Beyond Meat, Inc. (NASDAQ: BYND) (“Beyond Meat” or “the Company”),
a leader in plant-based meat, today reported financial results for
its third quarter ended October 2, 2021.
Third Quarter 2021 Financial
Highlights1
- Net revenues were $106.4 million, an increase of 12.7%
year-over-year.
- Gross profit was $23.0 million, or gross margin of
21.6% of net revenues.
- Net loss was $54.8 million, or $0.87 per common share.
Net loss as a percentage of net revenues was -51.5%.
- Adjusted EBITDA was a loss
of $36.8 million, or -34.5% of net revenues.
Beyond Meat President and CEO Ethan Brown commented, "Our third
quarter results reflect variability as we saw a decline from record
net revenues just a quarter ago. Despite current disruptions, we
remain focused on rapidly advancing key building blocks of
long-term growth. Whether scaling products and infrastructure for
our strategic quick serve restaurant partners, bringing new product
to retail markets, or investing in innovation, commercialization,
and production capabilities here in the U.S., EU, and China, we
believe we are steadily executing against our vision of being
tomorrow’s global protein company."
Brown added, "Near-term market and operating conditions
notwithstanding, we remain committed to our long-term strategy. As
we continue to advance the field of plant-based meat through
innovation and bold investment in domestic and global operations,
the consumer is only being made more aware of the relevance and
urgency of our mission. And although we see continued uncertainty
for the balance of this year, we look to 2022 with enthusiasm as we
expect to bring to life, together with our strategic partners,
product and production capacity that we’ve been steadfastly
investing in throughout the pandemic."
_________________________1 This release includes references to
non-GAAP financial measures. Refer to “Non-GAAP Financial Measures”
later in this release for the definitions of the non-GAAP financial
measures presented and a reconciliation of these measures to their
closest comparable GAAP measures.
Third Quarter 2021
Net revenues increased 12.7% to $106.4 million in the third
quarter of 2021, compared to $94.4 million in the year-ago period.
Growth in net revenues was primarily due to increased sales to
international customers, which increased 142.5% compared to the
year-ago period, mainly reflecting expansion of overall
distribution, accelerated orders and, to a lesser extent, new
product introductions. The increase in international net revenues
was partially offset by decreased U.S. net revenues, which declined
13.9% compared to the year-ago period, primarily as a result of
lower overall demand, and operational challenges with severe
weather as a key driver, partially offset by sales from new product
introductions. In aggregate, net revenue per pound of $5.34 during
the third quarter of 2021 was roughly equivalent to the year-ago
period.
Net revenues by channel (unaudited):
|
|
Three Months Ended |
|
Change |
(in
thousands) |
|
October 2,2021 |
|
September 26,2020 |
|
Amount |
|
% |
U.S.: |
|
|
|
|
|
|
|
|
Retail |
|
$ |
52,361 |
|
|
$ |
62,057 |
|
|
$ |
(9,696 |
) |
|
(15.6 |
)% |
Foodservice |
|
15,139 |
|
|
16,325 |
|
|
(1,186 |
) |
|
(7.3 |
)% |
U.S. net revenues |
|
67,500 |
|
|
78,382 |
|
|
(10,882 |
) |
|
(13.9 |
)% |
International: |
|
|
|
|
|
|
|
|
Retail |
|
21,391 |
|
|
7,975 |
|
|
13,416 |
|
|
168.2 |
% |
Foodservice |
|
17,541 |
|
|
8,079 |
|
|
9,462 |
|
|
117.1 |
% |
International net
revenues |
|
38,932 |
|
|
16,054 |
|
|
22,878 |
|
|
142.5 |
% |
Net revenues |
|
$ |
106,432 |
|
|
$ |
94,436 |
|
|
$ |
11,996 |
|
|
12.7 |
% |
|
|
Nine Months Ended |
|
Change |
(in
thousands) |
|
October 2,2021 |
|
September 26,2020 |
|
Amount |
|
% |
U.S.: |
|
|
|
|
|
|
|
|
Retail |
|
$ |
193,382 |
|
|
$ |
202,019 |
|
|
$ |
(8,637 |
) |
|
(4.3 |
)% |
Foodservice |
|
55,842 |
|
|
45,442 |
|
|
10,400 |
|
|
22.9 |
% |
U.S. net revenues |
|
249,224 |
|
|
247,461 |
|
|
1,763 |
|
|
0.7 |
% |
International: |
|
|
|
|
|
|
|
|
Retail |
|
67,134 |
|
|
23,499 |
|
|
43,635 |
|
|
185.7 |
% |
Foodservice |
|
47,664 |
|
|
33,888 |
|
|
13,776 |
|
|
40.7 |
% |
International net revenues |
|
114,798 |
|
|
57,387 |
|
|
57,411 |
|
|
100.0 |
% |
Net revenues |
|
$ |
364,022 |
|
|
$ |
304,848 |
|
|
$ |
59,174 |
|
|
19.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit was $23.0 million, or gross margin of 21.6% of net
revenues, in the third quarter of 2021, compared to $25.5 million,
or gross margin of 27.0% of net revenues, in the year-ago period.
During the third quarter of 2020, gross profit included $1.8
million of expenses related to inventory write-offs and reserves
and product repacking costs attributable to COVID-19. Excluding
these costs, of which there were none in the third quarter of 2021,
Adjusted gross profit in the year-ago period was $27.3 million, or
Adjusted gross margin of 28.9% of net revenues. Compared to
Adjusted gross margin in the year-ago period, the decrease in gross
margin in the third quarter of 2021 was primarily due to increased
transportation costs, increased inventory write-offs, higher
warehousing costs, and increased depreciation and amortization
expense, partially offset by reduced co-manufacturer fees.
Loss from operations in the third quarter of
2021 was $54.0 million compared to $18.5 million in the year-ago
period. The increase in loss from operations was primarily driven
by growth in overall headcount levels mainly to support the
Company's operations, innovation and marketing capabilities,
increased investments in marketing activities, higher professional
services fees related to recently established consulting
agreements, higher restructuring expenses primarily reflecting
increased legal costs, increased production trial activities, and
higher outbound freight costs included in the Company's selling
expenses.
Net loss was $54.8 million in the third quarter of 2021 compared
to $19.3 million in the year-ago period. Net loss per common share
was $0.87 in the third quarter of 2021 compared to $0.31 in the
year-ago period. During the third quarter of 2020, net loss
included $1.8 million in expenses attributable to COVID-19,
specifically related to inventory write-offs and reserves and
product repacking costs. Excluding these costs, Adjusted net loss
was $17.5 million, or $0.28 per common share, in the third quarter
of 2020. There were no similar costs in the third quarter of
2021.
Adjusted EBITDA was a loss of $36.8 million, or -34.5% of net
revenues, in the third quarter of 2021 compared to an Adjusted
EBITDA loss of $4.3 million, or -4.5% of net revenues, in the
year-ago period.
Balance Sheet and Cash Flow Highlights
The Company’s cash and cash equivalents balance was $886.4
million and total outstanding debt was $1.1 billion as of October
2, 2021. Net cash used in operating activities was $191.0 million
for the nine months ended October 2, 2021, compared to $42.7
million for the year-ago period. Capital expenditures totaled
$104.3 million for the nine months ended October 2, 2021, compared
to $38.0 million for the year-ago period. The increase in capital
expenditures was primarily due to the Company’s continued
investments in production equipment and facilities related to
capacity expansion initiatives domestically and abroad.
Fourth Quarter 2021 Outlook
The Company's operating environment continues to be affected by
near-term uncertainty related to COVID-19 and its potential impact
including on demand levels, labor availability and supply chain
disruptions. Management's outlook assumes reasonable containment of
COVID-19 infection rates both in the U.S. and abroad, but the
Company acknowledges that its operating results could differ
meaningfully from the expectations set forth below if its
assumptions related to COVID-19 and the effects from COVID-19 do
not materialize. Based on management's best assessment of the
environment today, the Company is providing the following guidance
for the fourth quarter of 2021:
- Net revenues in the range of $85
million to $110 million.
Embedded in the fourth quarter guidance range above are
management's expectations of a moderation in sales growth across
all channels as a result of, among other things, the Company's
fourth quarter 2021 period containing 5 fewer shipping days
compared to the fourth quarter of 2020, impacts associated with
knock-on effects from operational challenges in the third quarter
of 2021, ongoing operator challenges related to labor issues as
well as general caution among customers based on COVID-19-related
uncertainty, and accelerated orders in the third quarter of 2021
that would otherwise have been expected to materialize in the
fourth quarter.
Conference Call and Webcast
The Company will host a conference call and webcast to discuss
these results with additional comments and details today at 5:00
p.m. Eastern, 2:00 p.m. Pacific. Investors interested in
participating in the live call can dial 201-389-0879. The
conference call webcast will be available live over the Internet
through the “Investors” section of the Company’s website at
www.beyondmeat.com and later archived.
About Beyond Meat
Beyond Meat, Inc. (NASDAQ: BYND) is one of the fastest growing
publicly-traded food companies in the United States, offering a
portfolio of revolutionary plant-based proteins made from simple
ingredients without GMOs, bioengineered ingredients, hormones,
antibiotics or cholesterol. Founded in 2009, Beyond Meat products
are designed to have the same taste and texture as animal-based
meat while being better for people and the planet. Beyond Meat’s
brand commitment, Eat What You Love™, represents a strong belief
that there is a better way to feed our future and that the positive
choices we all make, no matter how small, can have a great impact
on our personal health and the health of our planet. By shifting
from animal-based meat to plant-based protein, we can positively
impact four growing global issues: human health, climate change,
constraints on natural resources and animal welfare. As of
September 2021, Beyond Meat had products available at approximately
128,000 retail and foodservice outlets in over 85 countries
worldwide. Visit www.BeyondMeat.com and follow @BeyondMeat,
#BeyondBurger and #GoBeyond on Facebook, Instagram, Twitter and
TikTok.
Forward-Looking Statements
Certain statements in this release constitute “forward-looking
statements" within the meaning of the federal securities laws.
These statements are based on management's current opinions,
expectations, beliefs, plans, objectives, assumptions and
projections regarding financial performance, prospects, future
events and future results, including ongoing uncertainty related to
the COVID-19 pandemic, including the ultimate duration, magnitude
and effects of the pandemic and, in particular, the impact to the
foodservice channel, operations and supply chains, growth trends,
our international expansion plans, market share, new and existing
customers and expense trends, among other matters, and involve
known and unknown risks that are difficult to predict. In some
cases, you can identify forward-looking statements by the use of
words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,”
“anticipate,” “believe,” “estimate,” “predict,” “outlook,”
“potential,” “continue,” “likely,” “will,” “would” and variations
of these terms and similar expressions, or the negative of these
terms or similar expressions. These forward-looking statements are
only predictions, not historical fact, and involve certain risks
and uncertainties, as well as assumptions. Forward-looking
statements should not be read as a guarantee of future performance
or results, and will not necessarily be accurate indications of the
times at, or by which or whether, such performance or results will
be achieved. Actual results, levels of activity, performance,
achievements and events could differ materially from those stated,
anticipated or implied by such forward-looking statements. While
Beyond Meat believes that its assumptions are reasonable, it is
very difficult to predict the impact of known factors and, in
particular, the COVID-19 pandemic, and, of course, it is impossible
to anticipate all factors that could affect actual results. There
are many risks and uncertainties that could cause actual results to
differ materially from forward-looking statements made herein
including, but not limited to, the effects of global outbreaks of
pandemics or contagious diseases or fear of such outbreaks (such as
COVID-19), including on our ability to expand in new geographic
markets or the timing of such expansion efforts; a resurgence of
COVID-19 and the discovery and spread of COVID-19 variants, such as
the Delta variant, which could slow, halt or reverse the reopening
process, or result in the reinstatement of social distancing
measures, business closures, restrictions on operations,
quarantines and travel bans; the impact of labor and supply chain
disruptions; the impact of uncertainty as a result of doing
business in China; government or employer mandates requiring
certain behaviors from employees due to COVID-19, including
COVID-19 vaccine mandates, which could result in employee attrition
at the Company, suppliers and customers as well as difficulty
securing future labor needs; the impact of adverse and uncertain
economic and political conditions in the U.S. and international
markets; the volatility of capital markets and other macroeconomic
factors; our ability to effectively manage our growth; our ability
to identify and execute cost-down initiatives intended to achieve
price parity with animal protein; the success of operations
conducted by joint ventures; the effects of increased competition
from our market competitors and new market entrants; changes in the
retail landscape, including the timing and level of trade and
promotion discounts, our ability to grow market share and increase
household penetration, repeat buying rates and purchase frequency,
and our ability to maintain and increase sales velocity of our
products; the timing and success of distribution expansion and new
product introductions in increasing revenues and market share; the
timing and success of strategic partnership launches and limited
time offerings resulting in permanent menu items; our estimates of
the size of market opportunities; our ability to effectively expand
our manufacturing and production capacity; our ability to
accurately forecast demand for our products and manage our
inventory, including the impact of customer orders ahead of
holidays and shelf reset activities, and supply chain and labor
disruptions; our operational effectiveness and ability to fulfill
orders in full and on time; variations in product selling prices
and costs, and the mix of products sold; our ability to
successfully enter new geographic markets, manage our international
expansion and comply with any applicable laws and regulations,
including risks associated with doing business in foreign
countries, substantial investments in our manufacturing operations
in China and The Netherlands, and our ability to comply with the
U.S. Foreign Corrupt Practices Act or other anti-corruption laws;
the success of our marketing initiatives and the ability to grow
brand awareness, maintain, protect and enhance our brand, attract
and retain new customers and grow our market share; our ability to
attract, maintain and effectively expand our relationships with key
strategic foodservice partners; our ability to attract and retain
our suppliers, distributors, co-manufacturers and customers; our
ability to procure sufficient high-quality raw materials to
manufacture our products; the availability of pea and other protein
that meets our standards; our ability to diversify the protein
sources used for our products; our ability to differentiate and
continuously create innovative products, respond to competitive
innovation and achieve speed-to-market; our ability to successfully
execute our strategic initiatives; the volatility associated with
ingredient, packaging and other input costs; the impact of
inflation across the economy, including higher food, grocery,
transportation and fuel costs; real or perceived quality or health
issues with our products or other issues that adversely affect our
brand and reputation; our ability to accurately predict consumer
taste preferences, trends and demand and successfully innovate,
introduce and commercialize new products and improve existing
products, including in new geographic markets; significant
disruption in, or breach in security of our information technology
systems and resultant interruptions in service and any related
impact on our reputation; management and key personnel changes, the
attraction and retention of qualified employees and key personnel,
and our ability to maintain our company culture as we grow; the
effects of natural or man-made catastrophic or severe weather
events particularly involving our or any of our co-manufacturers’
manufacturing facilities or our suppliers’ facilities; the impact
of marketing campaigns aimed at generating negative publicity
regarding our products, brand and the plant-based industry
category; the effectiveness of our internal controls; our
significant indebtedness and ability to pay such indebtedness;
risks related to our debt, including limitations on our cash flow
from operations and our ability to satisfy our obligations under
the convertible senior notes; our ability to raise the funds
necessary to repurchase the convertible senior notes for cash,
under certain circumstances, or to pay any cash amounts due upon
conversion; provisions in the indenture governing the convertible
senior notes delaying or preventing an otherwise beneficial
takeover of us; any adverse impact on our reported financial
condition and results from the accounting methods for the
convertible senior notes; estimates of our expenses, future
revenues, capital expenditures, capital requirements and our needs
for additional financing; our ability to meet our obligations under
our campus headquarters lease, the timing of occupancy and
completion of the build-out of our space, cost overruns and the
impact of COVID-19 on our space demands; changes in laws and
government regulation affecting our business, including Food and
Drug Administration and Federal Trade Commission governmental
regulation, and state, local and foreign regulation; new or pending
legislation, or changes in laws, regulations or policies of
governmental agencies or regulators, both in the U.S. and abroad,
affecting plant-based meat, the labeling or naming of our products,
or our brand name or logo; the failure of acquisitions and other
investments to be efficiently integrated and produce the results we
anticipate; the financial condition of, and our relationships with
our suppliers, co-manufacturers, distributors, retailers and
foodservice customers, and their future decisions regarding their
relationships with us; the ability of our suppliers and
co-manufacturers to comply with food safety, environmental or other
laws and regulations; seasonality, including increased levels of
purchasing by customers ahead of holidays, customer shelf reset
activity and the timing of product restocking by our retail
customers; the sufficiency of our cash and cash equivalents to meet
our liquidity needs and service our indebtedness; economic
conditions and the impact on consumer spending; outcomes of legal
or administrative proceedings, or new legal or administrative
proceedings filed against us; our, our suppliers’ and our
co-manufacturers’ ability to protect our proprietary technology and
intellectual property adequately; the impact of tariffs and trade
wars; the impact of changes in tax laws; foreign exchange rate
fluctuations; and the risks discussed under the heading “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2020 and the Company’s Quarterly Report on Form
10-Q for the quarter ended July 3, 2021 filed with the SEC on
August 12, 2021, and the Company’s Quarterly Report on Form 10-Q
for the quarter ended October 2, 2021 to be filed with the SEC, as
well as other factors described from time to time in the Company's
filings with the SEC. All forward-looking statements attributable
to us or persons acting on our behalf are expressly qualified in
their entirety by the cautionary statements set forth above. Such
forward-looking statements are made only as of the date of this
release. Beyond Meat undertakes no obligation to publicly update or
revise any forward-looking statement because of new information,
future events, changes in assumptions or otherwise, except as
otherwise required by law. If we do update one or more
forward-looking statements, no inference should be made that we
will make additional updates with respect to those or other
forward-looking statements.
Non-GAAP Financial MeasuresThe Company refers
to certain financial measures that are not recognized under U.S.
generally accepted accounting principles (GAAP) in this press
release, including: Adjusted gross profit, Adjusted gross margin,
Adjusted net loss, Adjusted net loss per diluted common share,
Adjusted EBITDA and Adjusted EBITDA as a % of net revenues. See
“Non-GAAP Financial Measures” below for additional information and
reconciliations of such non-GAAP financial measures.
Availability of Information on Beyond Meat’s Website and
Social Media ChannelsInvestors and others should note that
Beyond Meat routinely announces material information to investors
and the marketplace using SEC filings, press releases, public
conference calls, webcasts and the Beyond Meat Investor Relations
website. We also intend to use certain social media channels as a
means of disclosing information about us and our products to
consumers, our customers, investors and the public (e.g.,
@BeyondMeat, #BeyondBurger and #GoBeyond on Facebook, Instagram and
Twitter, and @BeyondMeatOfficial on TikTok). The information posted
on social media channels is not incorporated by reference in this
press release or in any other report or document we file with the
SEC. While not all of the information that the Company posts to the
Beyond Meat Investor Relations website or to social media accounts
is of a material nature, some information could be deemed to be
material. Accordingly, the Company encourages investors, the media,
and others interested in Beyond Meat to review the information that
it shares at the “Investors” link located at the bottom of the
Company’s webpage at
https://investors.beyondmeat.com/investor-relations and to sign up
for and regularly follow the Company’s social media accounts. Users
may automatically receive email alerts and other information about
the Company when enrolling an email address by visiting "Request
Email Alerts" in the "Investors" section of Beyond Meat’s website
at https://investors.beyondmeat.com/investor-relations.
Contacts
Media:Shira
Zackai917-715-8522szackai@beyondmeat.com
Investors: Fitzhugh Taylor and Raphael
Grossbeyondmeat@icrinc.com
|
BEYOND MEAT, INC. AND
SUBSIDIARIESCondensed Consolidated Statements of
Operations(In thousands, except share and per
share data)(unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
October 2,2021 |
|
September 26,2020 |
|
October 2,2021 |
|
September 26,2020 |
Net revenues |
|
$ |
106,432 |
|
|
$ |
94,436 |
|
|
$ |
364,022 |
|
|
$ |
304,848 |
|
Cost of goods sold |
|
83,456 |
|
|
68,908 |
|
|
260,986 |
|
|
207,978 |
|
Gross profit |
|
22,976 |
|
|
25,528 |
|
|
103,036 |
|
|
96,870 |
|
Research and development
expenses |
|
14,862 |
|
|
8,278 |
|
|
44,610 |
|
|
20,488 |
|
Selling, general and
administrative expenses |
|
56,362 |
|
|
33,560 |
|
|
143,602 |
|
|
95,167 |
|
Restructuring expenses |
|
5,750 |
|
|
2,146 |
|
|
12,068 |
|
|
6,028 |
|
Total operating expenses |
|
76,974 |
|
|
43,984 |
|
|
200,280 |
|
|
121,683 |
|
Loss from operations |
|
(53,998 |
) |
|
(18,456 |
) |
|
(97,244 |
) |
|
(24,813 |
) |
Other (expense) income,
net |
|
|
|
|
|
|
|
|
Interest expense |
|
(1,005 |
) |
|
(689 |
) |
|
(2,656 |
) |
|
(1,963 |
) |
Other, net |
|
759 |
|
|
(85 |
) |
|
(631 |
) |
|
(829 |
) |
Total other expense, net |
|
(246 |
) |
|
(774 |
) |
|
(3,287 |
) |
|
(2,792 |
) |
Loss before taxes |
|
(54,244 |
) |
|
(19,230 |
) |
|
(100,531 |
) |
|
(27,605 |
) |
Income tax (benefit)
expense |
|
(23 |
) |
|
55 |
|
|
27 |
|
|
70 |
|
Equity in losses of
unconsolidated joint venture |
|
595 |
|
|
— |
|
|
1,176 |
|
|
— |
|
Net loss |
|
$ |
(54,816 |
) |
|
$ |
(19,285 |
) |
|
$ |
(101,734 |
) |
|
$ |
(27,675 |
) |
Net loss per share available
to common stockholders—basic and diluted |
|
$ |
(0.87 |
) |
|
$ |
(0.31 |
) |
|
$ |
(1.61 |
) |
|
$ |
(0.45 |
) |
Weighted average common shares
outstanding—basic and diluted |
|
63,280,122 |
|
|
62,487,152 |
|
|
63,111,703 |
|
|
62,114,399 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BEYOND MEAT, INC. AND SUBSIDIARIES |
Condensed Consolidated Balance Sheets |
(In thousands, except share and per share
data) |
(unaudited) |
|
October 2,2021 |
|
December 31,2020 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
886,442 |
|
|
$ |
159,127 |
|
Accounts receivable |
48,849 |
|
|
35,975 |
|
Inventory |
193,490 |
|
|
121,717 |
|
Prepaid expenses and other current assets |
24,341 |
|
|
15,407 |
|
Total current assets |
$ |
1,153,122 |
|
|
$ |
332,226 |
|
Property, plant, and
equipment, net |
197,290 |
|
|
115,299 |
|
Operating lease right-of-use
assets |
25,444 |
|
|
14,570 |
|
Prepaid lease costs,
non-current |
49,456 |
|
|
— |
|
Other non-current assets,
net |
7,062 |
|
|
5,911 |
|
Total assets |
$ |
1,432,374 |
|
|
$ |
468,006 |
|
Liabilities and Stockholders’
Equity: |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
45,387 |
|
|
$ |
53,071 |
|
Wages payable |
4,269 |
|
|
2,843 |
|
Accrued bonus |
1,400 |
|
|
57 |
|
Current portion of operating lease liabilities |
3,962 |
|
|
3,095 |
|
Short-term borrowings under revolving credit facility |
— |
|
|
25,000 |
|
Accrued expenses and other current liabilities |
19,091 |
|
|
4,830 |
|
Short-term finance lease liabilities |
183 |
|
|
71 |
|
Total current liabilities |
$ |
74,292 |
|
|
$ |
88,967 |
|
Long-term liabilities: |
|
|
|
Convertible senior notes, net |
$ |
1,128,690 |
|
|
$ |
— |
|
Operating lease liabilities, net of current portion |
21,799 |
|
|
11,793 |
|
Finance lease obligations and other long-term liabilities |
488 |
|
|
149 |
|
Total long-term liabilities |
$ |
1,150,977 |
|
|
$ |
11,942 |
|
|
Commitments and
Contingencies |
|
|
|
Stockholders’ equity: |
|
|
|
Preferred stock, par value
$0.0001 per share—500,000 shares authorized, none issued and
outstanding |
$ |
— |
|
|
$ |
— |
|
Common stock, par value
$0.0001 per share—500,000,000 shares authorized; 63,326,309 and
62,820,351 shares issued and outstanding at October 2, 2021 and
December 31, 2020, respectively |
6 |
|
|
6 |
|
Additional paid-in
capital |
503,690 |
|
|
560,210 |
|
Accumulated deficit |
(296,601 |
) |
|
(194,867 |
) |
Accumulated other
comprehensive income |
10 |
|
|
1,748 |
|
Total stockholders’ equity |
$ |
207,105 |
|
|
$ |
367,097 |
|
Total liabilities and stockholders’ equity |
$ |
1,432,374 |
|
|
$ |
468,006 |
|
|
|
|
|
|
BEYOND MEAT, INC. AND SUBSIDIARIES |
Condensed Consolidated Statements of Cash
Flows |
(In thousands) |
(unaudited) |
|
|
Nine Months Ended |
|
|
October 2,2021 |
|
September 26,2020 |
Cash flows from operating
activities: |
|
|
|
|
Net loss |
|
$ |
(101,734 |
) |
|
$ |
(27,675 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
Depreciation and amortization |
|
14,910 |
|
|
9,276 |
|
Non-cash lease expense |
|
2,351 |
|
|
1,573 |
|
Share-based compensation expense |
|
21,624 |
|
|
20,377 |
|
Loss on sale of fixed assets |
|
199 |
|
|
218 |
|
Amortization of debt issuance costs |
|
2,338 |
|
|
195 |
|
Loss on extinguishment of debt |
|
1,037 |
|
|
1,538 |
|
Equity in losses of unconsolidated joint venture |
|
1,176 |
|
|
— |
|
|
|
|
|
|
Net change in operating assets and
liabilities: |
|
|
|
|
Accounts receivable |
|
(13,495 |
) |
|
10,365 |
|
Inventories |
|
(73,557 |
) |
|
(50,263 |
) |
Prepaid expenses and other assets |
|
(13,249 |
) |
|
(9,444 |
) |
Accounts payable |
|
965 |
|
|
2,442 |
|
Accrued expenses and other current liabilities |
|
18,176 |
|
|
245 |
|
Prepaid lease costs, non-current |
|
(49,456 |
) |
|
— |
|
Operating lease liabilities |
|
(2,332 |
) |
|
(1,584 |
) |
Net cash used in operating activities |
|
$ |
(191,047 |
) |
|
$ |
(42,737 |
) |
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
Purchases of property, plant and equipment |
|
$ |
(104,301 |
) |
|
$ |
(38,048 |
) |
Purchases of property, plant and equipment held for sale |
|
— |
|
|
(2,288 |
) |
Proceeds from note receivable on assets previously held for
sale |
|
— |
|
|
599 |
|
Payment of security deposits |
|
(132 |
) |
|
(9 |
) |
Net cash used in investing activities |
|
$ |
(104,433 |
) |
|
$ |
(39,746 |
) |
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
Proceeds from issuance of convertible senior notes |
|
$ |
1,150,000 |
|
|
$ |
— |
|
Purchase of capped calls related to convertible senior notes |
|
(83,950 |
) |
|
— |
|
Proceeds from revolving credit facility |
|
— |
|
|
50,000 |
|
Debt issuance costs |
|
(23,605 |
) |
|
(1,224 |
) |
Debt extinguishment costs |
|
— |
|
|
(1,200 |
) |
Repayment of revolving credit facility |
|
(25,000 |
) |
|
— |
|
Repayment of revolving credit line |
|
— |
|
|
(6,000 |
) |
Repayment of term loan |
|
— |
|
|
(20,000 |
) |
Repayment of equipment loan |
|
— |
|
|
(5,000 |
) |
Principal payments under finance lease obligations |
|
(130 |
) |
|
(52 |
) |
Proceeds from exercise of stock options |
|
7,554 |
|
|
6,491 |
|
Payments of minimum withholding taxes on net share settlement of
equity awards |
|
(2,749 |
) |
|
(1,736 |
) |
Net cash provided by financing activities |
|
$ |
1,022,120 |
|
|
$ |
21,279 |
|
Net increase (decrease) in
cash and cash equivalents |
|
$ |
726,640 |
|
|
$ |
(61,204 |
) |
Effect of exchange rate
changes on cash |
|
675 |
|
|
(169 |
) |
Cash and cash equivalents at
the beginning of the period |
|
159,127 |
|
|
275,988 |
|
Cash and cash equivalents at
the end of the period |
|
$ |
886,442 |
|
|
$ |
214,615 |
|
|
Supplemental disclosures
of cash flow information: |
|
|
|
|
Cash paid during the period for: |
|
|
|
|
Interest |
|
$ |
323 |
|
|
$ |
2,114 |
|
Taxes |
|
$ |
24 |
|
|
$ |
15 |
|
Non-cash investing and financing activities: |
|
|
|
|
Non-cash additions to property, plant and equipment |
|
$ |
2,653 |
|
|
$ |
2,545 |
|
Non-cash additions to financing leases |
|
$ |
580 |
|
|
$ |
— |
|
Operating lease right-of-use assets obtained in exchange for lease
liabilities |
|
$ |
14,269 |
|
|
$ |
3,151 |
|
Reclassification of other current liability to additional paid-in
capital in connection with the share-settled obligation |
|
$ |
2,535 |
|
|
$ |
— |
|
Note receivable from sale of assets held for sale |
|
$ |
— |
|
|
$ |
4,558 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
Beyond Meat uses the non-GAAP financial measures set forth below
in assessing its operating performance and in its financial
communications. Management believes these non-GAAP financial
measures provide useful additional information to investors about
current trends in the Company's operations and are useful for
period-over-period comparisons of operations. In addition,
management uses these non-GAAP financial measures to assess
operating performance and for business planning purposes.
Management also believes these measures are widely used by
investors, securities analysts, rating agencies and other parties
in evaluating companies in our industry as a measure of our
operational performance. These non-GAAP financial measures should
not be considered in isolation or as a substitute for the
comparable GAAP measures. In addition, these non-GAAP financial
measures may not be computed in the same manner as similarly titled
measures used by other companies.
Adjusted gross profit and Adjusted gross
margin
Adjusted gross profit is defined as net revenues less cost of
goods sold adjusted to exclude, when applicable, costs attributable
to COVID-19 activities which are not considered to be part of the
Company’s normal business activities. Adjusted gross margin is
defined as Adjusted gross profit divided by net revenues.
Adjusted gross profit and Adjusted gross margin are presented to
provide additional perspective on underlying trends in the
Company’s gross profit and gross margin, which we believe is useful
supplemental information for investors to be able to gauge and
compare the Company’s current business performance from one period
to another.
Adjusted net loss and Adjusted net loss per diluted
common share
Adjusted net loss is defined as net loss adjusted to exclude,
when applicable, costs attributable to COVID-19, as well as other
special items, which are those items deemed not to be reflective of
the Company’s ongoing normal business activities.
Adjusted net loss per diluted common share is defined as
Adjusted net loss divided by the number of diluted common shares
outstanding.
We consider Adjusted net loss and Adjusted net loss per diluted
common share to be useful indicators of operating performance
because excluding special items allows for period-over-period
comparisons of our ongoing operations. Adjusted net loss per
diluted common share is a performance measure and should not be
used as a measure of liquidity.
Adjusted EBITDA and Adjusted EBITDA as a % of net
revenues
Adjusted EBITDA is defined as net loss adjusted to exclude, when
applicable, income tax (benefit) expense, interest expense,
depreciation and amortization expense, restructuring expenses,
share-based compensation expense, expenses attributable to
COVID-19, and Other, net, including interest income, loss on
extinguishment of debt and foreign currency transaction gains and
losses. Adjusted EBITDA as a % of net revenues is defined as
Adjusted EBITDA divided by net revenues.
Limitations related to the use of non-GAAP financial
measures
There are a number of limitations related to the use of Adjusted
gross profit, Adjusted gross margin, Adjusted net loss, Adjusted
net loss per diluted common share, Adjusted EBITDA and Adjusted
EBITDA as a % of net revenues rather than their most directly
comparable GAAP measures. Some of these limitations are:
- Adjusted gross profit and Adjusted
gross margin exclude costs associated with activities deemed to be
non-recurring or not part of the Company’s normal business
activities, which are subjective determinations made by management
and may not actualize as expected;
- Adjusted net loss and Adjusted net
loss per diluted common share exclude costs associated with
activities deemed to be non-recurring or not part of the Company’s
normal business activities, which are subjective determinations
made by management and may not actualize as expected;
- Adjusted EBITDA excludes
depreciation and amortization expense and, although these are
non-cash expenses, the assets being depreciated may have to be
replaced in the future increasing our cash requirements;
- Adjusted EBITDA does not reflect
interest expense, or the cash required to service our debt, which
reduces cash available to us;
- Adjusted EBITDA does not reflect
income tax payments that reduce cash available to us;
- Adjusted EBITDA does not reflect
restructuring expenses that reduce cash available to us;
- Adjusted EBITDA does not reflect
expenses attributable to COVID-19 that reduce cash available to
us;
- Adjusted EBITDA does not reflect
share-based compensation expense and therefore does not include all
of our compensation costs;
- Adjusted EBITDA does not reflect
Other, net, including interest income, loss on extinguishment of
debt and foreign currency transaction gains and losses, that may
increase or decrease cash available to us; and
- other companies, including companies in our industry, may
calculate Adjusted EBITDA differently, which reduces its usefulness
as a comparative measure.
The following tables present the reconciliation of Adjusted
gross profit and Adjusted gross margin to their most comparable
GAAP measures, gross profit and gross margin, respectively, as
reported (unaudited):
|
|
Three Months Ended |
|
Nine Months Ended |
(in
thousands) |
|
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Gross profit, as reported |
|
$ |
22,976 |
|
|
$ |
25,528 |
|
|
$ |
103,036 |
|
|
$ |
96,870 |
|
Repacking costs attributable
to COVID-19 |
|
— |
|
|
657 |
|
|
— |
|
|
6,572 |
|
Inventory write-offs and
reserves attributable to COVID-19 |
|
— |
|
|
1,104 |
|
|
— |
|
|
1,104 |
|
Adjusted gross profit |
|
$ |
22,976 |
|
|
$ |
27,289 |
|
|
$ |
103,036 |
|
|
$ |
104,546 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Gross margin, as reported |
|
21.6 |
% |
|
27.0 |
% |
|
28.3 |
% |
|
31.8 |
% |
Repacking costs attributable
to COVID-19, as a percentage of net revenues |
|
— |
% |
|
0.7 |
% |
|
— |
% |
|
2.2 |
% |
Inventory write-offs and
reserves attributable to COVID-19, as a percentage of net
revenues |
|
— |
% |
|
1.2 |
% |
|
— |
% |
|
0.4 |
% |
Adjusted gross margin |
|
21.6 |
% |
|
28.9 |
% |
|
28.3 |
% |
|
34.4 |
% |
|
|
|
|
|
|
|
|
|
The following tables present the reconciliation of Adjusted net
loss and Adjusted net loss per diluted common share to their most
comparable GAAP measures, net loss and net loss per share available
to common stockholders—basic and diluted, respectively, as reported
(unaudited):
|
Three Months Ended |
|
Nine Months Ended |
(in
thousands) |
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Net loss, as reported |
$ |
(54,816 |
) |
|
$ |
(19,285 |
) |
|
$ |
(101,734 |
) |
|
$ |
(27,675 |
) |
Repacking costs attributable
to COVID-19 |
— |
|
|
657 |
|
|
— |
|
|
6,572 |
|
Inventory write-offs and
reserves attributable to COVID-19 |
— |
|
|
1,104 |
|
|
— |
|
|
1,104 |
|
Product donations attributable
to COVID-19 relief efforts |
— |
|
|
— |
|
|
— |
|
|
2,742 |
|
Loss on extinguishment of
debt |
— |
|
|
— |
|
|
1,037 |
|
|
1,538 |
|
Adjusted net loss |
$ |
(54,816 |
) |
|
$ |
(17,524 |
) |
|
$ |
(100,697 |
) |
|
$ |
(15,719 |
) |
|
Three Months Ended |
|
Nine Months Ended |
(in thousands, except
share and per share amounts) |
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Numerator: |
|
|
|
|
|
|
|
Net loss, as reported |
$ |
(54,816 |
) |
|
$ |
(19,285 |
) |
|
$ |
(101,734 |
) |
|
$ |
(27,675 |
) |
Aggregate non-GAAP adjustments
as listed above |
— |
|
|
1,761 |
|
|
1,037 |
|
|
11,956 |
|
Adjusted net loss used in
computing Adjusted net loss per diluted common share |
$ |
(54,816 |
) |
|
$ |
(17,524 |
) |
|
$ |
(100,697 |
) |
|
$ |
(15,719 |
) |
|
|
|
|
|
|
|
|
Denominator: |
|
|
|
|
|
|
|
Weighted average shares used
in computing Adjusted net loss per diluted common share |
63,280,122 |
|
|
62,487,152 |
|
|
63,111,703 |
|
|
62,114,399 |
|
Adjusted net loss per diluted
common share |
$ |
(0.87 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.60 |
) |
|
$ |
(0.25 |
) |
|
Three Months Ended |
|
Nine Months Ended |
|
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Net loss per share available to common stockholders—basic and
diluted, as reported |
$ |
(0.87 |
) |
|
$ |
(0.31 |
) |
|
$ |
(1.61 |
) |
|
$ |
(0.45 |
) |
Repacking costs attributable
to COVID-19 |
— |
|
|
0.01 |
|
|
— |
|
|
0.12 |
|
Inventory write-offs and
reserves attributable to COVID-19 |
— |
|
|
0.02 |
|
|
— |
|
|
0.02 |
|
Product donations attributable
to COVID-19 relief efforts |
— |
|
|
— |
|
|
— |
|
|
0.04 |
|
Loss on extinguishment of
debt |
— |
|
|
— |
|
|
0.01 |
|
|
0.02 |
|
Adjusted net loss per diluted
common share |
$ |
(0.87 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.60 |
) |
|
$ |
(0.25 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents the reconciliation of Adjusted
EBITDA to its most comparable GAAP measure, net loss, as reported
(unaudited):
|
|
Three Months Ended |
|
Nine Months Ended |
(in
thousands) |
|
October 2, 2021 |
|
September 26, 2020 |
|
October 2, 2021 |
|
September 26, 2020 |
Net loss, as reported |
|
$ |
(54,816 |
) |
|
$ |
(19,285 |
) |
|
$ |
(101,734 |
) |
|
$ |
(27,675 |
) |
Income tax (benefit)
expense |
|
(23 |
) |
|
55 |
|
|
27 |
|
|
70 |
|
Interest expense |
|
1,005 |
|
|
689 |
|
|
2,656 |
|
|
1,963 |
|
Depreciation and amortization
expense |
|
5,703 |
|
|
3,421 |
|
|
14,910 |
|
|
9,276 |
|
Restructuring expenses(1) |
|
5,750 |
|
|
2,146 |
|
|
12,068 |
|
|
6,028 |
|
Share-based compensation
expense |
|
6,385 |
|
|
6,842 |
|
|
21,624 |
|
|
20,377 |
|
Expenses attributable to
COVID-19(2) |
|
— |
|
|
1,761 |
|
|
— |
|
|
10,418 |
|
Other, net(3) |
|
(759 |
) |
|
85 |
|
|
631 |
|
|
829 |
|
Adjusted EBITDA |
|
$ |
(36,755 |
) |
|
$ |
(4,286 |
) |
|
$ |
(49,818 |
) |
|
$ |
21,286 |
|
Net loss as a % of net
revenues |
|
(51.5 |
)% |
|
(20.4 |
)% |
|
(27.9 |
)% |
|
(9.1 |
)% |
Adjusted EBITDA as a % of net
revenues |
|
(34.5 |
)% |
|
(4.5 |
)% |
|
(13.7 |
)% |
|
7.0 |
% |
____________
(1) |
|
Primarily comprised of legal and
other expenses associated with the dispute with a co-manufacturer
with whom an exclusive supply agreement was terminated in May
2017. |
(2) |
|
Comprised of $1.8 million in
costs attributable to COVID-19, consisting of $1.1 million in
inventory write-offs and reserves associated with foodservice
products determined to be unsalable and $0.7 million in repacking
costs in the three months ended September 26, 2020, and $10.4
million in costs attributable to COVID-19 consisting of $1.1
million in inventory write-offs and reserves associated with
foodservice products determined to be unsalable, $6.6 million in
repacking costs and $2.7 million in product donation costs related
to our COVID-19 relief efforts in the nine months ended September
26, 2020. |
(3) |
|
Includes $1.0 million in loss on
extinguishment of debt associated with termination of the Company's
credit facility in the nine months ended October 2, 2021 and $1.5
million in loss on extinguishment of debt associated with the
Company's refinanced credit arrangements in the nine months ended
September 26, 2020. |
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