BranchOut Food Announces 2023 Financial Results Ending Year at a $6.4M Run Rate with Current Commitments of $9.0M in Annualized Sales for 2024
- Impressive 276% growth in net revenue to $2.83M in 2023 compared to $752,178 in 2022.
- Expansion into new markets and channels, securing $9.0M in annualized sales commitments for 2024.
- Successful strategic collaboration with the U.S. Army to enhance MREs using proprietary technology.
- Continued revenue growth expected in 2024, with gross margin improvements and new product lines launched.
- Strong financial position with over $0.657M in cash and marketable securities as of December 31, 2023.
- None.
Insights
The reported 276% increase in net revenue for BranchOut Food Inc. is a substantial year-over-year growth, which is indicative of successful market penetration and product acceptance. The engagement with major retailers is a key driver of this growth, as it suggests a strategic expansion of distribution channels. The growth figures surpass typical industry benchmarks for food technology companies in their early stages post-IPO, which usually experience more modest revenue increases.
The company's focus on long-term relationships with leading retailers and the expansion of their top branded snack into new regions can be seen as a strategic move to solidify their market presence and secure future revenue streams. The reported sales velocity, nearly double the retailer's expectation, is a strong indicator of market demand and product fit. However, investors should monitor the sustainability of this growth, considering the competitive nature of the food technology sector and the company’s ability to maintain these relationships.
The anticipated additional sales and strategic collaborations, such as with the U.S. Army for MRE enhancements, could open new revenue channels and diversify the company's income sources. However, the company's net loss and cash position should be carefully considered by stakeholders. While the net loss has decreased, the company still operates at a loss and their cash reserves at the end of the year, though improved, may require further capital infusion to sustain the business as it scales.
BranchOut Food Inc.'s financial results, particularly the improved gross margin and reduced retailer chargebacks, reflect operational efficiencies that investors typically view favorably. The depreciation expense included in the cost of sales is a non-cash charge, which, while reducing gross profit, is a standard accounting practice for allocating the cost of assets over time.
Investors should note the company's current commitments valued at $9.0 million in annualized sales for 2024. This forward-looking statement provides a positive outlook but should be weighed against the company's historical performance and industry averages. The company's ability to forecast and meet these sales targets will be important for investor confidence.
It is important to analyze the company's liquidity position, as the cash and cash equivalents, along with marketable securities, suggest a relatively tight financial situation. The company's ability to manage its cash flow in relation to its operational needs and investment in growth will be critical in the coming months, especially as it continues to operate at a net loss.
BranchOut Food's utilization of their proprietary GentleDry technology to enhance MREs represents an innovative approach within the food technology industry. This collaboration with the U.S. Army could position the company as a key player in the field of food preservation and could lead to further opportunities within governmental and military supply chains.
The launch of new product lines, such as salad toppers and kids’ snack packs, demonstrates the company's agility in product development and its commitment to diversifying its product portfolio. The expansion into the convenience and grocery channels is a strategic move that aligns with current consumer trends towards healthier and more convenient food options.
However, the introduction of new products and expansion into new markets bring additional risks, including increased competition and the need for effective marketing strategies to achieve product differentiation. The success of these new product lines will depend on the company's ability to execute and deliver products that resonate with consumers' evolving preferences.
2023 net revenue of
BEND, Ore., April 02, 2024 (GLOBE NEWSWIRE) -- BranchOut Food Inc. (NASDAQ: BOF), a pioneering food technology company and producer of dehydrated fruit and vegetable-based products, today announced its recent accomplishments and financial results for the fourth quarter and year ended December 31, 2023.
Eric Healy, CEO of BranchOut Foods, said, “We are very pleased with BranchOut Food’s significant growth and accomplishments since our IPO in June 2023. In the ensuing nine months, we have built strong, long-term relationships with some of the nation’s leading retailers, and our products have now established popularity among shoppers in stores throughout the country.
“The fourth quarter was marked by revenue nearly doubling that of the previous total year, while gross margin improved as the year progressed. We also expect revenue to continue to grow in 2024. Our rising gross profit percentage is attributed to reduced retailer chargebacks compared to previous quarters. A depreciation expense of
“Our corporate strategy has propelled strong revenue growth in 2023, and we expect to continue this trajectory in 2024. Our current commitments are now at
Operational Highlights
- In Q4, BranchOut Food’s top branded snack expanded into the Bay Area Region of the Nation's largest warehouse club following significant commercial success in the retailer’s Southern California region. The sales velocity was nearly double the retailer’s expectation. As a result, BranchOut Food has secured roughly
$1.1 million in commitments for 2024, expanding into eight states. - In Q3, the company’s branded line launched in Jacksons Food Stores, with approximately 300 locations, marking BranchOut's first foray into the Convenience Store Channel. Additional new Grocery Channel launches include Family Foods, Market of Choice, Harmons, and Giant Martin.
- Subsequent to quarter end, BranchOut Food announced the successful completion of part of its strategic collaboration with the U.S. Army Combat Capabilities Development Command (DEVCOM) to enhance MREs (Meals Ready-to-Eat) through the implementation of BranchOut Food's proprietary GentleDry technology. The company anticipates the completion of shelf-life testing in the first half of 2024.
- In February 2024, the company expanded its relationship with the nation’s largest retailer. The new agreement is valued at an estimated
$7.6 million annually. - In March 2024, BranchOut Food launched two new product lines, salad toppers and kids’ snack packs, at the Natural Products Expo West. The products extend the company’s reach outside of the snacking category and into two additional use cases.
Financial Highlights
- Net revenue for the full year was
$2.83 million , compared to$752,178 for the year ended December 31, 2022, an increase of$2,073,677 , or276% . - Net loss for the twelve months ended December 31, 2023 decreased by
19% . - BranchOut Food had approximately
$0.65 7 million in cash, cash equivalents and marketable securities, and over$1.6 million of combined cash, accounts receivable and inventory, as of December 31, 2023. - Investors are encouraged to read the Company’s Annual Report on Form 10-K when it is filed with the Securities and Exchange Commission (the “SEC”), which will contain additional details about BranchOut Food’s financial results as of and for the period ended December 31, 2023.
About BranchOut Food Inc.
BranchOut Food is an international food-tech company delivering truly great natural snacks and real superfood ingredients enabled by its licensed dehydration technology. The company’s GentleDry Technology is the next generation in dehydration technology, preserving up to
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts of future events. Forward-looking statements may be identified using words such as "forecast," "intend," "seek," "target," "anticipate," "believe," "expect," "estimate", "plan," "outlook," and "project" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements with respect to the operations of BranchOut Food, Inc., (the Company) strategies, prospects and other aspects of the business of the Company are based on current expectations that are subject to known and unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from expectations expressed or implied by such forward-looking statements. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Although it may voluntarily do so from time to time, the Company undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.
For more information
Jeff Ramson
PCG Advisory
646-863-6893
jramson@pcgadvisory.com
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