Beyond Meat's stock soared on Tuesday as investors exulted in better-than-expected fourth-quarter sales and a new healthier burger that could help revive U.S. sales.
Shares of the plant-based meat maker soared more than 78% in post-market trading.
The El Segundo, California-based company said its sales for the October-December period fell 8% to $73.7 million. But analysts polled by FactSet said it was better than the $66.7 million Wall Street had expected.
The company also expects margins to improve this year as a result of extensive restructuring. Last year, the company cut employees and products, including its slow-selling plant-based jerky, and also shrunk its vast output. Ethan Brown, Beyond Meat's president and CEO, said the company previously relied on 13 external manufacturing locations in North America. Now he only uses one.
“I think we've really right-sized the business for the size of the opportunity we have today and the growth we want to generate going forward,” Brown said on a conference call with investors Tuesday.
Beyond Meat announced that its U.S. sales for the quarter fell 23.5%. The company said grocery sales were down despite lower prices, and restaurant demand was also down.
The company hopes to reverse its losses in the U.S. with a new version of its signature Beyond Burger, which has less sodium and saturated fat and more protein. The new burgers and Beyond Beef Ground will begin rolling out to U.S. stores next month.
Brown said the new options should help allay criticism that the previous version was unhealthy and over-processed. The new burger uses avocado oil instead of canola or coconut oil and adds protein from lentils and fava beans.
“What we need to do is re-engage consumers into this whole category with products that actually provide value in a way that they understand,” Brown said. “It's really about continuing to improve taste, and I think we've achieved that, but also addressing this fundamental issue around health.”
Beyond Meat said international sales rose 28.5% in the fourth quarter due to strong grocery and restaurant sales. Sales in Europe were particularly strong due to the sale of Beyond's McPlant burger at McDonald's.McDonald's does not sell Beyond products in the US
The company said its fourth-quarter net loss more than doubled to $155.1 million, or $2.40 per share. Adjusted for one-time items such as restructuring costs, the company had a loss of 92 cents per share, according to Zacks Investment Research. That beat analysts' expectations for a loss of 89 cents, according to FactSet.
The company expects full-year 2024 sales to be in the range of $315 million to $345 million. Analysts expected $344.4 million, according to FactSet. Full-year sales for 2023 fell 18% to $343 million.
According to the company, the gross profit margin for the full year 2024 is expected to be in the mid-to-high 10% range. The gross profit margin in 2023 was negative.
