Landec Corp Ca (LNDC) 10-Q Quarterly Report Thu Oct 03 2019



Contact Information:

At the Company:	Investor Relations:
Gregory S. Skinner	Jeff Sonnek
Executive Vice President Finance and Administration and CFO	(646) 277-1263
(650) 261-3677	Jeff.sonnek@icrinc.com

Landec Corporation Reports Fiscal 2020 First Quarter Results

Company Advances Strategic Priorities to Improve Long-Term Profitability

and Reiterates Fiscal Year 2020 Guidance

SANTA CLARA, CA - October 1, 2019 - Landec Corporation (Nasdaq: LNDC), a diversified health and wellness company with two operating businesses, Curation Foods, Inc. and Lifecore Biomedical, Inc. reported results for the fiscal 2020 first quarter ended August 25, 2019. Landec plans to create shareholder value by delivering against our financial targets, investing in growth, strengthening our balance sheet, implementing our strategic priorities to improve operating margins at Curation Foods and driving topline momentum at Lifecore.

Dr. Albert Bolles, Landec’s President and CEO commented, “First quarter results met our guidance and we are set up for a successful year at both Lifecore and Curation Foods. We are investing capital at Lifecore to expand capacity and at Curation Foods to further automate our processing facilities and drive out costs. Our people are integral to our success and we are investing in talent across our entire organization to drive meaningful change. The results of these efforts are beginning to show in an improved culture at Landec, which is squarely focused on profitability and on executing with excellence with an emphasis on productivity to increase margins, while fostering a culture of sustainability.”

Fiscal First Quarter 2020 Financial Highlights

First fiscal quarter 2020 results compared to first fiscal quarter 2019 are as follows:



(Unaudited and in thousands, except per-share data)	Three Months Ended					Change
	August 25, 2019			August 26, 2018		Amount			%
Revenues	$	138,714		$	124,668	$	14,046		11	%
Gross profit	15,336			16,337		(1,001		)	(6	)%
Net (loss) income from continuing operations	(4,784		)	335		(5,119		)	N/M
EBITDA*	314			3,301		(2,987		)	(90	)%
Diluted net (loss) income per share	$	(0.16	)	$	0.01	$	(0.17	)	N/M

*See “Non-GAAP Financial Information” at the end of this release for more information and for a reconciliation of certain financial information.

Revenues increased during the first quarter of fiscal 2020 primarily due to the addition of Yucatan Foods, which was acquired on December 1, 2018, that contributed $16.2 million in revenues and from a $2.2 million or 4% increase in salad revenues compared to the first quarter of last year. These increases were partially offset by: (1) a $3.2 million decrease in green bean revenues due to the extremely heavy rains and flooding in the Ohio Valley during May and June resulting in yields of 35% to 50% of normal, (2) a planned $1.4 million decrease in revenues in the packaged vegetables in bags and trays business, and (3) a $0.6 million planned decrease at Lifecore. The Lifecore decrease was a result of lower fermentation revenues during the first quarter of fiscal 2020 compared to the first quarter of fiscal 2019 due to the timing of shipments within fiscal 2020. The Lifecore revenue decrease was partially offset by a 49% increase in product development revenues due to an increase in development activities during the quarter.

The following information was filed by Landec Corp Ca (LNDC) on Tuesday, October 1, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Landec Corp Ca's 10-Q Quarterly Report:

Financial - Expense Highlight
The increase in SG&A expenses for the three months ended August 25, 2019, compared to the same period last year, was due to: (1) a $2.6 million increase in our Curation Foods business primarily due to $2.1 million of SG&A at Yucatan Foods and a $0.5 million increase in the Eat Smart line of products due primarily to an increase in consulting fees, most of which was associated with Curation Foods' cost saving initiatives, (2) a $0.3 million increase in our Lifecore business from higher salary and benefit expenses, and (3) a $0.2 million increase at our Other segment from higher salary and benefit expenses.

Financial - Expense Highlight
The Company includes in cost of sales all of the following costs: raw materials (including produce, seeds, packaging, syringes and fermentation and purification supplies), direct labor, overhead (including indirect labor, depreciation, and facility-related costs) and shipping and shipping-related costs.
Financial - Expense Highlight
The Yucatan Foods business adds another double-digit growth platform, a lower-cost infrastructure in Mexico and higher margin product offerings that generally exhibit less sourcing volatility.
Other - Other Highlight
As of August 25, 2019, the Company had cash and cash equivalents of $2.0 million, a net increase of $0.9 million from $1.1 million as of May 26, 2019.
Financial - Expense Highlight
The R&D expenses were flat for the three months ended August 25, 2019, compared to the same period last year, primarily due to higher salary and benefit expenses at Lifecore partially offset by decreases at our Other segment from fewer product development activities for our new ventures.
Financial - Earnings
Curation Foods The decrease in...Read more
Other - Other
Note 1 - Organization, Basis...Read more
Financial - Dividend
Dividend Income Dividend income is...Read more
Revenue - Product
Expand medical applications for HA:...Read more
Other - Other
The use of cash in...Read more
Revenue - Product
These increases were partially offset...Read more
Financial - Income
Interest Income The decrease in...Read more
Financial - Expense
Interest Expense The increase in...Read more
Financial - Expense
Windset The Company believes that...Read more
Revenue - Product
Curation Foods The increase in...Read more
Other - Other
These increases in working capital...Read more
Financial - Dividend
The decrease in dividend income...Read more
Financial - Earnings
There are numerous factors that...Read more
Other - Other
We believe that the Company's...Read more
Other - Other
Eat Smart Packaged Fresh Vegetables...Read more
Other - Other
Utilize manufacturing infrastructure to pursue...Read more
Revenue - Product
Elements of Lifecore's strategy include...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Landec Corp Ca provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: LNDC
CIK: 1005286
Form Type: 10-Q Quarterly Report
Accession Number: 0001628280-19-012132
Submitted to the SEC: Thu Oct 03 2019 12:04:58 PM EST
Accepted by the SEC: Thu Oct 03 2019
Period: Sunday, August 25, 2019
Industry: Canned Fruits Veg Preserves Jams And Jellies