nologies, a global leader in the production and marketing of value added products derived from rice bran, announced the Company's financial results for the first quarter of 2014 ended March 31, 2014.Financial Highlights
- Q1 Adjusted EBITDA of $24,000 compared to a loss of $4.0 million in FY 2013
- Q1 consolidated gross margins increased to 18.4%, up from 9.9%
- Q1 consolidated gross profit increased 46% to $1.4 million
- Q1 USA Segment sales grew 72% with gross profit up 130%
W. John Short, CEO & President, commented: "Our performance improved significantly in the first quarter in several key financial measures. Consolidated gross profit and gross margins increased significantly despite the planned ten week interruption in production at our Irgovel plant. Additionally, USA segment revenues and margins increased significantly with the integration of Healthy Natural, Inc.'s ('H&N') operations and our continued emphasis on 'converting feed to food' through the re-engineering of our product mix to focus on higher margin nutritional and functional food products."
Short continued: "We have a focused business plan to meet our current 2014 financial guidance for full year revenues of $59 million and full year Adjusted EBITDA of $6 million. Our team is focused on delivering strong growth in the coming quarters. The expansion initiatives at Irgovel, H&N, and Dillon are all underway and when completed will enable us to grow our business substantially in the coming years."
Operating Results
Consolidated revenues for Q1 2014 were $7.7 million, a 12% decline compared to last year's first quarter consolidated revenues of $8.7 million. The decline was a direct result of the planned idling of the Company's Irgovel facility in Brazil for 10 weeks in the first quarter to allow installation of equipment necessary to increase capacity at the rice bran bio-refinery by at least 50% to 9,000 metric tons per month.
Revenue from the Brazil segment totaled $2.7 million, a sharp but temporary 53% decline compared to revenue of $5.8 million recorded in the first quarter of 2013. The Irgovel plant was restarted at the end of March and revenue from Brazil is expected to ramp up significantly throughout the remainder of 2014.
The temporary decline in revenues from Brazil was largely offset by a strong performance from the USA segment where revenues increased 72% to $5 million, up from $2.9 million recorded in Q1 2013. The strong growth in USA segment revenues was primarily due to the integration of the H&N acquisition.
Consolidated gross profit increased by 46% to $1.4 million with consolidated gross margins improving from 9.9% of revenues in Q1 2013 to 18.4% in Q1 2014. Operating expenses increased to $4.1 million in the first quarter of 2014 compared to $3.7 million in the 2013 period. The increase in operating expenses is attributable to a $500,000 non-cash intangible amortization charge and a $250,000 increase in SG&A expenses for acquisition costs. Both items are related to the H&N acquisition. Excluding the acquisition related items, operating expenses were actually down slightly in the first quarter of 2014 compared to the same period in 2013. The Company recorded an operating loss of $2.7 million in both periods despite the lost production during the plant upgrade in Brazil.
Adjusted EBITDA
Earnings before interest, taxes, depreciation, amortization, other non-cash charges and stock-based compensation for the first quarter of 2014 was a positive $24,000 - a significant improvement from a loss of ($4.0) million recorded in full year 2013. Adjusted EBITDA is a non-GAAP measure that management believes provides important insight into RBT's operating results (see reconciliation of non-GAAP measures below).
Net Loss
For the first quarter of 2014, the Company recorded a net loss attributable to common stockholders of ($1.9) million or a loss of ($0.62) per diluted share on 3.0 million weighted average shares outstanding. This compares to a loss of ($5.8) million or ($5.57) per diluted share on 1.0 million weighted average shares outstanding in the first quarter of 2013.
Additional information can be found in the Company's Form 10-Q filed with the United States Securities and Exchange Commission on May 15, 2014.
