Agrify Corporation Announces Preliminary Unaudited Financial Results for Q4 2023 and Update on Customer Project
- Agrify anticipates a historical low net loss of $750 thousand in Q4 2023, a significant improvement from previous quarters.
- Loss from Operations is expected to decrease by 46% to a low of $2.5 million, showcasing operational efficiency.
- Gross Profit is projected to increase by 105% to $1.9 million, indicating improved financial performance.
- The Company expects the lowest net cash burn in its history, aiming for cashflow break-even in the second half of 2024.
- Ocean Deep/Golden Lake Business Park's progress includes facility acquisition, construction of an EXP1 Explosion Proof Room, and plans for product extraction and vertical farming units.
- Agrify's financial results for Q4 2023 and full fiscal year 2023 will be released before the end of March 2024.
- None.
Insights
From a financial perspective, the preliminary unaudited results for Agrify Corporation indicate a significant improvement in its fiscal health. The reported decrease in net loss to $750 thousand from the previous quarter's $2.1 million and a substantial reduction from the $58 million loss in the same quarter of the previous year, suggests a noteworthy turnaround. This is further bolstered by the 105% increase in gross profit and the expectation to approach cash flow break-even in the latter half of 2024. Such performance metrics are critical for investors assessing the company's operational efficiency and cost management strategies.
However, it's crucial to consider that these figures are subject to change upon the completion of annual review and audit procedures. Investors should closely monitor the finalized financial statements for any adjustments that could affect the outlook of the company. The ability to reduce cash burn to historical lows also signals potential for improved liquidity and financial stability, which could impact the company's ability to invest in growth opportunities or service any outstanding debt.
Examining the industry context, Agrify's focus on innovative cultivation and extraction solutions for the cannabis industry aligns with the growing demand for high-quality cannabis products. The construction of the UL-Certified EXP1 Explosion Proof Room and the PX30 Hydrocarbon Extraction Lab Package at Ocean Deep's facility in California represents a strategic move to capitalize on the state's robust cannabis market. The anticipated operation of 120 Vertical Farming Units in 2024 could position Ocean Deep—and by extension, Agrify—to meet the increasing consumer demand for premium cannabis flower.
It's important to note that the cannabis industry faces unique regulatory challenges that can affect market dynamics. As such, Agrify's financial and operational progress should be evaluated in light of potential regulatory shifts, which could influence the company's growth trajectory and market share.
Regarding the legal landscape, Agrify's operations within the cannabis industry must navigate a complex regulatory environment. The fact that Ocean Deep has completed the purchase of a facility and is constructing an explosion-proof room for extraction purposes indicates compliance with stringent safety regulations. This adherence to UL certification standards not only mitigates legal risks but also demonstrates the company's commitment to safety and quality, which can be a competitive advantage in an industry where regulatory compliance is paramount.
Investors should be aware of the legal implications of the cannabis industry's evolving regulatory framework, as changes can have immediate and long-term effects on Agrify's operational capabilities and market opportunities. The company's proactive approach to compliance can be seen as a risk management strategy that may contribute to sustained operational success.
Expects to Achieve the Lowest Record Net Loss and Cash Burn in Company History
TROY, Mich., Feb. 21, 2024 (GLOBE NEWSWIRE) -- Agrify Corporation (Nasdaq: AGFY) (“Agrify” or the “Company”), a leading provider of innovative cultivation and extraction solutions for the cannabis industry, today announced preliminary unaudited financial results for the fourth fiscal quarter of 2023 and updates for its Ocean Deep/Golden Lake Business Park project.
Fourth Quarter 2023 Outlook
- Net Loss in Q4 2023 is expected to be at a historical low of
$750 thousand , compared to$2.1 million net loss in Q3 2023, and$58 million loss in Q4 2022. - Loss from Operations is expected to decrease by
46% to a historical low of$2.5 million , compared to$4.6 million in Q3 2023 - Gross Profit is expected to increase
105% to$1.9 million , compared to$1 million in Q3 2023, and a gross loss of$33.5 million in Q4 2022. - Q4 2023 Net Cash burn is also expected to be the lowest in the Company history, and the Company expects to be in a position to approach cashflow break-even in the second half of 2024.
Agrify is expected to release its financial results for the fourth quarter and full fiscal year ended December 31, 2023 before the end of March 2024. The financial information presented in this press release may be adjusted as a result of the completion of customary annual review and audit procedures.
Golden Lake Business Park Project Update
Agrify’s customer, Ocean Deep/Golden Lake Business Park, is a California-based vertically integrated cannabis operator. Ocean Deep has completed the purchase of a roughly 30,000 square feet facility in Adelanto, California, and is currently constructing Agrify’s UL-Certified EXP1 Explosion Proof Room. Ocean Deep expects to soon be extracting products with Agrify’s turnkey PX30 Hydrocarbon Extraction Lab Package to bolster its product offerings. Ocean Deep is also expected to begin operation with an estimated 120 Vertical Farming Units (“VFUs”) sold by the Company to produce high-quality cannabis flower in 2024.
About Agrify
Agrify is a leading provider of innovative cultivation and extraction solutions for the cannabis industry, bringing data, science, and technology to the forefront of the market. Our proprietary micro-environment-controlled Vertical Farming Units (VFUs), enable cultivators to produce the highest quality products with unmatched consistency, yield, and ROI (return on investment) at scale. Our comprehensive extraction product line, which includes hydrocarbon, ethanol, solventless extraction, post-processing, and lab equipment, empowers producers to maximize the quantity and quality of extract required for premium concentrates. For more information, please visit our website at http://www.agrify.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning Agrify and other matters. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements including, without limitation, statements regarding preliminary financial results, the Company’s ability to approach break-even during the second half of 2024, the timing of the Company’s release of its audited financial statements, and the timing of Ocean Deep’s production using Agrify products. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this press release are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition, and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. You should carefully consider the risks and uncertainties that affect our business, including those described in our filings with the Securities and Exchange Commission (“SEC”), including under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 that was filed with the SEC on November 28, 2023, which can be obtained on the SEC website at www.sec.gov. These forward-looking statements speak only as of the date of this communication. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our public announcements and filings with the SEC.
Agrify Investor Relations
IR@agrify.com
(857) 256-8110
FAQ
What is Agrify Corporation's (AGFY) expected net loss for Q4 2023?
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What updates were provided on the Ocean Deep/Golden Lake Business Park project?
When will Agrify release its financial results for Q4 2023 and full fiscal year 2023?
