RIBT - Earnings call transcript Q4 2020

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Operator

Good afternoon ladies and gentlemen and welcome to the RiceBran Technologies Fourth Quarter and Full Year 2020 Earnings Call and Webcast. At this time, all participants are placed in a listen-only mode and the floor will be open for your question and comments following the presentation. It is now my pleasure to turn the floor over to your host Matt Chesler with FNK IR. Sir, the floor is yours.

Matt Chesler

Thank you, Catherine and good afternoon everyone. RiceBran quarter the conference financial to call. again Technologies XXXX fourth results Welcome are Chairman; Bradley, Chief us Peter With today Executive Financial and Officer. Mitchell, Todd today, contain I prepared uncertainties. subject to remind that and the want listeners to risks remarks statements forward-looking call may that are during management's today. also may questions forward-looking response to statements Management in additional your make Therefore, the in the Private Litigation Securities under the of for XXXX. Harbor company Safe claims Reform protection contained forward-looking Act statements more we may discussion differ discussed refer from results you uncertainties of detailed therefore, and filings a results these Actual with company's today to those the and SEC. in the

information any company's company future call provided and conditions Peter, change. management turn at page. February by ahead. as these no measures like addition I certain In of of XXXX to are non-GAAP please as on would market GAAP financial reconciliations At XXth, projections the financial including update available to to the assumes financial Peter. Investor call future Relations over performance measures time, www.ricebrantech.com today, in webcast as on estimates the This comparable obligation go represented the today this and to the include the projections to

Peter Bradley

in welcome transition team. within Rob for the company fourth meaningful you emerging and to high-growth reinforces the notable to Fink our improvements confidence high-margin RiceBran strategy into The ingredient RiceBran. a Matt company. you, was a Thank results specialty financial Good the underscore we The everyone. transfer one afternoon and quarter productive in RiceBran my our which

and a specialty value-added become tackling improve of mindset our six Phase what broader this This the change the food I the required initiating months, performance in past refer X implemented to of successfully imperative financial immediate supplier ingredients. as Over transition. we've to to

on we've before, a Ridge discussed drag business significant Golden XXXX. our through created As

effectively, important improvements mill in at and at However, refer a SRB new special ingredient significant towards core we operating and financial will and milling and this and the rice XXXX the SRB reinvigorated sales more procurement focus and to quarter, as stabilized And operate these by fourth to of businesses, our quarter. the Golden believe the beyond. as we for end management brand enhancing And momentum rice have drove performance the we successfully and in is accelerating into structure or our this businesses the MGI the as revitalizing implemented Ridge third installed mill's for better quarter. derivatives margins in operations continue and we growth fourth our also

mindset this? structure specialty terms achieve the our Phase of supported with margins which drove along minute. Todd margin-based Simply financial change from two operations detail. food you -- of word value, it initiatives series numbers me in to that a our of new out of come significant put, transition margin the the ingredients value change milling run quarter. to incentive customer-focused ingredients rolling in is some first, by means for to as like it we of a availability initiatives now transitioned do run it higher-margin the greenlighting And Simply company profitability but as volume. X a in from of put, used practical the mindset more this implementing differentiated what it's improved turnaround highlight how of growth let fourth product RiceBran. we've our me this some in set transition sales fourth see to And to said the the we'll program. and performance was But the mindset in performance accelerate our higher in XXXX. a specialty provide have specialty and I I which is to through by expanding Higher let So, in a the often higher quarter world stage derivatives, introductions, We both added the emphasis to complete, SRB our with a explain customers. improvement in ingredients phase ingredients. next in The will you Phase

Todd Mitchell

and Good fourth taking SG&A and trends reduction financial improved from for the thank afternoon us lower all Positive in time us. Golden in you of drive to everybody significantly to together came in quarter. the for join revenue losses businesses, our structural results Ridge, a

third steps million to the Importantly, in our to profitability, adjusted second $X.X EBITDA and losses million transitioning the $XXX,XXX of towards significant the quarter. $X.X down in narrowing from we losses fourth quarter in took That's quarter.

in Looking Revenue, $X.X in bit for greater a to XX% million increase the the at for million to $X.X from fourth revenue little a XX% quarter year $XX.X ago of full total detail. numbers million. year the grew a

growth core As our on Peter of demand driven and strong price highlighted, SRB of the and ASP SRB quarter delivering another higher-margin and refocus for SRB revenue derivatives. business operations paid sales by higher double-digit derivatives increases off SRB

fourth We also Ridge able on-stream not at a each in rate, yield, and last, milling deliver productivity that the management throughput. team higher progressive to operations month was And installing hourly improvement turned quarter. in Gross of year the for but least, around Golden new ago. year quarter with $XX,XXX losses Gross from to growth up saw generate in the from a the MGI million over losses. we in $X.X XX% quarter $XXX,XXX $XXX,XXX losses XXXX. narrowed totaled Gross in fourth

items what narrow reversal was of because significant Ridge year increases month Golden in in Operating So, to happened see the going trend. fourth Period. This that confidence yet, the quarter by the positive in million This and gross the lower from supported to quarter margins quarter fourth We've in other losses smaller million were $X.X corporate in a December. eliminate consecutive from reduce through quarter Operating from this narrowed improvement half but in to $X.X to SG&A of quarter a losses forward. our throughout second fourth in smarter actions in losses in by $X.X gross able reversal year drop overhead. of fourth million XX% to ago. reduction at about narrowed organization. emerged the ago. breakeven $X.X the a we XXXX we the -- each almost the million taken a at XXXX improvements hitting will And quarters SG&A This of they levels losses. the and the with prior was quarter progressive been about

For were and year the $XX.X million $X.X items SG&A XXXX. full in million versus other

net the to XXXX. were our by fourth losses million operating a $X.X $X program. equivalents. call down share, XXXX just and in Operating of inflows the from forward million the or losses quarter. of and total $X.XX loan, share XXXX. was quarter, I'll from $XX.X In of for sale million, versus million losses by million million And on net secured for and ended $XX.X the million, $X.X for under $XX.X $XXX,XXX adjusted to million with or in down We were losses $X.X net the our elements million ago. million in in $X.X forgiven. per per result, investing per were $X.XX quarter the second adjusted third ATM $X.X a Cash turn losses $X.XX $X.X million per from term to year of full raised in EBITDA a million $X.X under XXXX of XXXX. Golden And in $X.X shares the losses included for were PPP a I'm $XX.X as and outflows $X and were As losses loan in losses cash million million repeat, the or XXXX EBITDA. the and a or down Net Net million, Ridge, EBITDA liquidity. we'll in from $X.XX loan year, $XX quarter, in and $X.X fell in offset January, Peter discuss fourth share down the adjusted from I And $X.X million PPP from quarter share key back -- highlighted in mortgage the cash which strategy. of million down sorry year, completely

Peter Bradley

Thanks, Todd.

impact the Phase highlighted, successful of turn has and attention the financial X. now X Todd As to information to of to our -- Phase

efforts piece comment execution precision X and critical down and you team to as Maintaining success our our Phase objectives came executing wanted and XXXX next take areas: partnerships goals of three The the elements, specific through I strategy on further third, of with critical tied the the first, to that's with supply secondly, for on throughout differentiated Before we're and a leadership we've chain. execution. key beneficial compensation. this, offering; the The our and to urgency. collective short through key company building growth I mutually to the of enhancing And we any of sales on forward. and level both on expanding focus sense long-term embarking throughout implemented high both product achievement go-to-market margin move phase will individual their strategy; accelerating support this being be

area, and wellness particularly compelling in emerging seen nutritional the is for continue Both a and first already SRB SRB dietary uptick product growth we the consumer derivatives, expand the our We've and see opportunity accelerate of product significant offering Regarding a supplement to in categories. strong products. to we RiFiber. and meet benefits and range believe deliver of increase applications for demand we demand and for capacity demand functional these to RiSolubles there will in

potential both launch for and SRB wider derivatives. to products applications them will be by of We the these to to incorporated also more expect SRB replacement competitive ingredients new to enabling expand reflective clean-label variants a into reasons. easily going not customer products, a detail demand go chemically products. more range for allowing the lot I'm obviously into of for derived the of meet This

range in into SRB begin impact will value-add Golden own mill. positively Golden ancient specialty an providing Ridge time our incorporate stage and ingredients, derived of supply internal feedstock supply which develop capabilities, combining will we but our we also operations our and an Over at from SRB our the source an other milling profitability small by not This producing into MGI is both with of can chain will Ridge value-added grains. initial only the also differentiated ingredient of By processing of volumes, our our at milling We exciting rice integrating expertise chain. the strengthen from and strategy. commercial

will first. sales area customers. go-to-market efforts, drive product delivering our leaders we've structure or enhancing new ensure on enhanced strategy two focus through to new both is and second the with growth primary our and customer our value sales margin implemented our sales putting the The to attach Regarding

manufacturing mills deliver deliver to greater You important, business go-to-market with complementary relationships enhanced We also our will our more strengthen think more customers. our than partnerships. these benefit also supply chain. through less to performance should our to higher is now low-standing value-added and Todd chain these only we our back model be relationships and mean you over to this will moving ourselves products it'll seek major rice deepen forward. relationships on built a not turn RiceBran's but supply of partners. manufacturing the seek to a for expect just call We to new business believe suppliers. what can partners our no through but I'll to we strategy and we'll enhance brief enhanced to of Further complete our financial also outline be to for source partnerships see solutions give

Todd Mitchell

you, Thank Peter.

sense outlined, the want now be RiceBran growth our performance to of ingredients. differentiated successful couple process in over where a transition by accelerate give of we're next profitability series we of X the implementing years, see turnaround I an completion of financial Peter As transitioning XXXX. heading ongoing of of and initiatives higher-value with enhance This supplier plan, to to a but Phase you a will

versus ago. for We Ridge third strong be and lowest in By and in given to businesses, to revenue quarter, trends in Golden all in expect year the for relative be second the comparisons and and strongest growth first particular is MGI. the likely quarters XXXX a

the performance the positive we of gross Golden profits improved expect year. Ridge, throughout With

And to XQ in importantly, As the gross we in EBITDA and year. saw adjusted same for improvements XXXX base that expect profit two and adjusted past positive to we of lower in in in have beyond expand, the our to leverage sort sequel look quarters. we entire EBITDA the SG&A generate

back Peter some Now to for remarks. closing

Peter Bradley

supplier is we're financial a of ingredients message into an with on attractive key the My well transforming highly way that profile. differentiated to the business

our We and revitalizing SRB Ridge, our fourth is the as you successfully step of our that that in performance financial fixing in it overhead first improvements significant in just while results was the and important to cutting first Golden And so and by first derivatives more accomplish. was have the step. phase turnaround corporate quarter. much and businesses restructuring SRB completed saw an There

progress initial this on building profitability. accelerate is to growth sustainable now focus Our and generate

significant to financial company on the are track that As that build differentiated underscored for are value. we we will right guidance generate by our a XXXX, ingredients confident shareholder

like for and and I'd partners up support to open our questions. their employees, Lastly, now Catherine? investors thank our our for the call

Operator

gentlemen, open [Operator questions. now and is first Smith. floor Instructions] question Ladies coming from is for the Your Mark

Your now live. is line

Mark Smith

guys. Hi,

is increases me for you for business I how impactful within increases. don't question or SRB just price looking the quarter, this First all or at it quantify it guys know impacts really it price the can of more? core was kind at the if go-forward if

Todd Mitchell

also them the October, the in year. get of over Hi, I say in of wouldn't quarter in We so come increases the we in this Mark. of there further was impact took – the will quarter some Most to increases prices and price fourth course not January but fourth sub beginning it. expect not bulk

for largest were them customers they quantifying the of in terms our range. In double-digit

Mark Smith

– want just got on cuts. And I Todd Perfect. you while I've then to SG&A

this more As are sounds into the at you back some you'll as as this or look get forward we there's you the at business dollars some leverage there in is this to like cuts, look places solid, feel $X.X year million, it in or we million dollars, are $X.X invest that can pretty as like level absolute going good where – far expenses? operating need there

Todd Mitchell

$X let's sub SG&A I XXXX think maybe. $X the year in call for million should whole run it million,

number from that will I XXXX and for XQ. think below in $X.X million in it the that think I I �� up large was printed bit think pop we a we XXXX. will be by But probably XQ little

Mark Smith

just any look bit we avoid QX more to early that through primarily of we QX supply Okay. taken the you saw want to into some and pricing rice really I kind you Perfect. walk steps second maybe at look the And Golden in issues detail a have just little then back guys for and that But and in of before forward. can a Ridge?

Todd Mitchell

new we're decades first have of we're and purchasing is heading long, second all in and who several of a I We Wherever professional the guiding commodities, short a position. just of terms that both think time balanced principle scale. up has managing group, experience of all. in And terms of selling in

where cannot you and a book have the you balanced always So is a therefore commitment you don't into get honor. situation

Mark Smith

that very new today? to about know from then But take don't last it's know far assume that that as early And inning me. as that you else prepared not the much now. to new I or And Okay. products there's we're and one Peter, it. of I if you of that to there is any first that said want you right want can talk kind ready go-to-market is opportunities. safe to really product

Peter Bradley

something will capability. open will out you innings. – We've that you up will we first product all our got to in expect first new not from us, be will increase for quarter, this as which But constantly us. It's certainly one roll we applications the see

going will now on. XXXX, come ready We've Others and through go. our which our capability. we're better lot chain of tell – rather commodities. gets one capabilities, in a will to derivatives where we I those want you than supply it's go So be our got as to and SRB in later it's manufacturing one will The thing XXXX

Mark Smith

Okay.

would of MGI anything products be there for of new these Dillon out facility? potentially opportunities? the Is of most that assume product of to safe So coming new kind out

Peter Bradley

and ready that in quite it the an of little any talk line to more that's detail further I'm not a – potentially now. sure are There area we're bit really down about

Mark Smith

you guys Thank fair. very That’s great. much. That’s

Todd Mitchell

Mark. Thanks,

Operator

Peters question Bill is next [ph]. coming Your from

Your line live. is

Unidentified Analyst

you. the review the you be Thank there a for that you In that mentioned to might or call. call everything Hi, year's guys. be in Thank should strategic conference end. last Was this strategic – call mentioned? is there had was by during conference anything review, that doing mentioned reference you you else

Peter Bradley

strategic options. review the in looked number terms a think at I of we of

my it's operated here, with I the business. is in that solid think the I a core business right comments mentioned if as mindset correctly

to our of as We we've continue to we've that. the chain. didn't move we where So and need fix. supply needed there right I opportunities. at a are review We'll And get then solid cost base plan are think But think our looking I into most and to things strategy look got base I other now there XXXX, a solid growth. think we forward with for done

Unidentified Analyst

you. Okay. Thank

Operator

like this I'd questions remarks. turn at further no are now the There back lines floor time. from to the for Peter to closing

Peter Bradley

some down in steps. some for we come. the look through your And initial what to everyone you, to future. the and attention. more We've what steps appreciate – Thanks do We've plan forward being we've made path. opportunity a got of achieved we've the I able you attention. to how We've started to we everyone of Thank and talk their

Operator

gentlemen. ladies and today's call. you, Thank does This conclude

your You phone for this lines day. a participation. wonderful have your time may you disconnect Thank and at

RiceBran Technologies (RIBT) 26 Feb 212020 Q4 Earnings call transcript