Arcadia Biosciences, a producer and marketer of innovative plant-based health and wellness products, announced its financial and business results for the second quarter and first half of 2024. “The second quarter of 2024 marked a pivotal moment for Arcadia as we continue to transform the business and move towards becoming cash flow positive,” said T.J. Schaefer, President and CEO. “We monetized our wheat intellectual property through two key transactions: selling our resistant starch wheat trait to a wholly-owned subsidiary of Corteva Agriscience for $4 million, and selling our GoodWheat™ brand to Above Food for $4 million in net payments over the next three years. Additionally, we’ve achieved significant distribution gains for Zola® coconut water and launched two new flavors, positioning us to outpace category growth and gain market share.”
“Over the past two years, we’ve exited several underperforming brands, right-sized the organization, and streamlined our cost structure to extend our runway. While we continue to explore strategic alternatives, our focus for the remainder of the year is on reducing operating costs and accelerating growth in Zola,” Schaefer added.
Recent Operating and Business Highlights
- Arcadia Sells Resistant Starch Durum Trait to Corteva Agriscience: In May 2024, Arcadia sold its non-GMO Resistant Starch (RS) Durum trait to longtime partner Corteva Agriscience. This transaction advanced the monetization of Arcadia’s wheat technology with a one-time payment of $4 million.
- Arcadia Sells GoodWheat Brand to Above Food Corp: Also in Q2, Above Food Corp acquired the GoodWheat brand of better-for-you wheat products from Arcadia for $4 million in net payments over the next three years. GoodWheat, launched in 2018, helps consumers increase their fiber intake by using Arcadia’s patented non-GMO wheat grain, which is naturally higher in fiber and protein.
- Zola Coconut Water Ships New Flavors and Increases Sales: Zola continued to gain distribution as its new pineapple and lime flavors began shipping in Q2. Zola sales outperformed the coconut water category, with year-over-year sales increasing by 42%.
- Arcadia Announces CEO Transition: Following the recent departure of Stan Jacot, Thomas J. Schaefer was appointed President and CEO of Arcadia. Previously the Chief Financial Officer, Schaefer brings over 20 years of experience in investments, corporate finance, and consumer products.
Certain previously reported financial information has been reclassified to align with the current year’s presentation, related to the presentation of the financial results of Arcadia’s former GoodWheat and body care brands as discontinued operations. The financial information above, and the accompanying narrative, pertain to continuing operations unless stated otherwise.
More detailed financial statements are available in the Form 8-K filed today, accessible in the Investors section of the company’s website under SEC Filings.
Revenues
Revenue saw a slight increase during the second quarter of 2024 compared to the same period in 2023, driven by an increase in Zola sales, partially offset by a decrease in GLA sales. Revenue decreased by $86,000 during the first half of 2024 compared to the same period in 2023, due to a decline in GLA sales despite an increase in Zola sales year over year.
Operating Expenses
Operating expenses decreased by $3.4 million and $4.0 million during the second quarter and first half of 2024, respectively, compared to the same periods in 2023. This decrease was primarily due to a $4.0 million gain from the asset sale to Corteva Agriscience.
Cost of revenues decreased by $17,000 and $74,000 during the second quarter and first half of 2024, respectively, compared to the same periods in 2023, driven by reduced freight costs.
General and administrative expenses increased by $609,000 and $74,000 during the second quarter and first half of 2024, respectively, compared to the same periods in 2023. This increase was due to higher consulting and legal expenses associated with the transactions with Corteva and Above Food.
Net Income (Loss) Attributable to Common Stockholders
Net income attributable to common stockholders for the second quarter of 2024 was $1.1 million, or $0.78 per share, compared to $823,000, or $0.61 per share, for the same period in 2023. This improvement was primarily driven by a year-over-year decrease in net loss from discontinued operations.
Net loss attributable to common stockholders for the first half of 2024 was $1.4 million, or $1.00 per share, representing a $7.2 million improvement from the $8.6 million, or $7.70 per share, net loss for the same period in 2023. This improvement was primarily driven by the $4.0 million gain from the Corteva asset sale, along with the year-over-year decrease in net loss from discontinued operations.
