Air-Dried Beef Company To Restructure After "Record High Revenues," Will Raise $20M In New Financing As Shares Dive 16%

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  • Stryve Foods Inc SNAX reported second-quarter FY22 sales growth of 49% year-on-year to $10.95 million, missing the consensus of $13.45 million.
  • Gross loss for the quarter was $(4.4) million versus a gross profit of $3.6 million last year.
  • The company attributed the negative gross margin to price/mix on a large scale, but most significantly by a limited-time, retailer specific promotional program.
  • Operating expenses increased 35% Y/Y to $11.5 million.
  • The operating loss widened to $(16) million, and the net loss deepened to $(16.4) million.
  • Adjusted EBITDA loss for the quarter was $(11.4) million versus $(4.4) million last year.
  • The company held $5 million in cash and equivalents as of June 30, 2022.
  • Adjusted EPS loss of $(0.39) missed the consensus of $(0.33).
  • Outlook: Stryve Foods sees FY22 sales of $35 million - $37 million (prior view $43 million - $48 million) versus the consensus of $43.88 million.
  • Restructuring: The company plans to reduce operating expenses in the second half by greater than 50% year-over-year, and introduce a productivity program, focused on quality growth, efficiencies, and disciplined execution.
  • The company is positioned for new debt financing, including over $20 million in non-dilutive borrowing capacity.
  • Price Action: SNAX shares are trading lower by 16.19% at $0.80 on the last check Monday.
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