Sadot Group, Inc. Reports Third Quarter 2024 Results

About this update from Sadot Group Inc.

Reports Quarterly Net Income of $1.2 million BURLESON, TX / ACCESSWIRE / November 12, 2024 / Sadot Group Inc. (Nasdaq:SDOT) (" Sadot Group ", "Sadot" or the "Company"), an emerging player in the global food supply chain sector, today announced its financial results for the third quarter ended September 30, 2024 . Third Quarter 2024 Financial Highlights Consolidated revenues of $201.7 million , a 10.7% increase over the prior year period. Net income increased to $1.2 million , up from a $5.2 million loss in the prior year period, a significant improvement of $6.3 million . EBITDA of $2.9 million compared to a negative $4.4 million of EBITDA in the prior year period, a significant improvement of $7.4 million . Basic EPS improved to $0.25 compared to a negative $1.39 in the prior year period. Dilutive EPS improved to $0.23 compared to a negative $1.39 in the prior year period. Working capital surplus of $18.9 million compared to $8.3 million at December 31, 2023 . Year to Date 2024 Financial Highlights Consolidated revenues of $484.7 million , compared to $555.4 million in the prior year. Net income increased to $3.3 million , up from a $6.1 million loss in the prior year, a significant improvement of $9.3 million . EBITDA of $6.7 million compared to an EBITDA of negative $4.2 million in the prior year, a significant improvement of $10.9 million . Basic EPS improved to $0.74 compared to a negative $1.81 in the prior year. Dilutive EPS improved to $0.69 compared to a negative $1.81 in the prior year. "We are extremely pleased to report positive net income for the second consecutive quarter and record year-to-date net income, milestone achievements for the Company," said Michael Roper , Chief Executive Officer of Sadot Group . "Revenue growth in our core commodity trading business reached 11.6% year-over-year, in the latest three-month period, driven by increased transaction levels as we continued to expand our global commercial platform." The strength of our performance in the quarter and year-to-date periods reinforces our confidence in key strategies for driving growth and profitability within the nearly $2 trillion global agri-commodities market along with our commitment to delivering shareholder value." Strategic and Operational Highlights Completed 24 transactions of over 0.5 million metric tons of agri-commodities throughout 14 different countries during the third quarter. Initiated trades from Sadot Brasil and Sadot Canada expanding the Company's global presence. We are now a 100% franchise concept and have been able to reduce some overhead expenses accordingly. Completed the sale of SuperFit foods. Continuing due diligence with multiple parties for Pokémoto and Muscle Maker Grill . Placed a deposit and in negotiations for the acquisition of an agricultural farming property in Indonesia . All numbers disclosed in this report are the amounts attributable to Sadot Group Inc. and exclude the portion related to the non-controlling interests. All share based numbers are split adjusted. Webcast Details Date: Wednesday, November 13, 2024 Time: 10:30 am EDT / 7:30 am PDT To register, please use the following link: https://audience.mysequire.com/webinar-view?webinar_id=c7e40f7d-e2b2-4540-b18f-f5c281ad6d90 * Please note that when logging into the Webcast, individuals must, when prompted to, "allow video and audio" access to their device to view and hear the call. About Sadot Group Inc. Sadot Group Inc. has rapidly established itself as an emerging player in the global food supply chain. Sadot Group provides innovative and sustainable supply chain solutions that address the world's growing food security challenges. Sadot Group currently operates within key verticals of the global food supply chain including global agri-commodity origination and trading operations for food/feed products such as soybean meal, wheat and corn, and farm operations producing grains and tree crops in Southern Africa . Sadot Group connects producers and consumers across the globe, sourcing agri-commodity products from producing geographies such as the Americas , Africa and the Black Sea and delivering to markets in Southeast Asia , China and the Middle East / North Africa region. Sadot Group is headquartered in Burleson, Texas with subsidiary operations throughout the United States , Brazil , Canada, Colombia , India , Israel , Singapore , Ukraine , United Arab Emirates and Zambia . For more information, please visit www.sadotgroupinc.com . Sadot Group, Inc. Condensed Consolidated Balance Sheets (Unaudited) September 30, 2024 December 31, 2023 $'000 $'000 ASSETS Current assets: Cash 962 1,354 Accounts receivable, net of allowance for doubtful accounts of $0.8 million and $0.2 million as of September 30, 2024 and December 31, 2023 , respectively 38,333 52,920 Inventory 1,054 2,561 Assets held for sale 5,431 - Other current assets 113,241 56,016 Total current assets 159,021 112,851 Right to use assets 137 1,284 Property and equipment, net 11,847 12,883 Goodwill - 1,798 Intangible assets, net - 2,833 Other non-current assets 22 46,442 Total assets 171,027 178,091 LIABILITIES AND EQUITY Current liabilities: Accounts payable and accrued expenses 40,346 50,167 Notes payable, current, net of discount of $0.1 million and $0.2 million as of September 30, 2024 and December 31, 2023 , respectively 2,808 6,531 Operating lease liability, current 22 385 Deferred revenue, current 2,161 1,229 Liabilities held for sale 2,464 - Other current liabilities 92,283 46,270 Total current liabilities 140,084 104,582 Contract liability, non-current - 46,048 Notes payable, non-current - 622 Operating lease liability, non-current 117 1,027 Deferred revenue, non-current - 1,555 Total liabilities 140,201 153,834 Equity: Common stock, $0.0001 par value, 20,000,000 shares authorized, 5,020,373 and 4,046,472 shares issued and outstanding as of September 30, 2024 and December 31, 2023 , respectively 1 - Additional paid-in capital 111,650 107,992 Accumulated deficit (83,912 ) (87,179 ) Accumulated other comprehensive (loss) / income (180 ) 8 Total Sadot Group Inc. shareholders' equity 27,559 20,821 Non-controlling interest 3,267 3,436 Total stockholders' equity 30,826 24,257 Total liabilities and stockholders' equity 171,027 178,091 Sadot Group, Inc. Condensed Consolidated Statement of Operations and Other Comprehensive Income/ (Loss) (Unaudited) Three Months Ended September 30 , Nine Months Ended September 30 , 2024 2023 2024 2023 $'000 $'000 $'000 $'000 Commodity sales 200,906 179,975 480,706 547,900 Company restaurant sales, net of discounts 479 1,937 2,628 6,725 Franchise royalties and fees 321 245 1,319 767 Franchise advertising fund contributions 12 16 40 52 Other revenues 16 - 16 13 Cost of goods sold (199,271 ) (179,268 ) (480,074 ) (544,803 ) Gross profit 2,463 2,905 4,635 10,654 Impairment of goodwill - (828 ) - (828 ) Impairment of intangible assets - (810 ) - (810 ) Depreciation and amortization expenses (49 ) (443 ) (421 ) (1,517 ) Franchise advertising fund expenses (12 ) (16 ) (40 ) (52 ) Pre-opening expenses - (335 ) - (371 ) Post-closing expenses (91 ) (60 ) (120 ) (173 ) Stock-based expenses (1,713 ) (1,075 ) (4,430 ) (5,667 ) Sales, general and administrative expenses (4,245 ) (3,310 ) (8,770 ) (7,175 ) Loss from operations (3,647 ) (3,972 ) (9,146 ) (5,939 ) Other income - 1 19 252 Interest expense, net (1,718 ) (301 ) (2,969 ) (320 ) Change in fair value of stock-based compensation 1,001 297 2,691 1,161 Warrant modification expense - (958 ) - (958 ) Gain / (loss) on fair value remeasurement 5,461 (349 ) 11,995 (349 ) Gain on sale of trading securities - - 518 - Income / (Loss) Before Income Tax 1,097 (5,282 ) 3,108 (6,153 ) Income tax expense (3 ) (13 ) (9 ) (18 ) Net income / (loss) 1,094 (5,295 ) 3,099 (6,171 ) Net loss attributable to non-controlling interest 69 112 169 112 Net income / (loss) attributable to Sadot Group Inc. 1,163 (5,183 ) 3,268 (6,059 ) Net Income / (Loss) Per Share attributable to Sadot Group Inc. : Basic 0.25 (1.39 ) 0.74 (1.81 ) Diluted 0.23 (1.39 ) 0.69 (1.81 ) Weighted-Average # of Common Shares Outstanding: Basic 4,693,351 3,742,192 4,436,065 3,344,394 Diluted 5,011,339 3,742,192 4,707,964 3,344,394 Sadot Group, Inc. Condensed Consolidated Statement of Operations and Other Comprehensive Income/ (Loss) (Continued) (Unaudited) Three Months Ended September 30 , Nine Months Ended September 30 , 2024 2023 2024 2023 $'000 $'000 $'000 $'000 Net income / (loss) 1,094 (5,295 ) 3,099 (6,171 ) Other comprehensive income / (loss) Foreign exchange translation adjustment (4 ) - (1 ) - Unrealized loss, net of income tax (1 ) - (187 ) - Total other comprehensive loss (5 ) - (188 ) - Total comprehensive income / (loss) 1,089 (5,295 ) 2,911 (6,171 ) Comprehensive loss attributable to non-controlling interest 69 112 169 112 Total Comprehensive income / (loss) attributable to Sadot Group Inc. 1,158 (5,183 ) 3,080 (6,059 ) Sadot Group, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30 , 2024 2023 $'000 $'000 Cash Flows from Operating Activities Net income / (loss) 3,099 (6,171 ) Adjustments to reconcile net income / (loss) to net cash used in operating activities: Impairment of goodwill - 828 Impairment of intangible assets - 810 Depreciation and amortization 421 1,517 Stock-based expenses 4,430 5,667 Change in fair value of compensation (2,691 ) (1,161 ) Warrant modification expense - 958 Unrealized loss, net of income tax (187 ) - Foreign exchange translation adjustment (1 ) - Loss on disposal of assets 304 301 Bad debt expense - 82 Transfer to assets held for sale (481 ) - Changes in operating assets and liabilities: Accounts receivable, net 20,275 (61,155 ) Inventory 1,506 61 Other current assets (57,206 ) (6,659 ) Other non-current assets 46,229 - Accounts payable and accrued expenses (9,532 ) 55,869 Other current liabilities 46,278 397 Contract liability, non-current (46,048 ) - Operating right to use assets and lease liabilities, net 56 (46 ) Deferred revenue 528 23 Total adjustments 3,881 (2,508 ) Net cash provided by (used in) operating activities 6,980 (8,679 ) Cash Flows from Investing Activities Deposit on farmland (5,853 ) 4,914 Investment from non-controlling interest - 3,655 Purchases of property and equipment (38 ) (12,447 ) Disposal of property and equipment 462 208 Net cash provided by / (used in) investing activities (5,429 ) (3,670 ) Cash Flows from Financing Activities Proceeds from notes payable 4,569 7,684 Proceeds from exercise of warrants - 2,153 Repayments of notes payable (6,512 ) (4,964 ) Net cash (used in) provided by financing activities (1,943 ) 4,873 Net Increase (Decrease) in Cash (392 ) (7,476 ) Cash - beginning of period 1,354 9,898 Cash - end of period 962 2,422 Reconciliations of EBITDA and Other Non-GAAP Measures EBITDA and EBITDA Margin are non-GAAP measures. The Company defines EBITDA as Net loss, adjusted for depreciation, amortization, interest income / (expense), and income taxes. The Company believes that EBITDA and EBITDA Margin, (collectively, the "Non-GAAP Measures") are useful metrics for investors to understand and evaluate its operating results and ongoing profitability because they permit investors to evaluate its recurring profitability from its ongoing operating activities. EBITDA and EBITDA Margin, have certain limitations, and you should not consider them in isolation or as a substitute for analysis of its results of operations as reported under U.S. GAAP. The Company cautions investors that amounts presented in accordance with its definitions of any of the Non-GAAP Measures may not be comparable to similar measures disclosed by other issuers, because some issuers calculate certain of the Non-GAAP Measures differently or not at all, limiting their usefulness as direct comparative measures. The following table presents a reconciliation of EBITDA from the most comparable U.S. GAAP measure, Net loss, and the calculations of the Net loss margin and EBITDA Margin for the three and nine months ended September 30, 2024 and 2023: Three Months Ended September 30 , Nine Months Ended September 30 , 2024 2023 2024 2023 $'000 $'000 $'000 $'000 Net income / (loss) 1,094 (5,295 ) 3,099 (6,171 ) Adjustments to EBITDA: Depreciation and amortization expenses 49 443 421 1,517 Interest (income) / expense, net 1,718 301 2,969 320 Income tax expense 3 13 9 18 EBITDA 2,864 (4,538 ) 6,498 (4,316 ) EBITDA attributable to non-controlling interest 69 112 169 112 EBITDA attributable to Sadot Group Inc. 2,933 (4,426 ) 6,667 (4,204 ) Gross Profit 2,463 2,905 4,635 10,654 Gross Profit attributable to Sadot Group Inc. 2,532 3,017 4,804 10,766 Net income / (loss) margin attributable to Sadot Group Inc. 0.5 % (2.9) % 0.6 % (1.1) % EBITDA margin attributable to Sadot Group Inc. 1.5 % (2.4) % 1.4 % (0.8) % Forward-Looking Statements This press release may include "forward-looking statements" pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. To the extent that the information presented in this press release discusses financial projections, information, or expectations about our business plans, results of operations, products, or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as "should", "may," "intends," "anticipates," "believes," "estimates," "projects," "forecasts," "expects," "plans," and "proposes." Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading "Risk Factors" and elsewhere in documents that we file from time to time with the SEC . Forward-looking statements speak only as of the date of the document in which they are contained, and Sadot Group, Inc. , does not undertake any duty to update any forward-looking statements except as may be required by law. Investor Relations: Frank Pogubila SVP Integrous Communications W - 951.946.5288E - [email protected] SOURCE: Sadot Group Inc. View the original press release on accesswire.com

View stock analysis, news, and events for Sadot Group Inc.