|
Operating (loss) income |
|
(5,026 |
) |
|
|
(531 |
) |
|
|
(26,083 |
) |
|
|
(9,366 |
) |
|
|
|
|
|
|
|
|
Interest income |
|
15 |
|
|
|
15 |
|
|
|
68 |
|
|
|
81 |
|
Interest expense |
|
(4,469 |
) |
|
|
(1,675 |
) |
|
|
(18,184 |
) |
|
|
(15,551 |
) |
Transition services
income |
|
203 |
|
|
|
341 |
|
|
|
273 |
|
|
|
5,814 |
|
Loss on debt refinancing |
|
(23,774 |
) |
|
|
— |
|
|
|
(23,774 |
) |
|
|
Other (expense) income,
net |
|
(521 |
) |
|
|
— |
|
|
|
(1,002 |
) |
|
|
641 |
|
Net (loss) income before
tax |
|
(33,572 |
) |
|
|
(1,850 |
) |
|
|
(68,702 |
) |
|
|
(18,381 |
) |
Income tax benefit
(expense) |
|
(223 |
) |
|
|
840 |
|
|
|
(301 |
) |
|
|
6,431 |
|
Net (loss) income from
continuing operations |
$ |
(33,795 |
) |
|
$ |
(1,010 |
) |
|
$ |
(69,003 |
) |
|
$ |
(11,950 |
) |
|
|
|
|
|
|
|
|
Discontinued operations: |
|
|
|
|
|
|
|
Loss from discontinued
operations |
$ |
(2,335 |
) |
|
$ |
(50,539 |
) |
|
$ |
(33,187 |
) |
|
$ |
(100,558 |
) |
Income tax benefit
(expense) |
|
— |
|
|
|
(208 |
) |
|
|
— |
|
|
|
(365 |
) |
Loss from discontinued
operations, net of tax |
|
(2,335 |
) |
|
|
(50,747 |
) |
|
|
(33,187 |
) |
|
|
(100,923 |
) |
Net loss |
$ |
(36,130 |
) |
|
$ |
(51,757 |
) |
|
$ |
(102,190 |
) |
|
$ |
(112,873 |
) |
|
|
|
|
|
|
|
|
Basic net loss per share: |
|
|
|
|
|
|
|
Loss from continuing
operations |
$ |
(1.11 |
) |
|
$ |
(0.03 |
) |
|
$ |
(2.30 |
) |
|
$ |
(0.41 |
) |
Loss from discontinued
operations |
|
(0.08 |
) |
|
|
(1.72 |
) |
|
|
(1.11 |
) |
|
|
(3.43 |
) |
Total basic net (loss) income
per share |
$ |
(1.19 |
) |
|
$ |
(1.75 |
) |
|
$ |
(3.41 |
) |
|
$ |
(3.84 |
) |
|
|
|
|
|
|
|
|
Diluted net loss per
share |
|
|
|
|
|
|
|
(Loss) income from continuing
operations |
$ |
(1.11 |
) |
|
$ |
(0.03 |
) |
|
$ |
(2.30 |
) |
|
$ |
(0.41 |
) |
Loss from discontinued
operations |
|
(0.08 |
) |
|
|
(1.72 |
) |
|
|
(1.11 |
) |
|
|
(3.43 |
) |
Total diluted net loss per
share |
$ |
(1.19 |
) |
|
$ |
(1.75 |
) |
|
$ |
(3.41 |
) |
|
$ |
(3.84 |
) |
|
|
|
|
|
|
|
|
Shares used in diluted per
share computation |
|
30,319 |
|
|
|
29,486 |
|
|
|
29,958 |
|
|
|
29,466 |
|
LIFECORE BIOMEDICAL, INC.CONSOLIDATED
STATEMENTS OF CASH FLOWS(Unaudited and in thousands) |
|
Twelve Months Ended |
|
May 28, 2023 |
|
May 29, 2022 |
Cash flows from operating
activities: |
|
|
|
Net loss |
$ |
(102,190 |
) |
|
$ |
(112,873 |
) |
Adjustments to reconcile net
loss to net cash (used in) provided by operating activities: |
|
|
|
Depreciation, amortization of
intangibles, debt costs and right-of-use assets |
|
13,508 |
|
|
|
17,884 |
|
Loss on debt refinancing |
|
7,561 |
|
|
|
— |
|
Stock-based compensation
expense |
|
3,612 |
|
|
|
2,608 |
|
Deferred taxes |
|
351 |
|
|
|
(6,990 |
) |
Net loss (gain) on disposal of
property and equipment held and used |
|
30 |
|
|
|
152 |
|
(Gain) loss on disposal of
property and equipment related to restructuring, net |
|
— |
|
|
|
5,185 |
|
Loss on sale of Eat Smart |
|
— |
|
|
|
336 |
|
Gain on sale of
BreatheWay |
|
(2,108 |
) |
|
|
— |
|
Loss on sale of Yucatan |
|
21,096 |
|
|
|
— |
|
Loss on sale of O Olive |
|
1,222 |
|
|
|
Impairment of indefinite-lived
intangible assets and goodwill |
|
300 |
|
|
|
78,146 |
|
Other, net |
|
86 |
|
|
|
(426 |
) |
Changes in current assets and
current liabilities: |
|
|
|
Accounts receivable, net |
|
12,194 |
|
|
|
(6,138 |
) |
Inventories |
|
(13,823 |
) |
|
|
(5,960 |
) |
Prepaid expenses and other
current assets |
|
2,749 |
|
|
|
(602 |
) |
Accounts payable |
|
16,085 |
|
|
|
9,343 |
|
Accrued compensation |
|
(4,707 |
) |
|
|
(2,546 |
) |
Other accrued liabilities |
|
6,440 |
|
|
|
(1,346 |
) |
Deferred revenue |
|
3,136 |
|
|
|
(18 |
) |
Net cash used in operating
activities |
|
(34,458 |
) |
|
|
(23,245 |
) |
|
|
|
|
Cash flows from investing
activities: |
|
|
|
Purchases of property and
equipment |
|
(20,763 |
) |
|
|
(29,940 |
) |
Sale of investment in
non-public company |
|
— |
|
|
|
45,100 |
|
Proceeds from the sale of Eat
Smart, net |
|
|
|
73,500 |
|
Eat Smart sale net working
capital adjustments |
|
— |
|
|
|
(9,839 |
) |
Proceeds from sale of
BreatheWay, net |
|
3,135 |
|
|
|
— |
|
Proceeds from the sale of
Yucatan, net |
|
12,474 |
|
|
|
— |
|
Proceeds from the Sale of O
Olive |
|
1,001 |
|
|
|
Proceeds from sales of
property and equipment |
|
— |
|
|
|
1,141 |
|
Net cash provided by investing
activities |
|
(4,153 |
) |
|
|
79,962 |
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
Proceeds from sale of common
stock, net of issuance costs |
|
4,822 |
|
|
|
— |
|
Proceeds from long-term
debt |
|
150,000 |
|
|
|
20,000 |
|
Payments on long-term
debt |
|
(107,412 |
) |
|
|
(86,411 |
) |
Payments in connection to debt
extinguishment |
|
— |
|
|
|
— |
|
Proceeds from lines of
credit |
|
31,450 |
|
|
|
55,111 |
|
Payments for debt issuance
costs |
|
(5,969 |
) |
|
|
(821 |
) |
Payments on lines of
credit |
|
(54,640 |
) |
|
|
(44,111 |
) |
Taxes paid for employee stock
plans |
|
(274 |
) |
|
|
(789 |
) |
Proceeds from sale of
preferred stock, net of issuance costs |
|
38,082 |
|
|
|
— |
|
Net cash provided by (used in)
financing activities |
|
56,059 |
|
|
|
(57,021 |
) |
|
|
|
|
Net increase (decrease) in
cash and cash equivalents |
|
17,448 |
|
|
|
(304 |
) |
Cash and cash equivalents,
beginning of period |
|
1,643 |
|
|
|
1,295 |
|
Cash and cash equivalents, end
of period |
$ |
19,091 |
|
|
$ |
991 |
|
|
|
|
|
Supplemental disclosure of
non-cash investing and financing activities: |
|
|
|
Purchases of property and
equipment on trade vendor credit |
$ |
6,945 |
|
|
$ |
2,260 |
|
Convertible Preferred Stock
PIK dividend |
$ |
1,163 |
|
|
$ |
— |
|
LIFECORE BIOMEDICAL, INC.SEGMENT
RESULTS(Unaudited and in thousands) |
(Unaudited and in
thousands) |
|
Three Months Ended |
|
Change |
|
Twelve Months Ended |
|
Change |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
|
May 28, 2023 |
|
May 29, 2022 |
|
Amount |
|
% |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lifecore |
|
$ |
31,546 |
|
|
$ |
27,613 |
|
|
$ |
3,933 |
|
|
14 |
% |
|
$ |
103,269 |
|
|
$ |
109,320 |
|
|
$ |
(6,051 |
) |
|
(6 |
)% |
Curation Foods |
|
|
— |
|
|
|
494 |
|
|
|
(494 |
) |
|
(100 |
)% |
|
|
— |
|
|
|
1,910 |
|
|
|
(1,910 |
) |
|
(100 |
)% |
Total revenues |
|
|
31,546 |
|
|
|
28,107 |
|
|
|
3,439 |
|
|
12 |
% |
|
|
103,269 |
|
|
|
111,230 |
|
|
|
(7,961 |
) |
|
(7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lifecore |
|
|
8,394 |
|
|
|
13,361 |
|
|
|
(4,967 |
) |
|
(37 |
)% |
|
|
27,242 |
|
|
|
43,746 |
|
|
|
(16,504 |
) |
|
(38 |
)% |
Curation Foods |
|
|
(3 |
) |
|
|
(671 |
) |
|
|
668 |
|
|
100 |
% |
|
|
50 |
|
|
|
(817 |
) |
|
|
867 |
|
|
(106 |
)% |
Total gross profit |
|
|
8,391 |
|
|
|
12,690 |
|
|
|
(4,299 |
) |
|
(34 |
)% |
|
|
27,292 |
|
|
|
42,929 |
|
|
|
(15,637 |
) |
|
(36 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income from
continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lifecore |
|
|
2,780 |
|
|
|
7,165 |
|
|
|
(4,385 |
) |
|
(61 |
)% |
|
|
5,049 |
|
|
|
18,481 |
|
|
|
(13,432 |
) |
|
(73 |
)% |
Curation Foods |
|
|
(649 |
) |
|
|
(3,536 |
) |
|
|
2,887 |
|
|
82 |
% |
|
|
178 |
|
|
|
1,985 |
|
|
|
(1,807 |
) |
|
(91 |
)% |
Other |
|
|
(35,926 |
) |
|
|
(4,639 |
) |
|
|
(31,287 |
) |
|
(674 |
)% |
|
|
(72,162 |
) |
|
|
(32,416 |
) |
|
|
(39,746 |
) |
|
(123 |
)% |
Total net (loss) income from
continuing operations |
|
$ |
(33,795 |
) |
|
$ |
(1,010 |
) |
|
$ |
(32,785 |
) |
|
(3246 |
)% |
|
$ |
(66,935 |
) |
|
$ |
(11,950 |
) |
|
$ |
(54,985 |
) |
|
(460 |
)% |
Loss from discontinued
operations, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Curation Foods |
|
|
(1,641 |
) |
|
|
(50,747 |
) |
|
|
49,106 |
|
|
97 |
% |
|
|
(30,564 |
) |
|
|
(97,882 |
) |
|
|
67,318 |
|
|
69 |
% |
Other |
|
|
(694 |
) |
|
|
— |
|
|
|
(694 |
) |
|
N/M |
|
|
|
(2,623 |
) |
|
|
(3,041 |
) |
|
|
418 |
|
|
14 |
% |
Net loss |
|
$ |
(36,130 |
) |
|
$ |
(51,757 |
) |
|
$ |
15,627 |
|
|
30 |
% |
|
$ |
(100,122 |
) |
|
$ |
(112,873 |
) |
|
$ |
12,751 |
|
|
11 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lifecore |
|
$ |
5,332 |
|
|
$ |
10,621 |
|
|
$ |
(5,289 |
) |
|
(50 |
)% |
|
$ |
13,765 |
|
|
$ |
30,348 |
|
|
$ |
(16,583 |
) |
|
(55 |
)% |
Curation Foods |
|
|
(2,108 |
) |
|
|
(54,486 |
) |
|
|
52,378 |
|
|
96 |
% |
|
|
(32,976 |
) |
|
|
(109,338 |
) |
|
|
76,362 |
|
|
70 |
% |
Other |
|
|
(8,722 |
) |
|
|
(3,222 |
) |
|
|
(5,500 |
) |
|
(171 |
)% |
|
|
(28,425 |
) |
|
|
(15,708 |
) |
|
|
(12,717 |
) |
|
(81 |
)% |
Total EBITDA |
|
$ |
(5,498 |
) |
|
$ |
(47,087 |
) |
|
$ |
41,589 |
|
|
88 |
% |
|
$ |
(47,636 |
) |
|
$ |
(94,698 |
) |
|
$ |
47,062 |
|
|
50 |
% |
Non-GAAP Financial Information and
Reconciliations
EBITDA and adjusted EBITDA are non-GAAP
financial measures. We define EBITDA as earnings before interest,
income tax expense (benefit), and depreciation and amortization. We
define adjusted EBITDA as EBITDA before certain restructuring and
other non-recurring charges. See “Non-GAAP Financial Information”
above for further information regarding the Company’s use of
non-GAAP financial measures.
(Unaudited and in
thousands) |
|
Three Months Ended |
|
Twelve Months Ended |
|
May 28, 2023 |
|
May 29, 2022 |
|
May 28, 2023 |
|
May 29, 2022 |
Net loss |
|
$ |
(36,130 |
) |
|
$ |
(51,757 |
) |
|
$ |
(100,122 |
) |
|
$ |
(112,873 |
) |
Interest expense, net of interest income |
|
|
28,228 |
|
|
|
3,466 |
|
|
|
41,890 |
|
|
|
17,276 |
|
Income tax (benefit) expense |
|
|
223 |
|
|
|
(840 |
) |
|
|
301 |
|
|
|
(6,431 |
) |
Depreciation and amortization |
|
|
2,181 |
|
|
|
2,044 |
|
|
|
10,295 |
|
|
|
7,330 |
|
Total EBITDA |
|
$ |
(5,498 |
) |
|
$ |
(47,087 |
) |
|
$ |
(47,636 |
) |
|
$ |
(94,698 |
) |
Restructuring and other non-recurring charges |
|
|
6,890 |
|
|
|
5,489 |
|
|
|
20,258 |
|
|
|
16,639 |
|
Impairment of indefinite-lived intangible assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Loss from discontinued operations, net of tax |
|
|
2,335 |
|
|
|
50,747 |
|
|
|
33,187 |
|
|
|
100,923 |
|
Total adjusted EBITDA |
|
$ |
3,727 |
|
|
$ |
9,149 |
|
|
$ |
5,809 |
|
|
$ |
22,864 |
|
(1) Includes loss on debt financing of $23.8 million for the
fourth quarter and fiscal year ended 2023.
(Unaudited and in
thousands) |
|
Lifecore |
|
CurationFoods |
|
Other |
|
Total |
Three months ended May 28,
2023 |
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
2,780 |
|
|
$ |
(2,290 |
) |
|
$ |
(36,620 |
) |
|
$ |
(36,130 |
) |
Interest expense, net of
interest income |
|
|
(15 |
) |
|
|
— |
|
|
|
28,243 |
|
|
|
28,228 |
|
Income tax (benefit)
expense |
|
|
552 |
|
|
|
29 |
|
|
|
(358 |
) |
|
|
223 |
|
Depreciation and
amortization |
|
|
2,015 |
|
|
|
153 |
|
|
|
13 |
|
|
|
2,181 |
|
Total EBITDA |
|
|
5,332 |
|
|
|
(2,108 |
) |
|
|
(8,722 |
) |
|
|
(5,498 |
) |
Restructuring and other
non-recurring charges (1) |
|
|
751 |
|
|
|
55 |
|
|
|
6,084 |
|
|
|
6,890 |
|
Impairment of indefinite-lived
intangible assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Loss from discontinued
operations, net of tax |
|
|
— |
|
|
|
1,641 |
|
|
|
694 |
|
|
|
2,335 |
|
Total adjusted EBITDA |
|
$ |
6,083 |
|
|
$ |
(412 |
) |
|
$ |
(1,944 |
) |
|
$ |
3,727 |
|
|
|
|
|
|
|
|
|
|
Twelve months ended May 28,
2023 |
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
5,049 |
|
|
$ |
(30,386 |
) |
|
$ |
(74,785 |
) |
|
$ |
(100,122 |
) |
Interest expense, net of
interest income |
|
|
(62 |
) |
|
|
1 |
|
|
|
41,951 |
|
|
|
41,890 |
|
Income tax (benefit)
expense |
|
|
1,270 |
|
|
|
(5,334 |
) |
|
|
4,365 |
|
|
|
301 |
|
Depreciation and
amortization |
|
|
7,508 |
|
|
|
2,743 |
|
|
|
44 |
|
|
|
10,295 |
|
Total EBITDA |
|
|
13,765 |
|
|
|
(32,976 |
) |
|
|
(28,425 |
) |
|
|
(47,636 |
) |
Restructuring and other
non-recurring charges |
|
|
936 |
|
|
|
1,775 |
|
|
|
17,547 |
|
|
|
20,258 |
|
Impairment of indefinite-lived
intangible assets |
|
|
|
|
— |
|
|
|
|
|
— |
|
Loss from discontinued
operations, net of tax |
|
|
— |
|
|
|
30,564 |
|
|
|
2,623 |
|
|
|
33,187 |
|
Total adjusted EBITDA |
|
$ |
14,701 |
|
|
$ |
(637 |
) |
|
$ |
(8,255 |
) |
|
$ |
5,809 |
|
|
|
|
|
|
|
|
|
|
Three Months Ended May 29,
2022 |
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
7,165 |
|
|
$ |
(54,283 |
) |
|
$ |
(4,639 |
) |
|
$ |
(51,757 |
) |
Interest expense , net of
interest income |
|
|
(15 |
) |
|
|
— |
|
|
|
3,481 |
|
|
|
3,466 |
|
Income tax (benefit)
expense |
|
|
1,692 |
|
|
|
(458 |
) |
|
|
(2,074 |
) |
|
|
(840 |
) |
Depreciation and
amortization |
|
|
1,779 |
|
|
|
255 |
|
|
|
10 |
|
|
|
2,044 |
|
Total EBITDA |
|
|
10,621 |
|
|
|
(54,486 |
) |
|
|
(3,222 |
) |
|
|
(47,087 |
) |
Restructuring and other
non-recurring charges |
|
|
116 |
|
|
|
3,424 |
|
|
|
1,949 |
|
|
|
5,489 |
|
Loss from discontinued
operations, net of tax |
|
|
— |
|
|
|
50,747 |
|
|
|
— |
|
|
|
50,747 |
|
Total adjusted EBITDA |
|
$ |
10,737 |
|
|
$ |
(315 |
) |
|
$ |
(1,273 |
) |
|
$ |
9,149 |
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended May 29,
2022 |
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
18,481 |
|
|
$ |
(95,897 |
) |
|
$ |
(35,457 |
) |
|
$ |
(112,873 |
) |
Interest expense , net of
interest income |
|
|
(72 |
) |
|
|
299 |
|
|
|
17,049 |
|
|
|
17,276 |
|
Income tax (benefit)
expense |
|
|
5,266 |
|
|
|
(14,317 |
) |
|
|
2,620 |
|
|
|
(6,431 |
) |
Depreciation and
amortization |
|
|
6,673 |
|
|
|
577 |
|
|
|
80 |
|
|
|
7,330 |
|
Total EBITDA |
|
|
30,348 |
|
|
|
(109,338 |
) |
|
|
(15,708 |
) |
|
|
(94,698 |
) |
Restructuring and other
non-recurring charges |
|
|
387 |
|
|
|
10,364 |
|
|
|
5,888 |
|
|
|
16,639 |
|
Loss from discontinued
operations, net of tax |
|
|
— |
|
|
|
97,882 |
|
|
|
3,041 |
|
|
|
100,923 |
|
Total adjusted EBITDA |
|
$ |
30,735 |
|
|
$ |
(1,092 |
) |
|
$ |
(6,779 |
) |
|
$ |
22,864 |
|
(1) During fiscal year 2020, the Company announced a
restructuring plan to drive enhanced profitability, focus the
business on its strategic assets, and redesign the organization to
be the appropriate size to compete and thrive. This included a
reduction-in-force, a reduction in leased office spaces, and the
sale of non-strategic assets. Related to these continued
activities, in the fourth quarter of fiscal year 2023, the Company
incurred (1) $0.7 million of non-recurring charges primarily
related to consolidating and transitioning operations associated
with the Yucatan and O Olive Disposition, (2) $2.9 million of
restructuring and non-recurring charges, primarily related to legal
costs, audit fees and transition costs from corporate headquarters
transition to Lifecore, (3) $2.6 million in restructuring costs
associated with financial advisor and legal fees related to
management of the prior term loan lenders, and (4) $0.7 million in
non-recurring charges primary related to one-time expenses incurred
in the Lifecore production process.
Contact Information:Investor
RelationsJeff Sonnek(646)
277-1263jeff.sonnek@icrinc.com
Lifecore Biomedical (NASDAQ:LFCR)
과거 데이터 주식 차트
부터 4월(4) 2024 으로 5월(5) 2024
Lifecore Biomedical (NASDAQ:LFCR)
과거 데이터 주식 차트
부터 5월(5) 2023 으로 5월(5) 2024