SunOpta Announces Fourth Quarter and Fiscal 2024 Financial Results
Revenue from continuing operations increased 9% to $193.9 million, driven by volume growth
Loss from continuing operations of $4.6 million compared to a loss of $3.0 million in the prior year
Adjusted EBITDA from continuing operations increased 20% to $26.1 million
Delivered strong free cash flow and achieved targeted leverage of 3.0x
MINNEAPOLIS--(BUSINESS WIRE)--February 26, 2025--
SunOpta Inc. ("SunOpta" or the "Company") (Nasdaq:STKL) (TSX:SOY), an innovative and sustainable manufacturer fueling the future of food, today announced financial results for the fourth quarter ended December 28, 2024.
All amounts are expressed in U.S. dollars and results are reported in accordance with U.S. GAAP, except where specifically noted.
Fourth quarter 2024 highlights:
--
Revenues of $193.9 million increased 8.9% compared to $178.1 million in
the prior year period, driven by 12.8% volume growth partially offset by
a 2.1% price reduction for pass-through commodity pricing
--
Loss from continuing operations was $4.6 million compared to a loss of
$3.0 million in the prior year period
--
Adjusted earnings(1) from continuing operations was $7.6 million
compared to $4.5 million in the prior year period
--
Adjusted EBITDA(1) from continuing operations increased 20.0% to $26.1
million, or 13.5% of revenues, compared to $21.7 million, or 12.2% of
revenues, in the prior year period
--
Strong free cash flow enabling $24.7 million sequential reduction of
debt from Q3, driving achievement of leverage target of 3.0x
"We delivered another solid quarter led by double-digit volume growth reflecting broad strength across our portfolio," said Brian Kocher, Chief Executive Officer of SunOpta. "Our business momentum remains strong with productivity and efficiency initiatives progressing as planned, unlocking additional capacity. In 2025, we look to again drive strong growth and expand our market share by leveraging the competitive strengths of our platform to create unique, high value-add solutions for our customers. We will also maintain our disciplined financial approach to deliver sustainable gross margin improvement and continue to generate significant free cash flow. With no major growth capital investments on the horizon, we expect to continue de-levering our balance sheet and drive increasing returns on invested capital."
Fourth quarter 2024 Results
Revenues increased 8.9% to $193.9 million for the fourth quarter of 2024. The increase was driven by favorable volume/mix of 12.8%, partially offset by a price reduction of 2.1% due to the pass through of commodity costs for certain raw materials, together with a 1.7% revenue reduction related to our exit from the smoothie bowls category in March 2024. Volume/mix reflected volume growth for fruit snacks, broths, and plant-based beverages.
Gross profit decreased by $3.9 million, or 15.4%, to $21.2 million for the fourth quarter of 2024, compared to $25.0 million in the prior year period. As a percentage of revenues, gross profit margin was 10.9% compared to 14.1% in the fourth quarter of 2023. Adjusted gross margin(1) was 16.1% compared to 17.2% in the fourth quarter of 2023. The 110-basis point decrease in adjusted gross margin reflects incremental depreciation for newly launched production assets along with short-term investments to drive future sustainable supply chain efficiencies.
Operating income was $2.7 million down from $3.8 million in the fourth quarter of 2023, reflecting lower gross profit partially offset by lower SG&A expenses.
Loss from continuing operations was $4.6 million for the fourth quarter of 2024 compared with a loss of $3.0 million in the prior year period. Diluted loss per share from continuing operations attributable to common shareholders (after dividends and accretion on preferred stock) was $0.04 for the fourth quarter compared with a diluted loss per share of $0.03 in the prior year period.
Adjusted earnings(1) from continuing operations was $7.6 million or $0.06 per diluted share in the fourth quarter of 2024 compared to adjusted earnings from continuing operations of $4.5 million or $0.04 per diluted share in the fourth quarter of 2023.
Adjusted EBITDA(1) from continuing operations was $26.1 million in the fourth quarter of 2024 compared to $21.7 million in the fourth quarter of 2023.
In the fourth quarter of 2024, management identified certain errors related to prior year amounts, which were not material to the Company's previously issued financial statements. These principally related to underpayment of duties on certain of our products imported to the U.S. from Canada in fiscal years 2023 and 2022. We have revised the prior year financial results accordingly. In the aggregate, the correction of these errors had the effect of increasing the net losses previously reported for the fourth quarter and year ended December 30, 2023 by $1.8 million ($0.02 per share) and $3.8 million ($0.03 per share), respectively, and reducing our previous determinations of Adjusted EBITDA for those periods by $0.6 million and $2.6 million, respectively. These revisions are fully described in the Company's Annual Report on Form 10-K for fiscal 2024.
Please refer to the discussion and table below under "Non-GAAP Measures".
Balance Sheet and Cash Flow
As of December 28, 2024, SunOpta had total assets of $668.5 million and total debt of $265.2 million compared to total assets of $667.2 million and total debt of $263.5 million at year end fiscal 2023. During the fiscal year ended December 28, 2024, cash provided by operating activities of continuing operations was $52.3 million compared to $3.6 million of cash provided by operating activities of continuing operations during fiscal 2023. The increase in cash provided from operating activities mainly reflected improved working capital efficiency, together with increased operating income, driven by revenue growth. Investing activities of continuing operations consumed $25.0 million of cash during fiscal 2024, down from $46.5 million in fiscal 2023, reflecting lower capital expenditures together with proceeds from the sale of the smoothie bowl product line.
2025 Outlook(2)
The Company is introducing its outlook for fiscal 2025 and continues to expect strong growth in revenue and adjusted EBITDA:
($ millions) Outlook Growth
--------- ---------
Revenue $775 - 805 7% -- 11%
Adj. EBITDA $97 -- 103 9% - 16%
Conference Call
SunOpta plans to host a conference call at 5:30 P.M. Eastern time on Wednesday, February 26, 2025, to discuss the fourth quarter financial results. After prepared remarks, there will be a question and answer period. Investors interested in listening to the live webcast can access a link on SunOpta's website at www.sunopta.com under the "Investor Relations" section or directly. A replay of the webcast will be archived and can be accessed for approximately 90 days on the Company's website.
This call may be accessed with the toll free dial-in number (888) 440-4182 or international dial-in number (646) 960-0653 using Conference ID: 8338433.
(1) See discussion of non-GAAP measures
(2) The Company has included certain forward-looking statements about the future financial performance that include non-GAAP financial measures, including Adjusted EBITDA. These non--GAAP financial measures are derived by excluding certain amounts, expenses or income, from the corresponding financial measures determined in accordance with GAAP. The determination of the amounts that are excluded from these non-GAAP financial measures is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts recognized in a given period. We are unable to present a quantitative reconciliation of the aforementioned forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures because management cannot reliably predict all of the necessary components of such GAAP measures. Historically, management has excluded the following items from certain of these non-GAAP measures, and such items may also be excluded in future periods and could be significant amounts.
--
Expenses related to the acquisition or divestiture of a business,
including business development costs, impairment of assets, integration
costs, severance, retention costs and transaction costs;
--
Charges associated with restructuring and cost saving initiatives,
including but not limited to asset impairments, accelerated depreciation,
severance costs and lease abandonment charges;
--
Asset impairment charges and facility closure costs;
--
Legal settlements or awards; and
--
The tax effect of the above items.
About SunOpta Inc.
SunOpta (Nasdaq:STKL) (TSX:SOY) is an innovative and sustainable manufacturer fueling the future of food. With roots tracing back over 50 years, SunOpta drives growth for today's leading brands by serving as a trusted innovation partner and value-added manufacturer, crafting organic, plant-based beverages, fruit snacks, nutritional beverages, broths and tea products sold through retail, club, foodservice and e-commerce channels. Alongside the company's commitment to top brands, retailers and coffee shops, SunOpta also proudly produces its own brands, , including Sown$(R)$ , Dream(R) , and West Life$(TM)$ . For more information, visit www.sunopta.com and LinkedIn.
Forward-Looking Statements
Certain statements included in this press release may be considered "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, which are based on information available to us on the date of this release. These forward-looking statements include, but are not limited to, our intention to maintain our disciplined financial approach to deliver sustainable gross margin improvement and continue to generate significant free cash flow, our expectation to continue de-levering our balance sheet and drive increasing returns on invested capital and our anticipated Revenue, Adjusted EBITDA, Revenue growth and Adjusted EBITDA growth for fiscal 2025. Generally, forward-looking statements do not relate strictly to historical or current facts and are typically accompanied by words such as "potential", "expect", "believe", "anticipate", "estimates", "can", "will", "target", "should", "would", "plans", "continue", "becoming", "intend", "confident", "may", "project", "intention", "might", "predict", "budget", "forecast" or other similar terms and phrases intended to identify these forward-looking statements. Forward-looking statements are based on information available to the Company on the date of this release and are based on estimates and assumptions made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments including, but not limited to, the Company's actual financial results; uninterrupted operations and service levels to our customers; current customer demand for the Company's products; general economic conditions; continued consumer interest in health and wellness; the Company's ability to maintain product pricing levels; planned facility and operational expansions, closures and divestitures; cost rationalization and product development initiatives; alternative potential uses for the Company's capital resources; portfolio optimization and productivity efforts; the sustainability of the Company's sales pipeline; the Company's expectations regarding commodity pricing, margins and hedging results; procurement and logistics savings; freight lane cost reductions; yield and throughput enhancements; labor cost reductions; and the terms of our insurance policies. Whether actual timing and results will agree with expectations and predictions of the Company is subject to many risks and uncertainties including, but not limited to, potential loss of suppliers and customers as well as the possibility of supply chain, logistics and other disruptions; unexpected issues or delays with the Company's structural improvements and automation investments; failure or inability to implement portfolio changes, process improvements, go-to-market improvements and process sustainability strategies in a timely manner; changes in the level of capital investment; local and global political and economic conditions; consumer spending patterns and changes in market trends; decreases in customer demand; delayed or unsuccessful product development efforts; potential product recalls; working capital management; availability and pricing of raw materials and supplies; potential covenant breaches under the Company's credit facilities; and other risks described from time to time under "Risk Factors" in the Company's Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q (available at www.sec.gov). Consequently, all forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized. The Company undertakes no obligation to publicly correct or update the forward-looking statements in this document, in other documents, or on its website to reflect future events or circumstances, except as may be required under applicable securities laws.
SunOpta Inc.
Consolidated Statements of Operations
For the quarters and years ended December 28, 2024 and December 30, 2023
(Unaudited)
(All dollar amounts expressed in thousands of U.S. dollars, except per share
amounts)
Quarter ended Year ended
---------------------------- ----------------------------
December 28, December 30, December 28, December 30,
2024 2023(1) 2024 2023(1)
$ $ $ $
------------------ ------------- ------------- ------------- -------------
Revenues 193,909 178,057 723,728 626,730
Cost of goods sold 172,717 153,013 627,424 540,730
--------- --------- --------- ---------
Gross profit 21,192 25,044 96,304 86,000
Selling, general
and
administrative
expenses 18,236 20,251 79,406 78,654
Intangible asset
amortization 446 446 1,784 1,784
Other expense
(income), net (179) 475 (1,833) 455
Foreign exchange
loss (gain) (15) 66 1,357 110
--------- --------- --------- ---------
Operating income 2,704 3,806 15,590 4,997
Interest expense,
net 5,686 7,518 24,908 26,909
Other
non-operating
expense 450 - 686 -
--------- --------- --------- ---------
Loss from
continuing
operations before
income taxes (3,432) (3,712) (10,004) (21,912)
Income tax expense
(benefit) 1,187 (709) 1,470 3,269
--------- --------- --------- ---------
Loss from
continuing
operations (4,619) (3,003) (11,474) (25,181)
Net loss from
discontinued
operations (4,105) (10,482) (5,919) (153,608)
--------- --------- --------- ---------
Net loss (8,724) (13,485) (17,393) (178,789)
Dividends and
accretion on
preferred stock (138) (429) (539) (1,981)
--------- --------- --------- ---------
Loss attributable
to common
shareholders (8,862) (13,914) (17,932) (180,770)
--------- --------- --------- ---------
Basic and diluted
loss per share
Loss from
continuing
operations
attributable
to common
shareholders (0.04) (0.03) (0.10) (0.24)
Loss from
discontinued
operations (0.04) (0.09) (0.05) (1.34)
--------- --------- --------- ---------
Loss
attributable
to common
shareholders (0.08) (0.12) (0.15) (1.58)
--------- --------- --------- ---------
Weighted-average
common shares
outstanding
(000s)
Basic 116,951 115,793 116,617 114,226
Diluted 116,951 115,793 116,617 114,226
--------- --------- --------- ---------
(1) Revised from amounts previously filed to adjust for prior period errors.
More information is included in our Form 10-K.
SunOpta Inc.
Consolidated Balance Sheets
As at December 28, 2024 and December 30, 2023
(Unaudited)
(All dollar amounts expressed in thousands of U.S. dollars)
December 28, 2024 December 30, 2023(1)
$ $
--------------------------------- ----------------- ----------------------
ASSETS
Current assets
Cash and cash equivalents 1,552 306
Accounts receivable 46,314 63,023
Inventories 92,798 85,070
Prepaid expenses and other
current assets 14,680 23,776
Income taxes recoverable 4,114 4,717
Current assets held for sale - 5,910
---------------- ------------------
Total current assets 159,458 182,802
Restricted cash 7,460 8,448
Property, plant and equipment,
net 343,618 320,199
Operating lease right-of-use
assets 105,692 104,788
Intangible assets, net 20,077 21,861
Goodwill 3,998 3,998
Other long-term assets 28,224 25,055
---------------- ------------------
Total assets 668,527 667,151
---------------- ------------------
LIABILITIES
Current liabilities
Accounts payable 93,362 77,467
Accrued liabilities 17,876 22,724
Notes payable 11,110 17,596
Income taxes payable 638 -
Current portion of long-term
debt 29,393 24,647
Current portion of operating
lease liabilities 17,055 15,808
---------------- ------------------
Total current liabilities 169,434 158,242
Long-term debt 235,798 238,883
Operating lease liabilities 99,328 98,696
Deferred income taxes 325 505
---------------- ------------------
Total liabilities 504,885 496,326
Series B-1 Preferred Stock 15,048 14,509
SHAREHOLDERS' EQUITY
Common shares 471,792 464,169
Additional paid-in capital 30,775 28,188
Accumulated deficit (355,982) (338,050)
Accumulated other comprehensive
income 2,009 2,009
---------------- ------------------
Total shareholders' equity 148,594 156,316
---------------- ------------------
Total liabilities and
shareholders' equity 668,527 667,151
---------------- ------------------
(1) Revised from amounts previously filed to adjust for prior period errors.
More information is included in our Form 10-K.
SunOpta Inc.
Consolidated Statements of Cash Flows
For the years ended December 28, 2024 and December 30, 2023
(Unaudited)
(Expressed in thousands of U.S. dollars)
Year ended
-----------------------------------------
December 28, 2024 December 30, 2023(1)
$ $
--------------------------------- ----------------- ----------------------
CASH PROVIDED BY (USED IN)
Operating activities
Net loss (17,393) (178,789)
Net loss from discontinued
operations (5,919) (153,608)
---------------- ------------------
Loss from continuing operations (11,474) (25,181)
Items not affecting cash:
Depreciation and amortization 36,497 31,039
Amortization of debt issuance
costs 914 1,398
Deferred income taxes (180) 3,978
Stock-based compensation 11,190 12,432
Gain on sale of smoothie
bowls product line (1,800) -
Gain on sale of property,
plant and equipment (244) -
Loss on extinguishment of
debt - 1,584
Other (275) 707
Changes in operating assets
and liabilities, net of
divestitures 17,711 (22,382)
---------------- ------------------
Net cash provided by operating
activities of continuing
operations 52,339 3,575
Net cash provided by (used in)
operating activities of
discontinued operations (2,310) 11,269
---------------- ------------------
Net cash provided by operating
activities 50,029 14,844
---------------- ------------------
Investing activities
Additions to property, plant and
equipment (31,928) (46,125)
Proceeds from sale of smoothie
bowls product line 6,336 -
Proceeds from sale of property,
plant and equipment 612 -
Cash settlement of foreign
currency forward contract - (394)
---------------- ------------------
Net cash used in investing
activities of continuing
operations (24,980) (46,519)
Net cash provided by investing
activities of discontinued
operations 6,300 90,551
---------------- ------------------
Net cash provided by (used in)
investing activities (18,680) 44,032
---------------- ------------------
Financing activities
Increase (decrease) in borrowings
under revolving credit
facilities 2,187 (15,863)
Borrowings of long-term debt 1,446 199,855
Repayment of long-term debt (26,953) (95,303)
Repayment of asset-based credit
facilities - (141,880)
Payment of debt issuance costs - (3,297)
Proceeds from notes payable 129,662 102,043
Repayment of notes payable (136,148) (84,447)
Proceeds from the exercise of
stock options and employee share
purchases 1,935 1,882
Payment of withholding taxes on
stock-based awards (2,915) (9,404)
Payment of cash dividends on
preferred stock (305) (1,732)
Payment of common share issuance
costs - (191)
---------------- ------------------
Net cash used in financing
activities of continuing
operations (31,091) (48,337)
Net cash used in financing
activities of discontinued
operations - (2,464)
---------------- ------------------
Net cash used in financing
activities (31,091) (50,801)
---------------- ------------------
Increase in cash, cash
equivalents and restricted cash
in the period 258 8,075
Cash, cash equivalents and
restricted cash, beginning of
the period 8,754 679
---------------- ------------------
Cash, cash equivalents and
restricted cash, end of the
period 9,012 8,754
---------------- ------------------
(1) Revised from amounts previously filed to adjust for prior period errors.
More information is included in our Form 10-K.
In the fourth quarter of 2024, management identified certain underpayment of duties to U.S. Customs and Border Protection, recognized in cost of goods sold, for the period from January 2022 to December 2024. The identified errors related to prior years were not deemed material to the Company's previously issued financial statements, but it was determined that correcting the errors in the current period would be considered material to the Company's consolidated results of operations for fiscal 2024. As at December 28, 2024, the Company accrued $7.4 million for duties and interest thereon estimated to be owed for the impacted periods, of which $2.9 million related to each of the years ended December 28, 2024 and December 30, 2023, and $1.6 million related to the year ended December 31, 2022.
Additionally, the Company has corrected the financial results for the prior fiscal period for unrelated immaterial errors originating in fiscal 2023 that were previously corrected in fiscal 2024. The Company also reclassified certain consideration payable to a customer in 2023 from cost of goods sold to a reduction in revenues and remeasured certain lease assets and liabilities recognized as at December 30, 2023.
These revisions are fully described in the Company's Annual Report on Form 10-K for fiscal 2024.
Non-GAAP Measures
Adjusted Gross Margin
Gross margin is a measure of gross profit (equal to revenues less cost of goods sold) as a percentage of revenues. The Company uses a measure of adjusted gross margin that excludes non-capitalizable start-up costs that are incurred in connection with capital expansion projects. In recent years, the Company has undergone the largest capital expansion in its history, including the construction of a new plant-based beverage facility in Midlothian, Texas. As a result, start-up costs have had a significant impact on the comparability of reported gross margins, which may obscure trends in our margin performance. Additionally, the Company's measure of adjusted gross margin may exclude other unusual items that are identified and evaluated on an individual basis, which due to their nature or size, the Company would not expect to occur as part of its normal business on a regular basis.
The Company uses the measure of adjusted gross margin to evaluate the underlying profitability of its revenue-generating activities within each reporting period. The Company believes that disclosing this non-GAAP measure provides users with a meaningful, consistent comparison of its profitability measure for the periods presented. However, the non-GAAP measure of adjusted gross margin should not be considered in isolation or as a substitute for gross margin calculated based on gross profit determined in accordance with U.S. GAAP.
The following table presents a reconciliation of adjusted gross margin from reported gross margin calculated in accordance with U.S. GAAP.
Revenues Cost of Goods Sold Gross Profit
For the quarter ended $ $ $
------------------------- ----------- --------------------- ---------------
December 28, 2024
As reported 193,909 172,717 21,192
Adjustments:
Start-up costs(a) 1,306 (8,207) 9,513
Wastewater haul-off
charges(b) - (755) 755
----------- --------------------- ---------------
As adjusted 195,215 163,755 31,460
----------- --------------------- ---------------
Reported gross margin 10.9%
Adjusted gross margin 16.1%
---------------
Revenues(1) Cost of Goods Sold(1) Gross Profit(1)
For the quarter ended $ $ $
------------------------- ----------- --------------------- ---------------
December 30, 2023
As reported 178,057 153,013 25,044
Adjustments:
Start-up costs(a) 1,728 (666) 2,394
Product withdrawal
costs(c) - (3,440) 3,440
----------- --------------------- ---------------
As adjusted 179,785 148,907 30,878
----------- --------------------- ---------------
Reported gross margin 14.1%
Adjusted gross margin 17.2%
---------------
Revenues Cost of Goods Sold Gross Profit
For the year ended $ $ $
------------------------- ----------- --------------------- ---------------
December 28, 2024
As reported 723,728 627,424 96,304
Adjustments:
Start-up costs(a) 1,727 (14,608) 16,335
Wastewater haul-off
charges(b) - (4,361) 4,361
Product withdrawal
costs(c) - (2,145) 2,145
----------- --------------------- ---------------
As adjusted 725,455 606,310 119,145
----------- --------------------- ---------------
Reported gross margin 13.3%
Adjusted gross margin 16.4%
---------------
Revenues(1) Cost of Goods Sold(1) Gross Profit(1)
For the year ended $ $ $
------------------------- ----------- --------------------- ---------------
December 30, 2023
As reported 626,730 540,730 86,000
Adjustments:
Start-up costs(a) 1,728 (16,997) 18,725
Product withdrawal
costs(c) - (3,440) 3,440
----------- --------------------- ---------------
As adjusted 628,458 520,293 108,165
----------- --------------------- ---------------
Reported gross margin 13.7%
Adjusted gross margin 17.2%
---------------
Adjusted Earnings and Adjusted EBITDA from continuing operations
In addition to reporting financial results in accordance with U.S. GAAP, the Company provides additional information about its operating results regarding adjusted earnings and adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") from continuing operations, which are not measures in accordance with U.S. GAAP. The Company believes that adjusted earnings and adjusted EBITDA from continuing operations assist investors in comparing performance across reporting periods on a consistent basis by excluding items that management believes are not indicative of its operating performance. These non-GAAP measures are presented solely to allow investors to more fully assess the Company's results of operations and should not be considered in isolation of, or as substitutes for, an analysis of the Company's results as reported under U.S. GAAP.
The following are tabular presentations of adjusted earnings and adjusted EBITDA from continuing operations, including a reconciliation from loss from continuing operations, which the Company believes to be the most directly comparable U.S. GAAP financial measure.
December 28, 2024 December 30, 2023
----------------------- -------------------------
Per Share Per Share
For the quarters ended $ $ $ $
------------------------ ------------ --------- ------------ -----------
Loss from continuing
operations (4,619) (3,003)
Dividends and accretion
on preferred stock (138) (429)
-------- --------
Loss from continuing
operations attributable
to common
shareholders (4,757) (0.04) (3,432) (0.03)
Adjusted for:
Start-up costs(a) 11,494 2,394
Wastewater haul-off
charges(b) 755 -
Product withdrawal
costs(c) - 3,440
Unrealized foreign
exchange loss on
restricted cash(d) 244 -
Loss on
extinguishment of
debt(f) - 1,584
Other(i) (179) 491
-------- --------
Adjusted earnings from
continuing operations 7,557 0.06 4,477 0.04
-------- -------- -------- --------
December 28, 2024 December 30, 2023(1)
For the quarters ended $ $
--------------------------------- ------------------- ----------------------
Loss from continuing operations (4,619) (3,003)
Interest expense, net 5,686 7,518
Loss on sale of receivables* 450 -
Income tax expense (benefit) 1,187 (709)
Depreciation and amortization 9,492 8,166
Stock-based compensation 1,575 3,443
Adjusted for:
Start-up costs(a) 11,494 2,394
Wastewater haul-off
charges(b) 755 -
Product withdrawal costs(c) - 3,440
Unrealized foreign exchange
loss on restricted cash(d) 244 -
Other(i) (179) 491
--------------- ------------------
Adjusted EBITDA from continuing
operations 26,085 21,740
--------------- ------------------
* Included in other non-operating expense.
December 28, 2024 December 30, 2023(1)
--------------------- -------------------------
Per Share Per Share
For the years ended $ $ $ $
---------------------- ---------- --------- ------------ -----------
Loss from continuing
operations (11,474) (25,181)
Dividends and
accretion on
preferred stock (539) (1,981)
--------- -----------
Loss from continuing
operations
attributable to
common
shareholders (12,013) (0.10) (27,162) (0.24)
Adjusted for:
Start-up costs(a) 19,149 20,249
Wastewater
haul-off
charges(b) 4,361 -
Product
withdrawal
costs(c) 2,145 3,440
Unrealized
foreign exchange
loss on
restricted
cash(d) 1,607 -
Business
development
costs(e) - 2,390
Loss on
extinguishment
of debt(f) - 1,584
Severance
costs(g) - 897
Gain on sale of
smoothie bowls
product line(h) (1,800) -
Other(i) (33) 471
Change in
valuation
allowance for
deferred tax
assets(j) - 3,978
--------- -----------
Adjusted earnings from
continuing
operations 13,416 0.11 5,847 0.05
--------- -------- ----------- --------
December 28, 2024 December 30, 2023(1)
For the years ended $ $
--------------------------------- ------------------- ----------------------
Loss from continuing operations (11,474) (25,181)
Interest expense, net 24,908 26,909
Loss on sale of receivables* 686 -
Income tax expense 1,470 3,269
Depreciation and amortization 36,497 31,039
Stock-based compensation 11,190 12,432
Adjusted for:
Start-up costs(a) 19,149 20,249
Wastewater haul-off
charges(b) 4,361 -
Product withdrawal costs(c) 2,145 3,440
Unrealized foreign exchange
loss on restricted cash(d) 1,607 -
Business development costs(e) - 2,390
Severance costs(g) - 897
Gain on sale of smoothie
bowls product line(h) (1,800) -
Other(i) (33) 471
--------------- ------------------
Adjusted EBITDA from continuing
operations 88,706 75,915
--------------- ------------------
* Included in other non-operating expense.
Footnotes
(1) Revised from amounts previously filed to adjust for prior period
errors. More information is included in our Form 10-K.
(a) For the fourth quarter and year ended 2024, start-up costs of $9.5
million and $16.3 million, respectively, were recorded as a reduction
of revenues ($1.3 million and $1.7 million, respectively) and an
increase to cost of goods sold ($8.2 million and $14.6 million,
respectively). Start-up costs in 2024 were mainly related to the
scale-up of production at our plant-based beverage facility in
Midlothian, Texas, including the start-up of a new high-speed Edge
line, as well as the impact of production downtime during the fourth
quarter of 2024, to allow for the installation of new electrical
switchgear to replace temporary equipment that had been put in use due
to supply chain disruptions during the facility's construction.
Additionally, for the fourth quarter and year ended 2024, start-up
costs included $2.0 million and $2.8 million, respectively, of
consultancy fees related to operational productivity initiatives, which
were recorded in SG&A expenses.
For the fourth quarter and year ended 2023, start-up costs of $2.4
million and $18.7 million, respectively, were recorded as a reduction
of revenues ($1.7 million for the fourth quarter and year) and an
increase to cost of goods sold ($0.7 million and $17.0 million,
respectively). Start-up costs in 2023 were mainly related to the
initial ramp-up of production at our Midlothian, Texas, facility, and
the addition of new extrusion and high-speed packaging lines at our
fruit snacks facility in Omak, Washington.
Additionally, for the year ended 2023, start-up costs included $1.5
million of consultancy fees related to operational productivity
initiatives, which were recorded in SG&A expenses.
(b) Reflects temporary third-party haul-off charges for excess wastewater
produced at our Midlothian, Texas, facility, due to volume constraints
within our current treatment system. These charges are recorded in cost
of goods sold.
(c) For the year ended 2024, reflects certain direct costs, net of expected
insurance recoveries, related to the voluntary withdrawal from
customers of certain batches of aseptically packaged products that may
have had the potential for non-pathogenic microbial contamination.
For the fourth quarter and year ended 2023, reflects direct costs, net
of expected recoveries, related to the withdrawal from customers of
specific batches of aseptically-packaged product due to a faulty seal
caused by an equipment misconfiguration by a third-party service
provider. Product withdrawal costs are recorded in cost of goods sold.
(d) For the fourth quarter and year ended 2024, reflects an unrealized
foreign exchange loss associated with peso-denominated bank accounts in
Mexico that were retained following the divestiture of our Frozen Fruit
business ("Frozen Fruit") in 2023. These accounts are currently subject
to a judicial hold in connection with a litigation matter.
(e) For the year ended 2023, business development costs were related to the
divestiture of Frozen Fruit. These costs are recorded in SG&A
expenses.
(f) For the quarter and year ended 2023, reflects a loss on the
extinguishment of debt in connection with the refinancing of our credit
agreement in December 2023, which is recorded in interest expense,
net.
(g) For the year ended 2023, reflects employee severance costs recognized
in connection with the consolidation of our continuing operations
following the divestiture of Frozen Fruit, which are recorded in SG&A
expenses.
(h) For the year ended 2024, reflects the pre-tax gain on sale of the
smoothie bowls product line, which is recorded in other income.
(i) For the quarter ended 2024, other reflects a gain on sale of a former
warehouse facility. Additionally, for the year ended 2024, other
includes gains on the settlement of certain legal matters, partially
offset by accrued demolition costs related to our former roasted snack
facility, which was abandoned in 2018. For the quarter and year ended
2023, other includes a $0.4 million loss on a foreign exchange hedge in
connection with the divestiture of Frozen Fruit and reserves for legal
settlements. These other amounts are recorded in other expense/income.
(j) For the year ended 2023, reflects an increase to the valuation
allowance for U.S. deferred tax assets based on an assessment of the
future realizability of the related tax benefits.
Quarterly Adjusted EBITDA from Continuing Operations
The following table presents quarterly adjusted EBITDA from continuing operations.
Fiscal 2024
------------------------------------------------------------
Quarter ended Year ended
----------------------------------------------- -----------
March 30, June 29, September December December
2024 2024 28, 2024 28, 2024 28, 2024
$ $ $ $ $
----------- -------- ----------- ----------- -----------
Earnings (loss)
from
continuing
operations 3,796 (4,437) (6,214) (4,619) (11,474)
Interest
expense, net 6,050 6,410 6,762 5,686 24,908
Loss on sale of
receivables* - - 236 450 686
Income tax
expense
(benefit) 277 (17) 23 1,187 1,470
Depreciation
and
amortization 8,576 9,110 9,319 9,492 36,497
Stock-based
compensation 4,645 2,443 2,527 1,575 11,190
Adjusted for:
Start-up
costs 327 2,348 4,980 11,494 19,149
Wastewater
haul-off
charges - 1,426 2,180 755 4,361
Product
withdrawal
costs - 2,145 - - 2,145
Unrealized
foreign
exchange
loss on
restricted
cash - 838 525 244 1,607
Gain on
sale of
smoothie
bowls
product
line (1,800) - - - (1,800)
Other - (304) 450 (179) (33)
------- ------- ------- ------- -------
Adjusted EBITDA
from
continuing
operations 21,871 19,962 20,788 26,085 88,706
------- ------- ------- ------- -------
* Included in other non-operating expense.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250226033897/en/
CONTACT: Investor Relations:
Reed Anderson
ICR
646-277-1260
reed.anderson@icrinc.com
Media Relations:
Claudine Galloway
SunOpta
952-295-9579
press.inquiries@sunopta.com
(END) Dow Jones Newswires
February 26, 2025 17:00 ET (22:00 GMT)
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.