Canaccord Lowers Else Nutrition Estimates After Disappointing Quarter

This past week, Else Nutrition (CSE: BABY) reported their second quarter financial results. The company reported revenues of $1.11 million, down roughly 2% sequentially, while gross profit grew from $0.05 million to $0.33 million. Finally, the company posted a net loss of $4.75 million or a loss of $0.05 per share. The company ended the quarter with $17.9 million in cash and equivalents.

The company currently only has one analyst covering the stock, Canaccord Genuity, who has a C$5.75 price target and speculative buy rating. They call the earnings a mixed bag while Else missed all of Canaccord’s estimates by 15-30%. Canaccord estimated that second-quarter revenues would come in at $1.61 million while gross profit was expected to be $0.483 million. Adjusted EBITA came in at ($3,188) million while Canaccord estimated ($3,891) million.

Canaccord says that this quarter’s revenue miss was due to retail order lumpiness. The miss was attributed to weaker-than-expected toddler formula sales of $0.8 million versus their $1.3 million estimate. They say that the online sales have been solid with Amazon store sales up 50% and their own website sales up 34%. They write, “the online channel has been strong and steady, retail sales have been lumpy as they depend on the timing of orders received from distributors.”

Canaccord went ahead and lowered their full-year 2021 and 2022 estimate due to lowering their toddler formula revenue going forward. They also mention that the baby complementary cereal is still on track to launch during the fourth quarter of this year on time and is in line with their projections.

Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

One thought on “Canaccord Lowers Else Nutrition Estimates After Disappointing Quarter

  • September 25, 2021 8:44 AM at 8:44 am

    Where do you get Revenue of 49.5M from for 2022E? That’s 7x your FY 2021E


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