Better Choice Company Inc. Announces Pricing of Public Offering

Rhea-AI Summary

Better Choice Company Inc. (NYSE American: BTTR), a pet health and wellness company, has announced the pricing of its underwritten public offering. The company is offering 1,667,000 shares of common stock (or pre-funded warrants) at $3.00 per share, aiming to raise approximately $5 million in gross proceeds. ThinkEquity is acting as the sole book-runner for the offering, which is expected to close on July 31, 2024. Better Choice has granted underwriters a 45-day option to purchase up to an additional 100,000 shares. The company plans to use the net proceeds for general corporate purposes, including working capital, sales and marketing, and operating expenses.

Positive

• Successful pricing of public offering, potentially raising $5 million in gross proceeds
• Funds to be used for general corporate purposes, potentially supporting growth initiatives
• 45-day option granted to underwriters for additional share purchase, potentially increasing total proceeds

Negative

• Potential dilution of existing shareholders' ownership due to new share issuance
• Offering price of $3.00 per share may be below current market price, potentially impacting stock value

Insights

Financial Analyst

Better Choice Company's public offering of $5 million through the issuance of 1,667,000 shares (or pre-funded warrants) at $3.00 per share is a significant move for this pet health and wellness company. The pricing strategy suggests a cautious approach in the current market environment.

The offering's relatively modest size indicates that Better Choice is likely seeking to bolster its working capital and operational capabilities without overly diluting existing shareholders. However, the $3.00 per share price point may raise eyebrows, as it could imply a valuation challenge or reflect current market conditions for small-cap companies in the pet industry.

Interestingly, the inclusion of pre-funded warrants as an alternative to common stock provides flexibility for investors who may face regulatory constraints on common stock ownership. This structure could potentially attract a broader range of institutional investors.

The 45-day option granted to underwriters for an additional 100,000 shares is a standard practice but relatively small in size, representing only about 6% of the initial offering. This conservative approach might suggest management's confidence in the initial uptake but also a desire to limit potential dilution.

Investors should closely monitor how Better Choice utilizes these funds for working capital, sales and marketing and operating expenses. The effectiveness of this capital deployment will be important in determining whether this offering translates into improved financial performance and market position in the competitive pet health and wellness sector.

Market Research Analyst

Better Choice Company's decision to raise capital through a public offering is indicative of the broader trends in the pet health and wellness industry. The pet care market has seen robust growth, driven by increased pet ownership and premiumization trends, especially post-pandemic. However, this offering suggests that Better Choice may be facing challenges in capturing market share or achieving profitability in this competitive landscape.

The timing of this offering is intriguing. With many consumers facing economic pressures, there's a risk that spending on premium pet products could slow. Better Choice's move to strengthen its financial position could be seen as a proactive step to weather potential market headwinds or to fuel growth initiatives to stay competitive.

The $5 million raise, while modest, could be significant for a company of Better Choice's size. It may allow for increased marketing efforts or product development, which are important in an industry where brand recognition and innovation drive consumer choices. However, the relatively small size of the offering might limit the scope of potential initiatives, possibly putting Better Choice at a disadvantage against larger, better-funded competitors.

Investors should watch for how this capital infusion translates into market performance. Key metrics to monitor in the coming quarters include revenue growth, market share gains and progress towards profitability. The success of this offering will largely depend on management's ability to effectively allocate these new funds in a way that differentiates Better Choice in the crowded pet health and wellness market.

Tampa, Florida, July 29, 2024 (GLOBE NEWSWIRE) -- Better Choice Company Inc. (NYSE American: BTTR) (the “Company” or (“Better Choice”), a pet health and wellness company, today announced the pricing of its underwritten public offering of an aggregate of 1,667,000 shares of its common stock (or pre-funded warrants (“Pre-Funded Warrants”) in lieu thereof). Each share of common stock (or Pre-Funded Warrant) is being sold at a public offering price of $3.00 per share (inclusive of the Pre-Funded Warrant exercise price). Total gross proceeds from the offering, before deducting underwriting discounts and offering expenses, are expected to be approximately $5 million. In addition, Better Choice has granted the underwriters a 45-day option to purchase up to an additional 100,000 shares of common stock and/or Pre-Funded Warrants at the public offering price less the underwriting discount.

The closing of the offering is expected to occur on July 31, 2024, subject to the satisfaction of customary closing conditions. The Company intends to use the net proceeds from this offering for general corporate purposes, including working capital, sales and marketing, and operating expenses.

ThinkEquity is acting as the sole book-runner for the offering.

A registration statement on Form S-1 (File No. 333-280714) relating to the offering was filed with the Securities and Exchange Commission (“SEC”) and became effective on July 29, 2024. This offering is being made only by means of a prospectus. Copies of the final prospectus, when available, may be obtained from ThinkEquity, 17 State Street, 41^st Floor, New York, New York 10004. The final prospectus will be filed with the SEC and will be available on the SEC’s website located at http://www.sec.gov.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Better Choice Company Inc.

Better Choice Company Inc. is a rapidly growing pet health and wellness company committed to leading the industry shift toward pet products and services that help dogs and cats live healthier, happier and longer lives. We take an alternative, nutrition-based approach to pet health relative to conventional dog and cat food offerings and position our portfolio of brands to benefit from the mainstream trends of growing pet humanization and consumer focus on health and wellness. We have a demonstrated, multi-decade track record of success selling trusted pet health and wellness products and leverage our established digital footprint to provide pet parents with the knowledge to make informed decisions about their pet’s health. We sell the majority of our dog food, cat food and treats under the Halo brand, which is focused, respectively, on providing sustainably sourced kibble and canned food derived from real whole meat, and minimally processed raw-diet dog food and treats. For more information, please visit https://www.betterchoicecompany.com.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. The Company has based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Some or all of the results anticipated by these forward-looking statements may not be achieved. Further information on the Company’s risk factors is contained in our filings with the SEC. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Company Contact:
Better Choice Company, Inc.
Kent Cunningham, CEO

Investor Contact:
KCSA Strategic Communications
Valter Pinto, Managing Director
T: 212-896-1254
Valter@KCSA.com

FAQ

How much is Better Choice Company (BTTR) aiming to raise in its public offering?

Better Choice Company (BTTR) is aiming to raise approximately $5 million in gross proceeds from its public offering of 1,667,000 shares of common stock or pre-funded warrants.

What is the pricing of Better Choice Company's (BTTR) public offering announced on July 29, 2024?

Better Choice Company (BTTR) has priced its public offering at $3.00 per share of common stock or pre-funded warrant.

When is the expected closing date for Better Choice Company's (BTTR) public offering?

The expected closing date for Better Choice Company's (BTTR) public offering is July 31, 2024, subject to customary closing conditions.

How does Better Choice Company (BTTR) plan to use the proceeds from its public offering?

Better Choice Company (BTTR) intends to use the net proceeds from the offering for general corporate purposes, including working capital, sales and marketing, and operating expenses.