Clever Leaves Holdings Inc. CLVR CLVRW released financial results for the second quarter ended June 30, 2022, revealing revenue increased 27% to $4.7 million compared to $3.7 million in Q2 2021.
Q2 2022 Financial Highlights vs. Comparable Year-Ago Quarter
Gross profit was $1.3 million, which included a $1.3 million inventory provision, compared to $1.8 million, which included a $600,000 inventory provision.
Gross margin, which included such inventory provision of $1.3 million, was 28.0% compared to 48.1%, which included such inventory provision of $600,000.
Net loss reduced to $1.0 million compared to $9.0 million, driven primarily by a $6.9 million gain on investments following the company’s sale of a portion of its minority equity stake in Cansativa, as well as a $2.2 million decrease in stock-based compensation expense.
Adjusted EBITDA was $(6.3) million compared to $(5.7) million, primarily due to increased cost of sales, including increased inventory provision and additional sales and marketing expenses.
Cannabinoid revenue increased 124% to $1.3 million compared to $0.6 million, and non-cannabinoid revenue increased 9% to $3.4 million compared to $3.1 million.
During the second quarter of 2022, Clever Leaves used the cash proceeds derived from its at-the-market-offering of common stock to fully settle its secured convertible note with Catalina L.P., as well as its remaining debt obligations related to its acquisition of Herbal Brands in 2019. The company’s debt has thereby been reduced from $22.6 million to $2.1 million, resulting in annual cash interest expense savings of $800,000 through the end of 2022.
To further align its cost structure more closely with its full year strategic objectives, the company also completed a global work-force reduction during the second quarter of 2022. This reduction is expected to generate cash savings of $2.0 million in 2022 and $4.0 million in subsequent years.
Reiterated 2022 Outlook
Based on sustained commercial momentum across its target markets, the company continues to expect its full year 2022 revenue to be within the range of $20 million and $25 million, with adjusted gross margin expected to range between 50% and 55%. Clever Leaves also expects adjusted EBITDA to range between $(23) million and $(20) million. In addition, the company expects approximately $2 million to $3 million of annual capital expenditures.
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