Discover the latest news from CubicFarms (TSX: CUB), a modular vertical farm based in Vancouver, Canada:
CubicFarms and HydroGreen Expand into International Markets Through Partnership with Seehof Agrar GmBH (2023/08/26)
CubicFarm® Systems Corp. has entered into a Manufacturer’s Representative Agreement with its subsidiary HydroGreen Inc. and Germany-based Seehof Agrar GmBH. Led by dairy industry veteran Jürgen Bustorf, Seehof Agrar will promote and sell HydroGreen’s livestock feed equipment in Europe, the Middle East, and select countries in the Asia Pacific. The partnership aims to capitalize on growing interest from potential customers in these regions and is part of CubicFarms and HydroGreen’s strategy to target subsidized markets.
John de Jonge, President of HydroGreen, highlighted the significant opportunities in international markets for advancing the adoption of sprouted grain as a beneficial feed ingredient for ruminant livestock. Seehof Agrar, with its extensive experience in the European dairy industry, is considered a strategic partner to help HydroGreen expand internationally. The agreement comes as HydroGreen also focuses on domestic strategies, including establishing regional feed hub facilities in the United States.
The collaboration is expected to broadly impact the livestock feed industry, making sustainable and efficient feed solutions more accessible worldwide. It also aligns with HydroGreen’s efforts to secure funding opportunities in markets where government-subsidized programs can assist farmers and ranchers. The partnership is seen as a step forward in enhancing global food security and reducing the environmental footprint of agricultural production.
HydroGreen Signs Deal with Bar None Dairy for Sprouted-Grain Feed Production (2023/08/21)
CubicFarm® Systems Corp., a prominent local chain agricultural technology firm, recently made headlines with its announcement regarding HydroGreen Inc., its ruminant livestock feed subsidiary. HydroGreen has entered into a Memorandum of Terms with Bar None Dairy, a renowned dairy farm situated in Helm, California, under the ownership and management of Pier Van Der Hoek. The agreement entails Van Der Hoek’s commitment to procure 6 tons of sprouted-grain feed daily from HydroGreen’s upcoming second phase facility in Riverdale, California.
The initial building of the anticipated Riverdale facility has already reached its full commitment capacity for feed. As a result, Bar None Dairy’s procurement will be sourced from the facility’s second building, which is set to house 10 HydroGreen GLS 808 commercial-scale machines. Impressively, this system of machines boasts a production capacity of up to 34 tons of feed each day. This translates to an annual feed production of roughly 12,000 tons per building.
This collaboration endorses HydroGreen’s in-field product and paves the way for potential sales expansion to other dairy and beef enterprises in the vicinity. The venture is poised to showcase the effectiveness of HydroGreen’s avant-garde Feed as a Service (FaaS) business framework, aiming for swift product adoption. The FaaS model is a groundbreaking approach in agriculture. HydroGreen will oversee a regional feed facility, ensuring the harvest of sprouted-grain nutrition from its machines for sale to local livestock feed operations. This hands-on involvement by HydroGreen ensures peak feed production, stringent quality control, and superior animal performance outcomes for producers.
CubicFarm Q2 2023: Thriving Progress (2023/08/16)
CubicFarm Systems Corp. (TSX: CUB), a forward-thinking local chain agricultural technology company, is making waves in the industry with its innovative solutions to transform how we produce food and feed livestock. The company recently released its second-quarter financial and operating results for 2023, showcasing impressive revenue growth, operational milestones, and a strategic shift towards sustainable, efficient farming practices.
For the three months ending June 30th, 2023, CubicFarms reported a significant increase in revenue, reaching $3.3 million compared to $2.9 million during the same period the previous year. This upward trajectory indicates the company’s commitment to developing and deploying cutting-edge agricultural technology that addresses the challenges of modern food production.
One of the most noteworthy aspects of the Q2 2023 results is the substantial reduction in net losses, from $9.0 million in the previous year to $4.0 million. This improvement can be attributed to the company’s strategic focus on cost reduction measures, exemplified by a reduction in operating expenses from $9.3 million to $2.9 million. Such measures reflect CubicFarms’ dedication to streamlining operations and achieving financial sustainability.
CubicFarms’ operational highlights for Q2 2023 underscore its commitment to innovation and expansion in the agricultural technology landscape. One particularly remarkable development is the introduction of “Feed as a Service” (FaaS) through the company’s subsidiary, HydroGreen. This novel agricultural model involves the establishment of regional feed hub facilities equipped with Automated Vertical Pastures™, allowing CubicFarms to sell sprouted-grain nutrition to livestock feeding operations in the vicinity. This initiative generates additional revenue streams for the company and exemplifies its dedication to creating sustainable solutions for the livestock industry.
The company’s partnerships and collaborations further solidify its position in the market. The lease arrangement of FreshHub machinery and equipment to Langley Indoor Produce, with the option to retain equity interest, showcases CubicFarms’ commitment to advancing indoor farming technologies. Additionally, successful installations of HydroGreen units for livestock feed market players like Jim Cheney Inc. and the FaaS partnership with J&D Wilson Farms exemplify the company’s ability to deliver tangible, practical solutions to various segments of the agricultural industry.
In May 2023, CubicFarms experienced a significant transition in its leadership team as Carlos Yam, Chief Financial Officer, resigned. Michael Brendan Kyne, a seasoned professional with over 20 years of experience in investment management and business leadership, was appointed as the Interim CFO. This strategic move highlights the company’s commitment to maintaining financial solid stewardship and guiding the company toward sustainable growth.
As reflected in the statements of John de Jonge, CEO and President of HydroGreen, CubicFarms remains steadfast in its commitment to operational efficiency, sustainability, and expansion within promising markets. The company’s strategic pivot towards its Feed division and the FaaS program demonstrates a clear vision for creating recurring revenue streams while driving positive change in the agricultural sector.
CubicFarms’ Q2 2023 financial and operational results are a testament to the company’s dedication to revolutionizing agriculture through innovative technology, partnerships, and a keen focus on sustainable growth. As the world grapples with the challenges of feeding a growing population while preserving the environment, companies like CubicFarm are at the forefront of driving transformative solutions that have the potential to reshape the future of farming.
CubicFarm Systems Corp Announces Extension for Annual General Meeting Dates (2023/08/02)
CubicFarm® Systems Corp. (TSX: CUB) has announced an extension for its Annual General Meeting (AGM) for the year ending December 31, 2022. The Toronto Stock Exchange has granted a three-month extension to hold the AGM from June 30, 2023, to September 30, 2023, and the Registrar of Companies has granted a similar extension from September 16, 2023, to December 16, 2023, under section 182(4) of the Business Corporations Act. The decision to postpone the AGM was determined by the Company’s management to be in the best interest of its shareholders, allowing time to consider potential transactions requiring security holder approval or potential consolidation of share capital
CubicFarms’ HydroGreen Scores Strategic Agreement with Johann Dairy, Expands FaaS Model in California (2023/07/23)
In a move that underlines its growing influence in local chain agriculture technology, CubicFarms Systems Corp. (TSX:CUB), announced that HydroGreen Inc., its subsidiary focusing on ruminant livestock feed, has entered into a Memorandum of Terms (MOT) with Fresno-based Johann Dairy. Owned by John Verway, Johann Dairy is a prominent player in the California dairy industry. This new collaboration signifies a significant stride towards finalizing a purchase agreement and represents the second MOT with a large dairy in California in a fortnight.
To optimize this joint venture, HydroGreen has plans in the pipeline to set up a facility at the Wilson Dairy in Riverdale, California. The facility will be equipped with the first phase of 10 HydroGreen GLS 808 machines, with each machine potentially producing approximately 34 tons of feed daily. With the Riverdale Feed Facility already at full capacity, this initial phase stands to provide nearly 12,000 tons of feed each year.
As per the terms of the MOT with Johann Dairy, HydroGreen will deliver 10 tons of their specially designed “As Fed” Feed daily. This move not only acts as a testament to HydroGreen’s product credibility but also holds potential for further expansion of sales to other dairy and beef operations in the area. More importantly, it aims to highlight the feasibility of HydroGreen’s innovative Feed as a Service (FaaS) model and pave the way for a faster product adoption rate.
The FaaS model revolves around HydroGreen establishing a regional feed hub, complete with Automated Vertical Pastures™. The nutrition-rich, sprouted-grain feed produced is then sold to local livestock feeding operations. With HydroGreen at the helm of the feed hub operations, quality control, optimal feed production, and enhanced livestock performance are assured.
John de Jonge, Interim CEO and President of HydroGreen, expressed his enthusiasm about the new partnership. “This collaboration is a win-win situation. It ensures a steady supply of quality feed that boosts herd digestion for producers, while also creating a steady revenue stream for HydroGreen,” he noted. “We look forward to demonstrating the remarkable capabilities of our Automated Vertical Pastures™ and their positive impact on animal performance. We are confident that this initiative will underscore the efficiency and sustainability of our solutions, while fostering future collaborations in the agricultural sector.”
CubicFarms’ HydroGreen and Crosswind Jerseys Embark on Innovative Feed Partnership (2023/07/07)
CubicFarm® Systems Corp., a prominent agricultural technology firm, announced a new partnership today between its subsidiary HydroGreen Inc. and Crosswind Jerseys, a leading Elkton, South Dakota dairy company. HydroGreen will commence Feed as a Service (FaaS) deliveries on July 7, 2023, delivering 45 tons of HydroGreen feed each month from its production facilities in Sioux Falls.
HydroGreen feed has been recognized by Crosswind Jerseys for its significant potential to enhance the performance of its 2,100-strong dairy cow herd. The feed is derived from sprouted grains produced using HydroGreen technology and has shown favorable impacts on cow health and productivity during trials at Crosswind Jerseys.
The trials reported considerable improvements, including a 12% boost in rumination activity and dry matter intake, a 5% rise in milk production, and an 8% increment in conception rates. The HydroGreen forage also amplified protein levels by 25% more than the parent grain, contributing to higher digestibility and lower dietary energy waste. Similar results to the study conducted a year ago.
John de Jonge, Interim CEO and President of HydroGreen, expressed excitement about the partnership, emphasizing the importance of consistent daily nutrition and herd health. He highlighted their shared commitment with Crosswind Jerseys to improve livestock feed production efficiency and animal welfare.
CubicFarms Reports Its Q1 2023 (2023/05/16)
The Company reported increased revenue for Q1 2023, at $455,392, up from $243,912 during the same period last year. Despite this increase, the firm posted net losses of $4.7 million for Q1 2023, a significant reduction from the $8.8 million net loss recorded in Q1 2022.
This reduction in net losses can be attributed to the Company’s recent cost-cutting measures. As a result, CubicFarms reported that operating expenses, including selling, general & administrative, and research & development expenses, were reduced to $3.9 million, down from $8.1 million the previous year.
Key operational highlights from Cubicfarms Q1 2023 include a partnership with Langley Indoor Produce Ltd. On January 17, CubicFarms announced it had leased FreshHub machinery and equipment to Langley Indoor Produce Ltd., retaining an option for up to 97.6% equity interest. As part of this arrangement, CubicFarms granted a license for the FreshHub intellectual property limited to indoor, non-containerized use of the CubicFarms patented equipment. Future funding for Langley Indoor Produce Ltd. is expected to be provided by third-party investors.
Another operational highlight came from CubicFarms’ livestock feed subsidiary, HydroGreen, Inc., which installed two machines sold to Jim Cheney Inc. in Utah, as announced on March 7.
Further, during CubicFarms Q1 2023, the company confirmed the completion of its overnight marketed public offering on March 17, issuing 56,027,000 units priced at $0.05 per unit. The offering generated gross proceeds of $2,801,350, which included 10,261,000 units issued to reduce the Company’s working capital obligations, addressing $513,050 in payables.
Interim CFO Michael Kyne expressed satisfaction with the results, citing the increased revenue, reduced net losses, and decreased operating expenses as positive outcomes of the Company’s cost-reduction measures. He emphasized the role of strategic partnerships and successful installations in driving operational progress. He reiterated the Company’s commitment to delivering value to shareholders and pursuing sustainable growth in the agricultural sector.
CubicFarm Systems Corp released its financial results for the year ended December 31, 2022 (2023/05/03)
The agri-tech Company reported revenue of $0.2 million for the fourth quarter, a drop from $0.8 million during the same period last year. Annual revenue also suffered, totaling $3.6 million in 2022 compared to $5.3 million in the prior annum.
Net loss for Q4 2022 widened significantly to $29.8 million, up from $11.2 million during the same period in 2021. For the full year, the net loss was $60.4 million, more than double the $29.4 million loss in the prior year.
The higher net losses in 2022 were primarily due to impairment charges, despite reduced operating expenses. The Company recorded non-cash impairment charges of $23.1 million for the fourth quarter and $26.5 million for the whole year. These charges are associated with the Fresh and Feed divisions, following the Company’s assessment of the net assets’ carrying amount exceeding the recoverable amount.
Corporate overhead, encompassing general and administrative, selling, and research and development expenses, was $5.7 million for the fourth quarter. The overheads represent a 45% reduction from $10.4 million in the prior year, achieved through the Company’s cost reduction plan implemented in the second half of 2022. However, the annual corporate overhead in 2022 increased slightly to $31.6 million from $30.5 million in 2021.
CubicFarm is optimistic about its cost reduction plan, projected to yield annual savings of $15.6 million in cash-based operating expenses. The plan was announced in September 2022, and the Company reiterates it is on track to achieve this goal.
Despite the challenges faced in 2022, CubicFarm Systems Corp is determined to return to financial stability by continuing to implement its cost reduction strategy while reassessing its asset values and working towards enhancing machine sales.
Second Quarter 2022: Restructuring Process (2022/08/15)
In the second quarter of 2022, CubicFarms maintained its emphasis on project execution, particularly the installation of their CubicFarm Systems and HydroGreen Automated Vertical Pastures™ (AVPs) solutions, while continuing to build their sales pipeline, according to CFO Carlos Yam. Operational performance is reviewed continually, and measures, including expense management, are implemented to ensure financial alignment within operations. HydroGreen, a division of CubicFarms, is nearing completion on its installation of AVPs at Burnett’s Land & Livestock in Carpenter, Wyoming. These AVPs comprise the world’s most comprehensive automated indoor growing solution, garnering significant interest from potential customers.
The company showcased its HydroGreen Innovation Center R&D facility in Sioux Falls, South Dakota, to more than 400 National Holstein Convention conference attendees. Demonstrations at the event highlighted the six-day growth cycle from seed to feed and the nutritional benefits of HydroGreen fresh forage. Specifically, the forage could decrease methane emissions in dairy cows by roughly 24% per unit of milk output and beef cattle by about 48% per kilogram weight gain, offering additional benefits like water and land conservation.
Despite the net loss of $9.1 million for the three months and $17.9 million for the six months ended June 30, 2022, the company has announced several cost reduction measures. They have reduced approximately 16.5% of their workforce and other non-payroll-related overhead expenditures, resulting in an estimated $6.7 million in annualized savings. This equates to a reduction of 21.8% of the Company’s cash-based operating expenses on a trailing 12-month basis. In addition, a centralized procurement structure will be implemented to right-size indirect costs and optimize supply chain efficiencies. These cost-saving measures will positively impact the company’s financial performance starting in the third quarter of 2022.
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