LITTLE ROCK, Ark., USA – Westrock Coffee Company reported financial results for the first quarter ended March 31, 2023. Scott T. Ford, CEO and Co-founder stated, “We are pleased to report our first quarter results which continue to reflect the key product expansions of our growing platform, even as we work hard to bring through all of the potential EBITDA into our results.
As 2023 begins to take shape, we are focused on our two major initiatives of successfully launching our Conway extract and ready-to-drink facility in the first quarter of 2024 and continuing the maturation of our existing operations to be able to capture the profitability intrinsically available from our growing large-scale, global customer base.”
First Quarter Highlights
- Consolidated net sales were $205.4 million for the first quarter of 2023, an increase of $19.0 million, or 10%, compared to the first quarter of 2022.
- Consolidated gross profit for the first quarter of 2023 was $34.3 million and included $1.2 million of non-cash mark-to-market gains, compared to consolidated gross profit of $38.4 million for the first quarter of 2022, which included $1.1 million of non-cash mark-to-market gains. Gross profit was negatively impacted by unanticipated production down-time in the early part of the quarter related to the integration of a new enterprise resource planning system.
- Net loss for the period was $4.3 million, compared to a net loss of $4.7 million for the first quarter of 2022. The $4.3 million net loss for the first quarter of 2023 included $6.6 million of acquisition, restructuring and integration expense and $5.5 million of non-cash income from the change in fair value of warrant liabilities. Net loss of $4.7 million for the first quarter of 2022 included $2.5 million of acquisition, restructuring and integration expense.
- Adjusted EBITDA was $8.5 million for the first quarter of 2023, a decrease of $2.9 million, compared to the first quarter of 2022.
- Beverage Solutions segment contributed $181.2 million of net sales and $8.4 million of Adjusted EBITDA for the first quarter of 2023, compared to $148.4 million and $10.4 million, respectively, for the first quarter of 2022.
- SS&T segment, net of intersegment revenues, contributed $24.2 million of net sales and break-even Adjusted EBITDA for the first quarter of 2023, compared to $38.1 million and $1.0 million, respectively, for the first quarter of 2022.
Westrock Coffee: 2023 Outlook
The Company is reiterating its guidance for consolidated Adjusted EBITDA to grow 10% to 25% in full-year 2023, representing a range of $66 million to $75 million. This guidance is an estimate of what the Company believes is realizable as of the date of this release, and actual results may vary from this guidance and the variations may be material. Management will provide additional details regarding the 2023 outlook on the earnings results call later today.
The Company is not readily able to provide a reconciliation of forecasted Adjusted EBITDA to forecasted GAAP net income without unreasonable effort because certain items that impact such figure are uncertain or outside the Company’s control and cannot be reasonably predicted. Such items include the impacts of non-cash gains or losses resulting from mark-to-market adjustments of derivatives and the change in fair value of warrant liabilities, among others.