AppHarvest Shares Plummet On Q2 Earnings Disappointment, Reduced FY21 Outlook

AppHarvest Inc APPH reported second-quarter FY21 sales growth of 34.8% quarter-on-quarter, to $3.14 million, missing the analyst consensus of $5.87 million.
Operating expenses soared 1503% Y/Y to $27.5 million. The loss from operations widened Y/Y to $(40) million. Adjusted EBITDA loss was $(22.7) million.
Loss per share of $(0.32) missed the analyst consensus of $(0.19).
The company's Q2 results were impacted by operational headwinds and low market prices for tomatoes. It had sold 8.6 million pounds of tomatoes in Q2.
AppHarvest held $273.1 million in cash and equivalents as of June 30, 2021.
AppHarvest plans to organize internally under a holding company parent with three operating companies.
"Project New Leaf" targets $40 million annualized efficiencies and reductions in the cost of goods sold and selling, general and administrative expense. The project includes reductions in force.
AppHarvest has executed a nonbinding letter of intent with Mastronardi Produce to form a joint venture, FarmCo, to build and operate new high-tech CEA (controlled environment agriculture ) facilities and expand production.
Outlook: AppHarvest has cut FY21 sales outlook to $7 million - $9 million (prior $20 million - $25 million), versus the consensus of $21.72 million.
The company expects FY21 adjusted EBITDA loss to widen to $(75) million - $(70) million from $(52) million - $(48) million.
Looking ahead, the company reaffirmed its long-term 2025 outlook. It projects $350 million - $400 million in net sales in FY25.
Price Action: APPH shares are trading lower by 31.7% at $8.18 on the last check Wednesday.

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AppHarvest Shares Plummet On Q2 Earnings Disappointment, Reduced FY21 Outlook