Beyond Meat (NASDAQ: BYND) reported a wider loss in the first quarter of 2019 due to higher costs and expenses, a majority of which were related to mark-to-market adjustments on outstanding warrants. The company guides 2019 revenue above the Street’s view.
Net loss for the quarter widened to $6.6 million from $5.7 million a year ago, while loss per share narrowed to $0.95 from $0.98 in the prior year quarter on higher weighted average common shares outstanding. Pro forma loss was $0.14 per share, wider than last year’s loss of $0.13 per share.
Revenue soared by 215% to $40.2 million for the first quarter of 2019, helped by an increase in sales of The Beyond Burger, expansion in the number of retail and foodservice points of distribution, including new strategic customers, and greater demand from its existing customers.
The company discontinued its frozen chicken strips product line during the first quarter of 2019, causing a decline in frozen product revenues consistent with its shift to concentrate more on its fresh products platform.
Looking ahead into the full year 2019, the company expects net revenues to exceed $210 million, an increase of greater than 140% compared to 2018. Adjusted EBITDA is predicted to be about break-even.
Looking ahead, the company believes to be in the early stages of achieving growth. Hence, Beyond Meat remained focused on efforts to increase brand awareness, expand its distribution channels, launch additional innovative products, and invest in infrastructure and capacity for serving a robust global plant-based meats market.
For the first quarter, gross profit surged 414% to $10.8 million. This growth was primarily due to an increase in the amount of product sold with resulting operating leverage and improved production efficiencies. A greater proportion of revenues from the company’s fresh platform products also contributed to the improvement in gross margin.
The company has continued to invest in its internal research and development and marketing capabilities and incur higher absolute costs to support its expanded manufacturing and supply chain operations. Hence, the operating expenses for the quarter increased by 110%.
The company’s cash balance was $35.4 million as of March 30, 2019, and total outstanding debt was $30.4 million. The March 30, 2019 cash balance excludes net proceeds from the IPO of about $252.5 million, after deducting underwriting discounts and commissions and estimated offering expenses.
Subsequent to the quarter end, on May 6, 2019, the company completed its initial public offering in which it issued 11.07 million shares of common stock at an IPO price of $25.00 per share. On May 31, 2019, subsequent to the IPO, there were 60.12 million shares of common stock outstanding.
Shares of Beyond Meat ended Thursday’s regular session down 3.02% at $99.50 on the Nasdaq. Following the earnings release, the stock inched up over 16% in the after-market session.
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