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Sow Good Inc.(SOWG) - 2024 Q2 - Quarterly Results
SOWGSow Good Inc.(SOWG)2024-08-14 21:12

Financial Performance - Q2 2024 revenue increased 37% sequentially to 15.6million,comparedto15.6 million, compared to 1.3 million in Q2 2023, driven by the pivot to freeze-dried candy and expanded production capacity [4]. - Gross profit for Q2 2024 was 9.0million,withagrossmarginof57.69.0 million, with a gross margin of 57.6%, up from (1.6) million and 40.6% in Q2 2023 and Q1 2024 respectively [5]. - Net income in Q2 2024 was 3.3million,or3.3 million, or 0.29 per diluted share, compared to a net loss of (3.3)million,or(3.3) million, or (0.68) per diluted share, in Q2 2023 [7]. - Adjusted EBITDA improved to 6.2millioninQ22024,comparedto6.2 million in Q2 2024, compared to (2.1) million in Q2 2023 [8]. - Revenues for the three months ended June 30, 2024, reached 15,648,046,asignificantincreasefrom15,648,046, a significant increase from 1,315,346 in the same period of 2023, representing a growth of approximately 1,087% [24]. - Gross profit for the three months ended June 30, 2024, was 9,007,129,comparedtoagrosslossof9,007,129, compared to a gross loss of (1,580,913) in the same period of 2023, indicating a turnaround in profitability [24]. - Net income for the three months ended June 30, 2024, was 3,335,142,asignificantrecoveryfromanetlossof3,335,142, a significant recovery from a net loss of (3,320,900) in the same period of 2023 [25]. - The company reported a net operating income of 4,885,096forthethreemonthsendedJune30,2024,comparedtoanetoperatinglossof4,885,096 for the three months ended June 30, 2024, compared to a net operating loss of (2,473,391) in the same period of 2023 [25]. - Net income for the six months ended June 30, 2024, was 3,845,730,comparedtoanetlossof3,845,730, compared to a net loss of 4,722,430 for the same period in 2023, representing a significant turnaround [30]. - The company reported an EBITDA of 5,484,635forthesixmonthsendedJune30,2024,comparedtoanegativeEBITDAof5,484,635 for the six months ended June 30, 2024, compared to a negative EBITDA of (3,221,169) for the same period in 2023, reflecting improved operational performance [32]. - Adjusted EBITDA for the six months ended June 30, 2024, was 8,684,660,comparedtoanegativeadjustedEBITDAof8,684,660, compared to a negative adjusted EBITDA of (2,837,263) for the same period in 2023, indicating enhanced profitability [32]. Cash and Equity Position - Cash and cash equivalents increased to 14.4millionasofJune30,2024,upfrom14.4 million as of June 30, 2024, up from 2.4 million at December 31, 2023, following a public offering that generated 12.8millioninnetproceeds[9].−Totalstockholders′equityincreasedto12.8 million in net proceeds [9]. - Total stockholders' equity increased to 35,015,646 as of June 30, 2024, up from 7,280,449asofDecember31,2023,reflectingasubstantialimprovementinthecompany′sfinancialposition[23].−Totalstockholders′equityincreasedto7,280,449 as of December 31, 2023, reflecting a substantial improvement in the company's financial position [23]. - Total stockholders' equity increased to 35,015,646 as of June 30, 2024, up from 794,841asofJune30,2023,indicatingstrongfinancialgrowth[29].−Cashandcashequivalentsattheendoftheperiodwere794,841 as of June 30, 2023, indicating strong financial growth [29]. - Cash and cash equivalents at the end of the period were 14,373,035, a substantial increase from 293,024attheendofJune2023[31].−Thecompanyraised293,024 at the end of June 2023 [31]. - The company raised 15,712,976 from common stock offerings, net of offering costs, during the six months ended June 30, 2024 [31]. - The total additional paid-in capital increased to 89,899,666asofJune30,2024,from89,899,666 as of June 30, 2024, from 58,485,602 as of December 31, 2022, reflecting ongoing investment and capital raising efforts [29]. Operational Developments - The company is expanding in-house production capacity to meet growing demand and is diversifying distribution partnerships to enhance market reach [2]. - A new 324,000 square foot production and distribution facility is expected to significantly boost production capabilities once operational [2]. - The company aims to revolutionize the candy category with innovative products, enhancing its competitive advantage by controlling the manufacturing process [3]. - The company expresses confidence that 2024 will be a transformative year for creating significant shareholder value [4]. Liabilities and Expenses - Operating expenses rose to 4.1millioninQ22024,comparedto4.1 million in Q2 2024, compared to 0.9 million in Q2 2023, primarily due to increased compensation and professional services [6]. - Total current liabilities as of June 30, 2024, amounted to 6,283,399,anincreasefrom6,283,399, an increase from 5,771,200 as of December 31, 2023 [22]. - The total liabilities as of June 30, 2024, were 25,174,478,comparedto25,174,478, compared to 14,208,109 as of December 31, 2023, indicating an increase in the company's obligations [22]. - The company incurred interest expense of (599,664)forthethreemonthsendedJune30,2024,downfrom(599,664) for the three months ended June 30, 2024, down from (847,509) in the same period of 2023, suggesting improved cost management [25]. - The accumulated deficit decreased to (54,894,265)asofJune30,2024,from(54,894,265) as of June 30, 2024, from (58,739,995) as of December 31, 2023, indicating progress in reducing losses over time [23]. - The company reported a net cash used in operating activities of (939,534)forthesixmonthsendedJune30,2024,animprovementfrom(939,534) for the six months ended June 30, 2024, an improvement from (2,421,260) in the same period of 2023 [30]. - The company experienced a decrease in accounts receivable by 3,639,538duringthesixmonthsendedJune30,2024,comparedtoadecreaseof3,639,538 during the six months ended June 30, 2024, compared to a decrease of 721,135 in the same period of 2023 [30]. - The company incurred a loss on early extinguishment of debt amounting to $696,502 during the six months ended June 30, 2024 [32].