Revenue from continuing operations increased
16% to $176 million, driven by volume growth
Loss from continuing operations of $5.5
million compared to a loss of $5.7 million in the prior
year
Adjusted EBITDA from continuing operations
increased 13% to $21.5 million
Reaffirming 2024 outlook
SunOpta Inc. (“SunOpta” or the “Company”) (Nasdaq:STKL)
(TSX:SOY), an innovative and sustainable manufacturer fueling the
future of food, today announced financial results for the third
quarter ended September 28, 2024.
All amounts are expressed in U.S. dollars and results are
reported in accordance with U.S. GAAP, except where specifically
noted.
Third Quarter 2024 highlights:
- Revenues increased 15.5% to $176.2 million compared to $152.5
million in the year earlier period, driven by 20.6% volume growth
partially offset by a 2.8% price reduction for pass-through
commodity pricing
- Gross profit increased 16.4% to $23.6 million compared to $20.3
million in the prior year period
- Loss from continuing operations was $5.5 million compared to a
loss of $5.7 million in the prior year period
- Adjusted earnings¹ from continuing operations was $2.5 million
compared to $0.5 million in the prior year period
- Adjusted EBITDA¹ from continuing operations increased 12.6% to
$21.5 million, compared to $19.1 million in the prior year
period.
“The third quarter unfolded as expected,” said Brian Kocher,
Chief Executive Officer of SunOpta. “Volume again drove our revenue
growth reflecting the strength of our competitive position. Our
growth remains broad based across our customers, channels and
product portfolio and we continue to have a substantial pipeline of
new business opportunities. We continue to make short-term
investments in our supply chain to support our growth and implement
processes and controls. Those productivity initiatives are gaining
traction and creating a long runway for significant future
incremental capacity within our existing asset base which will
drive sustainable gross margin expansion. We remain confident in
the direction of our business and steadfast in our focus on driving
increasing returns on our invested capital and generating long-term
value for shareholders.”
Third Quarter 2024 Results
Revenues increased 15.5% to $176.2 million for the third quarter
of 2024. The increase was driven by favorable volume/mix of 20.6%,
partially offset by a price reduction of 2.8% due to the pass
through of commodity costs for certain raw materials. Our exit from
the smoothie bowls category in March 2024 resulted in a 2.3%
reduction in revenue. Volume/mix reflected volume growth for fruit
snacks, broths, plant-based beverages, and protein shakes.
Gross profit increased by $3.3 million, or 16.4%, to $23.6
million for the third quarter, compared to $20.3 million in the
prior year period. As a percentage of revenues, gross profit margin
was 13.4% compared to 13.3% in the third quarter of 2023. Adjusted
gross margin¹ was 17.0% compared to 16.4% in the third quarter of
2023. The 60-basis point increase in adjusted gross margin
reflected higher sales and production volumes partially offset by
incremental depreciation of new production equipment for capital
expansion projects, together with manufacturing inefficiencies.
Operating income was $1.5 million, up slightly compared to the
third quarter of 2023, reflecting higher gross profit together with
lower business development and employee severance costs following
the divestiture of Frozen Fruit and related consolidation of our
continuing operations in 2023, largely offset by higher variable
compensation accruals and increased professional fees related to
operational productivity initiatives.
Loss from continuing operations was $5.5 million for the third
quarter of 2024 compared with a loss of $5.7 million in the prior
year period. Diluted loss per share from continuing operations
attributable to common shareholders (after dividends and accretion
on preferred stock) was $0.05 for the third quarter compared with a
diluted loss per share of $0.05 in the prior year period.
Adjusted earnings¹ from continuing operations was $2.5 million
or $0.02 per diluted share in the third quarter of 2024 compared to
adjusted earnings from continuing operations of $0.5 million or
$0.00 per diluted share in the third quarter of 2023.
Adjusted EBITDA¹ from continuing operations was $21.5 million in
the third quarter of 2024 compared to $19.1 million in the third
quarter of 2023.
Please refer to the discussion and table below under “Non-GAAP
Measures”.
Balance Sheet and Cash Flow
As of September 28, 2024, SunOpta had total assets of $699.3
million and total debt of $289.9 million compared to total assets
of $669.4 million and total debt of $263.2 million at year end
fiscal 2023. During the three quarters ended September 28, 2024,
cash provided in operating activities of continuing operations was
$19.2 million compared to $8.4 million of cash used in operating
activities of continuing operations during the same period in 2023.
The increase in cash provided from operating activities mainly
reflected improved working capital efficiency, together with
improved profitability, driven by revenue volume growth and lower
start-up costs related to our Midlothian, Texas, facility.
Investing activities of continuing operations consumed $16.5
million of cash during the first three quarters of 2024 down from
$37.3 million for the same period in the prior year, reflecting the
completion of certain major capital projects including the
construction of our new plant-based beverage facility in
Midlothian, Texas.
2024 Outlook2
For fiscal 2024, the Company is reaffirming its outlook and
continues to expect strong growth in revenue and adjusted
EBITDA:
($ millions)
Outlook
Growth
Revenue
$
710 - 730
13% – 16%
Adj. EBITDA
$
88 – 92
12% - 17%
Conference Call
SunOpta plans to host a conference call at 5:30 P.M. Eastern
time on Tuesday, November 5, 2024, to discuss the third quarter
financial results. After prepared remarks, there will be a question
and answer period. Investors interested in listening to the live
webcast can access a link on SunOpta’s website at www.sunopta.com
under the “Investor Relations” section or directly. A replay of the
webcast will be archived and can be accessed for approximately 90
days on the Company’s website.
This call may be accessed with the toll free dial-in number
(888) 440-4182 or international dial-in number (646) 960-0653 using
Conference ID: 8338433.
1 See discussion of non-GAAP measures
2 The Company has included certain forward-looking statements
about the future financial performance that include non-GAAP
financial measures, including Adjusted EBITDA. These non–GAAP
financial measures are derived by excluding certain amounts,
expenses or income, from the corresponding financial measures
determined in accordance with GAAP. The determination of the
amounts that are excluded from these non-GAAP financial measures is
a matter of management judgment and depends upon, among other
factors, the nature of the underlying expense or income amounts
recognized in a given period. We are unable to present a
quantitative reconciliation of the aforementioned forward-looking
non-GAAP financial measures to their most directly comparable
forward-looking GAAP financial measures because management cannot
reliably predict all the necessary components of such GAAP
measures. Historically, management has excluded the following items
from certain of these non-GAAP measures, and such items may also be
excluded in future periods and could be significant
amounts.
- Expenses related to the acquisition or divestiture of a
business, including business development costs, impairment of
assets, integration costs, severance, retention costs and
transaction costs;
- Start-up costs of new facilities and equipment;
- Charges associated with restructuring and cost saving
initiatives, including but not limited to asset impairments,
accelerated depreciation, severance costs and lease abandonment
charges;
- Asset impairment charges and facility closure costs;
- Legal settlements or awards; and
- The tax effect of the above items.
About SunOpta Inc.
SunOpta (Nasdaq:STKL) (TSX:SOY) is an innovative and sustainable
manufacturer fueling the future of food. With roots tracing back
over 50 years, SunOpta drives growth for today’s leading brands by
serving as a trusted innovation partner and value-added
manufacturer, crafting organic, plant-based beverages, fruit
snacks, nutritional beverages, broths and tea products sold through
retail, club, foodservice and e-commerce channels. Alongside the
company’s commitment to top brands, retailers and coffee shops,
SunOpta also proudly produces its own brands, including Sown®,
Dream®, and West LifeTM. For more information, visit
www.sunopta.com and LinkedIn.
Forward-Looking Statements
Certain statements included in this press release may be
considered "forward-looking statements" within the meaning of the
United States Private Securities Litigation Reform Act of 1995 and
applicable Canadian securities legislation, which are based on
information available to us on the date of this release. These
forward-looking statements include, but are not limited to, that we
continue to have a substantial pipeline of new business
opportunities and our anticipated revenue, Adjusted EBITDA, revenue
growth and Adjusted EBITDA growth for fiscal 2024. Generally,
forward-looking statements do not relate strictly to historical or
current facts and are typically accompanied by words such as
“expect”, “believe”, “anticipate”, “estimates”, “can”, “will”,
“target”, "should", "would", "plans", “potential”, “continue”,
"becoming", "intend", "confident", "may", "project", "intention",
"might", "predict", “budget”, “forecast” or other similar terms and
phrases intended to identify these forward-looking statements.
Forward-looking statements are based on information available to
the Company on the date of this release and are based on estimates
and assumptions made by the Company in light of its experience and
its perception of historical trends, current conditions and
expected future developments including, but not limited to, the
Company’s actual financial results; uninterrupted operations and
service levels to our customers; current customer demand for the
Company’s products; general economic conditions; continued consumer
interest in health and wellness; the Company’s ability to maintain
product pricing levels; planned facility and operational
expansions, closures and divestitures; cost rationalization and
product development initiatives; alternative potential uses for the
Company’s capital resources; portfolio optimization and
productivity efforts; the sustainability of the Company’s sales
pipeline; the Company’s expectations regarding commodity pricing,
and margins; procurement and logistics savings; freight lane cost
reductions; yield and throughput enhancements; the cost of the
frozen fruit recall; labor cost reductions; and the terms of our
insurance policies. Whether actual timing and results will agree
with expectations and predictions of the Company is subject to many
risks and uncertainties including, but not limited to, potential
loss of suppliers and customers as well as the possibility of
supply chain, logistics and other disruptions; unexpected issues or
delays with the Company’s structural improvements and automation
investments; failure or inability to implement portfolio changes,
process improvements, go-to-market improvements and process
sustainability strategies in a timely manner; changes in the level
of capital investment; local and global political and economic
conditions; consumer spending patterns and changes in market
trends; decreases in customer demand; delayed or unsuccessful
product development efforts; potential product recalls; potential
additional costs associated with the frozen fruit recall; working
capital management; availability and pricing of raw materials and
supplies; potential covenant breaches under the Company’s credit
facilities; and other risks described from time to time under "Risk
Factors" in the Company's Annual Report on Form 10-K and its
Quarterly Reports on Form 10-Q (available at www.sec.gov).
Consequently, all forward-looking statements made herein are
qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by
the Company will be realized. The Company undertakes no obligation
to publicly correct or update the forward-looking statements in
this document, in other documents, or on its website to reflect
future events or circumstances, except as may be required under
applicable securities laws.
SunOpta Inc.
Consolidated Statements of Operations
For the quarters and three quarters ended
September 28, 2024 and September 30, 2023
(Unaudited)
(All dollar amounts expressed in thousands
of U.S. dollars, except per share amounts)
Quarter ended
Three quarters ended
September 28, 2024
September 30, 2023
September 28, 2024
September 30, 2023
$
$
$
$
Revenues
176,216
152,541
530,059
448,673
Cost of goods sold
152,632
132,273
452,880
385,697
Gross profit
23,584
20,268
77,179
62,976
Selling, general and administrative
expenses
21,052
18,377
61,824
58,403
Intangible asset amortization
446
446
1,338
1,338
Other expense (income), net
450
-
(1,654
)
(20
)
Foreign exchange loss (gain)
113
(37
)
1,372
44
Operating income
1,523
1,482
14,299
3,211
Interest expense, net
6,762
7,162
19,222
19,391
Other non-operating expense
236
-
236
-
Loss from continuing operations before
income taxes
(5,475
)
(5,680
)
(5,159
)
(16,180
)
Income tax expense
23
-
283
3,978
Loss from continuing operations
(5,498
)
(5,680
)
(5,442
)
(20,158
)
Net loss from discontinued operations
-
(140,143
)
(2,314
)
(143,126
)
Net loss
(5,498
)
(145,823
)
(7,756
)
(163,284
)
Dividends and accretion on preferred
stock
(137
)
(426
)
(401
)
(1,552
)
Loss attributable to common
shareholders
(5,635
)
(146,249
)
(8,157
)
(164,836
)
Basic and diluted loss per
share
Loss from continuing operations
attributable to common shareholders
(0.05
)
(0.05
)
(0.05
)
(0.19
)
Loss from discontinued operations
-
(1.21
)
(0.02
)
(1.26
)
Loss attributable to common
shareholders
(0.05
)
(1.26
)
(0.07
)
(1.45
)
Weighted-average common shares
outstanding (000s)
Basic
116,841
115,616
116,504
113,700
Diluted
116,841
115,616
116,504
113,700
SunOpta Inc.
Consolidated Balance Sheets
As at September 28, 2024 and December 30,
2023
(Unaudited)
(All dollar amounts expressed in thousands
of U.S. dollars)
September 28, 2024
December 30, 2023
$
$
ASSETS
Current assets
Cash and cash equivalents
2,933
306
Accounts receivable
63,163
64,862
Inventories
107,001
83,215
Prepaid expenses and other current
assets
15,845
25,235
Income taxes recoverable
3,980
4,717
Current assets held for sale
-
5,910
Total current assets
192,922
184,245
Restricted cash
7,703
8,448
Property, plant and equipment, net
339,651
319,898
Operating lease right-of-use assets
107,115
105,919
Intangible assets, net
20,523
21,861
Goodwill
3,998
3,998
Deferred income taxes
52
-
Other assets
27,362
25,055
Total assets
699,326
669,424
LIABILITIES
Current liabilities
Accounts payable
82,835
75,761
Accrued liabilities
19,176
20,889
Notes payable
12,991
17,596
Current portion of long-term debt
29,796
24,346
Current portion of operating lease
liabilities
16,605
15,808
Total current liabilities
161,403
154,400
Long-term debt
260,130
238,883
Operating lease liabilities
101,306
100,102
Deferred income taxes
325
505
Total liabilities
523,164
493,890
Series B-1 Preferred Stock
14,910
14,509
SHAREHOLDERS' EQUITY
Common shares
470,248
464,169
Additional paid-in capital
29,839
27,534
Accumulated deficit
(340,844
)
(332,687
)
Accumulated other comprehensive income
2,009
2,009
Total shareholders' equity
161,252
161,025
Total liabilities and shareholders'
equity
699,326
669,424
SunOpta Inc.
Consolidated Statements of Cash Flows
For the three quarters ended September 28,
2024 and September 30, 2023
(Unaudited)
(Expressed in thousands of U.S.
dollars)
Three quarters ended
September 28, 2024
September 30, 2023
$
$
CASH PROVIDED BY (USED IN)
Operating activities
Net loss
(7,756
)
(163,284
)
Net loss from discontinued operations
(2,314
)
(143,126
)
Loss from continuing operations
(5,442
)
(20,158
)
Items not affecting cash:
Depreciation and amortization
27,005
22,873
Amortization of debt issuance costs
686
1,093
Deferred income taxes
(105
)
4,260
Stock-based compensation
10,269
8,989
Gain on sale of smoothie bowls product
line
(1,800
)
-
Other
(249
)
410
Changes in operating assets and
liabilities, net of divestitures
(11,143
)
(25,852
)
Net cash provided by (used in) operating
activities of continuing operations
19,221
(8,385
)
Net cash provided by (used in) operating
activities of discontinued operations
(2,310
)
18,798
Net cash provided by operating
activities
16,911
10,413
Investing activities
Additions to property, plant and
equipment
(22,800
)
(37,272
)
Proceeds from sale of smoothie bowls
product line
6,336
-
Net cash used in investing activities of
continuing operations
(16,464
)
(37,272
)
Net cash provided by (used in) investing
activities of discontinued operations
6,300
(1,085
)
Net cash used in investing activities
(10,164
)
(38,357
)
Financing activities
Increase in borrowings under revolving
credit facilities
18,350
22,718
Repayment of long-term debt
(17,565
)
(31,435
)
Borrowings of long-term debt
1,145
19,840
Proceeds from notes payable
99,270
77,602
Repayment of notes payable
(103,875
)
(33,156
)
Proceeds from the exercise of stock
options and employee share purchases
919
831
Payment of withholding taxes on
stock-based awards
(2,804
)
(9,121
)
Payment of cash dividends on preferred
stock
(305
)
(1,427
)
Payment of share issuance costs
-
(191
)
Net cash provided by (used in) financing
activities of continuing operations
(4,865
)
45,661
Net cash used in financing activities of
discontinued operations
-
(14,852
)
Net cash provided by (used in) financing
activities
(4,865
)
30,809
Increase in cash, cash equivalents and
restricted cash in the period
1,882
2,865
Cash, cash equivalents and restricted
cash, beginning of the period
8,754
679
Cash, cash equivalents and restricted
cash, end of the period
10,636
3,544
Non-GAAP Measures
Adjusted Gross
Margin
The Company uses a measure of adjusted
gross margin to evaluate the underlying profitability of its
revenue-generating activities within each reporting period. This
non-GAAP measure excludes non-capitalizable start-up costs included
in cost of goods sold that are incurred in connection with capital
expansion projects. Start-up costs have had a significant impact on
the comparability of reported gross margins, which may obscure
trends in the Company’s margin performance. Additionally, the
Company’s measure of adjusted gross margin may exclude other
unusual items that are identified and evaluated on an individual
basis, which due to their nature or size, the Company would not
expect to occur as part of its normal business on a regular basis.
The Company believes that disclosing this non-GAAP measure provides
investors with a meaningful, consistent comparison of its
profitability measure for the periods presented. However, the
non-GAAP measure of adjusted gross margin should not be considered
in isolation or as a substitute for gross margin calculated based
on gross profit determined in accordance with U.S. GAAP.
The following table presents a
reconciliation of adjusted gross margin from reported gross margin
calculated in accordance with U.S. GAAP.
Quarter ended
Three quarters ended
September 28, 2024
September 30, 2023
September 28, 2024
September 30, 2023
Reported gross margin
13.4%
13.3%
14.6%
14.0%
Start-up costs(a)
2.4%
3.1%
1.3%
3.6%
Wastewater haul-off charges(b)
1.2%
-
0.7%
-
Product withdrawal costs(c)
-
-
0.4%
-
Adjusted gross margin
17.0%
16.4%
16.9%
17.7%
Note: percentages may not add due to
rounding.
(a)
For the third quarter and first three
quarters of 2024, start-up costs of $4.1 million and $6.8 million,
respectively, were recorded in costs of goods sold, which were
mainly related to the scale-up of production at our plant-based
beverage facility in Midlothian, Texas, including the start-up of a
new high-speed Edge line. In addition, start-up costs for the third
quarter and first three quarters of 2024, include the ramp-up of
oat-base extraction operations at our Modesto, California,
facility. For the third quarter and first three quarters of 2023,
start-up costs of $4.7 million and $16.3 million, respectively,
included in cost of goods sold mainly related to the initial
ramp-up of production at our Midlothian, Texas, facility, and the
addition of new extrusion and high-speed packaging lines at our
fruit snacks facility in Omak, Washington.
(b)
For the third quarter and first three
quarters of 2024, we incurred temporary third-party haul-off
charges of $2.2 million and $3.6 million, respectively, for excess
wastewater produced at our Midlothian, Texas, facility, due to
volume constraints within our current treatment system.
(c)
In the second quarter of 2024, we
conducted a voluntary withdrawal from customers of certain batches
of aseptically-packaged products that may have had the potential
for non-pathogenic microbial contamination. None of the withdrawn
product made it into the consumer marketplace. For the first three
quarters of 2024, we recognized direct costs related to the
withdrawal of $2.1 million, net of expected insurance recoveries,
which included finished goods inventory write-offs, product return
and logistic costs, and costs related to investigative and remedial
actions taken in response to the withdrawal, which corrective
actions have been completed. These charges are incremental to our
normal course reserves and have had a significant unfavorable
impact on our reported gross profit and gross margin for the first
three quarters of 2024.
Adjusted Earnings
and Adjusted EBITDA from continuing operations
In addition to reporting financial results
in accordance with U.S. GAAP, the Company provides additional
information about its operating results regarding adjusted earnings
and adjusted earnings before interest, taxes, depreciation and
amortization (“Adjusted EBITDA”) from continuing operations, which
are not measures in accordance with U.S. GAAP. The Company believes
that adjusted earnings and adjusted EBITDA from continuing
operations assist investors in comparing performance across
reporting periods on a consistent basis by excluding items that
management believes are not indicative of its operating
performance. These non-GAAP measures are presented solely to allow
investors to more fully assess the Company’s results of operations
and should not be considered in isolation of, or as substitutes
for, an analysis of the Company’s results as reported under U.S.
GAAP.
The following are tabular presentations of
adjusted earnings and adjusted EBITDA from continuing operations,
including a reconciliation from loss from continuing operations,
which the Company believes to be the most directly comparable U.S.
GAAP financial measure.
September 28, 2024
September 30, 2023
Per Share
Per Share
For the quarter ended
$
$
$
$
Loss from continuing operations
(5,498
)
(5,680
)
Dividends and accretion on preferred
stock
(137
)
(426
)
Loss from continuing operations
attributable to common
shareholders
(5,635
)
(0.05
)
(6,106
)
(0.05
)
Adjusted for:
Start-up costs(a)
4,980
4,733
Wastewater haul-off charges(b)
2,180
-
Unrealized foreign exchange loss on
restricted cash(c)
525
-
Business development costs(d)
-
928
Severance costs(e)
-
897
Other(f)
450
-
Adjusted earnings from continuing
operations
2,500
0.02
452
0.00
September 28, 2024
September 30, 2023
For the quarter ended
$
$
Loss from continuing operations
(5,498
)
(5,680
)
Interest expense, net
6,762
7,162
Loss on sale of receivables*
236
-
Income tax expense
23
-
Depreciation and amortization
9,319
7,983
Stock-based compensation
2,527
3,068
Adjusted for:
Start-up costs(a)
4,980
4,733
Wastewater haul-off charges(b)
2,180
-
Unrealized foreign exchange loss on
restricted cash(c)
525
-
Business development costs(d)
-
928
Severance costs(e)
-
897
Other(f)
450
-
Adjusted EBITDA from continuing
operations
21,504
19,091
* Included in other non-operating
expense.
(a)
Refer to footnote (a) to the Adjusted
Gross Margin table above for a description of start-up costs
included in cost of goods sold. Additionally, for the third quarter
of 2024, start-up costs included $0.8 million of professional fees
related to operational productivity initiatives, which are recorded
in SG&A expenses.
(b)
Refer to footnote (b) to the Adjusted
Gross Margin table above for a description of wastewater haul-off
charges included in cost of goods sold.
(c)
For the third quarter of 2024, reflects an
unrealized foreign exchange loss associated with peso-denominated
bank accounts in Mexico that were retained following the
divestiture of our frozen fruit business (“Frozen Fruit”) in
October 2023. These accounts are currently subject to a judicial
hold in connection with a litigation matter.
(d)
For the third quarter of 2023, reflects
business development costs related to the divestiture of Frozen
Fruit, which are recorded in SG&A expenses.
(e)
For the third quarter of 2023, reflects
employee severance costs accrued in connection with the
consolidation of our continuing operations following the
divestiture of Frozen Fruit, which are recorded in SG&A
expenses.
(f)
For the third quarter of 2024, other
reflects accrued demolition costs related to our former roasted
snack facility, which was abandoned in 2018. These costs are
recorded in other expense.
September 28, 2024
September 30, 2023
Per Share
Per Share
For the three quarters ended
$
$
$
$
Loss from continuing operations
(5,442
)
(20,158
)
Dividends and accretion on preferred
stock
(401
)
(1,552
)
Loss from continuing operations
attributable to common
shareholders
(5,843
)
(0.05
)
(21,710
)
(0.19
)
Adjusted for:
Start-up costs(a)
7,655
17,855
Wastewater haul-off charges(b)
3,606
-
Product withdrawal costs(c)
2,145
-
Unrealized foreign exchange loss on
restricted cash(d)
1,363
-
Business development costs(e)
-
2,390
Severance costs(f)
-
897
Gain on sale of smoothie bowls product
line(g)
(1,800
)
-
Other(h)
146
(20
)
Change in valuation allowance for deferred
tax assets(i)
-
3,978
Adjusted earnings from continuing
operations
7,272
0.06
3,390
0.03
September 28, 2024
September 30, 2023
For the three quarters ended
$
$
Loss from continuing operations
(5,442
)
(20,158
)
Interest expense, net
19,222
19,391
Loss on sale of receivables*
236
-
Income tax expense
283
3,978
Depreciation and amortization
27,005
22,873
Stock-based compensation
10,269
8,989
Adjusted for:
Start-up costs(a)
7,655
17,855
Wastewater haul-off charges(b)
3,606
-
Product withdrawal costs(c)
2,145
-
Unrealized foreign exchange loss on
restricted cash(d)
1,363
-
Business development costs(e)
-
2,390
Severance costs(f)
-
897
Gain on sale of smoothie bowls product
line(g)
(1,800
)
-
Other(h)
146
(20
)
Adjusted EBITDA from continuing
operations
64,688
56,195
* Included in other non-operating
expense.
(a)
Refer to footnote (a) to the Adjusted
Gross Margin table above for a description of start-up costs
included in cost of goods sold. Additionally, for the first three
quarters of 2024 and 2023, start-up costs included $0.8 million and
$1.5 million, respectively, of professional fees related to
operational productivity initiatives, which are recorded in
SG&A expenses.
(b)
Refer to footnote (b) to the Adjusted
Gross Margin table above for a description of wastewater haul-off
charges included in cost of goods sold.
(c)
Refer to footnote (c) to the Adjusted
Gross Margin table above for a description of product withdrawal
costs included in cost of goods sold.
(d)
For the first three quarters of 2024,
reflects an unrealized foreign exchange loss associated with
peso-denominated bank accounts in Mexico that were retained
following the divestiture of Frozen Fruit. These accounts are
currently subject to a judicial hold in connection with a
litigation matter.
(e)
For the first three quarters of 2023,
reflects business development costs related to the divestiture of
Frozen Fruit, which are recorded in SG&A expenses.
(f)
For the first three quarters of 2023,
reflects employee severance costs accrued in connection with the
consolidation of our continuing operation following the divestiture
of Frozen Fruit, which are recorded in SG&A expenses
(g)
For the first three quarters of 2024,
reflects the pre-tax gain on sale of the smoothie bowls product
line recognized in the first quarter of 2024, which is recorded in
other income.
(h)
For the first three quarters of 2024,
other reflects accrued demolition costs related to our former
roasted snack facility, which was abandoned in 2018, partially
offset by gains on the settlement of certain legal matters. These
amounts are recorded in other expense/income.
(i)
For the first three quarters of 2023,
reflects an increase to the valuation allowance for U.S. deferred
tax assets based on an assessment of the future realizability of
the related tax benefits.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241105689417/en/
Investor Relations: Reed Anderson ICR 646-277-1260
reed.anderson@icrinc.com
Media Relations: Claudine Galloway SunOpta 952-295-9579
press.inquiries@sunopta.com
SunOpta (TSX:SOY)
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