RIBT - Earnings call transcript Q2 2021

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Operator

Good day, ladies and gentlemen, and welcome to your RiceBran Technologies Second Quarter 2021 Earnings Call and Webcast. [Operator Instructions]. At this time, it is my pleasure to turn the floor over to your host, [indiscernible]. Sir, the floor is yours.

Unidentified Company Representative

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

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

Peter Bradley

Jeff, and everyone. good afternoon, you, Thank

and immune forces, a supplement This business made stabilized quarter. ceiling. and is now evolution now gives will one the a and floor. AIDP, And leading market. opportunity right focus due evidence milling from progress the second clearly execution in These this challenges excited This the the continued were significant our ingredients business confirmation increase stable increasingly of and product lines, and at have while coverage margin to significantly specialty meaningfully in The business on further our our we the have continued of major improved operations specialty I in year-over-year, operational agreement, With specialty and the of results market business and to value. of XX% significantly market was the progress health notably, macro in we our path. our better X shareholder today, growth transition facilities by more up sales was will in Most providing in our made on we progress. milestone announced weather expanded environment our with we improved our increase point, stabilizing and in product this raising major SG&A. and XX%, sector. the the into profile, ingredients addressable sales of lodged has and quarter some arrangement the our This To raising Revenues the eliminating SRB distribution challenges we our of systemic face. us wellness ceiling suppliers sales for organization, lines second new COVID, am and creating significantly expand now first ingredients, distribution to higher about fast-growing EBITDA a our the business. performance the nutraceutical derivatives we're adjusted not new also reductions on This demonstrate relationship

bran for derivatives of of line these existing applications. powdered First, for capsules new beverages, complement our and stabilized versions rice we tablets SRB launched use to in

use as Secondly, flow emulsifier. line hulls of we micronized introduced rise and the for agent a natural

to to We a differentiated fuel intensified growth. provide pipeline efforts development product of have ingredients our future also value

to expertise, into solid processing us new giving We market. footing specialty introduce the a established and have capacity robust products ingredient

lines. and drive sales moved leaders responsibility for we responsive for to our capture customer-centric that opportunity with doubt key future a to structure exists the organization current more a to increased no product Additionally, our

X specialty rice-derived strategy. critical as elements evolve growth predominantly on milling I focused operations of our to our am ingredients, While our continue

specialty into the And at provided has these capabilities. varieties. has installation production operations Golden Ridge, packing businesses. specialty of new milling SRB milling barley MGI, Our improvement focus facility completing are commenced on and and operational to currently At the platform commercial we develop commenced further of

we product an and increasingly our organization have I introductions, our new supply extend numbers will As first, in more growth with but play will you through new some operations demand further sales these important overall detail. run strategy, quarter our our second provide future Todd thoughts expand in on through potential. role let's the

Todd Mitchell

everyone. Peter. Good afternoon, you, Thank

generated We saw some in volatility in in by the to in the higher was necessary gas key the positioned improvements experienced lines. second some financial pressures the business second every strong metric, every off the and quarter for for we're one RiceBran financial made another of sales results improved and foot We've The of of advancement quarter significant our major of pull our raw half and bit us material prices, stronger contributions quarter. which half We adjustments, seasonal well the for prompted year. Technologies. second driven a year-over-year margin

to first and MGI to drop $X and by million attributed about crop. year-over-year Golden was at in $X.X both MGI. of be XXXX. and Ridge ago. in second tail XX% revenue all XX% greater a for revenue New revenue principally of was driven Golden we which a quarter up into grew in year-over-year, to moved sales Sequentially, Revenue. the second the growth in were $X.X numbers seasonal slowdown Ridge in from million total can at increase Year's at a SRB but The down look quarter quarter's up and derivatives, as little businesses million Let's the year's year end Sales from plus million both look XX% in the a from were detail. by begin quarter the revenue over harvest Total sequential of higher $X.X year-over-year, this

double the SRB first Gross For This the of million at was our a year first second MGI. derivatives for and core profitability sequentially to underpinned compared digits. continued from SRB raw higher by of derivatives, the Ridge, in year-over-year of $X.X year $XXX,XXX and revenue costs. growth Gross lower gains half year, look the gross half Golden improved profits to revenue and for business, XXXX, of $XX.X growth mill losses of XX% total gross with profit. by revenues in expansion half year due grades. were and to SRB margin grew We profits strong ago. million revenues the improvement first the and declined lower the year-over-year driven million in and growth at $XX.X from both in end Gross second in losses again, in increases the firmly in levels strong the profit quarter to quarter SRB material

early due a from the of seasonal quarter and milled volatility grains. in spreads was Some of this some narrowing to and market

a business this was the and to quarter of our of supply gross the We we half contracts, is second in the ago. which gross driven levels for down again, first year, Gross compared losses Some improvements in profit to million the principally we Operating Golden of in in first look from also the trend losses XXXX and of half positive third the narrowed at in expect Ridge to profits losses. dividends million fourth Operating first year expect million upward gross half quarters. second of all from lines. overall the $X.X margin quarter by $X.X road. $XXX,XXX to lower a loss our in XXXX, due $X.X new to with of pay but

asset the due year and improvement to SG&A ago. charges, gross in from included positive about second a last Sorry, reduction which a disposal Caveat year $X.X in This $X.X the only is started XX% breaking to quarter. SG&A to $XXX,XXX we've recently transition million out. million -- profit

reduction were $X.XX million, $X the in losses across million, types XX% net and second losses first expenses, margin Due the losses $X.XX due million about some or last per million a stable the year-over-year, or increases $X.X benefit the share the despite year our both the EBITDA. from SG&A $X.X ago. of premiums compared $X.XX first a for the insurance. hefty adjusted in we losses Operating items expectations Excluding were the first to or of quarter, during losses, XXXX in year. second and $X.X share and net insurance share down quarter. half gross first notably, in these losses reductions to operating in in first compared for year-over-year lower to look double-digit operating operating from of the extinguishment half in the net $X.X share continued the this half Net losses the With a the half million losses dropped to expansion and the of in year, charges, $X.X of of And and second of for large PPP SG&A to loan the $X.X increases year. million, was in was a or year million, most quarters quarter, in $X.XX all

$X.X to narrowed a year quarter first half $XXX,XXX $X.X XXXX the under losses million compared of adjusted $X the losses to EBITDA first just to And in in losses adjusted of of the second million adjusted were adjusted losses for of Importantly, EBITDA compared EBITDA million ago. EBITDA half XXXX.

to losses from second quarter EBITDA in and third adjusted the fourth improve expect We levels quarters.

seasonality get second of the second to losses, lower repairs and favorable from second in year sufficient a strategy. goal in turn to and principally payable of prove our the before end higher capacity for the million first momentum quarter. the on reserves due operating the to the and challenging. liquidity. We for quarterly more to the dropped advances have hurricane the believe XXXX commodity reduction Charles outflows and we the cash our reversal $X.X discuss at Golden capital of However, Lake to in achieving half million. EBITDA may versus from call damage MGI to forward Rigid I'll to have back end quarter Peter at at working and quarter, $X balance capital flow. of of at of positive Cash positive due to end inflows key seasonal and factored in the borrowing adjusted Cash quarter the a elements us pay our the Cash look first impact insurance was for

Peter Bradley

of rice Rice particular, most that despite needs for GMO our technologies, a nutritional all foods bran fractionation is and and dense, functional than and can in of broad X% of processing food ingredients brand feedstock needs applications. nonallergenic further the feed nutrient for and, Through unique modern-day feeds. free. ingredients the Thanks, we process added range and value of meet being underutilized Todd. Less create

new introductions, the doubt introduced for types products these As I of products mentioned, overall the exists. quarter. that no in even But second scratching potential X the we commercial these only of are with we surface

healthy bran for additional products over embrace As alternatives, grow. the demand less manufacturers increasingly rice traditional, solutions will

result of seen notably faced feedstocks, and has its ingredient of yield being which being though, corn, opportunity because for and impact access other been other to low soy a climate rice the with increased To inflation challenges the Asian and never a change With price its has of as demand and focus added business the transition change, focus grains on specialty higher. potential, had Technologies RiceBran capabilities. significant value to and

have the with in the seen this dramatic past, referred derivatives. initial to impact SRB the In of of growth we You partnerships. the our power

exponentially Our extensive and reach their technical with sales health market increase our the relationship in AIDP new will wellness category. and support and capabilities

relationships, to are our strengthen provide we'll announce new our access partnerships and our building manufacturing which enhance capacity markets. supply We chain, and together up will existing other other

develop and we a California, markets application. with new long-term the in cooperative SRB further FRC, relationship with our access to SRB agreement largest supply Specifically, a variants commitment to new and rice for new strengthened

our distribution pet supply partner. market manufacturing explore new access increasing SRB relationships support capacity chain supplier to our derivatives SRB to continue the important adding these improve the by opportunities. food and organic to are to And existing and applications We feed we for a expanding with our

declining XX supply expansion. just markets, added this we specialty a product a chain focused business Today, growth ingredients driving and numerous support manufacturing platform perspective, with ago, operational on months high have innovation For to and a value were health. challenges growth we potential by financial supported

open upside on reaching partners Our narrowed buying up quarterly we conclusion, the line to with and significant questions. call of and have our now as grow. I'd $X products breakeven In have investors these for sight than their support Operator? higher-margin specialty for net thank more million, like losses and employees,

Operator

Capital. Lake [Operator Instructions]. Meyers we Ryan go And line the of Street first, with to

Ryan Meyers

we we Ridge? additional give lower the Golden were from lower you was some of. Can aware a all what color just the if on results there little like something from revenue I'm that contribution wondering be were profit a base this going is there gross bit should or else It looks if on than expecting. us

Todd Mitchell

so. think don't I No,

Golden significantly. from didn't in basis. contribution the in saw with Ridge the there to we that is quite cut volume the June, think neutral losses But still. pretty I OpEx negative managed that trail-down to on GAAP the We've there cover slightly a we

Ryan Meyers

the adjusted EBITDA when helpful. EBITDA, here? big then That's adjusted Because Okay. guys were And change the you we to positive quarter, what's last outlook look exiting at the year. guiding for

of some mind what what are to you change wondering those Just guys and your there. caused headwinds

Todd Mitchell

amount a gave pricing raw us market significantly. materials I of bit volatility our quarter, think -- that saw or which raw fair a calmed of pause. It's down we this little in

some a think I milled also seen to our that forward in we've stabilize business of that But grains it's well. saw look. actually, haven't of then we factored our as trend, lower, we on yet. And demand into although the narrowing

of bit little we in So a factored that.

best here. right look conservative a taking way the we're think now. to that's But I it think at I outlook

Ryan Meyers

And in us press release, are, if you impact new those you wondering of the supply some detail called going little on bit the it's Okay. what give can manufacturing contracts footprint. that then to just out the exactly how more guys a

Peter Bradley

in for us. think the -- of of existing an I provider FRC Well, SRB are terms

our the to major volume really relationships in will it into and We don't FRC. from going expand California Delta. the we're sourcing see focus a our SRB So make and to change concentrate

the SRB X Ridge. albeit have -- one our Delta. Golden out one California, in coming of SRB own primary production then have, we'll we'll So conventional relatively in partners, And small,

Ryan Meyers

then the need capacity Okay. additional would the any products? increase What's launch new And current spend make capital a to is to you capacity that. now And follow-up products or SRB this there? to your right

Peter Bradley

Well, increasing SRB capacity, no.

converted products. as added little of prepared capacity I actually because, into remarks, of my plenty have We in said bran value so the is

go can support still and capital. significantly we we to got to major into no, before XX% So headroom XX%, SRB. we're derivatives higher volume perspective, the run From

without double size the basically the to of can So net-net Capex. anything is add? the do have we Todd, business major you

Todd Mitchell

in looking would I mean, product on that rice focused organic comes I part the that upmarket, I rice it. means California. for We're California. comes increasingly so think the only best driving these and Yes. agreements on best from our differentiating it at what business in quality also a in FRC, using is as is bran from the for as we're focusing thing strategy add focusing And the means and The there differentiating of of is a right?

is that's And capacity not partner what we're so for doing these looking necessarily looking much raw partnerships, so with to as best. with the

Operator

this are We to remarks. At no Instructions]. closing for time, back there signals. management turn [Operator further

Peter Bradley

you to you, Well, X the thank We've a attention. in for the got X of we're track. closing company. your years My for the on right change upside everyone, next value significant your deliver this much to real over Thank very is remark attention.

Operator

this gentlemen, for and We conference. you Ladies concludes thank today's your participation.

a disconnect great time. may Have this at lines day. You your

RiceBran Technologies (RIBT) 5 Aug 212021 Q2 Earnings call transcript