The introduction of GoodWheat pasta marked a highlight for Arcadia Biosciences, Inc. in the fiscal year ended Dec. 31, 2022. The Davis-based company also dealt with supply chain issues for its Zola brand coconut water and a variety of issues that led to a sales decline for its Soul Spring cannabidiol (CBD) products.
Arcadia Biosciences suffered a loss of $15.38 million in the fiscal year, which compared with a loss of $14.66 million in the previous fiscal year. Revenues rose 47% to $9.96 million from $6.78 million.
GoodWheat pasta has four times as much fiber as regular pasta along with 9 grams of protein per serving.
“GoodWheat continued its impressive distribution gains in Q4 as store count increased 34% in (a) quarter not normally associated with significant new shelf placements,” said Stanley E. Jacot, president and chief executive officer, in a March 30 earnings call. “From the initial launch in June, we have added more than 1,200 stores in seven months, beating our own internal projections by more than 50%.
“As we look forward into 2023, our focus will remain on gaining significant new distribution and launching or acquiring new categories,, but we will also support our retail customers through a variety of programs that will drive traffic to our brand and increase velocities.”
Four obstacles negatively impacted the CBD category, including the Soul Spring brand, Mr. Jacot said.
“One, the vast majority of US retailers will not take CBD products, including online retailers such as Amazon,” he said. “Two, many retailers that do sell CBD put the product behind locked glass doors, which has had a significantly negative impact on sales. Three, CBD products cannot be marketed on large mainstream platforms such as Google Search, Facebook and Instagram, limiting the ability to advertise the product, and fourth, many retailers that once sold CBD have either significantly reduced the set or (gotten) out of CBD completely.”
In the fourth quarter, a loss of $4.24 million compared with a loss of $9.28 million in the same time of the previous year. Fourth-quarter revenues plunged to $1 million from $2.17 million, primarily because of lower sales in body care. Arcadia divested its Saavy Naturals body care brand in the third quarter.
“In the fourth quarter, Zola sales declined compared to the same period last year, driven by some distribution losses in Q3 as a result of supply chain constraints,” Mr. Jacot said. “For the full year, Zola gained market share as sales were up 12% from our price increase in the first half of the year to offset higher freight costs.”
Arcadia gave its fiscal-year results after the Nasdaq market closed on March 30. The stock price was trading at $7.37 near midday on March 31, which was down over 6% from a close of $7.87 on March 30.
