Modern Meat (CSE: MEAT) last night quietly filed its year end financial statements for the period ended August 31, 2020. The filings reveal that the company managed to generate revenues of $82,144 for the full fiscal year, of which $57,914 came from the fourth quarter. The company meanwhile managed to post a net loss of $5.2 million for the year, of which $4.7 million was attributable to the fourth quarter, largely due to listing expenses of $3.4 million.
The revenue figure might come as a shocker to some shareholders, given that on September 10, just ten days after the close of the quarter, the company headlined a news release with, “Modern Meat Sells Out of Product 12 Consecutive Weeks and Continues to Move Into New Production Facility.” It appears that that new production facility was crucial to the operations of the firm, given that eleven of the twelve consecutive weeks of this product sell-out amounted to $57,914 in revenues at most.
Revenues generated for the year were not cheap either, with the $82,144 in total revenue generated coming with a cost of sales of $81,107. Interestingly, the cost of sales seems to have climbed from the time the company was non-public – the third quarter, when the firm was still private, saw sales of $24,019 at a cost of $12,036, resulting in a gross profit of $11,983. The fourth quarter meanwhile saw its sales of $57,914 cost the firm $69,071.
Expenses seemingly climbed significantly as well in the transition from private to public, with operating expenses climbing from $202,662 in the third quarter to $1.16 million in the fourth quarter. While some of this expense naturally is a result of fees related to the go-public transaction, such as consulting fees which amounted to $152,922 in the quarter as compared to the prior $1,750, or professional fees that climbed from $8,500 to $163,700 quarter over quarter, other fees rose as well.
For instance, management and director fees climbed from $53,000 to $109,746, and sales and marketing rose from $45,981 to $599,903. Even contract labor rose, from $8,543 to $25,165. The company also recorded transaction costs of $168,769 during the quarter, as well as a listing expense of $3.4 million.
Looking to the balance sheet, the company as of August 30 recorded a cash position of $2.8 million, along with prepaid expenses of $0.2 million and receivables of $0.1 million. Inventories meanwhile came in at just $20,925, resulting in total current assets of $3.2 million.
Accounts payable sat at $0.6 million at the end of the fiscal year, along with a loan payable of $0.2 million. Current portions of lease liabilities meanwhile came in at $27,436. Overall, the company listed $0.8 million in current liabilities, giving the firm net working capital of roughly $2.3 million.
Modern Meat last traded at $4.05 with a market capitalization of $114.6 million.
Information for this analysis was found via Sedar and Modern Meat. 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.
