Beyond Meat losses mount on product launches, deep discounts; shares slump
(Reuters) -Past Meat Inc’s quarterly losses ballooned, because the plant-based protein maker spent closely on product launches and supplied large reductions because it tried to protect its market share in opposition to deep-pocketed gamers and nimble upstarts.
The corporate’s inventory slid 20% in prolonged buying and selling on Wednesday, as Past Meat reported a gross margin of 0.2% for the primary quarter ended April 2, a 30 proportion level slide from a 12 months earlier.
The corporate blamed greater manufacturing and delivery prices in addition to its transfer to launch a plant-based jerky with PepsiCo Inc for poor quarterly efficiency.
“To launch a first-time product at such a big scale and previous to the institution of our personal devoted and streamlined course of, we had to take action in an costly and inefficient method,” Chief Monetary Officer Philip Hardin mentioned on an earnings name.
The corporate can also be battling competitors from Tyson Meals Inc and Kellogg Co, that are spending closely to cater to the craze for plant-based meat, forcing Past Meat to supply deep reductions on its merchandise.
“Traders are going to be more and more questioning BYND’s path to profitability, which is not good for the shares in a rising rate of interest setting,” CFRA Analysis analyst Arun Sundaram wrote in a consumer observe.
Past Meat reported a per-share lack of $1.58 within the first quarter, in contrast with 43 cents a 12 months earlier and far wider than the market expectation of $1.01.
Sundaram additionally mentioned Past Meat has burnt practically $580 million over the previous 12 months, elevating the chance of a capital increase by the tip of 2022.
Omicron-induced decline in gross sales to eating places weighed on Past Meat’s income, which barely rose to $109.5 million within the newest quarter, lacking Wall Avenue’s expectations of $112.3 million, in response to IBES information from Refinitiv.
Shares of the corporate have shed practically 60% this 12 months.
(Reporting by Praveen Paramasivam in Bengaluru; Modifying by Shailesh Kuber)
