Arcadia Biosciences (RKDA) Announces First Quarter 2024 Financial Results and Business Highlights

Rhea-AI Summary

Arcadia Biosciences (RKDA) reported positive financial results and business highlights for the first quarter of 2024, with revenue growth both sequentially and year-over-year. The company achieved its lowest loss from continuing operations in six years, showcasing a positive trend in revenue generation and gross profit margins. Operating expenses declined, and the company continued to expand its product reach and distribution, focusing on high-quality revenue sources. Key highlights include the expansion of GoodWheat and Zola products in multiple stores, driving revenue and gross profit growth. Overall, Arcadia Biosciences remains on a positive trajectory with a strong focus on monetizing its IP and delivering cashflow positive results.

Positive

• Revenue growth both sequentially and year-over-year

• Lowest loss from continuing operations in six years

• Fifth straight quarter of gross profit margins greater than 30%

• Operational expenses continued to decline at a double-digit pace versus last year

• GoodWheat brand expanded distribution for pancake and waffle mixes, launched new products, and received high ratings on Amazon

• Zola Coconut Water increased store count and is expected to drive revenue and gross profit in 2024

Negative

• None.

Insights

Financial Analyst

The first quarter financial results for Arcadia Biosciences exhibit a mixed but generally positive financial landscape. Notably, the sequential and year-over-year revenue growth is commendable, albeit modest at 2%. This suggests an effective market penetration strategy for its GoodWheat and Zola products. The company's ability to sustain gross profit margins above 30% for five consecutive quarters is particularly impressive, indicating a robust pricing strategy and cost management. However, the reported net loss, despite showing significant improvement, still reflects the challenges of reaching profitability. The reduction in operating expenses by 15% shows an effective cost containment effort, which if sustained, along with rising revenues, may lead to a positive net income in future quarters. The reclassification of body care brands indicates a strategic refocus on core business lines, which could streamline operations further. For investors, the company's successful management of operating costs and incremental revenue growth could hint at potential for long-term value creation. However, the lingering net losses call for a cautious approach, as the transition to profitability is yet to be realized.

Market Research Analyst

Arcadia's product expansion, particularly the GoodWheat line, including the launch on Amazon and the distinction of the Three Cheese Mac & Cheese as an 'Amazon's Choice: New Arrival Pick', signifies a strong brand recognition and consumer appeal. The expansion into more than 3,500 stores and increasing presence in online retail is indicative of an effective distribution strategy. The upcoming introduction of new flavors and an increase in distribution for Zola Coconut Water, which is projected to be a key revenue and gross profit driver in 2024, showcases Arcadia's commitment to innovation and market trends. This focus on product diversification and strategic marketing efforts may result in a stronger market position and brand loyalty, potentially leading to an increase in consumer base and sales volume. The company's strategic approach, if successful in capturing market share, could lead to material benefits for investors, evidenced by increased stockholder value. Yet, it's important for investors to monitor how these business moves translate into sustained financial performance and whether they can overcome the high costs associated with new distribution channels.

– Revenues increase sequentially and year-over-year –

– Loss from continuing operations is at lowest level in 6 years –

DALLAS--(BUSINESS WIRE)-- Arcadia Biosciences, Inc.^® (Nasdaq: RKDA), a producer and marketer of innovative, plant-based health and wellness products, today released its financial and business results for the first quarter of 2024.

“Arcadia continued its positive trajectory in the first quarter of 2024,” said Stan Jacot, president and CEO. “Revenue continues to grow, both sequentially and year-over-year, and we have transitioned the topline to high-quality revenue that generates gross profit across multiple sources. Operating expenses continued to decline at a double-digit pace versus last year, and this is now our fifth straight quarter of gross profit margins greater than 30 percent.

“Our GoodWheat™ is in more than 3,500 stores in three categories, and Zola^® coconut water is positioned for double-digit growth with new flavors and distribution. And finally, we remain focused on monetizing our IP and accelerating delivery of cashflow positive results,” he added.

Q1 2024 Key Operating and Business Highlights

• GoodWheat Continues Distribution Expansion. The GoodWheat brand continued to expand in Q1, adding a couple hundred stores of distribution for pancake and waffle mixes. GoodWheat Mac & Cheese launched nationwide on Amazon in Q1 2024 with three varieties: Classic Cheddar, White Cheddar and Three Cheese. And Amazon recently selected GoodWheat Three Cheese Mac & Cheese as an “Amazon’s Choice: New Arrival Pick” based on its high ratings, pricing and availability.
• Zola Coconut Water Increases Store Count. Zola added nearly 200 new stores in Q1 and will ship to approximately 1,300 new stores in Q2. Arcadia expects Zola to be a key driver in 2024 for both revenue and gross profit, with the upcoming launch of new Pineapple and Lime flavors and increasing distribution.

Arcadia Biosciences, Inc. Financial Snapshot (Unaudited) ($ in thousands)
	Three Months Ended March 31,
	2024		2023		Favorable / (Unfavorable)
					$		%
Total Revenues	1,255		1,232		23		2%
Total Operating Expenses	4,319		5,099		780		15%
Loss From Continuing Operations	(3,064)		(3,867)		803		21%
Net Loss Attributable to Common Stockholders	(2,423)		(9,384)		6,961		74%

Certain previously reported financial information has been reclassified to conform to the current year presentation. Reclassifications are related to the presentation of the financial results of our former body care brands as discontinued operations. The financial information above and narrative that follows relate to continuing operations unless stated otherwise.

More detailed financial statements are included in the Form 8-K filed today, available in the Investors section of the company’s website under SEC Filings.

Revenues

Revenues increased slightly during the first quarter of 2024 compared to the same period in 2023 driven by GoodWheat and Zola sales, partially offset by higher costs associated with new distribution.

Operating Expenses

Operating expenses decreased $780,000 during the first quarter of 2024 compared to the same period in 2023, primarily driven by a decrease in selling, general and administrative (SG&A) expenses related to rightsizing the organization and marketing investment.

Net Loss Attributable to Common Stockholders

Net loss attributable to common stockholders for the first quarter of 2024 was $2.4 million, or $1.78 per share, a $7.0 million improvement from the $9.4 million, or $10.86 per share, net loss for the first quarter of 2023. The improvement in net loss attributable to common stockholders for the first quarter of 2024 compared to the same period in 2023 was primarily driven by the valuation loss related to the March 2023 financing transaction.

Conference Call and Webcast

The company has scheduled a conference call for 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss first-quarter results and key strategic achievements. Interested participants can join the conference call using the following numbers:

U.S. Toll-Free Dial-In:				+1 (800) 715-9871
International Dial-In:				+1 (646) 307-1963
Passcode:				1615939

A live webcast of the conference call will be available on the Investors section of Arcadia’s website at www.arcadiabio.com. Following completion of the call, a recorded replay will be available on the company’s investor website.

About Arcadia Biosciences, Inc.

Since 2002, Arcadia Biosciences (Nasdaq: RKDA) has been innovating crops to provide high-value, healthy ingredients to meet consumer demands for healthier choices. With its roots in agricultural innovation, Arcadia cultivates next-generation wellness products that make every body feel good. The company’s food and beverage products include GoodWheat™ pasta, pancake mixes and mac & cheese and Zola^® coconut water. For more information, visit www.arcadiabio.com.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about the company and its products, including statements relating to the company’s growth, cash position, operating costs, financial performance, commercialization of products, monetization of intellectual property, and the growth, distribution, revenue and gross profit of the company’s Zola coconut water. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to, the risks set forth in filings that the company makes with the Securities and Exchange Commission from time to time, including in Arcadia’s Annual Report on Form 10-K for the year ended December 31, 2023 and other filings. These forward-looking statements speak only as of the date hereof, and Arcadia Biosciences, Inc. disclaims any obligation to update these forward-looking statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240509403135/en/

Arcadia Biosciences

T.J. Schaefer

ir@arcadiabio.com

Source: Arcadia Biosciences, Inc.

FAQ

What financial results did Arcadia Biosciences (RKDA) announce for the first quarter of 2024?

Arcadia Biosciences reported positive financial results for the first quarter of 2024, with revenue growth both sequentially and year-over-year.

What were the key highlights of Arcadia Biosciences' (RKDA) business performance in Q1 2024?

Key highlights include the expansion of the GoodWheat brand and Zola Coconut Water products in multiple stores, driving revenue and gross profit growth.

How did Arcadia Biosciences (RKDA) perform in terms of operating expenses in Q1 2024?

Arcadia Biosciences saw a decline in operating expenses at a double-digit pace versus the previous year in the first quarter of 2024.

What was the net loss attributable to common stockholders for Arcadia Biosciences (RKDA) in Q1 2024?

The net loss attributable to common stockholders for the first quarter of 2024 was $2.4 million, showing a significant improvement from the same period in 2023.

Where can interested participants find more detailed financial statements from Arcadia Biosciences (RKDA)?

Interested participants can find more detailed financial statements in the Form 8-K filed by the company, available in the Investors section of Arcadia's website under SEC Filings.