Beyond Meat Inc has forecast annual revenue slightly above estimates and doubled down on cost controls at a time when persistently high inflation was slowing demand for its faux meat products.
The company struck a more sobering note on a post-earnings call, saying steep inflation, a slowing economy, increased competition and consumers trading down to cheaper products were hurting growth.
Outlook
The plant-based meat maker forecast full-year revenue to be in the range of $375 million to $415 million, the midpoint of which is just above analysts' average estimate of $394.2 million, according to Refinitiv data.
"While the outlook for 2023 is encouraging, it is worth noting the company has had to lower its guidance several times over the past few years," said Arun Sundaram, senior equity analyst at CFRA Research.
"Nonetheless, investors may be optimistic that 2022 marked the low point for the company," he added.
The company expects operating expenses to slide 22% this year, compared with a 9% rise in 2022.
Read More: Alternative Proteins Making Waves In The Seafood Category: Analysis
'Marketing Activities'
"Total operating expense is expected to be approximately $250 million for the full year 2023, weighted slightly more heavily towards the front half of the year as we expect to invest disproportionately more behind marketing activities," said finance chief Lubi Kutua on a post-earnings call.
Beyond Meat beat quarterly expectations for the first time since June 2021. The company's net revenue fell 21% to $79.9 million in the quarter ended 31 December from a year earlier, but still beat analysts expectations of $75.7 million.
Net loss for Beyond Meat narrowed to $66.9 million, or $1.05 per share, in the fourth quarter. Analysts had estimated a loss of $1.18 per share.
In October, Beyond Meat had said it was targeting cash flow positive operations within the second half of 2023.
'Sustainable Growth Model'
Beyond Meat president and CEO Ethan Brown stated, "We are making solid progress in our transition to a sustainable growth model, one that emphasises the achievement of cash flow positive operations within the second half of 2023 [...].
"Our fourth quarter results clearly demonstrate delivery against our strategy and plan, including solid sequential progress on margin recovery and operating expense reduction, and continued inventory drawdown."
News by Reuters, additional reporting by ESM – your source for the latest A-Brands news. Click subscribe to sign up to ESM: European Supermarket Magazine.
