Clever Leaves Holdings Inc. (NASDAQ: CLVR, CLVRW) (“Clever Leaves”
or the “Company”), a leading multinational operator and licensed
producer of pharmaceutical-grade cannabinoids, is reporting
financial and operating results for the fourth quarter and full
year ended December 31, 2022. All financial information is
provided in US dollars unless otherwise indicated.
“2022 was a transformational year for Clever
Leaves as we executed on our refined growth strategy,” said Andres
Fajardo, CEO of Clever Leaves. “Our full year revenue growth
exceeded our revised 2022 guidance target, reflecting the
commercial traction we have gained across our target markets in our
cannabinoid business, which grew 90% in 2022. We have also steadily
streamlined our cost structure throughout the year, driving a 30%
year-over-year decrease in our G&A expenses and sales and
marketing costs combined. Similarly, our capital expenditures
decreased by 82% in 2022 compared to 2021. This progress allowed us
to perform in line with our revised 2022 financial outlook across
our key metrics, even as we navigated ongoing revenue headwinds
from broader macroeconomic pressures within our non-cannabinoid
segment. As we move further into 2023, I believe we are positioned
to continue executing on our growth objectives from a leaner, more
efficient operational foundation.”
Fourth Quarter 2022 Summary vs. Same
Year-Ago Quarter
- Revenue
increased 10% to $4.6 million compared to $4.2 million. Cannabinoid
revenue increased 71% to $1.9 million compared to $1.1 million, and
non-cannabinoid revenue was $2.8 million compared to $3.1
million.
- All-in cost per
gram of dry flower was $3.46 compared to $0.47, attributed to the
Company’s significantly reduced agricultural output, along with
ongoing extraction and processing costs at its Colombian
operations. Cost per gram in the fourth quarter of 2022 also
reflects higher expenses related to the Portugal operations, which
the Company is in the process of winding down.
- Gross profit,
including a $0.9 million inventory provision, improved to $0.7
million, as compared to $(0.3) million gross profit in the year-ago
quarter, which included a $3.0 million inventory provision.
Adjusted gross profit (a non-GAAP financial measure defined and
reconciled herein), which excluded such inventory provisions, was
$1.6 million compared to $2.7 million.
- Gross margin,
which included such inventory provision of $0.9 million, was 15.3%
compared to (6.9)%, which included such inventory provision of $3.0
million. Adjusted gross margin (a non-GAAP financial measure
defined and reconciled herein), which excluded such inventory
provisions, was 35.2% compared to 64.1%.
- Net loss was
$28.8 million compared to $24.0 million, driven primarily by a
$23.1 million restructuring charge the Company recorded during the
quarter. Net loss in the year-ago period included an $18.5 million
non-cash goodwill impairment charge and a $3.3 million non-cash
share-based compensation expense.
- Adjusted EBITDA (a non-GAAP
financial measure defined and reconciled herein) improved to $(5.2)
million compared to $(6.6) million.
Full Year 2022 Summary vs.
2021
- Revenue
increased 16% to $17.8 million compared to $15.4 million.
Cannabinoid revenue increased 90% to $6.1 million compared to $3.2
million, and non-cannabinoid revenue was $11.7 million compared to
$12.1 million.
- All-in cost per
gram of dry flower was $0.87 compared to $0.22, attributed to the
aforementioned reduced agricultural output in Colombia, as well as
continued extraction processing costs on current inventory. Cost
per gram during the year also reflects higher production expenses
related to the Portugal operations, which the Company is in the
process of winding down.
- Gross profit was
$4.3 million, which included a $4.7 million inventory provision,
compared to $6.8 million, which included a $3.0 million inventory
provision. Adjusted gross profit, which excluded such inventory
provisions, was $9.1 million compared to $9.8 million.
- Gross margin,
which included such inventory provision of $4.7 million, was 24.3%
compared to 44.3%, which included such inventory provision of $3.0
million. Adjusted gross margin, which excluded such inventory
provisions, was 50.9% compared to 63.7%.
- Net loss was
$66.2 million compared to $45.7 million. This was primarily
attributable to a $26.9 million restructuring expense—largely
driven by the aforementioned charge related to the Company’s
wind-down of its Portugal operations—as well as the $19.0 million
intangible asset impairment charge the Company recorded on its
cannabis-related licenses in Colombia during the third quarter of
2022. Net loss in the prior year included the aforementioned $18.5
million non-cash goodwill impairment charge, as well as an $11.5
million non-cash share-based compensation expense and was offset by
the $16.9 million gain on measurement of warrant liability.
- Adjusted EBITDA (a non-GAAP
financial measure defined and reconciled herein) was $(23.1)
million compared to $(23.7) million.
Fajardo continued: “Throughout 2022, we worked
to align our commercial efforts on a select set of core
international markets, while optimizing our cost structure and
balance sheet to best support these pipeline opportunities. We
activated and ramped our market pathways across Australia, Germany,
Brazil, and Israel, signing new agreements and further developing
our existing partnerships. To enhance our capital efficiency, we
implemented various restructuring initiatives and paid off our two
largest debt instruments, which we believe will allow us to drive
greater cost savings and take meaningful steps towards positive
cash flow.
“As we previously announced, we believe the
ongoing wind-down of our Portugal operations—and our resulting
exclusive operational focus on Colombia—will further advance our
strategic progress. While we expect to continue incurring
restructuring charges related to the wind-down through the first
half of this year, we anticipate that the operational transition
will significantly reduce our cash burn over the longer term. From
a product standpoint, we are on track to complete our first
commercial dry flower export from Colombia to Australia early in
the second quarter of this year, with the expectation of launching
Colombian flower exports to Germany, Israel, and the United Kingdom
by the second half of this year. As we finalize our preparations
for dry flower exports in Colombia, we expect to leverage the
benefits of our mature, expansive, and cost-efficient production
infrastructure.
“As we look to the year ahead, we believe we are
well-positioned to further develop the commercial pathways we have
forged across our target markets for both extracts and dry flower,
while driving incremental improvements in our cost structure and
capital efficiency. We look forward to building upon our strong
foundation in Colombia and expanding our global reach as a nimble
multinational cannabis operator.”
Fourth Quarter 2022 Financial
Results
Revenue in the fourth quarter of 2022 increased
10% to $4.6 million compared to $4.2 million for the same period in
2021. The increase was driven by strong year-over-year revenue
growth within the cannabinoid segment. This was partially offset by
decreased sales within the Company’s non-cannabinoid segment due to
current economic challenges faced by mass retailers and specialty
channels.
All-in cost per gram of dry flower in the fourth
quarter of 2022 was $3.46 per gram compared to $0.47 per gram for
the same period in 2021. The increase was primarily attributable to
the Company’s significantly reduced agricultural output in
Colombia, in conjunction with ongoing extraction and processing
costs on existing inventory. Cost per gram during the fourth
quarter also reflects higher expenses associated with Clever
Leaves’ Portugal operations, which the Company is in the process of
winding down.
Gross profit, including a $0.9 million inventory
provision, improved to $0.7 million in the fourth quarter of 2022
compared to $(0.3) million for the same period of 2021, which
included a $3.0 million inventory provision. Gross margin, which
included such provisions, was 15.3% in the fourth quarter of 2022
compared to (6.9)% for the same period of 2021. Adjusted gross
profit, which excluded the above provisions, was $1.6 million
compared to $2.7 million for the same period of 2021, with an
adjusted gross margin of 35.2% compared to 64.1% for the same
period of 2021. The decrease was primarily driven by the
aforementioned revenue headwinds within the Company’s
non-cannabinoid segment.
Operating expenses in the fourth quarter of 2022
were $29.5 million compared to $29.9 million for the same period in
2021. The increase in operating expenses during the fourth quarter
were driven by a $23.1 million restructuring expense the Company
recorded during the quarter, which was primarily related to the
wind-down of its Portugal operations. Operating expenses in the
fourth quarter of 2021 include the impact of an $18.5 million
non-cash goodwill impairment charge related to the Company’s
acquisition of its Colombian operations in November 2019.
Net loss in the fourth quarter of 2022 was $28.8
million compared to a net loss of $24.0 million for the same period
in 2021. This was driven primarily by the aforementioned $23.1
million restructuring charge the Company recorded during the
quarter. Net loss in the year-ago quarter included the impact of
$18.5 million of non-cash goodwill impairment taken in the fourth
quarter of 2021 in addition to higher non-cash share-based
compensation expense, inventory provision, and non-cash interest
expense recognized in connection with the conversion feature
related to the Company’s Convertible Note due 2024 with Catalina
LP, partially offset by the gain on remeasurement of warrant
liability and continued cost-cutting measures.
Adjusted EBITDA in the fourth quarter of 2022
was $(5.2) million compared to $(6.6) million for the same period
in 2021. The improvement was mainly attributable to continued cost
reductions during the quarter.
Cash, cash equivalents and restricted cash were
$12.9 million at December 31, 2022, compared to $37.7 million
at December 31, 2021. The decrease was primarily attributable
to sustained operating losses, working capital needs, as well as
repayment of $23.1 million in debt obligations during the year.
This decrease was partially offset by $26.3 million in net proceeds
raised from the Company’s at-the-market stock offering year-to-date
through the third quarter, as well as by $2.5 million in proceeds
from the Company’s partial sale of its investment in Cansativa.
During 2022, the Company has largely eliminated its debt, reducing
outstanding debt levels by approximately 94% since the beginning of
the year.
Full Year 2022 Financial
Results
Revenue in 2022 increased 16% to $17.8 million
compared to $15.4 million in 2021. The increase was driven by
increased sales in the Company’s cannabinoid segment, in part
offset by a slight decrease in its non-cannabinoid segment. The
growth in the Company’s cannabinoid segment sales reflects
continued expansion of sales activity and selling more
higher-margin products. The decreased sales in the Company’s
non-cannabinoid segment were driven by current economic challenges
faced by its mass retailers and specialty distributors during the
year.
All-in cost per gram of dry flower in 2022 was
$0.87 per gram compared to $0.22 per gram in 2021. The increase was
primarily driven by the Company’s significantly reduced
agricultural output and continued extraction processing costs on
current inventory in Colombia, as well as higher expenses
associated with Clever Leaves’ Portugal facilities, which the
Company is in the process of winding down..
Gross profit, which included a $4.7 million
inventory provision, was $4.3 million in 2022 compared to $6.8
million in 2021, which included a $3.0 million inventory provision.
Gross margin, which included such provisions, was 24.3% in 2022
compared to 44.3% in 2021. The decrease reflects a higher inventory
provision for 2022, as well as the margin impact due to the
decrease in revenue in the non-cannabinoid segment. Adjusted gross
profit, which excluded such provisions, was $9.1 million compared
to $9.8 million in 2021, reflecting a 50.9% adjusted gross margin
compared to 63.7% in 2021. The decrease was primarily attributable
to the aforementioned revenue headwinds in the Company’s
non-cannabinoid segment.
Operating expenses in 2022 were $79.4 million
compared to $64.0 million in 2021. The increase was attributable to
the aforementioned $26.9 million restructuring expense—which was
primarily related to the wind-down of the Company’s Portugal
operations—as well as the $19.0 million non-cash intangible asset
impairment charge related to the Company’s Colombian
cannabis-related licenses in the third quarter of 2022. Operating
expenses in 2021 include the impact of the aforementioned $18.5
million non-cash goodwill impairment charge taken in the fourth
quarter of 2021 related to the Company’s acquisition of its
Colombian assets in 2019.
Net loss in 2022 was $66.2 million compared to a
net loss of $45.7 million in 2021. The increase was driven
primarily by the aforementioned $26.9 million restructuring charge
the Company incurred during the year, along with the $19.0 million
intangible asset impairment charge related to the Company’s
Colombian cannabis-related licenses in the third quarter of 2022.
Net loss in 2021 included the impact of the $18.5 million goodwill
impairment charge the Company recorded in the fourth quarter of
2021, in addition to higher non-cash share-based compensation
expense, inventory provision, and a non-cash interest expense
recognized in connection with the conversion feature related to the
2024 Convertible Note, partially offset by a gain on remeasurement
of warrant liability and continued cost-cutting measures.
Adjusted EBITDA in 2022 improved to $(23.1) million compared to
$(23.7) million in 2021. This primarily reflects the Company’s
sustained cost reduction measures throughout 2022.
2023 Outlook and Strategic Growth
Objectives
Pursuant to the operational and commercial
progress the Company made during 2022, Clever Leaves expects its
full year 2023 revenue to range between $19 million and $22
million, with an adjusted gross margin between 58% and 63%. Clever
Leaves also expects its 2023 adjusted EBITDA to range between
$(13.6) million and $(10.6) million. The Company expects
approximately $0.5 million to $0.7 million of annual capital
expenditures in 2023, representing an estimated 50% reduction
compared to 2022.
To further progress its commercial momentum,
Clever Leaves has identified the following focused strategic growth
objectives and key regions for 2023:
- Focused Commercial
Strategy: The Company will continue to capitalize on its
commercial traction within a concentrated set of core markets:
- Australia: Complete
commercial launch of Colombian flower shipments and capitalize on
existing flower traction. Continue scaling and securing additional
extract sales agreements.
- Germany: Support
additional product sales through current extract B2B partnerships.
Prepare for launch of Colombian flower in the second half of 2023,
leveraging the Company’s IQANNA brand and its B2B
partnerships.
- Brazil: Continue
activating sales agreements for products that have recently
received regulatory approval and complete approvals for other key
products.
- Israel: Support
current momentum for isolates and APIs and prepare for the launch
of Colombian flower in the second half of 2023.
- United Kingdom:
Activate and scale early commercial opportunities.
- Colombia: Sell
products in the local market through insurance, leveraging changes
in regulation enacted in December of 2022.
- Low-Cost, High-Quality
Production in Colombia: After concentrating its operations
in Colombia, Clever Leaves will continue to expand its already
successful extract portfolio and will commercially launch its
high-THC flower produced in Colombia. The Company will leverage its
scale, operating experience, and factor costs to continue improving
margins.
- Optimized Cash
Management: As the Company works to accelerate revenue
growth, leverage its low-cost unit economics in Colombia, and
continue reducing its operating expenses and capital intensity, it
is focused on improving its balance sheet, which may include
several initiatives such as raising capital, reducing working
capital and monetizing non-core assets. The Company remains
committed to maintaining a lean and efficient expense structure to
optimize its ability to drive continued growth and create
shareholder value.
With the new cost structure and unit economics,
revenue and expected growth, and operating footprint, Clever Leaves
believes it is well-positioned for the new opportunities emerging
in the global cannabis market. These include a larger number of
markets regulating medical cannabis, progress towards the
legalization of adult-use cannabis in various international
markets, and the development of large nascent markets, like Brazil
or Australia.
Extension for Nasdaq Minimum Bid Price
Requirement
On September 29, 2022, Clever Leaves received a
deficiency notice from the Nasdaq Listing Qualifications department
(“the Staff”) because its closing share price was below $1.00 for
30 consecutive business days between August 17, 2022 through
September 28, 2022 (the “Minimum Bid Price Requirement”). The
Company’s initial 180 calendar day compliance period ended March
28, 2023.
On March 29, 2023, the Company received a second
notice from Nasdaq indicating that, while Clever Leaves has not
regained compliance with the Minimum Bid Price Requirement, the
Staff has determined that we are eligible for an additional 180
calendar day period, or until September 25, 2023 (the “Second
Compliance Period”), to regain compliance. According to the Second
Notice, the Staff’s determination was based on (i) the Company’s
common shares meeting the continued listing requirement for market
value of publicly held shares and all other applicable requirements
for initial listing on The Nasdaq Capital Market, with the
exception of the Minimum Bid Price Requirement, and (ii) the
written notice of the Company’s intention to cure the deficiency
during the Second Compliance Period by effecting a reverse share
split, if necessary. If at any time during the Second Compliance
Period, the closing bid price of the Company’s common shares is at
least $1.00 per share for a minimum of 10 consecutive business
days, the Staff will provide Clever Leaves with written
confirmation of compliance.
The Company is actively monitoring the bid price
for its common shares and will consider available options to
resolve the deficiency and regain compliance with the Nasdaq
minimum bid price requirement. Further information on the bid price
deficiency and potential actions can be found in the Company’s Form
10-K for the year ended December 31, 2022.
Conference Call
Clever Leaves will conduct a conference call
today at 5:00 p.m. Eastern time to discuss its results for the
fourth quarter and full year ended December 31, 2022.
Clever Leaves management will host the
conference call, followed by a question-and-answer session.
Conference Call Date: March 30, 2023Time: 5:00 p.m. Eastern
timeToll-free dial-in number: 1-855-238-2333International dial-in
number: 1-412-317-5222Conference ID: 10175028
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting with the
conference call, please contact Gateway Group at (949)
574-3860.
The conference call will be broadcast live and available for
replay here.
A telephonic replay of the conference call will also be
available after 8:00 p.m. Eastern time on the same day through
April 4, 2023.
Toll-free replay number: 1-844-512-2921International replay
number: 1-412-317-6671Replay ID: 10175028
About Clever Leaves Holdings
Inc.
Clever Leaves is a leading multinational
operator and licensed producer of pharmaceutical-grade
cannabinoids. Its operations in Colombia produce cannabinoid active
pharmaceutical ingredients (API) and finished products in flower
and extract form to a growing base of B2B customers around the
globe. Clever Leaves aims to disrupt the traditional cannabis
production industry by leveraging environmentally sustainable,
ESG-friendly, industrial-scale and low-cost production methods,
with the world’s most stringent pharmaceutical quality
certifications. We announce material information to the public
through a variety of means, including filings with the SEC, press
releases, public conference calls, and our website
(https://cleverleaves.com). We use these channels, as well as
social media, including our Twitter account (@clever_leaves), and
our LinkedIn page (https://www.linkedin.com/company/clever-leaves),
to communicate with investors and the public about our Company, our
products, and other matters. Therefore, we encourage investors, the
media, and others interested in our Company to review the
information we make public in these locations, as such information
could be deemed to be material information. Information on or that
can be accessed through our websites or these social media channels
is not part of this release, and references to our website
addresses and social media channels are inactive textual references
only.
Non-GAAP Financial Measures
In this press release, Clever Leaves refers to
certain non-GAAP financial measures including Adjusted EBITDA,
Adjusted Gross Profit and Adjusted Gross Margin. Adjusted EBITDA,
Adjusted Gross Profit and Adjusted Gross Margin do not have
standardized meanings prescribed by GAAP and are therefore unlikely
to be comparable to similar measures presented by other companies.
Adjusted EBITDA is defined as income/loss from continuing
operations before interest, taxes, depreciation and amortization,
share-based compensation expense, intangible asset impairment,
restructuring expenses, gain on investments, foreign exchange
gain/loss, gains/losses on the early extinguishment of debt,
gain/loss on remeasurement of warrant liability, equity investment
share of gain/loss and other expense/income. Adjusted Gross Profit
(and the related Adjusted Gross Margin measure) is defined as gross
profit excluding inventory provision. Adjusted EBITDA, Adjusted
Gross Profit and Adjusted Gross Margin also exclude the impact of
certain non-recurring items that are not directly attributable to
the underlying operating performance. Clever Leaves considers
Adjusted EBITDA, Adjusted Gross Profit and Adjusted Gross Margin to
be meaningful indicators of the performance of its core business.
Adjusted EBITDA, Adjusted Gross Profit and Adjusted Gross Margin
should neither be considered in isolation nor as a substitute for
the financial measures prepared in accordance with U.S. GAAP. For
reconciliations of Adjusted EBITDA, Adjusted Gross Profit and
Adjusted Gross Margin to the most directly comparable U.S. GAAP
measures, see the relevant schedules provided with this press
release. We have not provided or reconciled the non-GAAP
forward-looking information to their corresponding GAAP measures
because the exact amounts for these items are not currently
determinable without unreasonable efforts but may be
significant.
Forward-Looking Statements This
press release includes certain statements that are not historical
facts but are forward-looking statements for purposes of the safe
harbor provisions under the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements generally
are accompanied by words such as “aim,” “anticipate,” “believe,”
“can,” “continue,” “could,” “estimate,” “evolve,” “expect,”
“forecast,” “future,” “guidance,” “intend,” “may,” “opportunity,”
“outlook,” “pipeline,” “plan,” “predict,” “potential,” “projected,”
“seek,” “seem,” “should,” “will,” “would” and similar expressions
(or the negative versions of such words or expressions) that
predict or indicate future events or trends or that are not
statements of historical matters. Such forward-looking statements
as well as our outlook for 2023 are subject to risks and
uncertainties, which could cause actual results to differ from the
forward-looking statements. Important factors that may affect
actual results or the achievability of the Company’s expectations
include, but are not limited to: (i) our ability to continue as a
going concern; (ii) our ability to maintain the listing of our
securities on Nasdaq; (iii) our ability to implement our
restructuring initiatives; (iv) expectations with respect to future
operating and financial performance and growth, including if or
when Clever Leaves will become profitable; (v) Clever Leaves’
ability to execute its business plans and strategy and to receive
regulatory approvals (including its goals in its five key markets);
(vi) Clever Leaves’ ability to capitalize on expected market
opportunities, including the timing and extent to which cannabis is
legalized in various jurisdictions; (vii) global economic and
business conditions, including recent economic sanctions against
Russia and their effects on the global economy; (viii) geopolitical
events (including the ongoing military conflict between Russia and
Ukraine), natural disasters, acts of God and pandemics, including
the economic and operational disruptions and other effects of
COVID-19 such as the global supply chain crisis, travel
restrictions, delays or disruptions to physical shipments
(including outright bans on imported products), delays in issuing
licenses and permits, delays in hiring necessary personnel to carry
out sales, cultivation and other tasks, and financial pressures
upon Clever Leaves and its customers; (ix) regulatory developments
in key markets for the Company's products, including international
regulatory agency coordination and increased quality standards
imposed by certain health regulatory agencies, and failure to
otherwise comply with laws and regulations; (x) uncertainty with
respect to the requirements applicable to certain cannabis products
as well as the permissibility of sample shipments, and other risks
and uncertainties; (xi) consumer, legislative, and regulatory
sentiment or perception regarding Clever Leaves’ products; (xii)
lack of regulatory approval and market acceptance of Clever Leaves’
new products which may impede its ability to successfully
commercialize its products; (xiii) the extent to which Clever
Leaves’ is able to monetize its existing THC market quota within
Colombia; (xiv) demand for Clever Leaves’ products and Clever
Leaves’ ability to meet demand for its products and negotiate
agreements with existing and new customers, including the sales
agreements identified as a part of the Company’s 2022 strategic
growth objectives; (xv) developing product enhancements and
formulations with commercial value and appeal; (xvi) product
liability claims exposure; (xvii) lack of a history and experience
operating a business on a large scale and across multiple
jurisdictions; (xviii) limited experience operating as a public
company; (xix) changes in currency exchange rates and interest
rates; (xx) weather and agricultural conditions and their impact on
the Company’s cultivation and construction plans, (xxi) Clever
Leaves’ ability to hire and retain skilled personnel in the
jurisdictions where it operates; (xxii) Clever Leaves’ rapid
growth, including growth in personnel; (xxiii) Clever Leaves’
ability to remediate a material weakness in its internal control
cover financial reporting and to develop and maintain effective
internal and disclosure controls; (xxiv) potential litigation;
(xxv) access to additional financing; and (xxvi) completion of our
construction initiatives on time and on budget. The foregoing list
of factors is not exclusive. Additional information concerning
certain of these and other risk factors is contained in Clever
Leaves’ most recent filings with the SEC. All subsequent written
and oral forward-looking statements concerning Clever Leaves and
attributable to Clever Leaves or any person acting on its behalf
are expressly qualified in their entirety by the cautionary
statements above. Readers are cautioned not to place undue reliance
upon any forward-looking statements, which speak only as of the
date made. Clever Leaves expressly disclaims any obligations or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in its expectations with respect thereto or any change in events,
conditions or circumstances on which any statement is based.
Clever Leaves Investor
Inquiries:Cody Slach or Jackie KeshnerGateway Group,
Inc.+1-949-574-3860CLVR@gatewayir.com
Clever Leaves Press Contacts:Rich
DiGregorioKCSA Strategic
Communications+1-856-889-7351cleverleaves@kcsa.com
Clever Leaves Commercial
Inquiries:Andrew MillerVice President Sales - EMEA, North
America, and
Asia-Pacific+1-416-817-1336andrew.miller@cleverleaves.com
|
|
CLEVER LEAVES HOLDINGS INC. |
Consolidated Statements of Financial Position |
(Amounts in thousands of U.S. Dollars, except share and per share
data) |
(Audited) |
|
|
|
|
December 31, 2022 |
December 31, 2021 |
Assets |
|
|
Current: |
|
|
Cash and cash equivalents |
$ |
12,449 |
|
$ |
37,226 |
|
Restricted cash |
|
439 |
|
|
473 |
|
Accounts receivable, net |
|
2,252 |
|
|
2,222 |
|
Prepaids, deposits and other receivables |
|
2,708 |
|
|
5,064 |
|
Inventories, net |
|
8,399 |
|
|
15,408 |
|
Total current assets |
|
26,247 |
|
|
60,393 |
|
|
|
|
Investment – Cansativa |
|
5,679 |
|
|
1,458 |
|
Property, plant and equipment, net |
|
15,463 |
|
|
30,932 |
|
Intangible assets, net |
|
3,354 |
|
|
23,117 |
|
Operating lease right-of-use assets, net |
|
1,303 |
|
|
- |
|
Other non-current assets |
|
52 |
|
|
260 |
|
Total Assets |
$ |
52,098 |
|
$ |
116,160 |
|
|
|
|
Liabilities |
|
|
Current: |
|
|
Accounts payable |
|
2,299 |
|
|
3,981 |
|
Accrued expenses and other current liabilities |
|
4,238 |
|
|
2,898 |
|
Convertible note due 2024, current portion |
|
- |
|
|
16,559 |
|
Loans and borrowings, current portion |
|
465 |
|
|
949 |
|
Warrant liability |
|
113 |
|
|
2,205 |
|
Operating lease liabilities, current portion |
|
1,239 |
|
|
- |
|
Deferred revenue |
|
1,072 |
|
|
653 |
|
Total current liabilities |
$ |
9,426 |
|
$ |
27,245 |
|
Convertible note due 2024 |
|
- |
|
|
1,140 |
|
Loans and borrowings |
|
1,065 |
|
|
6,447 |
|
Deferred revenue |
|
- |
|
|
1,548 |
|
Operating lease liabilities - Long-term |
|
1,087 |
|
|
Deferred tax liabilities |
|
- |
|
|
6,650 |
|
Other long-term liabilities |
|
112 |
|
|
360 |
|
Total Liabilities |
$ |
11,690 |
|
$ |
43,390 |
|
|
|
|
Shareholders’ equity |
|
|
Additional paid-in capital |
|
221,313 |
|
|
187,510 |
|
Accumulated deficit |
|
(180,905 |
) |
|
(114,740 |
) |
Total shareholders' equity |
|
40,408 |
|
|
72,770 |
|
Total liabilities and shareholders' equity |
$ |
52,098 |
|
$ |
116,160 |
|
CLEVER LEAVES HOLDINGS INC. |
Consolidated Statements of Operations and Comprehensive
Loss |
(Amounts in thousands of U.S. Dollars, except share and per share
data) |
|
|
(Unaudited) |
|
(Audited) |
|
For the three months ended December 31, |
|
For the year ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenue, net |
$ |
4,614 |
|
|
$ |
4,194 |
|
|
$ |
17,800 |
|
|
$ |
15,374 |
|
Cost of sales |
|
(3,906 |
) |
|
|
(4,485 |
) |
|
|
(13,470 |
) |
|
|
(8,565 |
) |
Gross Profit |
|
708 |
|
|
|
(291 |
) |
|
|
4,330 |
|
|
|
6,809 |
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
General and administrative |
|
5,454 |
|
|
|
7,980 |
|
|
|
27,815 |
|
|
|
39,279 |
|
Sales and marketing |
|
(179 |
) |
|
|
1,499 |
|
|
|
1,897 |
|
|
|
2,915 |
|
Research and development |
|
605 |
|
|
|
1,546 |
|
|
|
1,719 |
|
|
|
1,546 |
|
Restructuring expenses |
|
23,151 |
|
|
|
- |
|
|
|
26,942 |
|
|
|
Intangible asset impairment |
|
- |
|
|
|
- |
|
|
|
19,000 |
|
|
|
Goodwill impairment |
|
- |
|
|
|
18,508 |
|
|
|
- |
|
|
|
18,508 |
|
Depreciation and amortization |
|
497 |
|
|
|
328 |
|
|
|
2,059 |
|
|
|
1,768 |
|
Total expenses |
|
29,528 |
|
|
|
29,861 |
|
|
|
79,432 |
|
|
|
64,016 |
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(28,820 |
) |
|
|
(30,152 |
) |
|
|
(75,102 |
) |
|
|
(57,207 |
) |
|
|
|
|
|
|
|
|
Other Expense (Income), Net |
|
|
|
|
|
|
|
Interest and amortization of debt issuance cost |
|
(17 |
) |
|
|
4,435 |
|
|
|
2,702 |
|
|
|
6,818 |
|
Gain on remeasurement of warrant liability |
|
(83 |
) |
|
|
(11,466 |
) |
|
|
(2,092 |
) |
|
|
(16,856 |
) |
Gain on investments |
|
- |
|
|
|
- |
|
|
|
(6,851 |
) |
|
|
- |
|
Loss (gain) on debt extinguishment, net |
|
- |
|
|
|
113 |
|
|
|
2,263 |
|
|
|
(3,262 |
) |
Foreign exchange (gain) loss |
|
(291 |
) |
|
|
139 |
|
|
|
1,129 |
|
|
|
1,276 |
|
Other expense ( income), net |
|
91 |
|
|
|
(379 |
) |
|
|
202 |
|
|
|
(502 |
) |
Total other income, net |
|
(300 |
) |
|
|
(7,158 |
) |
|
|
(2,647 |
) |
|
|
(12,526 |
) |
|
|
|
|
|
|
|
|
Loss before income taxes and equity investment
loss |
|
(28,520 |
) |
|
|
(22,994 |
) |
|
|
(72,455 |
) |
|
|
(44,681 |
) |
Deferred income tax (recovery) expense |
|
- |
|
|
|
950 |
|
|
|
(6,650 |
) |
|
|
950 |
|
Current income tax expense |
|
296 |
|
|
|
- |
|
|
|
296 |
|
|
|
- |
|
Equity investment share of loss |
|
- |
|
|
|
56 |
|
|
|
64 |
|
|
|
95 |
|
Net loss |
$ |
(28,816 |
) |
|
$ |
(24,000 |
) |
|
$ |
(66,165 |
) |
|
$ |
(45,726 |
) |
Net loss per share - basic and diluted |
$ |
(0.66 |
) |
|
$ |
(0.91 |
) |
|
$ |
(1.72 |
) |
|
$ |
(1.78 |
) |
Weighted-average common shares outstanding - basic and
diluted |
|
43,612,539 |
|
|
|
26,353,878 |
|
|
|
38,392,392 |
|
|
|
25,690,096 |
|
CLEVER LEAVES HOLDINGS INC. |
Consolidated Statements of Cash Flows |
(Amounts in thousands of U.S. Dollars) |
(Audited) |
|
|
|
|
|
|
|
|
|
For the Year ended |
|
|
December 31, 2022 |
|
|
|
December 31, 2021 |
|
|
|
|
|
|
|
|
|
Cash Flow from Operating Activities: |
|
|
|
|
|
|
|
Net loss |
$ |
(66,165 |
) |
|
$ |
(45,726 |
) |
Adjustments to reconcile to net cash used in operating
activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
3,672 |
|
|
|
3,508 |
|
Amortization of debt discount and debt issuance cost |
|
1,949 |
|
|
|
4,227 |
|
Fixed asset write-off |
|
- |
|
|
|
228 |
|
Inventory provision |
|
4,736 |
|
|
|
2,980 |
|
Non-cash lease expense |
|
127 |
|
|
|
- |
|
Restructuring and related costs |
|
25,809 |
|
|
|
- |
|
Gain on remeasurement of warrant liability |
|
(2,092 |
) |
|
|
(16,856 |
) |
Deferred income tax (recover) expense |
|
(6,650 |
) |
|
|
950 |
|
Foreign exchange loss |
|
1,129 |
|
|
|
1,276 |
|
Share-based compensation expense |
|
2,343 |
|
|
|
11,451 |
|
Intangible asset impairment |
|
19,000 |
|
|
|
- |
|
Goodwill impairment |
|
- |
|
|
|
18,508 |
|
Gain on investment |
|
(6,851 |
) |
|
|
- |
|
Loss on equity method investment, net |
|
64 |
|
|
|
95 |
|
(Gain) loss on debt extinguishment, net |
|
2,263 |
|
|
|
(3,262 |
) |
Other non-cash expense, net |
|
600 |
|
|
|
697 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
(Increase) in accounts receivable |
|
(278 |
) |
|
|
(546 |
) |
Decrease in prepaid expenses |
|
190 |
|
|
|
506 |
|
Decrease (Increase) in other receivables and other non-current
assets |
|
538 |
|
|
|
(1,298 |
) |
(Increase) in inventory |
|
(4,453 |
) |
|
|
(8,198 |
) |
(Decrease) in accounts payable and other current liabilities |
|
(4,749 |
) |
|
|
(4,197 |
) |
(Decrease) in accrued and other non-current liabilities |
|
(248 |
) |
|
|
(576 |
) |
Net cash used in operating activities |
$ |
(29,066 |
) |
|
$ |
(36,233 |
) |
|
|
|
|
|
|
|
|
Cash Flow from Investing Activities: |
|
|
|
|
|
|
|
Proceeds from partial sale of equity method investment |
|
2,498 |
|
|
|
- |
|
Purchase of property, plant and equipment |
|
(1,306 |
) |
|
|
(7,280 |
) |
Net cash used in investing activities |
$ |
1,192 |
|
|
$ |
(7,280 |
) |
|
|
|
|
|
|
|
|
Cash Flow From Financing Activities: |
|
|
|
|
|
|
|
Proceeds from issuance of long-term debt |
|
- |
|
|
|
25,000 |
|
Repayment of debt |
|
(23,131 |
) |
|
|
(26,538 |
) |
Other borrowings |
|
73 |
|
|
|
2,917 |
|
Proceeds from issuance of shares |
|
27,686 |
|
|
|
- |
|
Equity issuance costs |
|
(1,361 |
) |
|
|
- |
|
Proceeds from exercise of warrants |
|
- |
|
|
|
1,410 |
|
Deferred debt issuance costs |
|
- |
|
|
|
(965 |
) |
Stock option exercised |
|
22 |
|
|
|
10 |
|
Net cash provided by financing activities |
$ |
3,289 |
|
|
$ |
1,834 |
|
Effect of exchange rate changes on cash, cash equivalents &
restricted cash |
|
(226 |
) |
|
|
(82 |
) |
(Decrease) in cash, cash equivalents & restricted cash |
$ |
(24,811 |
) |
|
$ |
(41,761 |
) |
Cash, cash equivalents & restricted cash, beginning of
period |
|
37,699 |
|
|
|
79,460 |
|
Cash, cash equivalents & restricted cash, end of period |
$ |
12,888 |
|
|
$ |
37,699 |
|
CLEVER LEAVES HOLDINGS INC. |
Adjusted EBITDA Reconciliation (Non-GAAP
Measure) |
(Amounts in thousands of U.S. Dollars) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net Loss |
$ |
(28,816 |
) |
|
$ |
(24,000 |
) |
|
$ |
(66,165 |
) |
|
$ |
(45,726 |
) |
Gain on remeasurement of warrant liability |
|
(83 |
) |
|
|
(11,466 |
) |
|
|
(2,092 |
) |
|
|
(16,856 |
) |
Share-based compensation |
|
(263 |
) |
|
|
3,314 |
|
|
|
2,343 |
|
|
|
11,451 |
|
Intangible asset impairment |
|
- |
|
|
|
- |
|
|
|
19,000 |
|
|
|
- |
|
Restructuring expenses |
|
23,151 |
|
|
|
- |
|
|
|
26,942 |
|
|
|
- |
|
Goodwill impairment |
|
- |
|
|
|
18,508 |
|
|
|
- |
|
|
|
18,508 |
|
Depreciation & amortization |
|
737 |
|
|
|
1,693 |
|
|
|
3,672 |
|
|
|
3,508 |
|
Interest expense and amortization of debt issuance costs |
|
(17 |
) |
|
|
4,435 |
|
|
|
2,702 |
|
|
|
6,818 |
|
Gain on investments |
|
- |
|
|
|
- |
|
|
|
(6,851 |
) |
|
|
- |
|
Foreign exchange (gain) loss |
|
(291 |
) |
|
|
139 |
|
|
|
1,129 |
|
|
|
1,276 |
|
Loss (gain) on debt extinguishment, net |
|
- |
|
|
|
113 |
|
|
|
2,263 |
|
|
|
(3,262 |
) |
Deferred income tax (recovery) expense |
|
- |
|
|
|
950 |
|
|
|
(6,650 |
) |
|
|
950 |
|
Current income tax expense |
|
296 |
|
|
|
- |
|
|
|
296 |
|
|
|
- |
|
Equity investment share of loss |
|
- |
|
|
|
56 |
|
|
|
64 |
|
|
|
95 |
|
Other expense (income), net |
|
91 |
|
|
|
(379 |
) |
|
|
202 |
|
|
|
(502 |
) |
Adjusted EBITDA (Non-GAAP Measure) |
$ |
(5,195 |
) |
|
$ |
(6,637 |
) |
|
$ |
(23,145 |
) |
|
$ |
(23,740 |
) |
CLEVER LEAVES HOLDINGS INC. |
Adjusted Gross Profit Reconciliation (Non-GAAP
Measure) |
(Amounts in thousands of U.S. Dollars) |
(Unaudited) |
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Revenue |
$ |
4,614 |
|
|
$ |
4,194 |
|
|
$ |
17,800 |
|
|
$ |
15,374 |
|
Cost of sales, before inventory provision |
|
(2,992 |
) |
|
|
(1,505 |
) |
|
|
(8,734 |
) |
|
|
(5,585 |
) |
Inventory provision |
|
(914 |
) |
|
|
(2,980 |
) |
|
|
(4,736 |
) |
|
|
(2,980 |
) |
Gross Profit |
$ |
708 |
|
|
$ |
(291 |
) |
|
$ |
4,330 |
|
|
$ |
6,809 |
|
Inventory provision |
|
(914 |
) |
|
|
(2,980 |
) |
|
|
(4,736 |
) |
|
|
(2,980 |
) |
Adjusted Gross Profit (Non-GAAP Measure) |
$ |
1,622 |
|
|
$ |
2,689 |
|
|
$ |
9,066 |
|
|
$ |
9,789 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit Margin (%) |
|
15.3 |
% |
|
|
-6.9 |
% |
|
|
24.3 |
% |
|
|
44.3 |
% |
Adjusted Gross Profit Margin (Non-GAAP Measure) (%) |
|
35.2 |
% |
|
|
64.1 |
% |
|
|
50.9 |
% |
|
|
63.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clever Leaves (NASDAQ:CLVR)
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