8-K
false000157973300015797332023-08-032023-08-03

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 3, 2023

Vital Farms, Inc.

(Exact name of Registrant as Specified in Its Charter)

Delaware

001-39411

27-0496985

(State or Other Jurisdiction

of Incorporation)

(Commission File Number)

(IRS Employer

Identification No.)

 

 

 

3601 South Congress Avenue

Suite C100

Austin, Texas

78704

(Address of Principal Executive Offices)

(Zip Code)

(877) 455-3063

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock

 

VITL

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

 


 

Item 2.02 Results of Operations and Financial Condition

On August 3, 2023, Vital Farms, Inc. (the “Company”) issued a press release announcing its financial results for the fiscal quarter ended June 25, 2023. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

The information provided in this Form 8-K, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit No.

Description

99.1

 

Press Release, dated August 3, 2023

 

 

 

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

Vital Farms, Inc.

 

 

 

Dated: August 3, 2023

By:

 /s/ Thilo Wrede

Thilo Wrede

Chief Financial Officer

 

 


EX-99.1

Exhibit 99.1

 

Vital Farms Reports Second Quarter 2023 Financial Results

Second Quarter Net Revenue $106.4 million, up 28.4% versus Prior Year Period
Raises 2023 Net Revenue and Adjusted EBITDA Forecast

AUSTIN, TX – August 3, 2023 Vital Farms (Nasdaq: VITL), a Certified B Corporation that offers a range of ethically produced foods nationwide, today reported financial results for its second quarter ended June 25, 2023.

Financial highlights for the second quarter include:

Second Quarter 2023 Net Revenue increase of 28.4% to $106.4 million
Second Quarter 2023 Net Income of $6.7 million
Second Quarter 2023 Adjusted EBITDA of $11.3 million1

“Our progress as a brand and as a business thus far in 2023 continues to reinforce my excitement in the long-term potential of our company. Our brand continues to gain new consumers and the business produced another quarter of impressive top-line growth, over 28% with double-digit Adjusted EBITDA Margin again this quarter. Given the strong year-to-date results, we now feel confident increasing our full year Net Revenue and Adjusted EBITDA guidance,” said Russell Diez-Canseco, Vital Farms’ President and CEO.

Diez-Canseco continued, “Vital Farms’ continued strong performance is made possible by our consistent focus on working with our stakeholder community to generate sustained, positive outcomes. The commitment demonstrated by our crew members, farmers, and other external partners to deliver above and beyond the needs of our customers and consumers sets Vital Farms apart. The effort illustrates the passion of our people and the potential of our organization to further improve the lives of people, animals, and the planet through food.”

1 Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures defined in the section titled “Non-GAAP Financial Measures” below and are reconciled to net income and net income margin, respectively, their closest comparable GAAP measures, at the end of this release.

For the 13 Weeks Ended June 25, 2023

Net revenue increased 28.4% to $106.4 million in the second quarter of 2023, compared to $82.9 million in the second quarter of 2022. Net revenue growth in the second quarter of 2023 was driven by higher prices and volume gains of 6%. The volume growth was driven by increases at both new and existing retail customers.

Gross profit was $37.8 million, or 35.5% of net revenue, in the second quarter of 2023, compared to $24.9 million, or 30.1% of net revenue, in the prior year quarter. The gross profit growth was primarily driven by higher sales. Gross margin benefited from increased pricing across our portfolio, partially offset by headwinds that included higher input costs (inclusive of commodity impacts) across our shell egg and butter businesses as well as higher packaging costs.

Income from operations in the second quarter of 2023 was $8.0 million, compared to income from operations of $0.7 million in the second quarter of 2022. The change in income from operations was primarily attributable to higher sales and gross profit, partially offset by higher marketing costs and increased employee-related expenses as we grew headcount to support our growth.

Net income was $6.7 million in the second quarter of 2023, compared to net income of $0.2 million in the prior year quarter.

 


 

Net income per diluted share was $0.15 for the second quarter of 2023, compared to net income per diluted share of $0.00 in the prior year quarter.

Adjusted EBITDA was $11.3 million, or 10.7% of net revenue, in the second quarter of 2023, compared to $3.7 million, or 4.4% of net revenue, in the second quarter of 2022. The change in Adjusted EBITDA was primarily due to higher sales and improved gross profit performance, partially offset by increased marketing spend and higher employee-related expenses. Our Adjusted EBITDA excludes certain non-cash items. Adjusted EBITDA is a non-GAAP financial measure defined in the section titled “Non-GAAP Financial Measures” below and is reconciled to net income, its closest comparable GAAP measure, at the end of this release.

Balance Sheet and Cash Flow Highlights

Cash, cash equivalents and marketable securities were $93.5 million as of June 25, 2023, and we had no outstanding debt. Net cash provided by operating activities was $18.9 million for the 26-week period ended June 25, 2023, compared to net cash used in operating activities of $3.0 million for the 26-week period ended June 26, 2022.

Capital expenditures totaled $4.3 million in the 26-week period ended June 25, 2023, compared to $4.4 million in the prior year period.

Update on Fiscal 2023 Outlook

Thilo Wrede, Vital Farms’ Chief Financial Officer, commented: “We are pleased with our outstanding financial performance so far this year. We believe the underlying trajectory of our business remains strong and the company is set up well to deliver our updated guidance for fiscal year 2023.”

For the full fiscal year 2023, management now expects net revenue of more than $465 million, which still anticipates higher net revenue growth rates and gross margin in the first half of year than in the second half of the year.
Management now expects Adjusted EBITDA of more than $35 million for the full fiscal year 2023.
Finally, management now expects fiscal year 2023 capital expenditures in the range of $16 to $21 million.

Vital Farms’ guidance continues to assume that there are no additional significant disruptions to the supply chain or its customers or consumers, including any issues from adverse macroeconomic factors. Vital Farms cannot provide a reconciliation between its forecasted Adjusted EBITDA and net income (loss), its most directly comparable GAAP measure, without unreasonable effort due to the unavailability of reliable estimates for income taxes, among other items. These items are not within our control and may vary greatly between periods and could significantly impact future financial results.

Conference Call and Webcast Details

Vital Farms will host a conference call and webcast at 8:30 a.m. ET today to discuss the results. To participate in the call and receive dial in information, please register here: Vital Farms Q2 2023 Conference Call. Alternatively, participants may access the live webcast on the Vital Farms Investor Relations website at https://investors.vitalfarms.com under “Events.” The webcast will be archived in 30 days.

 


 

About Vital Farms

Vital Farms (Nasdaq: VITL) is a Certified B Corporation that offers a range of ethically produced foods nationwide. Started on a single farm in Austin, Texas in 2007, Vital Farms has become a national consumer brand that works with over 300 family farms and is the leading U.S. brand of pasture-raised eggs by retail dollar sales. Vital Farms' ethics are exemplified by its focus on the humane treatment of farm animals and sustainable farming practices. In addition, as a Delaware public benefit corporation, Vital Farms prioritizes the long-term benefits of each of its stakeholders, including farmers and suppliers, customers and consumers, communities and the environment, crew members, and stockholders. Vital Farms' products, including shell eggs, butter, hard-boiled eggs, and liquid whole eggs, are sold in approximately 24,000 stores nationwide. For more information, please visit www.vitalfarms.com.

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 Vital Farms’ market opportunity, anticipated growth, and future financial performance, including management’s outlook for fiscal year 2023 and management’s long-term outlook. These forward-looking statements are based on Vital Farms’ current assumptions, expectations, and beliefs and are subject to substantial risks, uncertainties, assumptions, and changes in circumstances that may cause Vital Farms’ actual results, performance, or achievements to differ materially from those expressed or implied in any forward-looking statement.

The risks and uncertainties referred to above include, but are not limited to: Vital Farms’ expectations regarding its revenue, expenses, and other operating results; Vital Farms’ ability to acquire new customers, to successfully retain existing customers, and to attract and retain its personnel, farmers, suppliers, distributors, and co-manufacturers; Vital Farms’ ability to sustain or increase its profitability; Vital Farms’ ability to procure sufficient high-quality eggs, cream for its butter, and other raw materials; Vital Farms' ability to successfully enter into new product categories; real or perceived quality with Vital Farms’ products or other issues that adversely affect Vital Farms’ brand and reputation; changes in the tastes and preferences of consumers; the financial condition of, and Vital Farms’ relationships with, its farmers, suppliers, co-manufacturers, distributors, retailers, and foodservice customers, as well as the health of the foodservice industry generally; the impact of agricultural risks, including diseases such as avian influenza; the ability of Vital Farms, its farmers, suppliers, and its co-manufacturers to comply with food safety, environmental or other laws or regulations; the effects of a public health pandemic or contagious disease on Vital Farms' supply chain, the demand for its products, and on overall economic conditions and consumer confidence and spending levels; future investments in its business, anticipated capital expenditures and estimates regarding capital requirements; anticipated changes in Vital Farms’ product offerings and Vital Farms’ ability to innovate to offer successful new products; the costs and success of marketing efforts; Vital Farms’ ability to effectively manage its growth and to compete effectively with existing competitors and new market entrants; the impact of adverse economic conditions, increased interest rates, and inflation; the potential negative impact of Vital Farms’ focus on a specific public benefit purpose and producing a positive effect for society on its financial performance; seasonality; and the growth rates of the markets in which Vital Farms competes.

 


 

These risks and uncertainties are more fully described in Vital Farms’ filings with the Securities and Exchange Commission (SEC), including in the sections entitled “Risk Factors” in its Quarterly Report on Form 10-Q for the fiscal quarter ended March 26, 2023, which Vital Farms filed on May 4, 2023, and other filings and reports that Vital Farms may file from time to time with the SEC. Moreover, Vital Farms operates in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for management to predict all risks, nor can Vital Farms assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements Vital Farms may make. In light of these risks, uncertainties, and assumptions, Vital Farms cannot guarantee future results, levels of activity, performance, achievements, or events and circumstances reflected in the forward-looking statements will occur. Forward-looking statements represent management’s beliefs and assumptions only as of the date of this press release. Vital Farms disclaims any obligation to update forward-looking statements except as required by law.

Media:

Rob Discher

rob.discher@vitalfarms.com

Investors:

Matt Siler

Matt.Siler@vitalfarms.com

 

 


 

VITAL FARMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share amounts)

(Unaudited)

 

 

13-Weeks Ended

 

 

26-Weeks Ended

 

 

 

June 25,
2023

 

 

June 26,
2022

 

 

June 25,
2023

 

 

June 26,
2022

 

Net revenue

 

$

106,445

 

 

$

82,870

 

 

$

225,616

 

 

$

159,929

 

Cost of goods sold

 

 

68,645

 

 

 

57,931

 

 

 

145,149

 

 

 

113,289

 

Gross profit

 

 

37,800

 

 

 

24,939

 

 

 

80,467

 

 

 

46,640

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

23,908

 

 

 

17,007

 

 

 

47,853

 

 

 

34,632

 

Shipping and distribution

 

 

5,853

 

 

 

7,211

 

 

 

13,679

 

 

 

15,373

 

Total operating expenses

 

 

29,761

 

 

 

24,218

 

 

 

61,532

 

 

 

50,005

 

Income (loss) from operations

 

 

8,039

 

 

 

721

 

 

 

18,935

 

 

 

(3,365

)

Other (expense) income, net:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(136

)

 

 

(7

)

 

 

(275

)

 

 

(15

)

Interest income

 

 

450

 

 

 

210

 

 

 

790

 

 

 

340

 

Other expense, net

 

 

(441

)

 

 

(52

)

 

 

(1,866

)

 

 

(3

)

Total other (expense) income, net

 

 

(127

)

 

 

151

 

 

 

(1,351

)

 

 

322

 

Net income (loss) before income taxes

 

 

7,912

 

 

 

872

 

 

 

17,584

 

 

 

(3,043

)

Income tax provision (benefit)

 

 

1,229

 

 

 

680

 

 

 

3,751

 

 

 

(1,697

)

Net income (loss)

 

 

6,683

 

 

 

192

 

 

 

13,833

 

 

 

(1,346

)

Less: Net loss attributable to
   noncontrolling interests

 

 

 

 

 

(7

)

 

 

 

 

 

(8

)

Net income (loss) attributable to Vital Farms, Inc.
   common stockholders

 

$

6,683

 

 

$

199

 

 

$

13,833

 

 

$

(1,338

)

Net income (loss) per share attributable to Vital
   Farms, Inc. stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

$

0.16

 

 

$

0.00

 

 

$

0.34

 

 

$

(0.03

)

Diluted:

 

$

0.15

 

 

$

0.00

 

 

$

0.32

 

 

$

(0.03

)

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

40,948,365

 

 

 

40,628,416

 

 

 

40,861,218

 

 

 

40,580,598

 

Diluted:

 

 

43,292,261

 

 

 

42,694,767

 

 

 

43,359,993

 

 

 

40,580,598

 

 

 


 

VITAL FARMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share amounts)

 

 

June 25,
2023

 

 

December 25,
2022

 

 

 

(Unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

47,673

 

 

$

12,914

 

Investment securities, available-for-sale

 

 

45,862

 

 

 

65,814

 

Accounts receivable, net

 

 

30,045

 

 

 

38,895

 

Inventories

 

 

42,105

 

 

 

26,849

 

Prepaid expenses and other current assets

 

 

6,193

 

 

 

5,142

 

Total current assets

 

 

171,878

 

 

 

149,614

 

Property, plant and equipment, net

 

 

59,340

 

 

 

59,155

 

Operating lease right-of-use assets

 

 

1,200

 

 

 

1,895

 

Goodwill and other assets

 

 

3,904

 

 

 

4,002

 

Total assets

 

$

236,322

 

 

$

214,666

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

21,840

 

 

$

25,972

 

Accrued liabilities

 

 

25,167

 

 

 

18,477

 

Operating lease liabilities, current

 

 

731

 

 

 

1,208

 

Finance lease liabilities, current

 

 

1,621

 

 

 

1,570

 

Income taxes payable

 

 

2,345

 

 

 

425

 

Total current liabilities

 

 

51,704

 

 

 

47,652

 

Operating lease liabilities, non-current

 

 

647

 

 

 

892

 

Finance lease liabilities, non-current

 

 

6,202

 

 

 

7,023

 

Other liabilities

 

 

1,725

 

 

 

767

 

Total liabilities

 

$

60,278

 

 

$

56,334

 

Commitments and contingencies (Note 19)

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock, $0.0001 par value per share, 310,000,000 shares authorized as of June 25, 2023 and December 25, 2022; 41,232,667 and 40,746,990 shares issued and outstanding as of June 25, 2023 and December 25, 2022, respectively

 

 

4

 

 

 

4

 

Additional paid-in capital

 

 

159,012

 

 

 

155,716

 

Retained earnings

 

 

17,992

 

 

 

4,159

 

Accumulated other comprehensive loss

 

 

(964

)

 

 

(1,547

)

Total stockholders’ equity

 

$

176,044

 

 

$

158,332

 

Total liabilities and stockholders’ equity

 

$

236,322

 

 

$

214,666

 

 

 


 

VITAL FARMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

 

 

26-Weeks Ended

 

 

 

June 25,
2023

 

 

June 26,
2022

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income (loss)

 

$

13,833

 

 

$

(1,346

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

3,543

 

 

 

2,287

 

Amortization of right-of-use assets

 

 

1,588

 

 

 

829

 

Amortization of available-for-sale debt securities

 

 

230

 

 

 

541

 

Stock-based compensation expense

 

 

3,687

 

 

 

2,929

 

Deferred taxes

 

 

767

 

 

 

(1,927

)

Unrealized loss on derivative instruments

 

 

847

 

 

 

 

Other

 

 

524

 

 

 

(260

)

Net change in operating assets and liabilities

 

 

(6,108

)

 

 

(6,058

)

Net cash provided by (used in) operating activities

 

$

18,911

 

 

$

(3,005

)

Cash flows from investing activities:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(4,292

)

 

 

(4,417

)

Purchases of available-for-sale debt securities

 

 

 

 

 

(29,944

)

Purchases and settlements of derivative instruments

 

 

(662

)

 

 

 

Sales of available-for-sale debt securities

 

 

1,907

 

 

 

 

Maturities and call redemptions of available-for-sale debt securities

 

 

18,453

 

 

 

28,334

 

Proceeds from the sale of property, plant and equipment

 

 

1,054

 

 

 

50

 

Return of investment in variable interest entity

 

 

552

 

 

 

 

Net cash provided by (used in) investing activities

 

$

17,012

 

 

$

(5,977

)

Cash flows from financing activities:

 

 

 

 

 

 

Proceeds from borrowing under revolving line of credit

 

 

7,500

 

 

 

 

Proceeds from exercise of stock options

 

 

110

 

 

 

397

 

Proceeds from issuance of common stock under employee stock purchase plan

 

 

135

 

 

 

 

Repayment of revolving line of credit

 

 

(7,500

)

 

 

 

Payment of tax withholding obligation on vested RSU shares

 

 

(636

)

 

 

(9

)

Principal payments under finance lease obligations

 

 

(773

)

 

 

(252

)

Payment of contingent consideration

 

 

 

 

 

(38

)

Net cash (used in) provided by financing activities

 

$

(1,164

)

 

$

98

 

Net increase (decrease) in cash and cash equivalents

 

 

34,759

 

 

 

(8,884

)

Cash and cash equivalents at beginning of the period

 

 

12,914

 

 

 

30,966

 

Cash and cash equivalents at end of the period

 

$

47,673

 

 

$

22,082

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

Cash paid for interest

 

$

268

 

 

$

15

 

Cash paid for income taxes

 

$

1,070

 

 

$

68

 

Supplemental disclosure of non-cash investing and financing
   activities:

 

 

 

 

 

 

Purchases of property, plant and equipment included in accounts payable and accrued liabilities

 

$

1,266

 

 

$

1,398

 

 

 


 

Non-GAAP Financial Measures

We report our financial results in accordance with GAAP. However, management believes that Adjusted EBITDA and Adjusted EBITDA Margin, non-GAAP financial measures, provide investors with additional useful information in evaluating our performance.

Adjusted EBITDA and Adjusted EBITDA Margin are financial measures that are not required by or presented in accordance with GAAP. We believe that Adjusted EBITDA and Adjusted EBITDA Margin, when taken together with our financial results presented in accordance with GAAP, provide meaningful supplemental information regarding our operating performance and facilitate internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of Adjusted EBITDA and Adjusted EBITDA Margin are helpful to our investors as they are measures used by management in assessing the health of our business, determining incentive compensation and evaluating our operating performance, as well as for internal planning and forecasting purposes.

We calculate Adjusted EBITDA as net income, adjusted to exclude: (1) depreciation and amortization; (2) (benefit) or provision for income taxes as applicable; (3) stock-based compensation expense; (4) interest expense; (5) change in fair value of contingent consideration; (6) interest income; and (7) the costs related to the discontinuation of our convenient breakfast product line. We believe the costs directly related to the convenient breakfast exit should be excluded as they are unlikely to recur. We calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by Net Revenue.

Adjusted EBITDA and Adjusted EBITDA Margin are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Some of the limitations of Adjusted EBITDA and Adjusted EBITDA Margin include that (1) they do not properly reflect capital commitments to be paid in the future, (2) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect these capital expenditures, (3) they do not consider the impact of stock-based compensation expense, (4) they do not include costs related to the discontinuation of our convenient breakfast product line; (5) they do not reflect other non-operating expenses, including interest expense; (6) they do not consider the impact of any contingent consideration liability valuation adjustments; and (7) they do not reflect tax payments that may represent a reduction in cash available to us. In addition, our use of Adjusted EBITDA and Adjusted EBITDA Margin may not be comparable to similarly titled measures of other companies because they may not calculate Adjusted EBITDA and Adjusted EBITDA Margin in the same manner, limiting the usefulness as comparative measures. Because of these limitations, when evaluating our performance, you should consider Adjusted EBITDA and Adjusted EBITDA Margin alongside other financial measures, including our net income and other results stated in accordance with GAAP.

 


 

The following table presents a reconciliation of Adjusted EBITDA to net income (loss) and a reconciliation of Adjusted EBITDA Margin to net income (loss) margin, the most directly comparable financial measures stated in accordance with GAAP, for the 13-week and 26-week periods presented.

VITAL FARMS, INC.

ADJUSTED EBITDA RECONCILIATION

(Amounts in thousands)

(Unaudited)

 

 

13-Weeks Ended

 

 

26-Weeks Ended

 

 

 

June 25,
2023

 

 

June 26,
2022

 

 

June 25,
2023

 

 

June 26,
2022

 

 

 

(in thousands)

 

 

(in thousands)

 

Net income (loss)

 

$

6,683

 

 

$

192

 

 

$

13,833

 

 

$

(1,346

)

Depreciation and amortization1

 

 

2,297

 

 

 

1,339

 

 

 

4,437

 

 

 

2,287

 

Stock-based compensation expense

 

 

1,446

 

 

 

1,633

 

 

 

3,687

 

 

 

2,929

 

Costs related to our exit of the convenient breakfast product line

 

 

 

 

 

 

 

 

 

 

 

2,341

 

Income tax provision (benefit)

 

 

1,229

 

 

 

680

 

 

 

3,751

 

 

 

(1,697

)

Interest expense

 

 

136

 

 

 

7

 

 

 

275

 

 

 

15

 

Change in fair value of contingent consideration2

 

 

-

 

 

 

12

 

 

 

 

 

 

19

 

Interest income

 

 

(450

)

 

 

(210

)

 

 

(790

)

 

 

(340

)

Adjusted EBITDA

 

$

11,341

 

 

$

3,653

 

 

$

25,193

 

 

$

4,208

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue

 

$

106,445

 

 

$

82,870

 

 

$

225,616

 

 

$

159,929

 

Net income (loss) margin3

 

 

6.3

%

 

 

0.2

%

 

 

6.1

%

 

 

(0.8

)%

Adjusted EBITDA Margin4

 

 

10.7

%

 

 

4.4

%

 

 

11.2

%

 

 

2.6

%

 

1 Amount also includes finance lease amortization.

2 Amount reflects the change in fair value of a contingent consideration liability in connection with our 2014 acquisition of certain
assets of Heartland Eggs.

3 Net income (loss) margin is calculated by dividing net income (loss) by net revenue.

4 Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by net revenue.