Real Good Food Eyes FY22 Revenue At Lower-End Of Outlook As Q3 Top-Line Misses Street View

  • Real Good Food Company Inc RGF reported third-quarter FY22 sales growth of 63.2% year-on-year to $37.55 million, missing the consensus of $40.01 million.
  • The revenue increase was primarily due to strong growth in sales volumes in the company's core product lines.
  • The gross profit decreased 25% Y/Y to $1.8 million, with a gross margin compressing from 10.2% to 4.7%.
  • The loss from operations widened to $(10.6) million from $(5.6) million last year.
  • The company held $5.4 million in cash and equivalents as of September 30, 2022.
  • Adjusted EBITDA loss for the quarter was $(3.8) million versus $(2.7) million last year.
  • Net loss for the quarter widened to $(13.1) million.
  • Outlook: Real Good Food sees FY22 net sales at the lower end of the prior guided range of $155 million - $160 million versus the consensus of $155.68 million.
  • It expects an FY22 adjusted gross margin of 19% - 21%. Adjusted EBITDA loss at the lower end of the guided range of $(7) million - $(9) million.
  • For FY23, the company expects net sales of at least $200 million (consensus $192.72 million), Adjusted gross margin of at least 24%, and Adjusted EBITDA in the mid-to-high single-digit million range.
  • Price Action: RGF shares are trading lower by 4.47% at $6.41 on the last check Friday.
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