Laird Superfood Reports First Quarter 2021 Financial Results

Net Sales Increase 35% Year Over Year to $7.4 Million

Online Sales Contribute 59% of Net Sales, with Direct To Consumer Sales from Lairdsuperfood.com Up 135% Year Over Year

Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood”), today reported financial results for its first quarter ended March 31, 2021.

First Quarter 2021 Highlights

• Net Sales increased to $7.4 million, an increase of 35% year over year.
• Online sales contributed 59% of net sales , increasing 65% year over year, with lairdsuperfood.com sales growing 135% year over year, and subscribers growing 153%.
• Wholesale sales contributed 39% of net sales, increasing 7% year over year, and included retail door expansion, beginning in March, into Target, Harris Teeter and Wakefern.
• Gross profit was $1.9 million and gross margin was 25.1% compared to gross profit of $2.1 million and gross margin of 38.6% in the prior year quarter.
• Net loss attributable to common stockholders was $5.3 million, or $0.60 per diluted share, compared to net loss attributable to common stockholders of $2.0 million, or $0.47 per diluted share, in the prior year period.

“Our first quarter 2021 results illustrate the power of our omnichannel platform as we continued aggressively scaling our business,” said Paul Hodge Jr., Co-founder, President and Chief Executive Officer of Laird Superfood. “Gross margins improved 480 basis points from the fourth quarter, and net sales increased 35% year over year, including a 65% increase in our dominant online channel. Subsequent to the end of the quarter, we completed the acquisition of Picky Bars, a fellow Central-Oregon based company that is aligned with our core values, our mission and our strategic goals. We are very excited to integrate their healthy snacks and breakfast products across the entire omnichannel platform,” concluded Hodge Jr.

For the Three Months Ended March 31, 2021

Net sales increased 35% to $7.4 million in the first quarter of 2021 compared to $5.5 million in the first quarter of 2020. Growth in net sales in the first quarter of 2021 was primarily driven by a significant expansion of our customer base in online channels.

Gross profit was $1.9 million, slightly lower compared to the prior year period of $2.1 million. Gross margin was 25.1% of net sales in the first quarter of 2021, compared to 38.6% of net sales in the prior year period. The year over year decrease in gross margin was primarily due to elevated outbound shipping costs combined with the launch of a free shipping initiative for direct online purchases made on lairdsuperfood.com , increased personnel costs, disposal costs related to the initial production and distribution of our liquid creamer product line, and increased co-packing costs primarily associated with our liquid creamer product line.

Operating expenses were $7.2 million compared to $4.1 million in the year ago period and reflect General and Administrative expense increases of $2.0 million, primarily due to stock-based compensation, personnel costs, insurance expense, and professional fees, as well as Sales and Marketing expense increases of $0.9 million, primarily due to advertising expense.

Loss from operations was $5.3 million in the first quarter of 2021, compared to a loss of $2.0 million in the prior year period.

Net loss attributable to common stockholders was $5.3 million, or $0.60 per diluted share, in the first quarter of 2021, compared to net loss attributable to common stockholders of $2.0 million, or $0.47 per diluted share.

Valerie Ells, Chief Financial Officer, commented, “The first quarter of 2021 illustrated the power of our online platform, a meaningful step forward in gross margin, and yet another quarter of year over year sales growth. As we progress into the year, our priorities will remain focused on market share, expanding our customer growth, optimizing our margins and integrating our recently announced acquisition. We demonstrated again this quarter that consumers who seek healthy, plant-based, sustainable products repeatedly purchase our authentic offerings across our dynamic, omnichannel platform.”

Balance Sheet and Cash Flow Highlights

The Company’s current assets include cash, cash equivalents, and restricted cash of $51.7 million as of March 31, 2021. Total outstanding debt was $51,000 as of March 31, 2021. Net cash used in operating activities was $5.1 million in the three months ended March 31, 2021, compared to $2.3 million in the comparative prior year period.

Capital expenditures totaled $0.2 million for the three months ended March 31, 2021, compared to $0.1 million in the comparative prior year period.

Conference Call and Webcast Details

The Company will host a conference call and webcast at 5:00 p.m. ET today to discuss results. The live conference call can be accessed by dialing (833) 772-0381 from the U.S. or (236) 384-2050 internationally. The conference I.D. code is 1495851. Alternatively, participants may access the live webcast on the Laird Superfood Investor Relations website at https://investors.lairdsuperfood.com under “Events.”

About Laird Superfood

Laird Superfood, Inc. creates award-winning, plant-based superfood products that are both delicious and functional. The Company's products are designed to enhance your daily ritual and keep consumers fueled naturally throughout the day. The Company was co-founded in 2015 by the world's most prolific big-wave surfer, Laird Hamilton. Laird Superfood's offerings are environmentally conscientious, responsibly tested, and made with real ingredients. Shop all products online at lairdsuperfood.com and join the Laird Superfood community on social media for the latest news and daily doses of inspiration.

Forward-Looking Statements

This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the federal securities laws, including but not limited to statements regarding Laird Superfood’s future financial performance, including our outlook for fiscal year 2021. These forward-looking statements are based on Laird Superfood’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause Laird Superfood’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. We expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

The risks and uncertainties referred to above include, but are not limited to: (1) the effects of the current COVID-19 pandemic, or of other global outbreaks of pandemics or contagious diseases or fear of such outbreaks, including on our supply chain, the demand for our products, and on overall economic conditions and consumer confidence and spending levels; (2) our expectations regarding our revenue, expenses, including shipping expenses, and other operating results; (3) our ability to acquire new direct and wholesale customers and successfully retain existing customers; (4) our ability to attract and retain our suppliers, distributors and co-manufacturers, and effectively manage their costs and performance; (5) our expectations regarding real or perceived quality with our products or other issues that adversely affect our brand and reputation; (6) our ability to innovate on a timely and cost-effective basis, predict changes in consumer preferences and develop successful new products, or updates to existing products, and develop innovative marketing strategies; (7) expectations regarding prices and availability of raw materials and other inputs, a substantial amount of which come from a limited number of suppliers outside the United States, including in areas which may be adversely affected by climate change; (8) effects of changes in the tastes and preferences of our consumers and consumer preferences for natural and organic food products; (9) the financial condition of, and our relationships with, our suppliers, co-manufacturers, distributors, retailers and foodservice customers, as well as the health of the foodservice industry generally; (10) effects of real or perceived quality or health issues with our products or other issues that adversely affect our brand and reputation; (11) the ability of ourselves, our suppliers and co-manufacturers to comply with food safety, environmental or other laws or regulations; (12) our plans for future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements; (13) the costs and success of our marketing efforts, and our ability to promote our brand; (14) our reliance on our executive team and other key personnel and our ability to identify, recruit and retain skilled and general working personnel; (15) our ability to effectively manage our growth; (16) our ability to compete effectively with existing competitors and new market entrants; (17) the impact of adverse economic conditions; and (18) the growth rates of the markets in which we compete.

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ICR
Ashley DeSimone & Reed Anderson
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