Westrock Coffee Co. of Little Rock (Nasdaq: WEST) reported its net sales increased 10% to $205.4 million for the quarter that ended March 31, compared with the same period last year.
The publicly traded coffee, tea and extracts company reported its net loss for the quarter at $4.3 million, an improvement over its net loss of $4.7 million in the same period last year.
“As 2023 begins to take shape, we are focused on our two major initiatives of successfully launching our Conway extract and ready-to-drink facility in the first quarter of 2024 and continuing the maturation of our existing operations to be able to capture the profitability intrinsically available from our growing large-scale, global customer base,” Scott T. Ford, CEO and co-founder of Westrock, said in a news release Thursday announcing the results.
The company also announced during the quarter that it is building a $70 million, 530,000-SF distribution center in Conway, a little more than two miles away from its new manufacturing facility there.
During the quarter, Westrock Coffee converted its Concord, North Carolina, plant “so that all our internal systems would operate on a single platform,” Ford said.
That resulted in about two weeks of production downtime in its roast and ground business, which when combined with the limits on the single-serve product line capacities, cost the company about $4 million in net profit for the quarter.
“I am pleased that this conversion is now behind us and that the long-awaited equipment expansion in our single-serve business is currently in place,” Ford said. “Both of these efforts create a greater foundation for our long-term growth and prepare us to execute the launch of our Conway extract and ready-to-drink facility early next year.”
Adjusted earnings before interest, taxes, depreciation, and amortization was $8.5 million for the first quarter of 2023, a decline of 25.8% compared with the first quarter of 2022.
Westrock said its guidance for consolidated adjusted EBITDA is expected to grow 10%-25% in 2023, which represents a range of $66 million to $75 million.