BRC Inc. Reports Fourth Quarter 2023 Financial Results
- None.
- None.
Insights
The reported 28% increase in net revenue for Q4 2023 is a significant indicator of BRC Inc.'s growth trajectory, particularly in the wholesale segment, which saw a 79% surge. This performance substantially outpaces the category growth, suggesting that the company is gaining market share and strengthening its competitive position within the FDM and RTD coffee segments. The strategic pivot towards wholesale channels is noteworthy because it typically involves lower marketing costs compared to DTC, which could be a factor in the decreased marketing expenses and improved profitability.
The company's focus on efficiency is evident in the reduced general and administrative expenses, contributing to a healthier bottom line despite a net loss. The projected Adjusted EBITDA for 2024 indicates management's confidence in continued operational improvements and cash flow generation. Investors should monitor the company's ability to maintain this momentum and manage the lower gross margins associated with the RTD product mix shift, as well as the potential risks from inflationary pressures on raw materials and finished goods.
From a financial perspective, the improvement in Adjusted EBITDA from a loss of $11.4 million to a positive $12.1 million is a critical turnaround, highlighting the company's progress towards profitability. The net loss reduction from $20.0 million to $14.0 million further underscores this trend. However, the decrease in gross margin by 500 basis points is a concern that warrants attention, as it reflects the impact of product mix, inventory reserves and inflation, which could squeeze profitability if not managed effectively.
The guidance for 2024, with an Adjusted EBITDA range of $27.0 million to $40.0 million and a Free Cash Flow conversion rate of approximately 80%, signals strong expectations for operational efficiency and profitability. Investors should consider the implications of the barter transaction on reported revenue, as it inflates the top-line figures. Excluding this, the underlying revenue growth is less pronounced, which is an essential consideration for assessing the company's organic growth.
The company's performance must be contextualized within the broader economic environment. The inflationary pressures mentioned, which have affected raw materials and finished goods costs, are reflective of current macroeconomic conditions. The ability of BRC Inc. to navigate these challenges while still posting significant revenue growth is commendable and indicates strong management and operational resilience.
The strategic reduction in marketing expenses, coupled with the shift towards wholesale distribution, suggests a tactical adaptation to market conditions that may favor lower-cost channels during times of economic uncertainty. The company's guidance for the upcoming fiscal year, particularly the anticipated increase in gross margin, suggests an expectation of either easing inflationary pressures or improved cost management strategies. Stakeholders should closely observe macroeconomic trends, as these will undoubtedly influence the company's financial health and its ability to meet projected targets.
Financial Highlights
-
Net Revenue increased
28% in Q4 2023 to$119.7 million 79% versus Q4 of 2022 - Outpaced category growth by over 18x within the FDM coffee category and 4x within RTD category
-
Profitability sequentially improved in Q4 2023; Adjusted EBITDA of
$12.1 million $14.0 million $11.4 million $20.0 million -
Continued acceleration of profit and cash flow expected in 2024 with guidance issued for Adjusted EBITDA of
$27.0 million $40.0 million 80% of Adjusted EBITDA
“Black Rifle continues to build momentum as a brand, as an efficient, well-run company, and most importantly, in its ability to impact the veteran and first responder community. We are one of the fastest growing brands in the coffee category, with bagged coffee growing at 18x the category and RTD coffee 4x the category,” said BRCC Chief Executive Officer Chris Mondzelewski. “Our brand awareness is now
“BRCC has reached an inflection point, driven by a renewed focus on efficiency and effectiveness, giving us confidence in our first full-year guidance of positive profit and free cash flow,” said BRCC Chief Financial Officer Steve Kadenacy. “Our strong performance during the past fiscal year demonstrates our commitment to excellence at every level of the company. We’ve further refined operations to serve our greater vision for the company – a vision that will allow us to strengthen and grow the business while creating value for our customers, partners, and investors.”
Fourth Quarter 2023 Financial Highlights (in millions, except % data)
|
Quarter To Date Comparisons |
|
Year To Date Comparisons |
|||||||||||||||||
|
|
2023 |
|
|
2022 |
|
$
|
%
|
|
|
2023 |
|
|
2022 |
|
$
|
%
|
|
||
Net Revenue |
$ |
119.7 |
|
$ |
93.6 |
|
$ |
26.1 |
|
|
$ |
395.6 |
|
$ |
301.3 |
|
$ |
94.3 |
|
|
Gross Profit |
$ |
31.7 |
|
$ |
29.5 |
|
$ |
2.2 |
|
|
$ |
125.4 |
|
$ |
99.2 |
|
$ |
26.2 |
|
|
Gross Margin |
|
26.5 |
% |
|
31.5 |
% |
|
|
|
|
31.7 |
% |
|
32.9 |
% |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Loss |
$ |
(14.0 |
) |
$ |
(20.0 |
) |
$ |
6.0 |
|
|
$ |
(56.7 |
) |
$ |
(338.0 |
) |
$ |
281.3 |
|
|
Adjusted EBITDA |
$ |
12.1 |
|
$ |
(11.4 |
) |
$ |
23.5 |
|
|
$ |
13.3 |
|
$ |
(34.0 |
) |
$ |
47.3 |
|
|
Fourth Quarter 2023 Results
Fourth quarter 2023 revenue increased
Gross profit increased to
Marketing expenses decreased
Salaries, wages and benefits expenses increased
General and administrative ("G&A") expenses decreased
Net loss for the fourth quarter of 2023 was
Financial Outlook
BRC Inc. provides guidance based on current market conditions and expectations for revenue, gross margin and adjusted EBITDA, which is a non-GAAP financial measure.
For the Full-year fiscal 2024, the Company expects:
|
FY2023 |
|
FY2024 Guidance |
|||||||
|
Actual |
|
Low |
High |
||||||
Net Revenue(1) |
$ |
395.6 |
|
|
$ |
430.0 |
|
$ |
460.0 |
|
Growth |
|
31 |
% |
|
|
9 |
% |
|
16 |
% |
Gross Margin |
|
31.7 |
% |
|
|
37 |
% |
|
40 |
% |
|
|
|
|
|
||||||
Adj. EBITDA |
$ |
13.3 |
|
|
$ |
27.0 |
|
$ |
40.0 |
|
Free Cash Flow |
|
|
|
|||||||
(1) A barter transaction favorably impacted Net Revenue in 2023 by
The guidance provided above constitutes forward-looking statements and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.
We have not reconciled forward-looking Adjusted EBITDA to its most directly comparable GAAP measure, net income(loss), in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. We cannot predict with reasonable certainty the ultimate outcome of certain components of such reconciliations, including market-related assumptions that are not within our control, or others that may arise, without unreasonable effort. For these reasons, we are unable to assess the probable significance of the unavailable information, which could materially impact the amount of future net loss. See “Non-GAAP Financial Measures” for additional important information regarding Adjusted EBITDA.
Conference Call
A conference call to discuss the Company’s fourth quarter results is scheduled for March 7, 2024, at 8:30 a.m. ET. Those who wish to participate in the call may do so by dialing (877) 407-0609 or (201) 689-8541 for international callers. A webcast of the call will be available on the investor relations page of the Company’s website at ir.blackriflecoffee.com. For those unable to participate in the conference call, a replay will be available after the conclusion of the call through March 14, 2024. The
About BRC Inc.
Black Rifle Coffee Company (BRCC) is a veteran-founded coffee company serving premium coffee to people who love America. Founded in 2014 by Green Beret Evan Hafer, Black Rifle develops their explosive roast profiles with the same mission focus they learned while serving in the military. BRCC is committed to supporting veterans, active-duty military, first responders and the American way of life.
To learn more, visit www.blackriflecoffee.com, subscribe to the BRCC newsletter, or follow along on social media.
Forward-Looking Statements
This press release contains forward-looking statements about BRC Inc. and its industry that involve substantial risks and uncertainties. All statements other than statements of historical fact contained in this press release, including statement’s regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s financial condition, liquidity, prospects, growth, strategies, future market conditions, developments in the capital and credit markets and expected future financial performance, as well as any information concerning possible or assumed future results of operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions, but the absence of these words does not mean that a statement is not forward-looking. The events and circumstances reflected in the Company’s forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Factors that may cause such forward-looking statements to differ from actual results include, but are not limited to: competition and our ability to grow and manage growth sustainably and retain our key employees; failure to achieve sustained profitability; negative publicity affecting our brand and reputation, or the reputation of key employees; failure to manager our debt obligations; failure to effectively make use of assets received under bartering transactions; failure by us to maintain our message as a supportive member of the Veteran and military communities and any other factors which may negatively affect the perception of our brand; our limited operating history, which may make it difficult to successfully execute our strategic initiatives and accurately evaluate future risks and challenges; failed marketing campaigns, which may cause us to incur costs without attracting new customers or realizing higher revenue; failure to attract new customers or retain existing customers; risks related to the use of social media platforms, including dependence on third-party platforms; failure to provide high-quality customer experience to retail partners and end users, including as a result of production defaults, or issues, including due to failures by one or more of our co-manufacturers, affecting the quality of our products, which may adversely affect our brand; decrease in success of the direct to consumer revenue channel; loss of one or more co-manufacturers, or delays, quality, or other production issues, including labor-related production issues at any of our co-manufacturers; failure to manage our supply chain, and accurately forecast our raw material and co-manufacturing requirements to support our needs; failure to effectively manage or distribute our products through our Wholesale business partners, especially our key Wholesale business partners; failure by third parties involved in the supply chain of coffee, store supplies or merchandise to produce or deliver products, including as a result of ongoing supply chain disruptions, or our failure to effectively manage such third parties; changes in the market for high-quality coffee beans and other commodities; fluctuations in costs and availability of real estate, labor, raw materials, equipment, transportation or shipping; failure to successfully compete with other producers and retailers of coffee; failure to successfully open new Black Rifle Coffee Outposts, including failure to timely proceed through permitting and other development processes, or the failure of any new or existing Outposts to generate sufficient sales; failure to properly manage our rapid growth, inventory needs, and relationships with various business partners; failure to protect against software or hardware vulnerabilities; failure to build brand recognition using our intellectual properties or otherwise; shifts in consumer spending, lack of interest in new products or changes in brand perception upon evolving consumer preferences and tastes; failure to adequately maintain food safety or quality and comply with food safety regulations; failure to successfully integrate into new domestic and international markets; risks related to leasing space subject to long-term non-cancelable leases and with respect to real property; failure of our franchise partners to successfully manage their franchises; failure to raise additional capital to develop the business; risks related to supply chain disruptions; risks related to unionization of employees; failure to comply with federal state and local laws and regulations, or failure to prevail in civil litigation matters; and other risks and uncertainties indicated in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on March 6, 2024 including those set forth under “Item 1A. Risk Factors” included therein, as well as in our other filings with the SEC. Such forward-looking statements are based on information available as of the date of this press release and the Company’s current beliefs and expectations concerning future developments and their effects on the Company. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not place undue reliance on these forward-looking statements as predications of future events. Although the Company believes that it has a reasonable basis for each forward-looking statement contained in this press release, the Company cannot guarantee that the future results, growth, performance or events or circumstances reflected in these forward-looking statements will be achieved or occur at all. These forward-looking statement speak only as of the date of this press release. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
BRC Inc.
|
|||||||||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue, net |
$ |
119,650 |
|
|
$ |
93,618 |
|
|
$ |
395,623 |
|
|
$ |
301,313 |
|
Cost of goods sold |
|
87,978 |
|
|
|
64,153 |
|
|
|
270,175 |
|
|
|
202,134 |
|
Gross profit |
|
31,672 |
|
|
|
29,465 |
|
|
|
125,448 |
|
|
|
99,179 |
|
Operating expenses |
|
|
|
|
|
|
|
||||||||
Marketing and advertising |
|
8,377 |
|
|
|
13,578 |
|
|
|
30,794 |
|
|
|
38,169 |
|
Salaries, wages and benefits |
|
18,967 |
|
|
|
16,881 |
|
|
|
71,054 |
|
|
|
64,286 |
|
General and administrative |
|
15,085 |
|
|
|
18,467 |
|
|
|
71,613 |
|
|
|
64,486 |
|
Other operating expense, net |
|
1,464 |
|
|
|
— |
|
|
|
2,198 |
|
|
|
— |
|
Total operating expenses |
|
43,893 |
|
|
|
48,926 |
|
|
|
175,659 |
|
|
|
166,941 |
|
Operating loss |
|
(12,221 |
) |
|
|
(19,461 |
) |
|
|
(50,211 |
) |
|
|
(67,762 |
) |
Non-operating income (expenses) |
|
|
|
|
|
|
|
||||||||
Interest expense, net |
|
(1,672 |
) |
|
|
(457 |
) |
|
|
(6,330 |
) |
|
|
(1,593 |
) |
Other income (expense), net |
|
(127 |
) |
|
|
(11 |
) |
|
|
10 |
|
|
|
339 |
|
Change in fair value of earn-out liability |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(209,651 |
) |
Change in fair value of warrant liability |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(56,675 |
) |
Change in fair value of derivative liability |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2,335 |
) |
Total non-operating expenses |
|
(1,799 |
) |
|
|
(468 |
) |
|
|
(6,320 |
) |
|
|
(269,915 |
) |
Loss before income taxes |
|
(14,020 |
) |
|
|
(19,929 |
) |
|
|
(56,531 |
) |
|
|
(337,677 |
) |
Income tax expense |
|
16 |
|
|
|
101 |
|
|
|
185 |
|
|
|
367 |
|
Net loss |
$ |
(14,036 |
) |
|
$ |
(20,030 |
) |
|
|
(56,716 |
) |
|
|
(338,044 |
) |
Less: Net loss attributable to non-controlling interest |
|
(9,551 |
) |
|
|
(14,842 |
) |
|
|
(39,971 |
) |
|
|
(255,138 |
) |
Net loss attributable to BRC Inc. |
$ |
(4,485 |
) |
|
$ |
(5,188 |
) |
|
$ |
(16,745 |
) |
|
$ |
(82,906 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per share attributable to Class A Common Stock(1) |
|
|
|
|
|
|
|
||||||||
Basic and diluted |
$ |
(0.07 |
) |
|
|
(0.09 |
) |
|
$ |
(0.27 |
) |
|
$ |
(1.62 |
) |
Weighted-average shares of Class A Common Stock outstanding(1) |
|
|
|
|
|
|
|
||||||||
Basic and diluted |
|
64,474,349 |
|
|
|
54,814,919 |
|
|
|
60,932,225 |
|
|
|
51,246,632 |
|
(1) For the year ended December 31, 2022, net loss per share of Class A Common Stock and weighted-average shares of Class A Common Stock outstanding is representative of the period from February 9, 2022 through December 31, 2022, the period following the Business Combination. Shares of Class B Common Stock do not participate in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted loss per share of Class B Common Stock under the two-class method has not been presented.
BRC Inc.
|
|||||||
|
December 31, |
|
December 31, |
||||
|
|
2023 |
|
|
|
2022 |
|
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
12,448 |
|
|
$ |
38,990 |
|
Restricted cash |
|
1,465 |
|
|
|
— |
|
Accounts receivable, net |
|
25,207 |
|
|
|
22,337 |
|
Inventories, net |
|
56,465 |
|
|
|
77,183 |
|
Prepaid expenses and other current assets |
|
12,153 |
|
|
|
6,783 |
|
Total current assets |
|
107,738 |
|
|
|
145,293 |
|
Property, plant and equipment, net |
|
68,326 |
|
|
|
59,451 |
|
Operating lease, right-of-use asset |
|
36,214 |
|
|
|
20,050 |
|
Identifiable intangibles, net |
|
418 |
|
|
|
225 |
|
Other |
|
23,080 |
|
|
|
315 |
|
Total assets |
|
235,776 |
|
|
|
225,334 |
|
Liabilities and Shareholders' Equity/(Deficit) |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
33,564 |
|
|
$ |
12,429 |
|
Accrued liabilities |
|
34,911 |
|
|
|
36,660 |
|
Deferred revenue and gift card liability |
|
11,030 |
|
|
|
9,505 |
|
Current maturities of long-term debt, net |
|
2,297 |
|
|
|
2,143 |
|
Current operating lease liability |
|
2,249 |
|
|
|
1,360 |
|
Current maturities of finance lease obligations |
|
58 |
|
|
|
95 |
|
Total current liabilities |
|
84,109 |
|
|
|
62,192 |
|
Non-current liabilities: |
|
|
|
||||
Long-term debt, net |
|
68,683 |
|
|
|
47,017 |
|
Finance lease obligations, net of current maturities |
|
23 |
|
|
|
221 |
|
Operating lease liability |
|
35,929 |
|
|
|
19,466 |
|
Other non-current liabilities |
|
524 |
|
|
|
502 |
|
Total non-current liabilities |
|
105,159 |
|
|
|
67,206 |
|
Total liabilities |
|
189,268 |
|
|
|
129,398 |
|
|
|
|
|
||||
Stockholders' equity/members' deficit: |
|
|
|
||||
Preferred Stock, |
|
— |
|
|
|
— |
|
Class A Common Stock, |
|
6 |
|
|
|
5 |
|
Class B Common Stock, |
|
15 |
|
|
|
16 |
|
Class C Common Stock, |
|
— |
|
|
|
— |
|
Additional paid in capital |
|
133,728 |
|
|
|
129,508 |
|
Accumulated deficit |
|
(120,478 |
) |
|
|
(103,733 |
) |
Total BRC Inc.'s stockholders' equity |
|
13,271 |
|
|
|
25,796 |
|
Non-controlling interests |
|
33,237 |
|
|
|
70,140 |
|
Total stockholders' equity |
|
46,508 |
|
|
|
95,936 |
|
Total liabilities and stockholders' equity |
$ |
235,776 |
|
|
$ |
225,334 |
|
BRC Inc.
|
|||||||
|
Year Ended December 31, |
||||||
|
|
2023 |
|
|
|
2022 |
|
Operating activities |
|
|
|
||||
Net loss |
$ |
(56,716 |
) |
|
$ |
(338,044 |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
||||
Depreciation and amortization |
|
7,263 |
|
|
|
4,383 |
|
Equity-based compensation |
|
6,974 |
|
|
|
6,079 |
|
Amortization of debt issuance costs |
|
549 |
|
|
|
317 |
|
Loss on disposal of assets |
|
4,763 |
|
|
|
— |
|
Other |
|
311 |
|
|
|
849 |
|
Change in fair value of earn-out liability |
|
— |
|
|
|
209,651 |
|
Change in fair value of warrant liability |
|
— |
|
|
|
56,675 |
|
Change in fair value of derivative liability |
|
— |
|
|
|
2,335 |
|
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable, net |
|
(2,766 |
) |
|
|
(14,895 |
) |
Inventories, net |
|
(8,183 |
) |
|
|
(56,311 |
) |
Prepaid expenses and other assets |
|
654 |
|
|
|
(184 |
) |
Accounts payable |
|
21,557 |
|
|
|
(6,146 |
) |
Accrued liabilities |
|
(1,811 |
) |
|
|
15,986 |
|
Deferred revenue and gift card liability |
|
1,525 |
|
|
|
2,171 |
|
Operating lease liability |
|
891 |
|
|
|
776 |
|
Other liabilities |
|
22 |
|
|
|
168 |
|
Net cash used in operating activities |
|
(24,967 |
) |
|
|
(116,190 |
) |
Investing activities |
|
|
|
||||
Purchases of property, plant and equipment |
|
(27,220 |
) |
|
|
(30,404 |
) |
Proceeds from sale of property and equipment |
|
5,712 |
|
|
|
— |
|
Net cash used in investing activities |
|
(21,508 |
) |
|
|
(30,404 |
) |
Financing activities |
|
|
|
||||
Proceeds from issuance of long-term debt, net of discount |
|
294,508 |
|
|
|
51,593 |
|
Debt issuance costs paid |
|
(4,333 |
) |
|
|
(279 |
) |
Repayment of long-term debt |
|
(268,230 |
) |
|
|
(38,761 |
) |
Financing lease obligations |
|
(173 |
) |
|
|
3 |
|
Repayment of promissory note |
|
(1,047 |
) |
|
|
— |
|
Issuance of stock from the Employee Stock Purchase Plan |
|
673 |
|
|
|
— |
|
Distribution and redemption of Series A preferred equity |
|
— |
|
|
|
(127,853 |
) |
Proceeds from Business Combination, including PIPE investment |
|
— |
|
|
|
337,957 |
|
Payment of Business Combination costs |
|
— |
|
|
|
(31,638 |
) |
Redemption of Class A and Class B shares |
|
— |
|
|
|
(20,145 |
) |
Redemption of incentive units |
|
— |
|
|
|
(3,627 |
) |
Net cash provided by financing activities |
|
21,398 |
|
|
|
167,250 |
|
Net increase (decrease) in cash, cash equivalents, and restricted cash |
|
(25,077 |
) |
|
|
20,656 |
|
Cash and cash equivalents, beginning of period |
|
38,990 |
|
|
|
18,334 |
|
Restricted cash, beginning of period |
|
— |
|
|
|
— |
|
Cash and cash equivalents, end of period |
$ |
12,448 |
|
|
$ |
38,990 |
|
Restricted cash, end of period |
$ |
1,465 |
|
|
$ |
— |
|
BRC Inc.
|
|||||
|
Year Ended December 31, |
||||
|
2023 |
|
2022 |
||
Non-cash operating activities |
|
|
|
||
Recognition of right-of-use operating lease assets |
$ |
18,547 |
|
$ |
20,050 |
Recognition of revenue for inventory exchanged for prepaid advertising |
$ |
28,901 |
|
$ |
— |
|
|
|
|
||
Non-cash investing and financing activities |
|
|
|
||
Property and equipment purchased but not yet paid |
|
1,857 |
|
|
2,279 |
Series A preferred equity exchange for PIPE shares |
|
— |
|
|
26,203 |
Series A preferred equity amortization |
|
— |
|
|
5,390 |
|
|
|
|
||
Supplemental cash flow information |
|
|
|
||
Cash paid for income taxes |
$ |
562 |
|
$ |
277 |
Cash paid for interest |
$ |
4,483 |
|
$ |
1,279 |
KEY OPERATING AND FINANCIAL METRICS |
|||||||||||
Revenue by Sales Channel |
|
|
|
|
|
|
|
||||
(in thousands) |
|
|
|
|
|
|
|
||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
Wholesale |
$ |
73,525 |
|
$ |
41,187 |
|
$ |
225,059 |
|
$ |
119,360 |
Direct to Consumer |
|
39,072 |
|
|
45,645 |
|
|
143,232 |
|
|
159,022 |
Outpost |
|
7,053 |
|
|
6,786 |
|
|
27,332 |
|
|
22,931 |
Total net sales |
$ |
119,650 |
|
$ |
93,618 |
|
$ |
395,623 |
|
$ |
301,313 |
Key Operational Metrics |
|
|
|
|
|
|
December 31, |
||
|
|
2023 |
|
2022 |
Wholesale Doors |
|
12,200 |
|
10,690 |
RTD Doors |
|
86,840 |
|
61,230 |
DTC Subscribers |
|
225,800 |
|
270,000 |
Outposts |
|
|
|
|
Company-owned stores |
|
18 |
|
15 |
Franchise stores |
|
18 |
|
11 |
Total Outposts |
|
36 |
|
26 |
Non-GAAP Financial Measures
To evaluate the performance of our business, we rely on both our results of operations recorded in accordance with generally accepted accounting principles in
A reconciliation of net loss, the most directly comparable GAAP measure, to EBITDA and Adjusted EBITDA is set forth below:
Reconciliation of Net Loss to Adjusted EBITDA |
|
|
|||||||||||||
(amounts in thousands) |
|
|
|
|
|
|
|
||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net loss |
$ |
(14,036 |
) |
|
|
(20,030 |
) |
|
$ |
(56,716 |
) |
|
|
(338,044 |
) |
Interest expense |
|
1,672 |
|
|
|
457 |
|
|
|
6,330 |
|
|
|
1,593 |
|
Tax expense |
|
16 |
|
|
|
101 |
|
|
|
185 |
|
|
|
367 |
|
Depreciation and amortization |
|
1,909 |
|
|
|
1,328 |
|
|
|
7,263 |
|
|
|
4,383 |
|
EBITDA |
$ |
(10,439 |
) |
|
$ |
(18,144 |
) |
|
$ |
(42,938 |
) |
|
$ |
(331,701 |
) |
Non-cash fair value adjustments |
|
|
|
|
|
|
|
||||||||
Change in fair value of earn-out liability expense(1) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
209,651 |
|
Change in fair value of warrant liability expense(2) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
56,675 |
|
Change in fair value of derivative liability(3) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,335 |
|
EBITDA, excluding non-cash fair value adjustments |
$ |
(10,439 |
) |
|
$ |
(18,144 |
) |
|
$ |
(42,938 |
) |
|
$ |
(63,040 |
) |
Equity-based compensation(4) |
|
1,329 |
|
|
|
1,496 |
|
|
|
6,974 |
|
|
|
6,929 |
|
System implementation costs(5) |
|
484 |
|
|
|
318 |
|
|
|
3,541 |
|
|
|
723 |
|
Transaction expenses(6) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,020 |
|
Executive recruiting, relocation and sign-on bonus(7) |
|
(29 |
) |
|
|
876 |
|
|
|
1,515 |
|
|
|
3,757 |
|
Write-off of site development costs(8) |
|
341 |
|
|
|
730 |
|
|
|
2,833 |
|
|
|
1,055 |
|
Strategic initiative related costs(9) |
|
— |
|
|
|
629 |
|
|
|
1,505 |
|
|
|
7,760 |
|
Non-routine legal expense(10) |
|
2,909 |
|
|
|
781 |
|
|
|
10,290 |
|
|
|
1,866 |
|
RTD start-up and production issues(11) |
|
— |
|
|
|
1,769 |
|
|
|
2,394 |
|
|
|
5,205 |
|
(Gain) Loss on assets held for sale(12) |
|
— |
|
|
|
— |
|
|
|
105 |
|
|
|
— |
|
Contract termination costs(13) |
|
— |
|
|
|
125 |
|
|
|
730 |
|
|
|
683 |
|
Restructuring fees and related costs(14) |
|
1,692 |
|
|
|
— |
|
|
|
6,812 |
|
|
|
— |
|
RTD transformation costs(15) |
|
15,268 |
|
|
|
— |
|
|
|
18,917 |
|
|
|
— |
|
Loss on impairment of assets |
|
592 |
|
|
|
— |
|
|
|
592 |
|
|
|
— |
|
Adjusted EBITDA |
$ |
12,147 |
|
|
$ |
(11,420 |
) |
|
$ |
13,270 |
|
|
$ |
(34,042 |
) |
(1) |
Represents the non-cash expense recognized to remeasure the earn-out liability to fair value upon vesting events. The change in fair value was a result of the increase of the closing price of our publicly traded common stock subsequent to the closing of our business combination. |
|
(2) |
Represents non-cash expense recognized to remeasure the warrant liability to fair value upon redemption. The change in fair value was a result of the increase of the closing price of our publicly traded common stock subsequent to the closing of our business combination. |
|
(3) |
Represents non-cash expense recognized to remeasure the derivative liability to fair value upon the vesting event. The change in fair value was a result of the increase of the closing price of our publicly traded common stock subsequent to the closing of our business combination. |
|
(4) |
Represents the non-cash expense related to our equity-based compensation arrangements for employees, directors, consultants and wholesale channel partner. |
|
(5) |
Represents non-capitalizable costs associated with the implementation of our enterprise-wide resource planning (ERP) system. |
|
(6) |
Represents expenses related to becoming a public company such as public company readiness, consulting and other fees that are not related to core operations. |
|
(7) |
Represents nonrecurring payments made for executive recruitment, relocation, and sign-on bonuses. |
|
(8) |
Represents the write-off of development costs for abandoned retail locations. |
|
(9) |
Represents nonrecurring third-party consulting costs related to the planning and execution of our growth and productivity strategic initiatives. |
|
(10) |
Represents legal costs and fees incurred in connection with certain non-routine legal disputes consisting of certain claims relating to deSPAC warrants and a commercial dispute with a former consultant resulting from the Company in-housing certain activities. |
|
(11) |
Represents nonrecurring, non-cash costs and expense incurred as a result of our RTD start-up and production issue. |
|
(12) |
Represents the impairments on assets held for sale, net of (gain) loss on sale of assets held for sale. |
|
(13) |
Represents nonrecurring costs incurred for early termination of software and service contracts. |
|
(14) |
Represents restructuring advisory fees, severance, and other related costs (previously included in footnote (7) and footnote (9)). |
|
(15) |
Represents non-recurring, non-cash or non-operational costs associated with the transformation of our RTD business including loss on write-off of RTD inventory, discounts recognized on non-cash transactions, and other non-cash costs to transform our RTD business. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240306814008/en/
Investor Contacts:
Tanner Doss: IR@BlackRifleCoffee.com
ICR for BRCC: BlackrifleIR@icrinc.com
Source: BRC Inc.
FAQ
What was the percentage increase in net revenue for BRC Inc. in Q4 2023?
What was the growth percentage of Wholesale revenue for BRC Inc. in Q4 2023?
What was the Adjusted EBITDA for BRC Inc. in Q4 2023?
What was the Net Loss for BRC Inc. in Q4 2023?
What is the guidance for Adjusted EBITDA for BRC Inc. in 2024?
