Edible Garden AG rporated(US:EDBL)2024-08-14 19:51Financial Performance - Total revenue for the second quarter of 2024 was $4.268 million, a slight increase from $4.221 million in the same quarter of 2023, representing a growth of 1.1%[6] - Gross profit for the second quarter of 2024 was $1.566 million, compared to $553 thousand in the same quarter of 2023, indicating a significant increase of 184%[6] - The company reported a net loss of $1.932 million for the second quarter of 2024, compared to a net loss of $638 thousand in the same quarter of 2023, reflecting a deterioration in performance[6] - The net loss for the six months ended June 30, 2024, was $5,909,000, compared to a net loss of $3,517,000 for the same period in 2023, indicating a worsening financial performance[10] - For the six months ended June 30, 2024, total revenue was $7,401,000, compared to $6,676,000 for the same period in 2023, representing an increase of approximately 10.9%[30] - Net loss for Q2 2024 was $1.932 million, compared to a net loss of $638 thousand in Q2 2023, influenced by a prior one-time income of $1.233 million related to the employee retention credit[106] - Net loss for the first half of 2024 was $5.909 million, compared to a net loss of $3.517 million in the same period of 2023[114] Assets and Liabilities - Total current assets increased to $6.305 million as of June 30, 2024, up from $2.647 million at the end of 2023, marking an increase of 137%[4] - Cash reserves rose to $2.188 million as of June 30, 2024, compared to $510 thousand at the end of 2023, showing a substantial increase of 328%[4] - Total liabilities increased to $9.372 million as of June 30, 2024, compared to $6.944 million at the end of 2023, representing a rise of 35%[5] - The company reported a working capital deficit of $2.315 million as of June 30, 2024, up from $257 thousand as of December 31, 2023[119] - As of June 30, 2024, total gross debt outstanding was $5.735 million, an increase from $4.445 million as of December 31, 2023[119] Cash Flow and Financing - The company reported a cash flow used in operating activities of $(5,649,000) for the six months ended June 30, 2024, compared to $(5,568,000) for the same period in 2023[10] - The company raised $5,498,000 from a public offering of common stock and warrants during the six months ended June 30, 2024[8] - The company raised approximately $5.998 million in gross proceeds from a public offering and $1.1 million from an at-the-market offering[119] - The company has raised a total of $1,544,250 in net funds through the sale of trade receivables to Cedar Advance LLC[87] - The Company entered into a future receivables financing agreement with Cedar Advance, LLC, selling $1,491,000 of future accounts receivable for a net amount of $1,000,000[50] Stock and Shareholder Information - The company had 3,160,392 shares of common stock outstanding as of August 10, 2024[2] - The weighted-average number of common shares outstanding for the second quarter of 2024 was 1,591,355, compared to 132,074 in the same quarter of 2023[6] - As of June 30, 2024, total common shares increased to 3,160,392 from 141,354 as of June 30, 2023, reflecting significant stock issuance activities[7] - The Company issued 72,898 shares to round up due to a stock split, reflecting adjustments in share structure[9] - The Company has outstanding warrants totaling 5,666,095 as of June 30, 2024, with a weighted average exercise price of $5.68 per share[68] Operational Expenses - Selling, general, and administrative expenses for the second quarter of 2024 were $2.748 million, up from $2.380 million in the same quarter of 2023, an increase of 15.4%[6] - Selling, general and administrative expenses for the first half of 2024 increased by $1.561 million, or 30.78%, to $6.632 million, due to a severance charge and higher audit fees[110] - Advertising expenses increased to $73,584 for the six months ended June 30, 2024, compared to $29,152 for the same period in 2023, reflecting a growth of approximately 152%[35] Inventory and Cost of Goods Sold - Cost of goods sold decreased by $966 thousand, or 26.3%, to $2.7 million in Q2 2024, primarily due to the elimination of large third-party growers[102] - Total inventory as of June 30, 2024, was $891,000, up from $678,000 as of December 31, 2023, representing an increase of approximately 31.4%[41] - Cost of goods sold for the first half of 2024 decreased by $337 thousand, or 5.48%, to $5.811 million, due to a shift away from third-party growers[110] Compliance and Regulatory Issues - The company is currently not in compliance with Nasdaq's continued listing requirements, with stockholders' equity at $366 thousand as of June 30, 2024, below the required minimum of $2.5 million[130] - The company received notices of noncompliance from Nasdaq regarding stockholders' equity and publicly held shares requirements[88] Future Outlook and Strategic Initiatives - Edible Garden plans to seek additional funding through debt or equity financing to improve liquidity and meet future financial obligations[17] - The company is evaluating options to raise additional funds and reduce cash requirements to achieve positive cash flow[76] - The company is focused on expanding its market presence through strategic partnerships and financing agreements[136] - The company is actively pursuing new product development and technological advancements to drive future growth[136] - The company is exploring potential mergers and acquisitions to enhance its competitive position in the market[136]