[ad_1]
Beyond Meat posted better-than-expected earnings for the first quarter on Tuesday, but warned it saw a drop in sales in late March as the coronavirus pandemic closed restaurants across the country.
Given the uncertainty regarding restaurant sales, the company withdrew its profit forecast for the year.
“I am proud of our first quarter financial results, which exceeded our expectations despite an increasingly challenging operating environment due to the Covid-19 health crisis,” CEO Ethan Brown said in a statement.
The company’s shares rose about 5% in off-hours trading.
The company reported net income of $ 1.8 million, or 3 cents a share, compared to a net loss of $ 6.6 million, or 95 cents a share, a year ago.
Revenue soared 141% to $ 97.1 million, from a year ago, and exceeded analyst expectations of $ 88.3 million, according to a Refinitiv survey.
The company said its adjusted earnings before interest, taxes, depreciation and amortization were $ 12.7 million. A year ago, the company recorded an adjusted EBITDA loss of $ 2.1 million.
Beyond Meat said it hopes to continue to benefit from consumers eating at home, but “the magnitude and duration of the impact on the food service channel, in particular,” has prompted it to withdraw its 2020 forecast.
Sales to restaurants and food outlets accounted for about 42% of Beyond’s revenue in the quarter. That’s a 59% drop in total revenue in the previous quarter.
Sales on your US food service channel. USA They increased 156% to $ 22.6 million in the first quarter, while sales grew 57% to $ 18.6 million in the international food service business.
The company has taken steps to guarantee its liquidity as it prepares to resist any business interruption due to Covid-19. As of March 28, the company had about $ 246.4 million in cash, he said, and outstanding debt of about $ 30.6 million. On April 22, the company announced that it entered a new $ 150 million revolving line of credit.
“We maintained our strong front-line momentum while driving our best performance in unit cost of production per pound,” Chief Financial Officer Mark Nelson said. “Despite the near-term challenges ahead due to the current global health crisis, our improvement in operating results and the continued strength of our balance sheet give us greater confidence in the Company’s long-term financial position. “
Ahead of earnings, Beyond Meat announced plans on Tuesday to capitalize on potential meat supply chain problems as some US meat plants. USA They become sites for outbreaks of coronavirus. Beyond told Reuters that it plans to offer great value packages and discounts to some US retailers. USA This summer, hoping for a bigger market share as beef prices rise due to Covid-19 related production disruptions.
Tyson Foods’ shares were affected Monday after it reported production disruptions due to earnings affected by the coronavirus.
Tyson executives said the US pig processing capacity. USA It has been cut almost in half as the coronavirus closes slaughterhouses, putting pressure on profits. Pork accounts for about 12% of Tyson’s sales. Like Tyson, JBS and Smithfield have also temporarily closed plants as the outbreaks overwhelm their workforce.
Beyond said it will seek to fill any gaps in supermarket supply chains with its higher-than-normal value packages and discounts aimed at narrowing the price gap between Beyond’s burgers and beef, which analysts say could be a obstacle to widespread adoption of Beyond burgers.
Beyond that, it will face competition as it seeks to capitalize on the opportunity.
Early Tuesday, plant-based meat competitor Impossible Foods announced plans to start selling its burgers at the Kroger supermarket chain. Kroger, which also operates Fred Meyer, King Soopers, Ralphs and other stores, will sell the vegan burgers online for sidewalk pickup and delivery as well, starting Tuesday.
Impossible Foods said the Kroger launch represents an 18-fold increase in the company’s retail footprint this year. It hopes to expand its retail presence 50 times this year, he said.
Prices for beef sent to wholesale buyers have risen to record levels as coronavirus slows production, even as restaurants in some states seek to reopen.
Beyond’s plant-based meat has typically sold for much more than beef. During the first quarter, Beyond’s ground beef and beef patty alternatives were priced at around double and triple the price per pound of traditional ground beef, according to Wells Fargo.
