In This Article:
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Adjusted EBITA: Positive at $1.4 million, an improvement of $1.9 million year over year.
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Gross Margin: Increased 630 basis points year over year to 43.9%.
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Net Sales: Increased to $85.1 million, a nearly 4% increase compared to the first quarter of last year.
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Gross Profit: Increased by $6.5 million to $37.3 million for the quarter.
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Operating Expenses: $40.1 million or 47.2% of net sales, compared to $32.9 million or 40.1% of net sales last year.
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Net Loss: $5 million compared to a net loss of $1.6 million in the first quarter of last year.
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Cash Flow from Operating Activities: Improved to positive $2.5 million, a $9.6 million improvement year over year.
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Unrestricted Cash and Cash Equivalents: $3.3 million as of September 30, 2024.
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Outstanding Borrowings: $23.3 million under the credit facility with $27.1 million of additional borrowing capacity.
Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Farmer Bros Co (NASDAQ:FARM) reported solid sales growth and meaningful gains in both gross margin and adjusted EBITA on a year-over-year and quarter-over-quarter basis.
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The company achieved a milestone with the refresh of its premium Boyd's coffee brand, expanding it from a predominantly West Coast brand to a nationwide offering.
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Efforts to optimize and add density to existing DSD routes have contributed to improved customer retention and service.
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The company has been proactive in navigating coffee market volatility and changes in consumer behavior through nimble commodity purchasing and inventory management.
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Farmer Bros Co (NASDAQ:FARM) reported a positive adjusted EBITA of $1.4 million, marking a significant improvement from previous quarters.
Negative Points
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Operating expenses increased to $40.1 million or 47.2% of net sales, compared to $32.9 million or 40.1% of net sales in the first quarter of last year.
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The company reported a net loss of $5 million for the quarter, compared to a net loss of $1.6 million in the first quarter of last year.
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There were no asset sales during the first quarter of this fiscal year, contributing to the increase in operating expenses.
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The company acknowledges that financial results may not be linear quarter to quarter due to current volatility in coffee commodity markets and the macroeconomic environment.
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Farmer Bros Co (NASDAQ:FARM) recognizes that they are not yet seeing the top-line results needed for significant scale and long-term growth.
Q & A Highlights
Q: Can you discuss the growth and density in your routes, and how churn is being managed? A: John Moore, President and CEO, explained that churn is stabilizing better than expected despite industry headwinds. The company is focusing on customer service and optimizing routes rather than adding new ones. They aim to increase product penetration within existing accounts to unlock potential value.