Edible Garden (EDBL) Q4 2024 earnings summary

Executive summary

• Gross profit for 2024 grew 181.3% and gross margin nearly tripled to 16.7% due to a strategic focus on the core herb business and vertical integration.

• Core herb business revenue grew 16.3% year-over-year, offsetting declines from the exit of lower-margin lettuce and floral categories.

• Operational realignment, cost controls, and capital raises improved working capital, liquidity, and operational efficiency.

• Signed a non-binding letter of intent to acquire Narayan Group, aiming to expand internationally and diversify product offerings.

• Innovation initiatives included launching new shelf-stable products, a clean-labeled sports nutrition line, and sustainable packaging, earning recognition in the 2024 Food Tech 500.

Financial highlights

• Full-year 2024 revenue was $13.9 million, a 1.4% decrease from 2023, with a $1.8 million increase in core herb sales offsetting declines elsewhere.

• Cost of goods sold for 2024 decreased by $1.7 million (12.7%) to $11.6 million, driven by internalizing production and product mix shift.

• Gross profit rose to $2.3 million from $0.8 million, and gross margin improved from 5.9% to 16.7%.

• Net loss for 2024 was $11.1 million, up from $10.2 million in 2023, due to higher SG&A and interest costs.

• Cash at year-end was $3.5 million, up from $0.5 million in 2023.

Outlook and guidance

• Management expects continued margin expansion and top-line growth in 2025, driven by new product launches, operational efficiencies, and vertical integration.

• No significant one-time charges are anticipated in Q1 2025 related to the exit from lettuce and floral businesses.

• Targeting gross profit margins of 35-40% as product mix shifts toward higher-margin, shelf-stable products.

• Acquisition of Narayan, if completed, is expected to drive global expansion and operational efficiencies.

• Anticipates accelerated top-line growth as the transition to higher-margin products is complete.