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Laird Superfood Reports Fourth Quarter 2022 and Fiscal Year 2022 Financial Results

Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood,” “we” and “our”), today reported financial results for its fourth quarter and fiscal year ended December 31, 2022.

Jason Vieth, Chief Executive Officer, commented, "Fiscal year 2022 was a year of transition, beginning with the onboarding of a new leadership team and culminating in the successful transition of our in-house manufacturing and fulfillment center to 3rd party co-manufacturing and logistics partners at the end of the year. We expect this move to expedite our margin improvement agenda by moving our business to a variable cost model and dramatically reducing our overhead costs. Additionally, we recently unveiled a complete brand refresh across all products in our portfolio, which is already having a positive effect on retail performance. We believe that these momentous steps will position the business for growth and continued improvement in our gross margin throughout 2023."

Anya Hamill, Chief Financial Officer, commented, "We have completed cost cutting and cash optimization initiatives across multiple functions, even beyond manufacturing and supply chain, in order to aggressively curtail selling, general, and administrative expenses in the coming year and to eliminate inefficient marketing spend. We expect that the transformation of our supply chain to a variable cost model will drive gross margin improvement to over 30% in 2023, excluding any one time charges. In shutting down our Sisters facility and making this move to a third-party supply chain, we incurred $9.1 million of one-time charges in the fourth quarter of 2022, most of which were non-cash, as detailed in our Non-GAAP Financial Statement. Additionally, I am pleased to report that our operating cash burn was reduced by $7.8 million in 2022, and we are implementing a number of initiatives to further improve our cash burn rate in 2023."

Fourth Quarter 2022 Highlights

  • Net Sales of $9.0 million compared to $8.8 million in the third quarter of 2022 and $9.4 million in the prior year period.
  • E-commerce contributed 66% of total Net Sales and decreased 4.7% year-over-year reflecting lower direct-to-consumer (“DTC”) revenues due to a 52% reduction in marketing media spend partially offset by double-digit growth in sales via Amazon.com.
  • Wholesale contributed 34% of total Net Sales and revenue decreased 3.3% year-over-year, primarily due to lower sales in the Club channel.
  • Gross Margin was (4.6)%, compared to 23.4% in the third quarter of 2022 and 23.6% in the prior year period. This reduction is primarily due to exit and disposal costs relating to the transition to a co-manufacturing model and the product quality issue discovered in the first quarter of 2023.
  • Adjusted Gross Margin, which is a non-GAAP financial measure, was 19.0% compared to 23.4% in the third quarter of 2022 and 23.6% in the fourth quarter of 2021. This margin compression reflects fixed cost deleverage on lower production volume due to inventory drawdown, increased costs associated with inventory reserves and disposals, and inflationary freight costs. For more details on non-GAAP financial measures, refer to the information in the Non-GAAP financial measures section of this press release.
  • Net Loss was $15.6 million, or $1.69 per diluted share compared to a Net Loss of $5.7 million, or $0.63 per diluted share, in the third quarter of 2022 and a Net Loss of $6.9 million, or $0.76 per diluted share, in the prior year period.
  • Adjusted Net Loss, which is a non-GAAP financial measure, of $4.3 million, or $0.47 per diluted share, improved sequentially versus Adjusted Net Loss of $5.6 million, or $0.61 per diluted share, in the third quarter of 2022. In the prior year period Adjusted Net Loss was $6.9 million, or $0.76 per diluted share. For more details on non-GAAP financial measures, refer to the information in the Non-GAAP financial measures section of this press release.

 

 

Three Months Ended December 31,

 

 

2022

 

2021

 

 

$

 

% of Total

 

$

 

% of Total

Coffee creamers

 

$

4,934,397

 

 

 

55

%

 

$

5,177,126

 

 

 

55

%

Hydration and beverage enhancing supplements

 

 

1,061,721

 

 

 

12

%

 

 

1,290,336

 

 

 

14

%

Harvest snacks and other food items

 

 

1,855,273

 

 

 

21

%

 

 

1,821,220

 

 

 

19

%

Coffee, tea, and hot chocolate products

 

 

1,808,361

 

 

 

20

%

 

 

1,874,473

 

 

 

20

%

Other

 

 

710,989

 

 

 

8

%

 

 

439,695

 

 

 

5

%

Gross sales

 

 

10,370,741

 

 

 

116

%

 

 

10,602,850

 

 

 

113

%

Shipping income

 

 

270,251

 

 

 

3

%

 

 

196,384

 

 

 

2

%

Returns and discounts

 

 

(1,671,464

)

 

 

(19

)%

 

 

(1,431,675

)

 

 

(15

)%

Sales, net

 

$

8,969,528

 

 

 

100

%

 

$

9,367,559

 

 

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

E-commerce

 

 

5,902,285

 

 

 

66

%

 

 

6,195,224

 

 

 

66

%

Wholesale

 

 

3,067,243

 

 

 

34

%

 

 

3,172,335

 

 

 

34

%

Sales, net

 

$

8,969,528

 

 

 

100

%

 

$

9,367,559

 

 

 

100

%

Fiscal Year 2022 Highlights

  • Net Sales of $35.8 million compared to $36.8 million in the fiscal year 2021.
  • E-commerce contributed 62% of total Net Sales in fiscal years 2022 and 2021, decreasing 1.7% year-over-year reflecting lower direct-to-consumer (“DTC”) revenues due to planned reductions in marketing spend partially offset by double-digit growth in sales via Amazon.com.
  • Wholesale contributed 38% of total Net Sales in fiscal years 2022 and 2021, decreasing 4.3% year-over-year, primarily due to lower sales in the Club and Food Service channels.
  • Shelf stable and liquid creamer consumption in the Natural channel increased by 24.5% compared to fiscal year 2021.
  • Gross Margin was 14.5%, compared to 25.6% in fiscal year 2021. This reduction is primarily driven by exit and disposal costs relating to the transition to a co-manufacturing model and a product quality issue discovered in the first quarter of 2023.
  • Adjusted Gross Margin, which is a non-GAAP financial measure, was 19.8% compared to 25.6% in fiscal year 2021. This reduction is due to fixed cost deleverage on lower volume, increased costs associated with inventory reserves and disposals, and inflationary freight costs. For more details on non-GAAP financial measures, refer to the information in the Non-GAAP financial measures section of this press release.
  • Net Loss was $40.3 million, or $4.41 per diluted share compared to a Net Loss of $23.9 million, or $2.66 per diluted share, in fiscal year 2021.
  • Adjusted Net Loss, which is a non-GAAP financial measure, of $22.8 million, or $2.49 per diluted share, compared to Adjusted Net Loss was $23.4 million, or $2.56 per diluted share in fiscal year 2021. For more details on non-GAAP financial measures, refer to the information in the Non-GAAP financial measures section of this press release.

 

 

Year Ended December 31,

 

 

2022

 

2021

 

 

$

 

% of Total

 

$

 

% of Total

Coffee creamers

 

$

19,800,429

 

 

 

55

%

 

$

21,767,409

 

 

 

59

%

Hydration and beverage enhancing supplements

 

 

4,877,067

 

 

 

14

%

 

 

5,814,629

 

 

 

16

%

Harvest snacks and other food items

 

 

7,191,316

 

 

 

20

%

 

 

7,108,361

 

 

 

19

%

Coffee, tea, and hot chocolate products

 

 

6,648,576

 

 

 

19

%

 

 

5,228,888

 

 

 

14

%

Other

 

 

1,805,914

 

 

 

5

%

 

 

808,352

 

 

 

2

%

Gross sales

 

 

40,323,302

 

 

 

113

%

 

 

40,727,639

 

 

 

110

%

Shipping income

 

 

1,099,358

 

 

 

3

%

 

 

457,879

 

 

 

1

%

Returns and discounts

 

 

(5,594,268

)

 

 

(16

)%

 

 

(4,374,565

)

 

 

(11

)%

Sales, net

 

$

35,828,392

 

 

 

100

%

 

$

36,810,953

 

 

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

E-commerce

 

 

22,313,241

 

 

 

62

%

 

 

22,687,736

 

 

 

62

%

Wholesale

 

 

13,515,151

 

 

 

38

%

 

 

14,123,217

 

 

 

38

%

Sales, net

 

$

35,828,392

 

 

 

100

%

 

$

36,810,953

 

 

 

100

%

Balance Sheet and Cash Flow Highlights

The Company had $17.8 million of cash and cash equivalents as of December 31, 2022, and no outstanding debt.

Net cash used in operating activities was $14.3 million for the year ended December 31, 2022, compared to $22.1 million in the prior year period. During fiscal 2022, net cash used in operating activities improved sequentially from the second to the third quarter by 8.6% and sequentially from the third to the fourth quarter by 11.7%.

2023 Outlook

We anticipate that uncertain economic environment with historically high inflation rates impacting consumer spending will continue into 2023. We believe that strategic actions we have taken in 2022, and continue to take in 2023, have positioned the business for net sales growth in the high single digits and gross margin in excess of 30%, excluding extraordinary events. Gross margin guidance excludes any one-time charges associated with the any non-recurring actions.

Conference Call and Webcast Details

The Company will host a conference call and webcast at 5:00 p.m. ET today to discuss results. Participants may access the live webcast on the Laird Superfood Investor Relations website at https://investors.lairdsuperfood.com under “Events”.

About Laird Superfood

Laird Superfood, Inc. creates award-winning, plant-based superfood products that are both delicious and functional. The Company's products are designed to enhance your daily ritual and keep consumers fueled naturally throughout the day. The Company was co-founded in 2015 by the world's most prolific big-wave surfer, Laird Hamilton. Laird Superfood's offerings are environmentally conscientious, responsibly tested and made with real ingredients. Shop all products online at lairdsuperfood.com and join the Laird Superfood community on social media for the latest news and daily doses of inspiration.

Forward-Looking Statements

This press release and the conference call referencing this press release contain “forward-looking” statements, as that term is defined under the federal securities laws, including but not limited to statements regarding Laird Superfood’s future financial performance and growth. These forward-looking statements are based on Laird Superfood’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause Laird Superfood’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. We expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

The risks and uncertainties referred to above include, but are not limited to: (1) the effects of the current COVID-19 pandemic, or of other global outbreaks of pandemics or contagious diseases or fear of such outbreaks, including on our supply chain, the demand for our products, and on overall economic conditions and consumer confidence and spending levels; (2) volatility regarding our revenue, expenses, including shipping expenses, and other operating results; (3) our ability to acquire new direct and wholesale customers and successfully retain existing customers; (4) our ability to attract and retain our suppliers, distributors and co-manufacturers, and effectively manage their costs and performance; (5) effects of real or perceived quality or health issues with our products or other issues that adversely affect our brand and reputation; (6) our ability to innovate on a timely and cost-effective basis, predict changes in consumer preferences and develop successful new products, or updates to existing products, and develop innovative marketing strategies; (7) adverse developments regarding prices and availability of raw materials and other inputs, a substantial amount of which come from a limited number of suppliers outside the United States, including in areas which may be adversely affected by climate change; (8) effects of changes in the tastes and preferences of our consumers and consumer preferences for natural and organic food products; (9) the financial condition of, and our relationships with, our suppliers, co-manufacturers, distributors, retailers and food service customers, as well as the health of the food service industry generally; (10) the ability of ourselves, our suppliers and co-manufacturers to comply with food safety, environmental or other laws or regulations; (11) our plans for future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements; (12) the costs and success of our marketing efforts, and our ability to promote our brand; (13) our reliance on our executive team and other key personnel and our ability to identify, recruit and retain skilled and general working personnel; (14) our ability to effectively manage our growth; (15) our ability to compete effectively with existing competitors and new market entrants; (16) the impact of adverse economic conditions; and (17) the growth rates of the markets in which we compete.

LAIRD SUPERFOOD, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2022

 

2021

 

2022

 

2021

Sales, net

 

$

8,969,528

 

 

$

9,367,559

 

 

$

35,828,392

 

 

$

36,810,953

 

Cost of goods sold

 

 

(9,381,825

)

 

 

(7,153,814

)

 

 

(30,641,125

)

 

 

(27,379,082

)

Gross profit

 

 

(412,297

)

 

 

2,213,745

 

 

 

5,187,267

 

 

 

9,431,871

 

General and administrative

 

 

 

 

 

 

 

 

 

 

 

 

Salaries, wages and benefits

 

 

1,902,935

 

 

 

2,093,064

 

 

 

6,414,481

 

 

 

8,392,326

 

Impairment of goodwill and long-lived assets

 

 

4,688,015

 

 

 

 

 

 

12,814,441

 

 

 

8,317

 

Loss on lease termination

 

 

3,596,365

 

 

 

 

 

 

3,596,365

 

 

 

 

Other expense

 

 

1,559,811

 

 

 

2,305,766

 

 

 

7,769,876

 

 

 

8,058,619

 

Total general and administrative expenses

 

 

11,747,126

 

 

 

4,398,830

 

 

 

30,595,163

 

 

 

16,459,262

 

Research and product development

 

 

92,160

 

 

 

171,984

 

 

 

427,537

 

 

 

1,030,127

 

Sales and marketing

 

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

 

1,723,332

 

 

 

2,256,998

 

 

 

6,914,706

 

 

 

7,570,879

 

General marketing

 

 

814,344

 

 

 

1,412,265

 

 

 

3,797,761

 

 

 

4,491,446

 

Other expense

 

 

875,529

 

 

 

991,872

 

 

 

3,816,237

 

 

 

3,832,573

 

Total sales and marketing expenses

 

 

3,413,205

 

 

 

4,661,135

 

 

 

14,528,704

 

 

 

15,894,898

 

Total expenses

 

 

15,252,491

 

 

 

9,231,949

 

 

 

45,551,404

 

 

 

33,384,287

 

Operating loss

 

 

(15,664,788

)

 

 

(7,018,204

)

 

 

(40,364,137

)

 

 

(23,952,416

)

Other income

 

 

124,096

 

 

 

63,458

 

 

 

47,088

 

 

 

99,704

 

Loss before income taxes

 

 

(15,540,692

)

 

 

(6,954,746

)

 

 

(40,317,049

)

 

 

(23,852,712

)

Income tax expense

 

 

(14,495

)

 

 

68,661

 

 

 

(20,269

)

 

 

(17,834

)

Net loss

 

$

(15,555,187

)

 

$

(6,886,085

)

 

$

(40,337,318

)

 

$

(23,870,546

)

Net loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(1.69

)

 

$

(0.76

)

 

$

(4.41

)

 

$

(2.66

)

Diluted

 

$

(1.69

)

 

$

(0.76

)

 

$

(4.41

)

 

$

(2.66

)

Weighted-average shares of common stock outstanding used in computing net loss per share of common stock, basic and diluted

 

 

9,199,597

 

 

 

9,067,235

 

 

 

9,146,008

 

 

 

8,983,294

 

LAIRD SUPERFOOD, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

Years Ended December 31,

 

 

2022

 

2021

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(40,337,318

)

 

 

(23,870,546

)

Adjustments to reconcile net loss to net cash from operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

1,118,071

 

 

 

981,598

 

Gain on sale of assets held-for-sale

 

 

(577,058

)

 

 

 

Stock-based compensation

 

 

631,227

 

 

 

4,040,207

 

Provision for inventory obsolescence

 

 

2,795,174

 

 

 

423,345

 

Impairment of goodwill and other long-lived assets

 

 

12,814,441

 

 

 

 

Loss on lease termination

 

 

3,596,365

 

 

 

 

Noncash lease costs

 

 

1,065,591

 

 

 

 

Other

 

 

247,350

 

 

 

137,451

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

(303,187

)

 

 

(383,998

)

Inventory

 

 

1,729,604

 

 

 

(3,622,784

)

Prepaid expenses and other current assets

 

 

1,604,880

 

 

 

(1,008,978

)

Operating lease liability

 

 

(742,111

)

 

 

368,894

 

Accounts payable

 

 

191,499

 

 

 

(474,519

)

Accrued expenses

 

 

1,853,033

 

 

 

1,312,495

 

Net cash from operating activities

 

 

(14,312,439

)

 

 

(22,096,835

)

Cash flows from investing activities

 

 

 

 

 

 

Purchase of property, plant, and equipment

 

 

(1,154,219

)

 

 

(1,555,191

)

Deposits on equipment to be acquired

 

 

 

 

 

(489,325

)

Proceeds on sale of property, plant, and equipment

 

 

17,677

 

 

 

12,700

 

Purchase of software

 

 

(2,713

)

 

 

(156,855

)

Acquisition of a business, net of cash acquired

 

 

 

 

 

(10,449,587

)

Proceeds from sale of assets held-for-sale

 

 

1,596,212

 

 

 

 

Proceeds from sale of investment securities available-for-sale

 

 

8,513,783

 

 

 

 

Net cash from investing activities

 

 

8,970,740

 

 

 

(12,638,258

)

Cash flows from financing activities

 

 

 

 

 

 

Common stock issuances, net of taxes

 

 

9,464

 

 

 

(152,414

)

Common stock issuance costs

 

 

 

 

 

(82,043

)

Recovery of short-swing profits

 

 

28,555

 

 

 

 

Stock options exercised, net of taxes

 

 

64,248

 

 

 

810,704

 

Net cash from financing activities

 

 

102,267

 

 

 

576,247

 

Net change in cash and cash equivalents

 

 

(5,239,432

)

 

 

(34,158,846

)

Cash and cash equivalents beginning of year

 

 

23,049,234

 

 

 

57,208,080

 

Cash and cash equivalents end of year

 

$

17,809,802

 

 

$

23,049,234

 

LAIRD SUPERFOOD, INC.

CONSOLIDATED BALANCE SHEETS

 

 

As of

 

 

December 31,

2022

 

December 31,

2021

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash, cash equivalents, and restricted cash

 

$

17,809,802

 

 

$

23,049,234

 

Accounts receivable, net

 

 

1,494,469

 

 

 

1,268,718

 

Investment securities available-for-sale

 

 

 

 

 

8,635,077

 

Inventory, net

 

 

5,696,565

 

 

 

10,221,343

 

Prepaid expenses and other current assets, net

 

 

2,530,075

 

 

 

4,507,462

 

Total current assets

 

 

27,530,911

 

 

 

47,681,834

 

Noncurrent assets

 

 

 

 

 

 

Property and equipment, net

 

 

150,289

 

 

 

4,512,935

 

Fixed assets held-for-sale

 

 

800,000

 

 

 

 

Intangible assets, net

 

 

1,424,218

 

 

 

4,838,854

 

Goodwill

 

 

 

 

 

6,486,000

 

Right-of-use asset

 

 

133,922

 

 

 

2,327,752

 

Total noncurrent assets

 

 

2,508,429

 

 

 

18,165,541

 

Total assets

 

$

30,039,340

 

 

$

65,847,375

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

1,080,267

 

 

$

888,768

 

Accrued expenses

 

 

6,312,140

 

 

 

2,897,253

 

Lease liability, current portion

 

 

59,845

 

 

 

 

Total current liabilities

 

 

7,452,252

 

 

 

3,786,021

 

Long-term liabilities

 

 

 

 

 

 

Deferred tax liability, net

 

 

 

 

 

7,534

 

Lease liability

 

 

76,076

 

 

 

 

Total long-term liabilities

 

 

76,076

 

 

 

7,534

 

Total liabilities

 

 

7,528,328

 

 

 

3,793,555

 

Stockholders’ equity

 

 

 

 

 

 

Common stock, $0.001 par value, 100,000,000 shares authorized as of December 31, 2022 and December 31, 2021; 9,576,117 and 9,210,414 issued and outstanding at December 31, 2022, respectively; 9,460,243 and 9,094,539 issued and outstanding at December 31, 2021, respectively

 

 

9,210

 

 

 

9,095

 

Additional paid-in capital

 

 

118,636,834

 

 

 

117,903,455

 

Accumulated other comprehensive loss

 

 

 

 

 

(61,016

)

Accumulated deficit

 

 

(96,135,032

)

 

 

(55,797,714

)

Total stockholders’ equity

 

 

22,511,012

 

 

 

62,053,820

 

Total liabilities and stockholders’ equity

 

$

30,039,340

 

 

$

65,847,375

 

Non-GAAP Financial Measures

In this press release, we report adjusted net loss and adjusted net loss per diluted share, which are financial measures not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (“GAAP”). Management uses adjusted net loss and adjusted net loss per diluted share to evaluate financial performance because adjusted net loss and adjusted net loss per diluted share allow for period-over-period comparisons of the Company’s ongoing operations before the impact of certain items described below. Management believes this information may also be useful to investors to compare the Company’s results period-over-period. We define adjusted net loss and adjusted net loss per diluted share to exclude certain one-time costs defined in detail in the table to follow. Please be aware that adjusted net loss and adjusted net loss per diluted share have limitations and should not be considered in isolation or as a substitute for net loss or diluted net loss per share. In addition, we may calculate and/or present adjusted net loss and adjusted net loss per diluted share differently than measures with the same or similar names that other companies report, and as a result, the non-GAAP measures we report may not be comparable to those reported by others.

These non-GAAP measures are reconciled to the most directly comparable GAAP measures in the table that follows.

LAIRD SUPERFOOD, INC.

NON-GAAP FINANCIAL MEASURES

(Unaudited)

 

 

Three Months Ended

 

Year Ended

 

 

March 31,

2022

 

June 30,

2022

 

September 30,

2022

 

December 31,

2022

 

December 31,

2022

Net loss

 

$

(14,139,402

)

 

$

(4,904,520

)

 

$

(5,738,209

)

 

$

(15,555,187

)

 

$

(40,337,318

)

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impairment of goodwill and long-lived assets

(a)

 

8,026,000

 

 

 

100,426

 

 

 

 

 

 

1,479,006

 

 

 

9,605,432

 

Strategic organizational shifts

(b)

 

(581,351

)

 

 

(803,405

)

 

 

67,974

 

 

 

8,683,331

 

 

 

7,366,549

 

Gain on sale of land held-for-sale

(c)

 

 

 

 

(573,818

)

 

 

 

 

 

 

 

 

(573,818

)

Company-wide rebranding costs

(d)

 

 

 

 

 

 

 

 

 

 

455,475

 

 

 

455,475

 

Product quality issue

(e)

 

 

 

 

 

 

 

 

 

 

559,042

 

 

 

559,042

 

Other

(f)

 

(22,296

)

 

 

 

 

 

96,400

 

 

 

95,000

 

 

 

169,104

 

Adjusted net loss

 

$

(6,717,049

)

 

$

(6,181,317

)

 

$

(5,573,835

)

 

 

(4,283,333

)

 

$

(22,755,534

)

Adjusted net loss per share, diluted:

 

 

(0.74

)

 

 

(0.68

)

 

 

(0.61

)

 

 

(0.47

)

 

 

(2.49

)

Weighted-average shares of common stock outstanding used in computing adjusted net loss per share of common stock, diluted

 

 

9,095,441

 

 

 

9,132,632

 

 

 

9,178,533

 

 

 

9,199,597

 

 

 

9,136,071

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Impairment charges to goodwill and long-lived intangible assets assumed in the acquisition of Picky Bars which occurred Q2 2021, in the amounts of $6.5 million and $1.5 million, respectively, as well as $0.1 million of impairment charges related to production machinery held-for-sale in Q2 2022.

 

(b) Costs incurred as part of the strategic downsizing of the Company's operations, including lease termination costs, severances and other personnel costs, forfeitures of stock-based compensation, impairment of property, plant, equipment, and internal use production software, and other exit and disposal costs including but not limited to inventory writeoffs, moving and setup costs, and property tax abatement repayment. Reversals of stock-based compensation arising from the forfeitures of unvested awards following the resignation of certain executive officers, compensation expense recognized for severances related to the resignations of certain executive officers.

 

(c) Gains realized on the sale of excess lots of land adjacent to the Company's warehouses in Sisters, Oregon in Q2 2022.

 

(d) Costs incurred as part of the company-wide rebranding efforts that occurred in Q4 2022, launching in Q1 2023.

 

(e) Inventory reserves recorded to account for the product quality issue that was discovered in the first quarter of 2023, related to finished goods and raw material inventories on hand as of December 31, 2022.

 

(f) Realized losses on the liquidation of all of the Company's available-for-sale securities included in other income in Q1 2022. Recovery of costs incurred in connection with an insurance claim following loss of product during handling by a third party included in costs of goods sold in Q1 2022. Losses incurred on prepaid inventories which were not recoverable following the bankruptcy of the supplier and costs incurred as a result of the early termination of a long-term service contract as part of a strategic initiative to relieve future cash obligations included in general and administrative expenses in Q3 2022. Estimated legal settlement costs related to an ongoing class action lawsuit included in general and administrative expenses in Q4 2022.

 

LAIRD SUPERFOOD, INC.

NON-GAAP FINANCIAL MEASURES

(Unaudited)

 

 

Three Months Ended

 

Year Ended

 

 

March 31,

2021

 

June 30,

2021

 

September 30,

2021

 

December 31,

2021

 

December 31,

2021

Net loss

 

$

(5,330,504

)

 

$

(6,302,259

)

 

$

(5,351,698

)

 

$

(6,886,085

)

 

$

(23,870,546

)

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Write off of prepaid inventory balances from bankrupt supplier

(a)

 

 

 

 

179,000

 

 

 

 

 

 

 

 

 

179,000

 

Acquisition costs

(b)

 

98,750

 

 

 

179,390

 

 

 

 

 

 

 

 

 

278,140

 

Adjusted net loss

 

$

(5,231,754

)

 

$

(5,943,869

)

 

$

(5,351,698

)

 

$

(6,886,085

)

 

$

(23,413,406

)

Adjusted net loss per share, diluted:

 

 

(0.59

)

 

 

(0.66

)

 

 

(0.59

)

 

 

(0.76

)

 

 

(2.56

)

Weighted-average shares of common stock outstanding used in computing adjusted net loss per share of common stock, diluted

 

 

8,894,495

 

 

 

8,967,797

 

 

 

9,001,912

 

 

 

9,067,235

 

 

 

9,136,071

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Losses incurred on prepaid inventories which were not recoverable following the bankruptcy of the supplier.

 

(b) Costs associated with the acquisition of Picky Bars LLC on May 3, 2021, including professional and legal fees.

 

 

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