Local Bounti (LOCL) Q2 2024 earnings summary

Executive summary

• Sales grew 31% year-over-year to $9.4 million in Q2 2024, driven by expanded production and new facilities in Texas and Washington.

• Adjusted EBITDA loss improved by $800,000 year-over-year to $7.5 million, with a path to positive Adjusted EBITDA in early 2025.

• Net loss widened to $25.3 million for Q2 2024, compared to $10.7 million in Q2 2023, primarily due to higher interest expense and increased operating costs.

• Commercial operations began at new Texas and Washington facilities, expanding distribution to Sam's Club and Brookshire's.

• Entered negotiations for up to $400 million in new financing to support facility expansion and working capital.

Financial highlights

• Q2 2024 sales reached $9.4 million, up from $7.2 million in Q2 2023 and $8.4 million in Q1 2024.

• Adjusted gross margin (excluding depreciation and stock-based compensation) was approximately 29%, up five percentage points from Q1.

• Operating expenses decreased 25% year-over-year for Q2 2024, mainly due to lower stock-based compensation and reduced SG&A costs.

• Net loss was $25.3 million, compared to $10.7 million in Q2 2023, with prior year benefiting from a $15.2 million non-cash gain.

• Cash, cash equivalents, and restricted cash totaled $16.2 million as of June 30, 2024.

Outlook and guidance

• Full-year 2024 sales guidance reiterated at $50 million–$60 million, with significant revenue growth expected in the second half as new facilities ramp up.

• Targeting positive Adjusted EBITDA in early 2025 through increased revenue, lower SG&A, and reduced R&D costs.

• Management expects adjusted gross margin to increase as scaling and cost optimization continue.

• Fourth quarter anticipated to be larger than third quarter to meet guidance.

• Plans to introduce new products and expand distribution to additional retail locations in the second half of 2024.