Desperately seeking reasons to be positive

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

The week ended 17 March 2023 once again saw Nasdaq and FFF’s listed FoodTech space go their separate ways – that’s two out of the last three weeks now, so much for “…as Nasdaq goes, so goes FoodTech”.   What’s more, Nasdaq had the good week, rising 4.4%; listed FoodTech the bad, more share price fallers than risers - 32 fallers, 15 risers, two non-movers. But enough of the glass half-empty attitude, time for a glass half-full perspective.  Six less share price fallers and six more share price risers compared to a week earlier.  Reason enough for cheer on its own. Always good to have a back-up though but, other than a few individual stock winners, not much else to say that was positive in terms of the wider FoodTech space. The imminent arrival of Spring, heralding longer days and warmer weather, will just have to do.

Nothing bad about Local Bounti’s (LOCL) week – shares soared 47% to close at 74 cents.  All the gains were made on the last trading day of the week when the vertical farmer announced “that it amended its existing credit facility with Cargill Financial Services, Inc...”  CFO Kathleen Valiasek explained: "The amendment we announced today provides us added flexibility to meet our near-term capital needs associated with the buildout of our facilities.  This represents the first of several thoughtful steps we expect to take to ensure that we have access to capital to support our growth strategies and keep our current development on track while we scale up our enterprise, including through potential sale-leaseback transactions or similar strategies.”

The Company also dished out some preliminary numbers: “For the full year ended December 31, 2022, the Company generated sales of $19.5 million, adjusted gross margin of 38%, a net loss of $111.1 million, and adjusted EBITDA loss of $29.8 million.” Good to see the market joining in and focusing on the positives.

Similar story with Blue Apron’s (APRN) Q4 results. $106.81 million sales beat the $100.13 million consensus number; average order value was up 14.7% to $73.15; average revenue per customer was up 12.4% year on year to $358.  Those were the positives.  On the negative side an 11.3% fall in the number of customers and a 13% year on year fall in orders.  The result? An EPS loss of ($0.49) that beat the $(0.83) loss the market had been expecting and an improved adjusted EBITDA loss of $13.5 million compared to last year’s $17.9 million.

CEO Linda Findley commented: "2022 was a challenging year for our business. Our team was tasked with managing through macroeconomic headwinds, continued inflation, funding delays and higher marketing costs as we simultaneously looked for the best pathways to preserve capital. At times, we were not as nimble as we needed to be, but 2022 is not indicative of what we are seeing so far in 2023. We adjusted late last year by adding new talent to our leadership and dramatically reducing costs. These actions are already resulting in a positive impact in 2023.” Market was impressed, marking the meal kit co’s shares up 17% to US$0.879.

No doubt about the week’s biggest loser – BOXED’s (BOXD) shares lost an eye-watering 76%.  That’s because, as reported by the Wall Street Journal, “Grocery courier Boxed Inc. said Tuesday it might file for bankruptcy as it continues to explore a possible sale of the business less than two years after going public through a merger with a special-purpose acquisition company, or SPAC. The e-commerce company specializing in household staples and pantry items said in a securities filing that it is actively soliciting proposals for the sale of all or most of its assets to improve its liquidity position.” Still a possibility of a sale of the business then - desperately seeking a glass half full angle…