Farmers Edge, a digital agriculture company, has reported its financial results for Q4 and the year ending December 31, 2022. The company has successfully reduced its adjusted free cash flow deficit by 56% year-over-year by executing its cost reduction program to deliver $20 million in annualized cost savings. The company has also restructured its sales teams, hired new sales personnel, and is actively engaged in discussions with several potential enterprise partners to increase sales in the future.
Although the revenues for the three months and year ended December 31, 2022 (excluding partner subsidies in 2021) were slightly lower than the comparable periods in 2021, the company remains focused on improving profitability by growing its top-line through its industry-leading technology solutions and forging critical partnerships with growers and enterprise customers. Lower digital agronomy revenues were due to the lower digital agronomy acres during the year. In addition, lower fertility revenue in Q1 2022 also impacted the year-to-date results.
In Q4 2022, crop input e-commerce sales were lower due to a supply-demand mismatch caused by weaker market demand and an oversupply of products. Management expects e-commerce sales to rebound in Q1 2023 and plans to enhance its retail marketplace by broadening its offerings through a new platform. As a result, the adjusted EBITDA loss for the fourth quarter of 2022 was $7.8 million, and the net loss was $20.0 million for the fourth quarter of 2022, including a non-cash impairment charge related to the e-commerce operations and other non-recurring items of $9.7 million.
Vibhore Arora, Farmers Edge’s Chief Executive Officer, said the company remains focused on improving profitability by growing its top line through its industry-leading technology solutions and forging critical partnerships with growers and enterprise customers. As a result of cost optimization efforts and efficient working capital management, the company reduced its adjusted free cash flow deficit by over 50% in Q4 2022 on a year-over-year basis. In addition, the company has sold 0.2 million acres of New Digital Agronomy for the quarter ending December 31, 2022, and 3.5 million acres, including 1.7 million non-paying PGP acres for the year to date.
Photo by Zoe Schaeffer on Unsplash
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