St. Louis, Missouri, USA
August 10, 2021
- Consolidated revenues increased 28% to $39.7 million and were up 47% on a normalized basis.
- Contract acres for proprietary soybean varieties increased 133% to approximately 70,000 acres.
- Launched a new yellow pea breeding and commercialization program.
- Proposed combination with Star Peak Corp II expected to close during the third quarter of 2021.
Benson Hill, Inc. (the “Company” or “Benson Hill”), a food tech company unlocking the natural genetic diversity of plants with its cutting-edge food innovation engine, today announced operating and financial results for the quarter ended June 30, 2021.
“We are pleased with the performance we achieved in the second quarter and first half of 2021,” said Matt Crisp, Chief Executive Officer of Benson Hill. “Our teams did a terrific job delivering on the financial and operating objectives we set, with strong revenue growth in the second quarter in both our Ingredients and Fresh business segments. We continue to make significant headway towards scaling the production and commercialization of our innovative soybean feed, ingredient, and specialty cooking oil products. We are excited about the impending harvest of the first commercial plantings of our Ultra-High Protein soybeans, which will expand our soy portfolio to offer our customers and consumers a non-GMO, traceable and more sustainably made protein ingredient for the fast-growing plant-based food market.”
“Our top priority is to build mutual trust with our partners and customers, and to deliver innovative products that address significant and rapidly growing market demands,” Crisp continued. “By creating a better seed, we can enable the advancement of the food system by aligning interests of consumers and growers, while providing more sustainably made products. To that end, we have strategic initiatives underway to accelerate future crop development, enable our integrated business model for soy and further advance our innovation efforts in yellow pea protein ingredients. We announced the launch of our advanced yellow pea breeding and commercialization program today and our Crop Accelerator is on track to be operational by the end of 2021. These important initiatives and a continuous focus on execution are creating the foundation for our future growth as we become the ‘picks and shovels’ of the plant-based revolution.”
Second Quarter 2021 Results
Reconciliation of non-GAAP financial measures can be found on page 14.
- Revenues were $39.7 million, an increase of $8.7 million, or 28%, compared to the second quarter of 2020. Revenues increased 47% on a normalized basis, excluding $4.0 million in the prior year period from a non-core barley business divested in late 2020.
- Gross profit was a loss of $0.1 million in the quarter due to non-recurring costs of $2.8 million. The Company utilized higher cost air transportation from South America to accelerate the delivery of its proprietary seeds, including Ultra-High Protein soybean varieties, for planting in this crop year. Excluding this non-recurring cost, adjusted gross profit was $2.8 million in the quarter or 7.0% of sales.
- Reported net loss was $27.4 million compared to a loss of $12.7 million in the prior year period.
- Adjusted EBITDA was a loss of $15.8 million compared to $8.4 million loss in the prior year period. The results in the quarter were largely in line with expectations.
Ingredients Segment Second Quarter Results
Revenues for the segment were $22.7 million, an increase of $4.9 million, or 28%, as compared to the prior year period. Excluding $4.0 million of sales in Q2 2020 from the divested barley operations, Ingredient Segment revenues increased 64%. The performance in the quarter was attributable to the commercialization of the Company’s Veri™ cooking oil derived from Benson Hill’s proprietary soybean seed with the benefit of omega-9 fatty acids, as well as high protein and lower anti-nutrient soybean meal for the animal feed market and higher average selling prices for conventional yellow pea ingredients.
Adjusted EBITDA for the segment was a loss of $6.4 million, which represents a decrease of $3.9 million as compared to the same period in 2020. The Company incurred $2.8 million of non-recurring seed production costs, including freight, to accelerate the plantings of its Ultra-High Protein soybean seed. In addition, higher average selling prices were more than offset by startup and other operating costs associated with early-stage commercialization of proprietary soybean products. Adjusted EBITDA was also impacted by higher research and development costs, compared to the prior year, associated with products anticipated to be commercialized within this segment. In Q2 2020, the barley operations, divested in October of 2020, contributed $0.6 million in gross profit.
Fresh Segment Second Quarter Results
Revenues for the segment were $16.9 million, an increase of $4.7 million, or 39%, compared to $12.2 million in the prior year period. The revenue increase was primarily driven by higher sales volumes of conventional fresh produce, which was partially offset by lower average selling prices. Higher regional and ex-U.S. farm yields led to more supply versus demand, and as a result, lower average selling prices across the industry.
Segment adjusted EBITDA was a profit of $0.2 million, a decline of $0.7 million as compared to the same period in 2020. This decrease was primarily driven by lower average selling prices and higher freight costs, which partially offset higher sales volumes.
Development Update
Benson Hill exceeded its previous target of doubling contracted acres of its proprietary soybean varieties. The Company contracted with partner farmers in the U.S. to grow approximately 70,000 acres in the 2021 crop year versus 30,000 acres in the 2020 crop year, representing an approximately 133% year-over-year growth. These proprietary non-GMO soybean varieties are bred by Benson Hill to be higher in protein, have benefits of omega-9 fatty acids and low anti-nutrients. This year’s crop plans include the first commercial plantings of Benson Hill’s Ultra-High Protein soybeans, which enables serving the human food ingredients market. Additional proprietary products from this crop year include feed ingredients for aquaculture and swine as well as the specialty cooking oil markets.
Innovation and Technology Initiatives
Yellow Pea Breeding Station and Commercialization Program: Three years ago, Benson Hill began investing in innovation and critical infrastructure to develop improved yellow pea ingredients. Yellow pea has traditionally received little genomic innovation. Today, yellow pea is the fastest-growing source of protein for the rapidly expanding plant-based protein market as well as the pet food and animal feed markets. The Company in 2019 created a comprehensive mapping of the yellow pea genome for its proprietary CropOS® innovation platform, which uses artificial intelligence and machine learning to identify promising seed candidates. As an outgrowth of its significant progress in yellow pea genomics since the program’s inception, Benson Hill recently launched an advanced yellow pea breeding station and commercialization program to shorten the typical development cycle of new seed varieties. The yellow pea breeding station located in Minot, N.D., is in close proximity to the Company’s wholly owned yellow pea operating subsidiary Dakota Ingredients. Benson Hill is working to develop varieties with less off-flavors, potentially limiting the need for additives in plant-based food product formulations, and high protein content to reduce the need for expensive, environmentally intensive processing steps typically required to produce current commodity yellow pea protein ingredients.
Crop Accelerator: Benson Hill’s Crop Accelerator is on-track to be operational by the end of 2021. The 47,000 square-foot facility will feature 20,000 square feet of dynamically adaptive Conviron growth houses and chambers, equipped with multi-channel LEDs, additive CO2, temperature, humidity and lighting controls. The innovative facility is expected to enable plant breeding to develop varieties significantly faster than traditional breeding methods. The Crop Accelerator is expected to enhance Benson Hill’s capabilities to leverage the data science, plant science and food science through its CropOS® technology platform. These unique technologies can accelerate and scale the delivery of novel plant-based food and ingredient options to meet rising global demand.
Consolidated Six Month 2021 Highlights
- Revenues were $71.5 million, an increase of $8.9 million, or 14% as compared to the first six months of 2020. Revenues increased 32% excluding $8.5 million in 2020 revenues from the divested barley business.
- Gross profit was $0.5 million. Excluding $2.8 million in excess freight costs incurred during the second quarter, gross profit was $3.3 million, 4.7% of sales.
- Reported net loss was $49.8 million compared to a loss of $24.8 million in the first half of 2020.
- Adjusted EBITDA was a loss of $30.6 million compared to a $17.7 million loss in the prior year period.
- Cash and marketable securities were $42.6 million as of June 30, 2021.
For more information, please see Star Peak Corp II current amended S-4 registration statement, as filed with the SEC (here).
Benson Hill and Star Peak II Business CombinationOn May 8, 2021, Benson Hill, Star Peak Corp II (“STPC” or “Star Peak”) and STPC II Merger Sub Corp., a wholly owned subsidiary of STPC (“Merger Sub”), entered into a merger agreement pursuant to which Benson Hill will be merged with and into Merger Sub, with Benson Hill surviving the merger as a wholly owned subsidiary of STPC. The transaction is expected to provide the combined entity New Benson Hill with approximately $625 million of gross proceeds, assuming no redemptions, including a $225 million fully committed PIPE at $10.00 per share. Upon closing, Benson Hill will be deemed the accounting predecessor and the combined entity will be the successor registrant with the SEC, meaning that Benson Hill’s consolidated financial statements for previous periods will be disclosed in the New Benson Hill’s (formerly STPC’s) future periodic reports filed with the SEC.
Following the expected Q3 2021 transaction close, the combined company will have an estimated enterprise value of $1.35 billion and will be listed on the New York Stock Exchange under the new ticker symbol BHIL.
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