Company raises full-year 2019 outlook "data-reactid =" 11 "> Net revenues increase 287% year over year to $ 67.3 million
Company Raises Full Year 2019 Outlook
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<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt ( 0.8em) –sm "type =" text "content =" Second quarter 2019 Financial highlights compared to the prior year "data-reactid =" 13 "> Second quarter 2019 Financial highlights compared to period before the year
- Net income was $ 67.3 million, an increase of 287%;
- Gross profit was $ 22.7 million, or 33.8% as a percentage of net income, compared to gross profit of $ 2.6 million, or 15.0% as a percentage of net income, in the prior year;
- Net loss was $ 9.4 million, or a loss of $ 0.24 per common share, compared to a net loss of $ 7.4 million, or a loss of $ 1.22 per common share in the previous year; and
- Adjusted EBITDA, which is a non-GAAP financial measure, was $ 6.9 million compared to an adjusted EBITDA loss of $ 5.6 million in the period since.
See "Non-GAAP Financial Measures" below for how Beyond Meat defines Adjusted EBITDA and the financial table that accompanies this release for a reconciliation of this measure to the nearly comparable GAAP measure.
“We are very pleased with the results in the second quarter reflecting the continued strength of our business as evidenced by new food service partnerships, expanded distribution in domestic retail channels, and accelerating expansion in our international markets. We believe our positive momentum continues to demonstrate mainstream consumers' growing desire for plant-based meat products both domestically and abroad, "said Ethan Brown, Beyond Meat's President and Chief Executive Officer. "Looking ahead, we will continue to prioritize efforts to increase our brand awareness, expand our distribution channels, launch new innovative products and invest in our infrastructure and in-house capabilities to meet the strong demand we are seeing across the business."
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Second Quarter 2019 "data-reactid =" 21 "> Second quarter 2019
Net income increased 287% to $ 67.3 million in the second quarter of 2019 compared to $ 17.4 million in the second quarter of 2018. Net revenue growth in the second quarter of 2019 was primarily due to an increase in sales volumes of products in our fresh platform on both our retail and restaurant and food service channels, driven by expansion in the number of retail and food distribution locations, including new strategic customers, international customers, and greater demand from our existing customers.
|Three months ended||Amendment||Six months ended||Amendment|
|(in thousands)|| 29. June
| 30. June
|Amount||%|| 29. June
| 30. June
|Net Revenue: |
|Gross Fresh Platform||$||67,722||$||15,119||$||52 603|| 347.9||%||$||106528||$||24 715||$||81,813||331 , 0||%|
|Gross Frozen Platform ||5639||4506||1,133||25.1||%||10 151||||9254||897||9.7||%|
|Less: Discounts||(610||)||]||(2,258||)||(3.852||)||170.6||%||(9,222||)|| (3,826||)||(5 396||)||141, 0||%|
|Net Revenue||$||67,251||||$||17367|| $||49884||||287.2||%||$||107457||$||30143||$||77314 ||256.5||%|
|Three months ended||Change||Six months ended||Change|
|(in thousands)|| 29. June
| 30. June
|Amount||%|| 29. June
| 30. June
|Retail ||$||34120||$||11684||$||22436||192,0 %||$||53699||$||20972||$||32727||156.1||%|
|Restaurant and Food Service||33,131||5,683||27,448  483.0 %||53,758||9171||44,587||486.2||%|
|Net Revenue ||$||67251||$||17367||$  49884||287,2||%||$||107457||||$||30,143||$||77,314||256.5||%|
Gross profit was $ 22.7 million, or 33.8% as a percentage of net revenue, in the second quarter of 2019, compared to $ 2.6 million, or 15.0% as a percentage of net income, in the prior period. The increase in gross profit and gross margin was mainly due to an increase in the volume of products sold, which resulted in operational leverage and streamlining of production efficiency. A larger share of gross revenues from the company's fresh platform also contributed to the improvement in gross margin.
Revenues from operations in the second quarter of 2019 were $ 2.2 million, compared to a loss of $ 7.3 million in the second quarter of last year. This improvement was entirely driven by the year-over-year increase in net income and the resulting increase in gross profit, partially offset by higher operating costs, mainly due to higher absolute costs to support the company's expanded production and supply chain operations, higher administrative costs associated with being a public sector companies, and continue investing in innovation and marketing capabilities.
Net loss was $ 9.4 million in the second quarter of 2019, compared to a net loss of $ 7.4 million in the prior period. The expanded net loss was primarily a result of $ 11.7 million in noncash expenses related to the warranty liability revaluation of our original offering in May 2019.
Adjusted EBITDA was $ 6.9 million, or 10.2 % as a percentage of net income in the second quarter of 2019 compared to an adjusted EBITDA loss of $ 5.6 million in the second quarter of 2018. Adjusted EBITDA is a non-GAAP financial measure defined under “Non-GAAP financial measures” and is aligned with net loss, its nearly comparable GAAP measure, at the end of this release.
Chief Financial Officer and Treasurer, Mark Nelson commented: “We are pleased with the positive level of Adjusted EBITDA we achieved in the second quarter. The early benefits we see with cost productivity throughout our supply chain and production network, along with solid demand through customer collaboration, have helped deliver these strong gross margins and operating margin results. ”
<p class =" canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Balance and cash flow highlights "data-reactid =" 33 "> Highlights of balance sheet and cash flow
The Company's cash and cash equivalents were $ 277.0 million as of June 29, 2019, and the total outstanding debt was $ 30.5 million. Net cash used in operating activities was $ 22.4 million for the six months ended June 29, 2019, compared to $ 12.7 million for the prior period. Capital expenditure was $ 7.5 million for the six months ended June 29, 2019, compared to $ 10.0 million for the prior period.
For the full year 2019, the company is lifting the guidelines and now expects the following:
- Net revenues will exceed $ 240 million, an increase of over 170% compared to 2018, updated from previous net revenue forecast to exceed $ 210 million; and
- Adjusted EBITDA to be positive compared to previous expectations of break-even Adjusted EBITDA.
The Company does not provide net loss guidance, the most directly comparable GAAP measure, and similarly cannot provide a reconciliation between expected adjusted EBITDA and net loss calculations without unreasonable effort due to the unavailability of reliable estimates for certain items. These items are not under the company's control and can vary greatly between periods and can have a significant impact on future financial results.
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The company will host a conference call and webcast with the corporate management to discuss these results with further comments and details today at 4:30 pm Eastern, 7 p.m. 13:30 Pacific. The webcast from the conference call will be available live over the Internet through the "Investors" section of the company's website at www.beyondmeat.com. To participate in the live broadcast, call 866-221-1171 from the US and 270-215-9602 internationally. A phone playback will be available approximately two hours after the call ends on Monday, August 12, 2019, by calling 855-859-2056 from the United States, or 404-537-3406 from international locations, and entering confirmation code 6866428.
<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " About Beyond Meat " data- reactid = "48"> About Beyond Meat
Beyond Meat is one of the fastest growing food companies in the United States, offering a portfolio of revolutionary plant-based meat. Founded in 2009, Beyond Meat has a mission to build meat directly from plants, an innovation that allows consumers to experience the taste, texture and other sensory characteristics of popular animal-based meat products while enjoying the nutritional and environmental benefits of eating. plant-based meat products. Beyond Meat's brand commitment, "Eat What You Love," represents a strong belief that consumers can eat more, not less, of their favorite meals by eating their plant-based meat portfolio, and by doing so, can help resolve concerns related to human health, climate change, resource conservation and animal welfare. The Beyond Meats portfolio of fresh and frozen plant-based proteins is currently sold at approximately 53,000 retail outlets and food service locations worldwide.
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Forward-looking statements "data-reactid =" 50 "> Forward-looking statements
Certain statements in this release constitute" forward-looking statements. "These statements are based on management's current opinions, expectations, perceptions, plans, goals, assumptions, or estimates for future events or future results. These forward-looking statements are merely predictions, not historical factors, and involve certain risks and uncertainties as well as assumptions. Actual results, activity level, performance, achievements and events may differ materially from those provided, assumed or implied by such forward-looking statements. While Beyond Meat believes that the assumptions are reasonable, it is very difficult to predict the impact of known factors, and of course, it is impossible to predict all factors that may affect actual results. There are many risks and uncertainties that could cause actual results to differ materially from forward-looking statements here, including, most clearly, the risks discussed under the heading “Risk Factors” in the Company's Form 10-Q for the quarter ended June 29, 2019. to the Securities and Exchange Commission ("SEC") July 29, 2019, as well as other factors described from time to time in the Company's filings with the SEC. Such forward-looking statements are made first from the date of this release. Beyond Meat assumes no obligation to update or revise any forward-looking statements due to new information, future events or otherwise, unless otherwise required by law. If we update one or more forward-looking statements, it should not be concluded that we will make any further updates with respect to these or other forward-looking statements.
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Katie.firstname.lastname@example.org  BEYOND MEAT, INC.
Condensed Statements of Operations
(In thousands, except data per share and per share)
| BE 19659617]INC.
Condensed Balance Sheets
(In thousands, excluding stock and share information)
| June 29
| 31. December
|Cash and cash equivalents||$||276,987||$||54,271|
|Accounts receivable||34,388||12,626|| Inventory||42,695||30,257  Prepaid expenses and other current assets||726||5,672|
|Total current assets||361.796||102,826|
|Real estate, plant and equipment9 34,473||30,527|
|Other fixed assets, net||792||396|
|Total assets||$||397,061|| $||133,749|
|Liabilities, convertible preferred stock and share (Deficit): |
|Payments 19659016] $||27,383||$||17,247 |
|Payable salary||1208||[1 9659016]||1,255|
|Accrued expenses and other short-term liabilities  3,622||2,391|
|Short-term revolving credit limit loans||6000||–|
|Short-term capital commitments||33   44  ] Liability||–||1,918|
|Total short-term debt||$||40,403 ||$||25,167|
|Revolving credit line||$||–||||$||6000 |
|Long-term portion of bank loan, net||19,543||19,3 88|
|Equipment loan, net||4,924||5,000|
|Capital leases and other long-term liabilities||406||404|
|Total long-term debt||$||24,873||$||30,792|
|Liabilities and contingency|||
|Convertible preferred stock||$||–||$||199,540|
|Share capital (deficit):|||
|Preferred Stock, face value $ 0.0001 per share – 500,000 shares authorized, none issued and outstanding||–||–|
|Common Stock, face value $ 0.0001 per share – 500,000,000 shares and 58,669,600 shares authorized on June 29, 2019 and December 31, 2018; 60,167,521 and 6,951,350 shares issued and outstanding on June 29, 2019 and December 31, 2018 respectively||6||1|
|Additional paid-up capital||477,541 ||7,921|
|Total equity (deficit)||$||331,785||$||(121,750||)|
|Total debt, convertible preferred stock and equity (deficit)||$||397,061 ||$||133,749|
| BEYOND MEAT, INC.
Condensed cash flow statements
|Six months ended|
| June 29
| June 30
|Cash flows from operations:|
|Net losses ||$||(16,090||)||$  (13.092||)|
|Adjustments to reconcile net loss with net cash used in operating activities:|
|Depreciation and amortization||3 957||1 620|
|Share-based compensation cost||2,678||710|
|Amortization of debt issuance costs||78||35|
|Change in preferred and common stock guarantees debt||12,503||259|
|Net change in fixed assets and debt:|
|Prepaid expenses and other assets||(2.131||)||(154 )|
|Accrued expenses and other current liabilities||1,028|| 259|
|Net cash used in operating activities||$  (22,366||)||$||(12,667||)|
|Cash flows used in investment activities:|||
|Purchase of tangible assets||$||(7,502||)||$||(9,973 )|
|Revenue from sale of fixed assets ||232||–|
|Purchase of property, plant and equipment held for sale||(3,121||)||– |
|Payment of security deposit||(487||)||(60||)|
|Net cash used in investment activities||$||(10.878||) ||$||(10,033||)|
|Cash flows from financing activities:|||
|Income from the issue of ordinary shares in according to IPO, less issue costs||$||255,448||$||–|
|erie G preferred stock offer, net of offer costs||–||1,350|
|Loan Revenue Revenue||–||10,000|
|Revolving on revolving credit limit||–||(2,500||)|
|Repayment on term loans||–||(1,000||)|
|Repayment of Missouri Note||–||(1,450||)  Payment of capital commitments||(21||)||(117||)|
|Income from exercise of stock options||533||||871  Net cash provided by financing activities||$||255,960||$||7,154|| Net increase (reduction) in cash and cash equivalents||$||222 716||$||(15,546||) [1 9659230] Cash and cash equivalents at the beginning of the period||54,271||39,035|
|Cash and cash equivalents at the end of the period|| $
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Non-GAAP Financial Measures " data-reactid = "63"> Non-GAAP Financial Measures
Beyond Meat uses the following non-GAAP financial measures in its assessment operating performance and in its financial communications:
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "“Adjusted EBITDA” is defined as net loss adjusted to exclude, when applicable, income tax expense, interest expense, depreciation and amortization expense, restructuring expenses, share-based compensation expense, inventory losses from termina tion of an exclusive supply agreement with a co-manufacturer, costs of termination of an exclusive supply agreement with the same co-manufacturer, and expenses primarily associated with the conversion of our convertible notes and remeasu rement of our preferred stock warrant liability and common stock warrant liability." data-reactid="65">“Adjusted EBITDA” is defined as net loss adjusted to exclude, when applicable, income tax expense, interest expense, depreciation and amortization expense, restructuring expenses, share-based compensation expense, inventory losses from termination of an exclusive supply agreement with a co-manufacturer, costs of termination of an exclusive supply agreement with the same co-manufacturer, and expenses primarily associated with the conversion of our convertible notes and remeasurement of our preferred stock warrant liability and common stock warrant liability.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="“Adjusted EBITDA as a % of net revenues” is defined as Adjusted EBITDA divided by net revenues." data-reactid="66">“Adjusted EBITDA as a % of net revenues” is defined as Adjusted EBITDA divided by net revenues.
We use Adjusted EBITDA and Adjusted EBITDA as a % of net revenues because they are important measures upon which our management assesses our operating performance. We use Adjusted EBITDA and Adjusted EBITDA as a % of net revenues as key performance measures because we believe these measures facilitate operating performance comparison from period-to-period by excluding potential differences primarily caused by the impact of restructuring, asset depreciation and amortization, non-cash share-based compensation and non-operational charges including the impact to cost of goods sold and selling, general and administrative expenses related to the termination of an exclusive co-manufacturing agreement, early extinguishment of convertible notes and remeasurement of warrant liability. Because Adjusted EBITDA and Adjusted EBITDA as a % of net revenues facilitate internal comparisons of our historical operating performance on a more consistent basis, we also use these measures for our business planning purposes. In addition, we believe Adjusted EBITDA and Adjusted EBITDA as a % of net revenues are widely used by investors, securities analysts, ratings agencies and other parties in evaluating companies in our industry as a measure of our operational performance.
There are a number of limitations related to the use of Adjusted EBITDA rather than net loss, which is the most directly comparable GAAP measure. Some of these limitations are:
These non-GAAP financial measures should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. These non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies.
The following table presents the reconciliation of Adjusted EBITDA to its most comparable GAAP measure, net loss, as reported (unaudited):