SCOTTSDALE, Arizona,
November 10, 2016 /PRNewswire/ --
RiceBran Technologies (NASDAQ: RIBT and RIBTW) (the
"Company" or "RBT"), a global leader in the production and
marketing of value added products derived from rice bran, today
announced its financial results for its fiscal third quarter ended
September 30, 2016.
Company Highlights
Additions to the Board of Directors. The
Company strengthened its board with the addition of Brent Rosenthal, Beth
Bronner, and Ari Gunderson.
The new board members bring significant food industry,
business management, and corporate governance experience to help
guide the Company's future growth.
Realignment of Executive Team. The Company's Board of
Directors elevated Dr. Robert Smith
to the position of Interim CEO. Dr. Smith has been with the Company
for over four years and has over 20 years experience managing
product and business opportunities in the agricultural, nutrition,
and nutraceutical industries for companies including Herbal
Sciences Group and Monsanto. He also served as Research Assistant
Professor at the AgBiotech Center at Rutgers
University. Additionally, the Company named Michael Goose to the newly created position of
President of Ingredient Sales and Marketing. Mr. Goose brings
to the Company over 13 years of consumer package goods experience
as a new product innovator for companies including the Hain
Celestial Group and Kosher Valley Poultry.
Capital Infusion into Irgovel Operations. In October 2016, the Company's minority partner in
its Irgovel operations in Brazil,
contributed $1.2 million in equity to
be used for working capital in the Brazil segment. Additionally, Irgovel's
management has negotiated various raw bran supply agreements that
will allow Irgovel to obtain rice bran on a consistent basis with
set pricing. As a result of these events, the Company
anticipates significant sequential quarterly improvement in
operating results from its Brazil
segment as Irgovel returns to more normalized operations in the
fourth quarter of 2016.
Implementation of Strategic Growth Plan. During the
quarter, management and the board conducted an extensive review of
the business resulting in the development of a new and focused
strategic plan intended to grow the Company and build shareholder
value. As part of that plan, the Company intends to relocate
its corporate offices and certain aspects of its business to a
centralized location in California
to better service its current and future customers.
Q3 Operating Results
Revenue
Consolidated revenues for Q3 2016 were $8.8 million compared to consolidated revenues of
$8.9 million in Q3 2015. USA segment revenue rose to $8.3 million in Q3 2016, an increase of 64%
compared to Q3 2015 revenues of $5.0
million. The increase in USA segment revenue was led
by a 75% increase in sales of human nutrition products and a 44%
increase in animal feed product sales. The USA segment's strong performance was offset by
an 86% year over year decline in Brazil segment revenue. Brazil segment
revenue totaled $563,000 in Q3 2016
due to the Irgovel facility operating in an economically feasible
manner due to insufficient working capital.
Gross Profit
Consolidated gross profit for Q3 2016 was $1.9 million compared to $2.1 million in Q3 2015 with consolidated gross
profit percentage declining by 1.5 percentage points to 22%.
USA segment gross profit increased by 90% to reach
$2.5 million compared to $1.3 million in Q3 2015. USA segment gross
profit percentage increased by 4 percentage points to 30% in Q3
2016 due to increased revenue coupled with a 6% decline in raw bran
prices. Consolidated gross profit and gross profit percentage were
negatively impacted by the Company's Brazil segment where a shortage of working
capital resulted in a severe decline in production volume leading
to a significant increase in negative gross profit.
Operating Expenses
Consolidated Q3 2016 operating expenses totaled $4.0 million compared to $3.4 million in Q3 2015. The rise in
operating expenses was attributable to a $700,000 increase in corporate selling, general
and administrative expenses partially offset by a $100,000 decrease in depreciation expense.
Adjusted EBITDA
Consolidated Adjusted EBITDA in Q3 2016 resulted in a loss of
$506,000 compared to an Adjusted
EBITDA loss of $269,000 recorded in
Q3 2015. USA and Corporate segment
Adjusted EBITDA in Q3 2016 was $325,000 compared to prior year Adjusted EBITDA
loss of $474,000. The Company's
Brazil segment recorded an
Adjusted EBITDA loss of $831,000 in
Q3 2016, compared to an Adjusted EBITDA gain of $205,000 in Q3 2015. Adjusted EBITDA is a
non-GAAP measure management believes provides important insight
into the Company's operating results (see reconciliation of
non-GAAP measures below).
Net Loss
For the third quarter of 2016 the Company recorded a net loss
attributable to shareholders of $1.0
million or a loss of $0.11 per
diluted share on 9.4 million weighted average shares outstanding.
This compares to a loss of $0.5
million or $0.06 per diluted
share on 9.2 million weighted average shares outstanding in the
third quarter of 2015.
"We continue to generate positive results from our USA segment where revenue and margins have
increased significantly on a year over year basis.
Additionally, with the new capital infusion and supply
agreements now in place in Brazil,
we anticipate seeing improving results from those operations in the
coming quarters," said Dr. Robert
Smith, Interim CEO of RiceBran Technologies. "As we
move through the remainder of 2016 and into 2017 we intend to begin
the implementation of a comprehensive strategic plan, formulated by
management and the board, designed improve efficiencies, expand our
market opportunities, and build lasting shareholder value.
This plan will include consolidating our corporate offices,
extrusion operations and warehousing to one location in
California, and gearing that new
location to meet the standards of the Food Safety Modernization
Act. This will enable us to service the needs of large CPG
customers seeking ingredients that are high in nutrition, gluten
free, non allergenic, and non-GMO. Our entire team is
dedicated to building our RiceBran Technologies into the leading
supplier of rice bran ingredients to the human and animal nutrition
markets. We look forward to working diligently to achieve
that goal in the coming quarters and years in order to increase the
value of our Company for the benefit of our stockholders."
Additional information can be found in the Company's Quarterly
Report on Form 10-Q filed with the United States Securities and
Exchange Commission on November 10,
2016.
The Company will hold a conference call to discuss its Q3 2016
results and business strategy on November
10, 2016 at 4:30 PM EDT.
Call-in information is as follows:
- Date: November 10, 2016
- Time: 4:30 p.m. Eastern Daylight
Time
- Direct Dial-in number for US/Canada: (201) 493-6780
- Toll Free Dial-in number for US/Canada: (877) 407-3982
- Dial-In number for international callers: (201) 493-6780
- Participants will ask for the RiceBran Technologies Third
Quarter 2016 Financial Results Call
This call is being webcast by ViaVid and can be accessed at
https://public.viavid.com/index.php?id=121930.
The call will also be available for replay by accessing
https://public.viavid.com/index.php?id=121930.
About RiceBran Technologies
RiceBran Technologies is a human food ingredient and animal
nutrition company focused on the procurement, bio-refining and
marketing of numerous products derived from rice bran. RiceBran
Technologies has proprietary and patented intellectual property
that allows us to convert rice bran, one of the world's most
underutilized food sources, into a number of highly nutritious
human food ingredient and animal nutrition products. Our
target markets are human food ingredients and animal nutrition
manufacturers and retailers, as well as natural food, functional
food and nutritional supplement manufacturers and retailers, both
domestically and internationally. More information can be found in
the Company's filings with the SEC and by visiting our website at
http://www.ricebrantech.com.,
Forward-Looking Statements
This release contains forward-looking statements, including, but
not limited to, statements about RiceBran Technologies'
expectations regarding the supply of rice bran, financial
performance, the implementation of strategic plans and future
growth. These statements are made based upon current expectations
that are subject to known and unknown risks and uncertainties.
RiceBran Technologies does not undertake to update
forward-looking statements in this news release to reflect actual
results, changes in assumptions or changes in other factors
affecting such forward-looking information. Assumptions and
other information that could cause results to differ from those set
forth in the forward-looking information can be found in this press
release and in RiceBran Technologies' filings with the
Securities and Exchange Commission, including its most recent
periodic reports.
USE OF NON-GAAP FINANCIAL
INFORMATION
We utilize "Adjusted EBITDA" as a supplemental measure in
our ongoing analysis of short term and long term cash requirement
and liquidity needs. Adjusted EBITDA does not represent cash flows
from operations as defined by generally accepted accounting
principles ("GAAP"), is not a measure derived in accordance with
GAAP and should not be considered as an alternative to net income
(the most comparable GAAP financial measure to EBITDA). Management
uses Adjusted EBITDA as an indicator of our current financial
performance. By eliminating the impact of all material non-cash
charges as well as items that do not regularly occur, we believe
that Adjusted EBITDA provides a more accurate and informative
indicator of our cash requirements.
The table below contains a reconciliation of net income (GAAP)
and Adjusted EBITDA (Non-GAAP) for the three months ended
September 30th 2016 and
2015 and the nine months ended September
30th 2016 and 2015. We do not provide a
reconciliation of forward-looking net income (GAAP) to Adjusted
EBITDA (non-GAAP). Due to the nature of certain reconciling
items, it is not possible to predict with any reliability what
future outcomes may be with regard to the expense or income that
may ultimately be recognized in future periods. Any
forward-looking Adjusted EBITDA information that we may provide
from time to time consistently excludes the same items from
projected net income that are excluded from actual net income in
the table below.
RiceBran Technologies
Adjusted EBITDA Reconciliation
For the three months ended September 30, 2016 (in thousands)
Corp. & USA Brazil Consolidated
Net loss $ (94) $ (1,456) $ (1,550)
Interest expense 353 393 746
Interest income - (84) (84)
Income tax benefit - - -
Depreciation & amortization 509 262 771
Unadjusted EBITDA $ 768 $ (885) $ (117)
Add Back Other Items:
Change in fair value of derivative
liabilities (1,166) - (1,166)
Foreign currency exchange, net - 27 27
Other income/expense (132) 19 (113)
Share-based compensation 155 8 163
Est. CEO Employment Agreement Settlement 700 - 700
Adjusted EBITDA $ 325 $ (831) $ (506)
RiceBran Technologies
Adjusted EBITDA Reconciliation
For the three months ended September 30,
2015 (in thousands)
Corp. & USA Brazil Consolidated
Net loss $ (995) $ (576) $ (1,571)
Interest expense 348 413 761
Interest income - (23) (23)
Income tax benefit (6) - (6)
Depreciation & amortization 621 231 852
Unadjusted EBITDA $ (32) $ 45 $ 13
Add Back Other Items:
Change in fair value of derivative
liabilities (654) - (654)
Foreign currency exchange, net - 93 93
Other income/expense - 53 53
Share-based compensation 212 14 226
Adjusted EBITDA $ (474) $ 205 $ (269)
Adjusted EBITDA Reconciliation
For the nine months ended September 30, 2016 (in thousands)
Corp. & USA Brazil Consolidated
Net loss $ (2,366) $ (7,438) $ (9,804)
Interest expense 1,486 1,092 2,578
Interest income - (94) (94)
Income tax benefit - - -
Depreciation & amortization 1,542 714 2,256
Unadjusted EBITDA $ 662 $ (5,726) $ (5,064)
Add Back Other Items:
Change in fair value of derivative
liabilities (314) - (314)
Gain on resolution of Irgovel
purchase litigation (1,598) - (1,598)
Loss on extinguishment of debt - - -
Foreign currency exchange, net - (111) (111)
Other income/expense (132) 159 27
Goodwill impairment - 3,024 3,024
Severance payments - 153 153
Proxy contest
expense 1,057 - 1,057
Share-based compensation 584 35 619
Est. CEO Employment Agreement
Settlement 700 - 700
Other 167 - 167
Adjusted EBITDA $ 1,126 $ (2,466) $ (1,340)
RiceBran Technologies
Adjusted EBITDA Reconciliation
For the nine months ended September 30,
2015 (in thousands)
Corp. & USA Brazil Consolidated
Net loss $ (4,564) $ (4,610) $ (9,174)
Interest expense 999 1,435 2,434
Interest income - (91) (91)
Income tax benefit (19) - (19)
Depreciation & amortization 1,880 1,316 3,196
Unadjusted EBITDA $ (1,704) $ (1,950) $ (3,654)
Add Back Other Items:
Change in fair value of derivative
liabilities (1,211) - (1,211)
Loss on extinguishment of debt 1,904 - 1,904
Foreign currency exchange, net - 281 281
Other income/expense (155) 202 47
Severance payments - 180 180
Share-based compensation 588 40 628
Adjusted EBITDA $ (578) $ (1,247) $ (1,825)
Investor Contact:
Ascendant Partners, LLC
Fred Sommer
+1(732)410-9810
fred@ascendantpartnersllc.com
SOURCE RiceBran Technologies