Coffee Service

Westrock Coffee lifts Q3 2023 earnings despite sales drop

Image: Westrock Coffee Co.

November 21, 2023

Westrock Coffee Co., a coffee provider to the retail, foodservice, convenience store, travel center and hospitality industries, lifted its Q3 2023 earnings despite a sales dip compared to the prior year period, according to an earnings release.

Highlights include:

• Consolidated net sales fell 4.6% from $230.3 million in Q3 2022 to $219.6 for the quarter ending Sept. 30, 2023.
• Net income improved from a net loss of $13 million to $16.6 million in the comparative quarters, including $3.1 million of acquisition, restructuring and integration expense, $3 million of start-up costs related to the Conway, Arkansas extract and ready-to-drink facility, and $25.1 million of non-cash gains from the change in fair value of warrant liabilities.
• EPS improved from a loss of 41 cents to 15 cents on both a basic and diluted basis.

Shares traded today at $8.56 against a 52-week range of $6.88 to $14.71.

"Our third quarter performance was a mix of positives and negatives, the most important, unfortunately, being the rapid fall off in volume demand for our traditional roast and ground coffee products during the early part of the quarter, which drove weaker than projected adjusted EBITDA results for the period," Scott Ford, CEO and co-founder, said in the press release. "While hot coffee volumes have since stabilized and we continue to see great progress in monetizing our flavors, extracts and ingredients and single serve product portfolios, the negative impact of July and August in hot coffee was too much for the other parts of our business to overcome in the quarter."

The company expects its 2023 outlook for adjusted EBITDA to fall below its previously issued guidance range of flat to 10% over 2022.