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Farmer Bros. reports 20.6% increase in fiscal year 2021 net sales to $102.9 million

Farmer Bros Waheed Zaman

NORTHLAKE, Texas, US – Farmer Bros. Co. yesterday reported financial results for its fourth quarter and fiscal year ended June 30, 2021. Net sales were $102.9 million, an increase of $21.8 million, or 26.9%, from the prior year period due to notable improvement in the DSD channel compared to the prior year. Gross margin increased to 27.6% from 19.2% in the prior year period, and was the highest gross margin quarter during fiscal 2021.

Net loss was $4.0 million compared to a net loss of $9.7 million in the prior year period. Adjusted EBITDA was $3.4 million compared to $0.7 million in the prior year period*. As of June 30, 2021, total debt outstanding was $91.0 million and cash and cash equivalents was $10.3 million.

Negotiated new credit facilities, effectively increasing borrowing capacity and flexibility while lowering overall borrowing cost

Farmer Bros. Co.: Fiscal 2021 Highlights:

  • Net sales were $397.8 million, a decrease of $103.5 million, or 20.6%, from the prior year due primarily to the impact of the COVID-19 pandemic
  • Achieved notable improvement in DSD channel sales compared to pre-COVID levels during fiscal year 2021, with sequential improvement in every quarter, from down 45% at June 30, 2020 to down 27% for the fourth quarter of 2021
  • Gross margin decreased to 25.4% from 27.6% in the prior year, but improved sequentially in every quarter of the year.
  • Net loss was $41.7 million compared to a net loss of $37.1 million in the prior year period
  • Adjusted EBITDA was $16.6 million compared to $18.7 million in the prior year period
  • Successfully completed key initiatives within the company’s optimization strategy, including:
    • Doubling production and packaging capacity at the Northlake, Texas facility
    • Ending production and fully exiting the aged Houston, Texas facility
    • Opening a new West Coast distribution facility in Rialto, California, and
    • Completing full deployment of new handheld technology on our DSD routes

(*Adjusted EBITDA, a non-GAAP financial measure, is reconciled to its corresponding GAAP measure at the end of this press release.)

Deverl Maserang, Chief Executive Officer, commented, “We’re very pleased with the continued progress we made during our fourth fiscal quarter, which builds on the work we achieved throughout the year and positions us well heading into the new fiscal year. Our optimization strategies have led to solid efficiencies that we’re seeing increasingly materialize as volumes have steadily improved throughout the quarter. As a result, we posted our strongest quarterly gross margin since the onset of the pandemic, and we expect these efficiencies to strengthen as volumes continue to recover.” Mr. Maserang continued, “Just prior to the onset of the pandemic, we put several initiatives in place and outlined our turnaround strategy, which included rebalancing and strengthening our footprint, optimizing our manufacturing capabilities and supply chain, modernizing our facilities, and implementing new technologies to expand our offerings and streamline our sales process. I am very proud of our team’s execution through a challenging environment, and we are gaining confidence as we’re starting to see more positive changes flow through our business, benefiting our bottom line. While we remain vigilant given recent developments in the trajectory of the pandemic, we have yet to see any meaningful impact from the Delta variant, and we’re encouraged by the weekly trends we’ve seen in the first few weeks of our fiscal first quarter.”