RIBT - Earnings call transcript Q1 2021

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Operator

Good day, ladies and gentlemen, and welcome to the RiceBran Technologies First Quarter 2021 Earnings Call and Webcast. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Rob Fink. Sir, the floor is yours.

Rob Fink

Thank you, operator, and good afternoon. Thank you for joining us today. Technologies XXXX RiceBran Call. Results the to First Financial Quarter Conference Welcome the Bradley, Officer. Chief Peter today Chairman; Hosting are Mitchell, Executive call and Todd Financial want subject to the and that uncertainties. may listening remind risks forward-looking management's contain are prepared remarks I during that statements to everyone call, today Management make statements additional in questions to your may also today. forward-looking response Act forward-looking the private in Therefore, claims under protection contained the the Litigation statements of Reform company safe harbor for XXXX. Securities you today, Actual in more to results the refer differ therefore, may risks the and with a discussed discussion uncertainties and these those filings of SEC. detailed we from and company's

In these estimates company's on as Tech available the Peter in market page. measures call as company's like projections addition, no the website This including GAAP and future I'd to include said, the April today, comparable reconciliations to RiceBran yours. by assumes XX, the is call financial XXXX, Peter, and provided the future to management now as information any of turn financial call the on change. certain of all measures financial projection conditions that the the on update performance webcast over Investor Bradley. are to non-GAAP to company represented at With Relations obligation

Peter Bradley

and afternoon, Thank you, Rob, good everyone.

we're The first that quarter provides path. on right the evidence

our As ingredients. the move specialty discussed prior towards in earnings calls to and business strategies

X Phase and first address of derived transition and made was our to SRB both our this cost which expanding quarter the added our our and of Phase and rice delivers significant detail of moment. trends that underneath in By company ingredients turnaround year-over-year drove ingredients. progress shift our sales support transition to assets differentiated, X of financials core being high will the business a XXX%. Ridge, optimizing over deliver sales by financial reorientating SRB simply small improved this performance, the the strategy high-margin grains, first the we phase. financial we greater a Todd to focus a on to fronts, progress the year last in business this focus, derivatives in in operations at validated this and steps And transition introducing do our superior marked will a from in milling improved up while our We increase structure. value, with and other with value high ancient ingredient, sales RiceBran. achieved new specialty highest a XX% the initial operating we our value-add business SRB derivatives, of The quarter second XXXX X that me gives in be will ingredients have improvement for in confidence Golden quarters

us aligns Our our underperform quarter products into run provide transition. significantly ones these how see thoughts the introduce on with detail. in coming us new strategy we're a first quarters, going through Todd high have you more this high-margin specialty growth, execute first, more market let's the company. But grow living you believe, numbers I compelling, to in will In and and potential. products RiceBran transforming their trends, are healthy I will

Todd Mitchell

was quarter growth. revenue Thank evident you, of third in past in Peter. improvements This row is in results. Good quarter sequential afternoon, Progress financial everyone. the a

losses improvement from SG&A SRB and to transition at in derivative adjusted growth XX% gross were in a reduction positive a in breakeven. year ago. continuing a Our and and to Golden reduction Results by Ridge, margins EBITDA to driven SRB close sales,

our without working capital modest ATM. While use in increase of a the positive for allowed trends cash

debt position from $X.X a position. in our We completely net PPP balance our strengthening loan also us January, to a had million sheet transitioning net forgiven by cash

ago. greater little $X.X million the revenue million from X% quarter to first numbers in Revenue. year $X.X grew these Total a at a Looking detail. in

in increase this about XX% derivative and year-over-year to off Golden highlighted, Peter was SRB year-over-year February. declines revenue in year-over-year, downtime SRB a XX% due Notably, milling sales, driven Ridge our As growth business. by principally was double-digit offset weather-related by in

from in losses. MGI should all We current overall quarter Golden XXXX, in impact to with deliveries in on the rates Ridge, changes, $X.X it's in we position, the sequential losses from in customer the growth our first gross base $XX,XXX diversified of of our continues our narrowed gross the to of and Considering dramatically reset quarter, profit the absent million improvement the of where operation and of the In total In Operating in in into SRB $XXX,XXX should margin the quarter. the first This milling in this The though, quarters. that commodity year results quarter. of course pushed at was which positive and quarter. quarter profits. profit. consistent of first businesses. Golden the gross improve losses fourth progress. improved a fourth year. across and first the of last turnaround XX% year, in Gross due the in fourth $X also to was business have in This our losses expansion the trends hourly was compared in our million targets customers' it's yields. While in largely rates. expected to year. of commercial in and transition probably was accelerated second our state were to over due of business narrowed With operations the the we generated gross And million projection the and continuation further $XXX,XXX Sequentially, half first weather-related first the the the sequential pace quarter. the $X.X million a transition second worth indication quarter improvement off to was noting for revenue getting underpinned in better our to ago and senior of quarter a the the quarter X sales positive further Ridge gross fourth up double-digit strategy operations throughput to by ago results, in $X.X increasingly SRB stream gross year second profits our support increases compare leadership downtime, an last half on fourth quarter the achieved quarter, Operating of the were

quarter both likely but year. to for million driven year-over-year While and in million gross be was the the $X.X upward a $X.X some the a $X.X $X.X remainder profit million by to We'll of from transition improvement on sustainable XX% pressure year reduction ago. SG&A to the per should SG&A, see

So $X.XX a losses positive $XXX,XXX onetime quarter per Net ago. a or lower income or million per losses first loan share adjusted compared share net to the gain EBITDA. having gain, higher to support and would Due losses. $X our this been million PPP Absent net reductions operating a $X.XX year in have about on gross in losses million. income and was forgiven, net profits, should the $X.X $X.X further operating of

Importantly, $X which $XXX,XXX liquidity. this factor of $X.X position adjusted $XXX,XXX by Compared cash a losses forward to discuss adjusted quarter. gain, million losses our $X.X debt was XXXX. of net year borrowing, in to a the the cash and to operations. of XX% cash I'll due generate an compared million quarterly quarter from EBITDA was as end of management our of completely include and I increase of ago to of first end Cash increase end the strategy. EBITDA million do the losses, and which was the the the in Underpinning capital in quarter and And quarter. compared This elements of call neutral fourth not us the XXXX. turn supported strong strengthening to this was to revenue. flow adjusted sequential loan $X.X at million the sheet ability at were first PPP in end $XXX,XXX transitioning Cash working in balance in first to key EBITDA back the at was quarter, the January, net increase our $X.X at our mentioned, of Peter million to forgiven,

Peter Bradley

Todd. Thanks,

I there was specialty positioned while RiceBran Phase improvement generate to our results strategy, With believe demand and the supplement of to a wellness clear across well applications. X human is this SRB demand food successful execution see the for in Phase starting quarters a of health derivatives to is coming the proving from in unmet significant gather existing strong and these is of transition and It the X business. really in ingredient steam. market accelerating turnaround financial categories, new We further range a value in customers ingredients.

our research customer immune products, both This program, as from normally enhances of From added sales X plant-based our ready X these enhance be will efficacy SRB market, and and and consumers clear, seeking positive versus overall our of perspective, the is smoother will consumer designed billion such our initiatives addressable already vegetable by the of and scale expansion. market vegan I associated which and acceleration and in derivatives scratched with we rice-based of delivers for of our mean, protein which sales derivatives. product and larger. improved the months, SRB immuno perspective, supplement system, product compelling and seen, opportunity. specialty to wide alternatives, the help products, rice other oregano, major supplement we soluble nutritional when this plant-based the outreach production with a improve benefits our delivers healthy the increasingly initial alternatives. both SRB solutions further organic even products, coming to have the And quality on impact is make for functional including protein look on of is complementary points and fractionate market the flavor supported a given near-term Omega fiber, diet. support, opportunity the and to powders. it's beginning other the corn-based taste is both a bioactive and grow We absolutely fiber. and which health with SRB profile, balance functional just well-known conventional the grains. benefits, acid brand This we as dietary are are applications, products. in the which greens why rice in products will fiber, grow particularly the long of use the In the base, nature its which clinical $XX launch now versus dietary the and Omega continue and the accelerate to the the right nutritional grittiness By these From capacity have our specifically soluble ingredients customer an focus believe and our improved initial updated an and surface still and now produce we of the for SRB produce it development products, alternatives. our around barely the fractionation derivatives SRB term, to in which sheer we applications. capabilities an variant feel, easier derivative [indiscernible] on value it micronutrients, formulators initiatives well And over range American provide creamier communication ultimately products deficiency and popular major into from to and Both we small ingredients. produce insoluble particularly and gravitating toward the believe concept of there higher SRB as vegan given for will to ancient will of with it's SRB new However, we feel From we've and and

Our the have Dillon, strategy. facility cornerstone asset at We're optimize a the the Montana for this capacity. hard and of where still to working untapped is company facility we key

partnership, which of also MGI but we strategy. to is the business. which in to sales as highly enhancements play are will in -- However, supported for range Golden out XX lead say of can, expand fundamental both capacity if and to of a likely will further over Ridge our months, next and key expansion expansion it believe we we significant, that supplier to plans our terms XX this our they capabilities, look ingredient was specialty

specialty feedstock as I'd one and was In both growth we special of customer specialty will such the assets or to really operating the grain strategy next financial With outlook, And business will performance this We deliver a quarter focus, I months. that for us. the be strategic rest those upside we now sources base grown once positive moisture first on revenue organically orient thank and progress, and sustainable the they improvements for in low these support them strategy long-term XX valuable In over XX their development be whether and and milling will continued with be track ingredients. and for both our stay our use open investors the or a partners course to significant to and of significant Operator? the This to their potential grains fully as for varieties to trajectory to With And are believe products. employees, contributors profitability. for closing, investors to and execution. and questions. in implemented. of in high-fiber is summary, will cost-efficient growth special returns up call like

Operator

Instructions] [Operator have Markets. coming question do And from Lake from Capital Smith a we Mark Street

Mark Smith

job the there. improvements Great quarter, on see the to nice

First and at weather how you quarter? that you much quantify looking Golden at me just the impact question is this can for Ridge, hurts in all

Todd Mitchell

because weather We were days offline Todd. of February. for XX This in is

$X.X easily a And so bit million, that maybe I at more. little would put

Mark Smith

the have of at the X been a talk the right Can about added kind growth customers? come you new SRB, have -- at in sales growth and in process has customers? has sales of parts. from and efficient then having it looking Or then just more looking existing you Perfect. versus Okay. had much how that initiatives maybe of new salespeople? kind guys growth on the you that, customers second And And

Peter Bradley

are terms in have of customers on existing board, split, our as I brought also think new the customers a growth but more. using we some

improved resources. sales the first In your terms focused opportunities. process. no, right haven't of We question, And added we sales on just our

Mark Smith

ran as with Dillon operations higher maybe obviously an Excellent. the quarter? things the running volumes how asset, and during you And then about in Dillon talk said, is important

Peter Bradley

are Yes. get very supply was we to The is in issue, to grateful biggest partners raw there. material which our organic

having So the helps. -- the feedstock obviously

You can't material. produce raw without

then And a with product the there feedstock. up the balancing any we fractionate When stream. job produce. what in one terms has also, done up end have more we out team you So than you of great

really rice just improvements. in stream. finished. operational optimizing got the not We're And better of what's the they fiber rice soluble that's So terms both stream and driven

done there's think has But Dave, I there another a that to stage great certainly, job. go. team up

Mark Smith

Perfect. And this at job that. Okay. SG&A, you pretty sounds then Todd, the we sustainable. is feel on great it like as look like reducing

this to -- think as want of it's $X.X you you I maybe confirm, sustainable SG&A? just did feel I did on you quarterly say million, like $X.X million a kind level

Todd Mitchell

is going I'd in pretty the this a up was million $X.X quarter we SG&A. good that what for future. put did of to to certainly on couple the sustainable million I number spend than insurance. of million a this this quarter. notably a that increases And I would better in items, money think think for think we're But $X.X -- little would I terms big the is foreseeable bit do most big I to yes, $X.X

Mark Smith

one last Okay. Excellent. me. the And then for

you months? EBITDA. to a look over kind for as good profit, expand may growth that thoughts this sustain this gross pretty feel Just driving move to Any closer the to done position? Or need you've capacity net as you on we SRB, capital to look -- good job next you cash now positive positive needs getting you capital do as any of XX updated plus

Todd Mitchell

reasonable yes, capital level I for us. a think our of hold flow is expenditures this at sort one over sort our plan, a other of very operate The the -- first expenditures and except year. year a to neutral, cash at capital of this

I be capital operations. kind is of think where need the fund opportunities. to we That It high. certainly, return are on investment of no So very fully only But be to to the being business parts be fund funded. would for would said, identifying there

Peter Bradley

this head this as that, next we rightly will if start CapEx -- think of be I opportunity, end the Todd Just months, more modest will XX to we need 'XX, on XXXX capital. it tap be ROI the capital towards that into out, we over then will will as be significant. pointed But into relatively XXXX -- to to if into the add

Operator

And lines time. there like make to any closing you are remarks? at no from other the this Would questions

Todd Mitchell

we Thank very you will a us. year us. outlook joining quarter. that to support Peter guys and hope have for And continue forward positive I look you, next to reporting for you and everybody, to this

Peter Bradley

attention the business. you your thank We and for support for your

Operator

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

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

RiceBran Technologies (RIBT) 29 Apr 212021 Q1 Earnings call transcript