Landec (LNDC) Misses Q4 EPS by 11c, Maintains FY22 Outlook

Landec (NASDAQ: LNDC) reported Q4 EPS of ($0.23), $0.11 worse than the analyst estimate of ($0.12). Revenue for the quarter came in at $128.8 million versus the consensus estimate of $129.1 million.

FISCAL 2022 OUTLOOK:

Excluding restructuring and other nonrecurring charges, tax implications and any unforeseen potential impact from the ongoing COVID-19 pandemic, the Company is reiterating its full year fiscal 2022 guidance, which is detailed below with growth figures that are compared to fiscal 2021:

Revenue from continuing operations:

• Consolidated Revenues: range of $545 million to $554 million (flat to +1.8%)
• Lifecore segment: range of $105 million to $108 million (+7% to +10%)
• Curation Foods segment: range of $440 million to $446 million (-1.4% to 0.0%)

Adjusted EBITDA:

• Consolidated: range of $33.3 million to $35.5 million (+6% to +13%)
• Lifecore segment: range of $26 million to $27 million (+6% to +10%)
• Curation Foods segment: range of $12 million to $13 million (+9% to +18%)
• Other (Corporate Expense): range of ($4.5) million to ($4.7) million

Seasonality:

• From an adjusted EBITDA perspective, the Company now anticipates that less than 30% of its annual consolidated adjusted EBITDA will be generated in its fiscal first half. This is due to customer inventory re-balancing at Lifecore as a result of the COVID-19 pandemic which results in relatively flat year-over-year revenue growth in the first half of fiscal 2022 followed by an anticipated substantial double-digit growth in the second half of fiscal 2022 at Lifecore. From a gross margin perspective, the Company expects Lifecore to realize a lower gross margin rate in the first half of fiscal 2022 compared to the first half of fiscal 2021 due to product mix. At Curation Foods, the Company continues to expect annual adjusted EBITDA growth in segment gross margin, which is expected to meet its steady-state target of 11% to 14% for the full fiscal year 2022. However, the Company now expects to face inflationary pressures beginning in the second quarter that it believes will be offset by price increases and cost saving initiatives in the second half of fiscal 2022. Despite these incremental headwinds, the Company still expects Curation Foods to achieve segment gross margin improvement in the second quarter of fiscal 2022.

For earnings history and earnings-related data on Landec (LNDC) click here.

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