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Nov 29, 2020
Lifecore Biomedical Q2 2021 Earnings Report
Reported second quarter and first half fiscal year 2021 results and reiterated fiscal 2021 guidance.
Key Takeaways
Landec Corporation reported a decrease in revenues but an increase in gross profit for the second quarter of fiscal year 2021. The company's net loss increased due to restructuring charges and a change in the fair market value of its Windset investment. However, adjusted EBITDA significantly improved, driven by both the Curation Foods and Lifecore segments.
Revenues decreased by 8.2% year-over-year to $130.9 million.
Gross profit increased by 33.0% year-over-year to $20.6 million.
Net loss was $13.3 million, including restructuring charges and a Windset fair market value adjustment.
Adjusted EBITDA increased to $8.7 million, compared to $0.9 million in the prior year period.
Lifecore Biomedical
Lifecore Biomedical
Forward Guidance
Landec Corporation is reiterating its full year fiscal 2021 guidance, excluding restructuring and other nonrecurring charges, tax implications and any potential impact from the ongoing COVID-19 pandemic.
Positive Outlook
- Consolidated Revenues: range of $530 million to $550 million (-10% to -7%)
- Lifecore: range of $93 million to $97 million (+8% to +13%)
- Curation Foods: range of $437 million to $453 million (-13% to -10%)
- Consolidated Adjusted EBITDA: range of $33 million to $37 million (+50% to +68%)
- Lifecore Adjusted EBITDA: range of $22.5 million to $24.5 million (+12% to +22%)
Challenges Ahead
- Curation Foods Adjusted EBITDA: range of $12 million to $14 million (+181% to +238%)
- The Company anticipates that fiscal third quarter revenue will be greater than the fiscal fourth quarter revenue for both operating segments due to variations in seasonality.
- The Company believes that Curation Foods will continue to generate consistent sequential quarterly improvement in its gross profit margin as the business builds towards its steady-state gross profit margin target of 11% to 14% by fiscal year-end 2021.
- The Company believes that Lifecore has reverted to its pre-COVID gross margin levels and is managing the business to its annualized target of approximately 40%.
- Taking into account its fiscal first quarter COVID-related margin impact, the Company expects Lifecore to achieve full year fiscal 2021 gross margin of approximately 38%.