Arcadia Biosciences (RKDA) 8-K Arcadia Biosciences (RKDA) Announces Fourth-Quarter and Full-Year 2021 Financial Results and Business Highlights

Exhibit 99.2

 

Arcadia Biosciences, Inc.

Consolidated Balance Sheets

(Unaudited)

(In thousands, except share data)

	As of December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	28,685		$	14,042
Short-term investments		—			11,625
Accounts receivable, net of allowance for doubtful accounts of $76 and $0    as of December 31, 2021 and 2020, respectively		1,370			1,406
Inventories, net — current		4,433			3,812
Prepaid expenses and other current assets		900			811
Total current assets		35,388			31,696
Restricted cash		—			2,001
Property and equipment, net		2,291			3,539
Right of use assets		3,081			5,826
Inventories, net — noncurrent		2,494			3,485
Goodwill		—			408
Intangible assets, net		484			370
Other noncurrent assets		180			23
Total assets	$	43,918		$	47,348
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	3,638		$	4,105
Amounts due to related parties		64			80
Debt — current		—			1,141
Unearned revenue — current		—			8
Operating lease liability — current		1,074			717
Other current liabilities		264			263
Total current liabilities		5,040			6,314
Debt — noncurrent		—			2,105
Operating lease liability — noncurrent		2,220			5,389
Common stock warrant liabilities		3,392			2,708
Other noncurrent liabilities		2,070			2,280
Total liabilities		12,722			18,796
Stockholders’ equity:
Common stock, $0.001 par value—150,000,000 shares authorized as of    December 31, 2021 and December 31, 2020; 22,184,235 and 13,450,861 shares    issued and outstanding as of December 31, 2021 and December 31, 2020,    respectively.		63			54
Additional paid-in capital		257,515			239,496
Accumulated deficit		(226,485	)		(211,825	)
Total Arcadia Biosciences stockholders’ equity		31,093			27,725
Non-controlling interest		103			827
Total stockholders' equity		31,196			28,552
Total liabilities and stockholders’ equity	$	43,918		$	47,348

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Arcadia Biosciences, Inc.

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except share data and per share data)

	Year Ended December 31,
	2021			2020
Revenues:
Product	$	6,587		$	1,044
License		17			6,801
Royalty		176			—
Contract research and government grants		—			106
Total revenues		6,780			7,951
Operating expenses (income):
Cost of product revenues		8,708			5,199
Research and development		3,889			7,960
Gain on sale of Verdeca		—			(8,814	)
Loss on sale of Arcadia Spain		497			—
Impairment of intangible assets		3,302			—
Impairment of goodwill		1,648			—
Change in fair value of contingent consideration		(210	)		—
Impairment of property and equipment, net		1,534			—
Selling, general and administrative		22,938			16,467
Total operating expenses		42,306			20,812
Loss from operations		(35,526	)		(12,778	)
Interest expense		(20	)		(47	)
Other income, net		10,114			740
Change in fair value of common stock warrant liabilities		8,946			6,570
Loss on extinguishment of warrant liability		—			(635	)
Gain on extinguishment of PPP loan		1,123			—
Offering costs		(769	)		—
Net loss before income taxes		(16,132	)		(6,150	)
Income tax (provision) benefit		(2	)		124
Net loss		(16,134	)		(6,026	)
Net loss attributable to non-controlling interest		(1,474	)		(1,371	)
Net loss attributable to common stockholders	$	(14,660	)	$	(4,655	)
Net loss per share attributable to common stockholders:
Basic and diluted	$	(0.69	)	$	(0.47	)
Weighted-average number of shares used in per share    calculations:
Basic and diluted		21,280,620			9,959,018
Other comprehensive loss, net of tax
Unrealized losses on investment securities		—			(1	)
Other comprehensive loss		—			(1	)
Comprehensive loss attributable to common stockholders	$	(14,660	)	$	(4,656	)

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Arcadia Biosciences, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

	Year Ended December 31,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(16,134	)	$	(6,026	)
Adjustments to reconcile net loss to cash used in operating activities:
Change in fair value of common stock warrant liabilities		(8,946	)		(6,570	)
Change in fair value of contingent consideration		(210	)		—
Offering costs		769			—
Depreciation		929			632
Amortization of intangible assets		116			30
Lease amortization		1,276			1,048
Impairment of intangible assets		3,302			—
Impairment of goodwill		1,648			—
Loss (Gain) on disposal of equipment		23			(8	)
Loss on disposal of intangible assets		222			—
Net amortization of investment premium		—			(44	)
Stock-based compensation		1,541			2,042
Bad debt expense		76			—
Gain on sale of Verdeca		—			(8,814	)
Realized gain on corporate securities		(10,221	)		—
Corporate securities received in exchange for license agreement		—			(4,318	)
Unrealized gain on corporate securities		—			(656	)
Write-down of inventory and prepaid production costs		3,593			4,311
Loss on extinguishment of warrant liability		—			635
Gain on extinguishment of PPP loan		(1,123	)		—
Impairment of property and equipment		1,534			—
Deferred income taxes		—			(107	)
Changes in operating assets and liabilities:
Accounts receivable		(40	)		(1,119	)
Inventories		(2,383	)		(9,751	)
Prepaid expenses and other current assets		56			39
Other noncurrent assets		(158	)		(15	)
Accounts payable and accrued expenses		(372	)		(580	)
Amounts due to related parties		(16	)		40
Unearned revenue		(8	)		(34	)
Other current liabilities		1			(43	)
Operating lease payments		(1,343	)		(910	)
Net cash used in operating activities		(25,868	)		(30,218	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property and equipment		19			8
Purchases of property and equipment		(1,007	)		(2,335	)
Proceeds from sale of Verdeca		—			3,153
Acquisitions, net of cash acquired		(4,250	)		(500	)
Purchases of investments		—			(1,292	)
Proceeds from sales and maturities of investments		21,846			18,250
Net cash provided by (used in) investing activities		16,608			17,284
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock and warrants from    December 2020 Offering		—			8,000
Payments of offering costs relating to December 2020 Offering		—			(652	)
Proceeds from issuance of common stock and warrants from    January 2021 PIPE securities purchase agreement		25,147			—
Payments of offering costs relating to January 2021 PIPE    securities purchase agreement		(1,912	)		—
Proceeds from borrowings		—			3,108
Payments of transaction costs relating to extinguishment of warrant liability		—			(863	)

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Principal payments on notes payable		(2,146	)		(34	)
Proceeds from exercise of warrants		22			9,372
Proceeds from exercise of stock options and purchases through ESPP		39			51
Capital contributions received from non-controlling interest		750			1,578
Net cash provided by financing activities		21,900			20,560
Effects of foreign currency translation on cash and cash equivalents		2			—
Net increase (decrease) in cash, cash equivalents and restricted cash		12,642			7,626
Cash, cash equivalents and restricted cash — beginning of period		16,043			8,417
Cash, cash equivalents and restricted cash — end of period	$	28,685		$	16,043
	$	—		$	—
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest	$	25		$	10
Cash paid for taxes	$	1		$	1
NONCASH TRANSACTIONS:
Shares of common stock issued at closing of ISI transaction	$	—		$	432
Common stock warrants issued to placement agent and included in offering costs related to     December 2020 Purchase Agreement		—			287
Common stock warrants issued to placement agent and included in offering costs related to    May 2020 Warrant Transaction		—			215
Common stock warrants issued to placement agent and included in offering costs related to    July 2020 Warrant Transaction		—			101
Fair value of shares of common stock issued at closing of Arcadia Wellness transaction		2,053			—
Common stock warrants issued to placement agent and included in offering    costs related to January 2021 PIPE securities purchase agreement		942			—
Right of use assets obtained in exchange for new operating lease liabilities		1,664			331
Right of use assets obtained through modification of existing lease agreement		—			4,207
Fixed assets acquired with notes payable		—			37
Purchases of fixed assets included in accounts payable and accrued expenses		—			71

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