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Sow Good Inc.(SOWG) - 2024 Q1 - Quarterly Results
SOWGSow Good Inc.(SOWG)2024-05-15 12:35

Revenue and Growth - Q1 2024 revenue increased 20% sequentially to 11.4million,comparedtoapproximately11.4 million, compared to approximately 198.9K in Q1 2023, driven by the pivot to freeze dried candy and expanded production capacity[2][4] - Total revenues for the three months ended March 31, 2024, were 11,406,320,comparedto11,406,320, compared to 198,930 for the same period in 2023, representing a significant increase[29] - The company anticipates continued growth in production infrastructure and retail presence, aiming to maintain leadership in the freeze dried candy category[13] Profitability - Gross profit for Q1 2024 was 4.6million,withagrossmarginof40.64.6 million, with a gross margin of 40.6%, down from 57.8% in the prior-year period due to higher labor and production costs[5] - Gross profit for the three months ended March 31, 2024, was 4,629,438, compared to 114,927forthesameperiodin2023,indicatingasubstantialimprovement[29]−NetincomeforQ12024wasapproximately114,927 for the same period in 2023, indicating a substantial improvement[29] - Net income for Q1 2024 was approximately 510.6K, a significant improvement from a net loss of (1.4)millioninQ12023[7]−NetincomeforthethreemonthsendedMarch31,2024,was(1.4) million in Q1 2023[7] - Net income for the three months ended March 31, 2024, was 510,588, a turnaround from a net loss of 1,401,530inthesameperiodof2023[31]−AdjustedEBITDAforQ12024improvedto1,401,530 in the same period of 2023[31] - Adjusted EBITDA for Q1 2024 improved to 2.45 million, compared to approximately 171.3KinQ12023[7]−AdjustedEBITDAforQ12024reached171.3K in Q1 2023[7] - Adjusted EBITDA for Q1 2024 reached 2,451,668, compared to 171,295inQ12023,indicatingstrongoperationalperformance[35]ExpensesandCosts−OperatingexpensesinQ12024were171,295 in Q1 2023, indicating strong operational performance[35] Expenses and Costs - Operating expenses in Q1 2024 were 3.7 million, up from 1.0millioninQ12023,primarilyduetoincreasedcompensationandprofessionalservicesexpenses[6]−GeneralandadministrativeexpensesforthethreemonthsendedMarch31,2024,were1.0 million in Q1 2023, primarily due to increased compensation and professional services expenses[6] - General and administrative expenses for the three months ended March 31, 2024, were 3,690,643, compared to 941,903forthesameperiodin2023,reflectingincreasedoperationalcosts[30]−Stock−basedcompensationexpenseforQ12024was941,903 for the same period in 2023, reflecting increased operational costs[30] - Stock-based compensation expense for Q1 2024 was 1,371,735, up from 999,257inQ12023,indicatingincreasedemployeecompensationcosts[35]ProductionandCapacity−Productioncapacityreached4.5millionunitsinQ12024,exceedingtheinitialprojectionof4.25millionunits,withatargetofupto30millionunitsforthefullyear[3]−ThecompanyplanstoaddfivenewSKUsandexpanditsretailpresencetonearly2,000Targetstoresand300BigLotsstoresthissummer[4]CashFlowandFinancialPosition−Cashandcashequivalentsincreasedto999,257 in Q1 2023, indicating increased employee compensation costs[35] Production and Capacity - Production capacity reached 4.5 million units in Q1 2024, exceeding the initial projection of 4.25 million units, with a target of up to 30 million units for the full year[3] - The company plans to add five new SKUs and expand its retail presence to nearly 2,000 Target stores and 300 Big Lots stores this summer[4] Cash Flow and Financial Position - Cash and cash equivalents increased to 6.8 million at March 31, 2024, up from 2.4millionatDecember31,2023,followinga2.4 million at December 31, 2023, following a 3.7 million equity private placement[8] - Total assets increased to 27,903,372asofMarch31,2024,upfrom27,903,372 as of March 31, 2024, up from 21,488,558 as of December 31, 2023[28] - Total liabilities rose to 15,002,569asofMarch31,2024,comparedto15,002,569 as of March 31, 2024, compared to 14,208,109 as of December 31, 2023[27] - Total stockholders' equity increased to 12,900,803asofMarch31,2024,from12,900,803 as of March 31, 2024, from 7,280,449 as of December 31, 2023[28] - Net cash provided by operating activities was 1,297,651,aturnaroundfromnetcashusedof1,297,651, a turnaround from net cash used of 966,117 in the previous year[34] - Total cash and cash equivalents at the end of the period increased to 6,815,355,upfrom6,815,355, up from 348,441 at the end of Q1 2023[34] - Proceeds from the issuance of common stock amounted to 3,737,999,contributingtothepositivecashflowfromfinancingactivities[34]MarketActivity−ThecompanysuccessfullyuplistedtoNasdaqonMay2,2024,andcompletedapublicofferingraisingapproximately3,737,999, contributing to the positive cash flow from financing activities[34] Market Activity - The company successfully uplisted to Nasdaq on May 2, 2024, and completed a public offering raising approximately 13.8 million in gross proceeds[12][11] Inventory and Accounts Payable - Inventory decreased significantly by 1,256,833,reflectingimprovedinventorymanagement[34]−Thecompanyreportedasignificantincreaseinaccountspayableby1,256,833, reflecting improved inventory management[34] - The company reported a significant increase in accounts payable by 40,476, contrasting with a decrease of $163,065 in the previous year[34]