Clever Leaves Reports Fourth Quarter And Full Year 2021 Results

Clever Leaves Holdings Inc. CLVRW, a leading multinational operator and licensed producer of pharmaceutical-grade cannabinoids reported late Thursday its financial and operating results for the fourth quarter and full-year ended December 31, 2021.

Full-Year 2021 Financial Results

Revenue in 2021 increased 27% to $15.4 million compared to $12.1 million in 2020.
Cost per gram of dry flower in 2021 was $0.22 per gram compared to $0.14 per gram in 2020.
Gross profit, including a $3.0 million inventory write-down, was $6.8 million compared to $7.4 million in 2020, with a gross margin of 44.3% compared to 61.2% in 2020.
Adjusted gross profit, which excludes such inventory write-down, increased 25% to $9.8 million compared to $7.8 million in 2020, reflecting a 63.7% adjusted gross margin compared to 64.5% in 2020.
Operating expenses in 2021 were $45.5 million, which excludes the impact of an $18.5 million non-cash goodwill impairment charge related to the Company’s acquisition of its Colombia operations in November 2019.
Net loss in 2021 was $45.7 million compared to a net loss of $25.9 million in 2020.
Adjusted EBITDA in 2021 was $(24.9) million compared to $(23.3) million in 2020.

Highlights Of The Fourth Quarter 2021

• Revenue increased 25% in 2021, to $4.2 million.
• Cannabinoid revenue increased 11% to $1.1 million.
• Non-cannabinoid revenue increased 31% to $3.1 million.
• Net loss was $24.0 million.
• “We have made progress in the fourth quarter by strengthening our operational foundation and advancing our commercial momentum to better position us for 2022,” said Andres Fajardo, president and incoming CEO of Clever Leaves. “We delivered year-over-year revenue growth of 26% and 29% across our non-cannabinoid and cannabinoid businesses, respectively. We also maintained our prudent approach to cost management as we drove continued production efficiencies. We believe the incremental milestones we achieved throughout our first year as a public company will enable us to leverage our low-cost production advantages and advance our global distribution efforts in 2022."

Fourth Quarter 2021 Financial Results

Revenue in the fourth quarter of 2021 increased 25% to $4.2 million compared to $3.3 million for the same period in 2020, driven by sustained performance strength within the non-cannabinoid segment, as well as the cannabinoid segment.

All-in cost per gram of dry flower in the fourth quarter of 2021 was $0.47 per gram compared to $0.15 per gram for the same period in 2020. The increase was primarily attributable to continued production costs associated with ramping early-stage operations in Portugal, partially offset by sustained cost efficiencies in the Company’s Colombian production operations.

Gross profit, including a $3.0 million inventory write-down, was $(0.3) million compared to $2.3 million for the same period of 2020, with a gross margin of (6.9)% compared to 67.9% for the same period of 2020.

Adjusted gross profit, which excludes such write-down, was flat at $2.7 million compared to $2.7 million for the same period of 2020, with an adjusted gross margin of 64.1% compared to 79.8% for the same period of 2020. 

Operating expenses in the fourth quarter of 2021 were $11.4 million, excluding the impact of an $18.5 million non-cash goodwill impairment charge related to the Company’s acquisition of its Colombia operations in November 2019, compared to $9.6 million for the same period in 2020. .

Net loss in the fourth quarter of 2021 was $24.0 million compared to a net loss of $0.9 million for the same period in 2020. 

Adjusted EBITDA in the fourth quarter of 2021 was $(7.8) million compared to $(6.3) million for the same period in 2020. This was primarily driven by higher public company expenses. Cash, cash equivalents, and restricted cash were $37.7 million on December 31, 2021, compared to $79.5 million on December 31, 2020.

After completing a cultivation expansion in Portugal, in the third quarter, Clever received a license from the Portuguese regulatory health authority, INFARMED, I.P. The firm plans to ramp up its Portuguese flower operations. Meanwhile, in Colombia, Clever continued to prepare its operations to support dried flower exports.

Clever launched its CBD brand, JoySol, in the U.S. and is leveraging its robust distribution and production networks to expand overall market opportunities.

In 2022, Clever announced two new supply agreements in Australia and three agreements in Germany, comprising both new partnerships and expanded agreements with current partners. “We are making similar commercial strides within Israel, including our recently announced global strategic partnership with InterCure INCR,” Fajardo explained.

2022 Outlook

Following on the operational and commercial progress Clever Leaves has made throughout 2021, the Company continues to expect full-year 2022 revenue to range between $20 million and $25 million, with an adjusted gross margin between 50% and 55%. Clever Leaves also expects adjusted EBITDA to range between $(23) million and $(20) million. The Company expects approximately $2 million to $3 million of annual capital expenditures, representing an estimated 70% reduction compared to 2021.

Photo by Damir Spanic on Unsplash.