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Category: Tattooed Chef (TTCF)
Date: 30 June 2021 Stock price of Tattooed Chef : $21.03 Market Capital of Tattooed Chef: $1.72 billion We take a look at the 1st quarter 2021 earnings report of Tattooed Chef (TTCF) a leading plant-based food company offering a broad portfolio of innovative plant-based food products that taste great and are sustainably sourced. For the 1st quarter 2021 the group reported revenues of $52.7 million and a net loss of -$7.9 million
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Sam Galletti, President and CEO of Tattooed Chef - Our record start to the year demonstrates the strength of our business and the Tattooed Chef brand,” said Sam Galletti, President and CEO of Tattooed Chef. "
More About Tattooed Chef
Tattooed Chef is a leading plant-based food company offering a broad portfolio of innovative plant-based food products that taste great and are sustainably sourced. Tattooed Chef’s signature products include ready-to-cook bowls, zucchini spirals, riced cauliflower, acai and smoothie bowls, and cauliflower pizza crusts, which are available in the frozen food sections of leading national retail food stores across the United States. Understanding consumer lifestyle and food trends, and a commitment to innovation, allows Tattooed Chef to continuously introduce new products. Tattooed Chef provides great-tasting, approachable, and innovative products not only to the growing group of consumers who seek to adopt a plant-based lifestyle, but to any of the “People Who Give a Crop”.
Overview of Tattooed Chef's 1st quarter 2021 earnings report
Financial Highlights for the First Quarter of 2021 Compared to the First Quarter of 2020
First Quarter 2021 Results
Revenue increased by $19.5 million, or 59%, to $52.7 million in the three months ended March 31, 2021 compared to $33.2 million in the three months ended March 31, 2020. The revenue increase was primarily driven by an $18.4 million increase in “Tattooed Chef” branded products, and a $1.3 million increase in private label products and legacy products for select private label retailers. The increase in Tattooed Chef branded products resulted from expansion in the number of U.S. distribution points, as well as increased volume at existing retail customers with our current portfolio of products and new product introductions including smoothie bowls, vegetable blends, buffalo cauliflower, and other value-added riced cauliflower meals.
Gross profit was $13.7 million in the three months ended March 31, 2021 compared to $9.2 million in the three months ended March 31, 2020. Gross margin in the three months ended March 31, 2021 was 26.0% compared to 27.9% in the three months ended March 31, 2020. Gross margin in the three months ended March 31, 2021 decreased compared to the prior year period, however, on a sequential basis, first quarter gross margin increased 860 basis points compared to 17.4% in the fourth quarter of 2020 due to increased operational efficiencies.
Operating expenses increased $18.3 million to $20.7 million in the three months ended March 31, 2021 compared to $2.4 million in the three months ended March 31, 2020. The increase in operating expenses was primarily due to $3.2 million of stock-based compensation, $2.6 million in marketing, $2.6 million in public company and new employee costs, and $1.9 million in promotional expenses to invest in customers through promotional offers. The Company expects operating expenses to decrease as a percentage of revenue over time.
Net loss was $7.9 million in the three months ended March 31, 2021 compared to net income of $5.9 million in the prior year period, primarily driven by increased operating expenses.
Adjusted EBITDA loss was $3.0 million in the three months ended March 31, 2021, compared to Adjusted EBITDA of $7.4 million in the three months ended March 31, 2020. The decrease in Adjusted EBITDA was primarily due to the operating expenses that were previously mentioned.
- Revenue was $52.7 million, a 59% increase compared to $33.2 million in the prior year period; Tattooed Chef branded product revenue was a record $36.0 million, an increase of 105% compared to $17.6 million in the prior year period.
- Gross profit was $13.7 million, or 26% gross margin, compared to $9.2 million, or 28% gross margin, in the prior year period.
- Net loss was $7.9 million compared to net income of $5.9 million in the prior year period.
- Adjusted EBITDA loss was $3.0 million compared to Adjusted EBITDA of $7.0 million in the prior year period. Adjusted EBITDA is a non-GAAP financial measure defined under “Non-GAAP Measures.” Please see “Adjusted EBITDA Reconciliation” at the end of this press release.
First Quarter 2021 Results
Revenue increased by $19.5 million, or 59%, to $52.7 million in the three months ended March 31, 2021 compared to $33.2 million in the three months ended March 31, 2020. The revenue increase was primarily driven by an $18.4 million increase in “Tattooed Chef” branded products, and a $1.3 million increase in private label products and legacy products for select private label retailers. The increase in Tattooed Chef branded products resulted from expansion in the number of U.S. distribution points, as well as increased volume at existing retail customers with our current portfolio of products and new product introductions including smoothie bowls, vegetable blends, buffalo cauliflower, and other value-added riced cauliflower meals.
Gross profit was $13.7 million in the three months ended March 31, 2021 compared to $9.2 million in the three months ended March 31, 2020. Gross margin in the three months ended March 31, 2021 was 26.0% compared to 27.9% in the three months ended March 31, 2020. Gross margin in the three months ended March 31, 2021 decreased compared to the prior year period, however, on a sequential basis, first quarter gross margin increased 860 basis points compared to 17.4% in the fourth quarter of 2020 due to increased operational efficiencies.
Operating expenses increased $18.3 million to $20.7 million in the three months ended March 31, 2021 compared to $2.4 million in the three months ended March 31, 2020. The increase in operating expenses was primarily due to $3.2 million of stock-based compensation, $2.6 million in marketing, $2.6 million in public company and new employee costs, and $1.9 million in promotional expenses to invest in customers through promotional offers. The Company expects operating expenses to decrease as a percentage of revenue over time.
Net loss was $7.9 million in the three months ended March 31, 2021 compared to net income of $5.9 million in the prior year period, primarily driven by increased operating expenses.
Adjusted EBITDA loss was $3.0 million in the three months ended March 31, 2021, compared to Adjusted EBITDA of $7.4 million in the three months ended March 31, 2020. The decrease in Adjusted EBITDA was primarily due to the operating expenses that were previously mentioned.
Tattooed Chef management commentary on their 1st quarter 2021 earnings report
PARAMOUNT, Calif., May 12, 2021 (GLOBE NEWSWIRE) -- Tattooed Chef, Inc. (Nasdaq: TTCF) (“Tattooed Chef” or the “Company”), a leader in plant-based foods, today announced financial results for the three months ended March 31, 2021.
“Our record start to the year demonstrates the strength of our business and the Tattooed Chef brand,” said Sam Galletti, President and CEO of Tattooed Chef. “Branded revenue increased 105% in the first quarter across the mass, club, and grocery channels driven by successful product launches, increased distribution, and a promotion at a large club chain. We are executing on our growth strategy to increase distribution, build brand awareness, expand manufacturing capabilities, and diversify our product portfolio through innovation. We are investing in the business today in order to support strong long-term growth, and we believe the recently announced strategic acquisition of Foods of New Mexico will help create meaningful shareholder value going forward.”
“Our record start to the year demonstrates the strength of our business and the Tattooed Chef brand,” said Sam Galletti, President and CEO of Tattooed Chef. “Branded revenue increased 105% in the first quarter across the mass, club, and grocery channels driven by successful product launches, increased distribution, and a promotion at a large club chain. We are executing on our growth strategy to increase distribution, build brand awareness, expand manufacturing capabilities, and diversify our product portfolio through innovation. We are investing in the business today in order to support strong long-term growth, and we believe the recently announced strategic acquisition of Foods of New Mexico will help create meaningful shareholder value going forward.”
Sarah Galletti, Chief Creative Officer and “The Tattooed Chef”, added, “We are revolutionizing plant-based eating with the Tattooed Chef brand by tapping into consumer preferences and constantly bringing new ideas to the market. Our recent product launches in retail have been very successful and with the addition of our new manufacturing capabilities with the Foods of New Mexico acquisition, we have a pipeline of over 250 plant-based innovation ideas including ambient products and snacks.”
Balance Sheet and Cash Flow
As of March 31, 2021, the Company had cash and cash equivalents of $185 million.
Outlook
For full year 2021, the Company expects:
Balance Sheet and Cash Flow
As of March 31, 2021, the Company had cash and cash equivalents of $185 million.
Outlook
For full year 2021, the Company expects:
- Revenue in the range of $235 million to $242 million, an increase of 58% to 63% compared to 2020. This guidance implies 49% year-over-year growth on the base business to $222 million, and a $13 million to $20 million contribution from one of the two facilities included in the Foods of New Mexico acquisition, which is expected to close near-term. This revenue guidance excludes any revenue contribution from the second facility (Karsten) because it is currently not in operation. The Company expects to update guidance again once production begins at that facility in the coming months.
- Gross margin in the range of 20% to 25%
- Adjusted EBITDA in the range of $2 million to $4 million
- Capital expenditures in the range of $15 million to $20 million
Tattooed Chef (TTCF) stock price chart over the last 5 years
The image below shows the stock price history of Intel over the last 5 years. And its been a good time for Tattooed Chef stockholders with the stock increasing sharply by 119.8% over the last 5 years.
The stock of Tattooed Chef is trading at closer to its 52 week high than it is to itw 52 week low which is a clear indication that the short term sentiment and momentum of Tattooed Chef's stock is positive at this point in time.
The stock of Tattooed Chef is trading at closer to its 52 week high than it is to itw 52 week low which is a clear indication that the short term sentiment and momentum of Tattooed Chef's stock is positive at this point in time.
Latest stock valuation of Tattooed Chef
So what is Tattooed Chef stock worth based on their 1st quarter 2021 earnings report? Based on their earnings report our valuation model provides a target price (full value price) for Tattooed Chef at $6.20 a stock.
We therefore believe the stock of Tattooed Chef is overvalued at its current price of $21.03
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $6.20, thus a good entry point into Intel would be at $5.60 or below.
Since the stock of Tattooed Chef is trading at well above our suggested entry point we rate the stock of Tattooed Chef as a sell
We therefore believe the stock of Tattooed Chef is overvalued at its current price of $21.03
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $6.20, thus a good entry point into Intel would be at $5.60 or below.
Since the stock of Tattooed Chef is trading at well above our suggested entry point we rate the stock of Tattooed Chef as a sell
Next earnings release of Tattooed Chef
It is expected that Tattooed Chef will release their 2nd quarter 2021 earnings report in early August 2021
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