Orlando, Fla, Jan. 13, 2023 (GLOBE NEWSWIRE) -- Kalera Public Limited Company (“Kalera” or the “Company”) (Nasdaq: KAL), a vertical farming company headquartered in Orlando, Florida, provided an update on the steps it has taken and its plans going forward to achieve cash flow break-even by the end of fiscal year 2023.
“I continue to be very pleased with the commercial side of our business, specifically sales and operations. Demand for our products is stronger than ever across all channels, and our facilities are operating better than ever and very consistently,” said Jim Leighton, President and Chief Executive Officer of Kalera. “The cost cutting measures we’re undertaking should result in total annual cost savings of approximately 74% in 2023 compared to expenses incurred in 2022. With these savings and the improvements in our sales and operations, we expect to achieve cash flow break-even by the end of fiscal year 2023, which is our #1 priority.”
To accelerate profitability at the Houston and Denver farms and to make configuration updates at the Orlando and Atlanta farms for efficiency and increased loose-leaf production capacity, Kalera plans to temporarily halt production at the Orlando and Atlanta farms, which will result in an annual run rate reduction of operating expenses of approximately $4.9 million until such time as the facilities are re-opened. In the interim, these measures will consolidate all retail volume in the southeast and be serviced by our Houston farm. The Houston and Denver farms will be near capacity with the optimized product mix for retail and foodservice accelerating these farms’ path to profitability. We have worked closely with our customers to ensure we continue with strong growth while we reposition the Orlando and Atlanta farms to better serve our customers with the right products in the future.
Our US Foods partnership continues to be a strong driver and an important aspect of Kalera’s commercial strategy. We are working closely with the US Foods marketing and category management team to launch new and innovative products that will drive incremental value and sales to the category for both US Foods and Kalera.
To save costs, Kalera is relocating its corporate offices from Orlando to the Denver farm, reducing corporate General & Administrative (G&A) expenses by approximately $0.8 million annually.
The previously announced divestiture of Kalera’s international assets in Kuwait and Singapore and the Vindara seed genetics business is underway. Operations at Kalera’s international businesses, including in Germany, Kuwait, and Singapore, have been shut down, which will reduce Kalera’s annual G&A expenses by approximately 50% annually. In addition, while Kalera has not yet received any definitive offers for the purchase of Vindara, the due diligence process with a number of interested parties is currently ongoing. By entering these processes and assuming a successful sale of Vindara by February 2023, Kalera expects to reduce its G&A expenses and operating losses in 2023 by approximately 65% compared to 2022. Expenses related to the business combination with Agrico Acquisition Corp. in June 2022 were one-time in nature, which will mean approximately $7.5 million less in expenses in 2023 compared to 2022.
“The macro environment supporting Kalera’s business model has been validated,” Mr. Leighton said. “We continue to gain new customers and new distribution points, and we continue to have the support of major retailers in addition to our agreement with US Foods. Vertical farming can and should play an important role in the future of food production.”
As a leader in controlled environment agriculture, Kalera is driven by our belief that vertical farming can play an important role in securing access to fresh produce for a growing world population facing climate change and concerns about the future of traditional farming. Through our proprietary technology, we sustainably grow local, delicious, nutrient-rich, pesticide-free, non-GMO leafy greens year-round. Our automated, data-driven, hydroponic vertical farms produce higher yields and, use approximately 95% less water, and 99% less land than traditional farming. Sold under the Kalera brand, our leafy greens are “better than organic” and priced competitively, always with the end consumer in mind. Kalera is headquartered in Orlando, Florida with farms in Orlando; Atlanta, Georgia; Houston, Texas; and Denver, Colorado, with additional farms under development. More information is available at www.kalera.com.
This communication includes certain statements that are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the applicable securities laws. Forward-looking statements generally are accompanied by words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "should," "would," "plan," "predict," "potential," "seem," "seek," "future," "outlook," and similar expressions that predict or indicate future events or trends or that are not statements of historical matters.
These forward-looking statements include, but are not limited to, statements regarding Kalera’s share structure and Nasdaq listing status. These statements are based on various assumptions and/or on the current expectations of Kalera's management. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by any investor or other person as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Kalera. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to general economic, financial, legal, political and business conditions and changes in domestic and foreign markets; changes in the assumptions underlying Kalera's expectations regarding its future business; the effects of competition on Kalera's future business; and the outcome of judicial proceedings to which Kalera is, or may become a party.
If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Kalera presently do not know or currently believe are immaterial that could also cause actual results to differ materially from those contained in the forward-looking statements. In addition, forward-looking statements reflect expectations, assumptions, plans or forecasts of future events and views as of the date of this communication. Kalera anticipates that subsequent events and developments will cause these assessments to change. However, while Kalera may elect to update these forward-looking statements at some point in the future, Kalera specifically disclaims any obligation to do so, except as required by applicable law. These forward-looking statements should not be relied upon as representing Kalera's assessments as of any date subsequent to the date of this written communication. Accordingly, undue reliance should not be placed upon the forward-looking statements.
Financial Profiles, Inc.