UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 8-K



CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): November 5, 2020



RICEBRAN TECHNOLOGIES
(Exact Name of Registrant as Specified in Charter)



California
0-32565
87-0673375
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

1330 Lake Robbins Drive, Suite 250
   
The Woodlands, TX
 
77380
(Address of Principal Executive Offices)
 
(Zip Code)

Registrant’s telephone number, including area code: (281) 675-2421

(Former name or Former Address, if Changed Since Last Report.)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company      ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common Stock
 
RIBT
 
NASDAQ Capital Market



Item 2.02
Results of Operations and Financial Condition.

On November 5, 2020, RiceBran Technologies (the “Company”) announced certain financial results for the three months ended September 30, 2020. A copy of the Company’s press release announcing this information and certain other information is attached hereto as Exhibit 99.1.

The information furnished in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01
Financial Statements and Exhibits

Exhibit No.
 
Description
 
Press Release issued November 5, 2020.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
RICEBRAN TECHNOLOGIES
     
Date: November 5, 2020
By:
/s/ Todd T. Mitchell
   
Todd T. Mitchell
   
Chief Financial Officer
   
(Duly Authorized Officer)




Exhibit 99.1

 
RiceBran Technologies Reports 3Q 2020 Financial Results and Provides Business Updates
 
THE WOODLANDS, Texas, November 5, 2020 /PRNewswire/ — RiceBran Technologies (RIBT), a global leader in the production and marketing of value-added products derived from rice bran and a processor of rice, barley and oat products and co-products from these grains, announced financial results today for the quarter ended September 30, 2020.
 
“We have taken the important first steps to increase shareholder value by reinvigorating our core RiceBran business and driving strong growth at MGI, while reducing losses at Golden Ridge and further streamlining corporate overhead,” said RiceBran’s Executive Chairman Mr. Peter Bradley. “We remain in the process of a strategic review which is pointing to multiple options for further accelerating the growth of shareholder value, and in the coming quarters, we will implement initiatives to capitalize on the company’s strong core capabilities and unrecognized asset base.”
 
Third Quarter 2020 Operational Highlights
 
Golden Ridge ramping up production after challenging period: Golden Ridge ran well below capacity for most of the third quarter as we were unable to acquire grain economically. We have balanced our commodity exposure, installed new leadership, and are reinvigorating operations. Losses mitigated toward the end of the quarter and operations continued to improve in October.
 
Core SRB business returns to growth and margin expansion: Quarterly SRB revenue grew year-over-year and was up double-digits from levels in the second quarter of 2020, driven by demand for higher-ASP and higher-margin SRB derivatives. We are getting a double-digit price increase from our largest SRB customer which will be fully implemented by the beginning of the first quarter of 2021, and we are focused on accelerating growth through potential product expansion.
 
MGI revenues scaling on the back of capacity expansion: Revenue from MGI was up 45% in the quarter compared to a year ago driven by customer growth as we leveraged prior investments in capacity expansion. Notably, incremental capacity was taken up by a customer who is now purchasing products from all three of our companies, highlighting the business’ fit with our overall strategy.
 
Adjusted EBITDA losses narrow to lowest levels in two years: Despite lower than expected revenue, net losses narrowed to $2.8 million in the third quarter from $3.3 million a year ago, due to a 50% reduction in SG&A. As a result, adjusted EBITDA (Non-GAAP) losses of $1.8 million in the third quarter declined $1.1 million from $2.9 million in the second quarter. With our SG&A run -rate now under $2 million per quarter, and results for Golden Ridge expected to improve, adjusted EBITDA losses should narrow further in the fourth quarter.
 

Company is focused on maintaining a strong balance sheet: Capital resources and operating liquidity remain solid with $3.9 million in cash on hand and an incremental $1.0 million in available borrowing capacity at the end of the third quarter. A reacceleration in commercial activity at Golden Ridge should have a positive impact on working capital and overall liquidity.
 
“In the third quarter of 2020, we saw positive revenue and margin trends from our core RiceBran business, and strong year-over-year growth for MGI,” said RiceBran CFO Todd Mitchell. “We also took steps to turnaround results at Golden Ridge by balancing our commodity exposure and installing new management. As a result, with further cuts in corporate overhead, adjusted EBITDA losses were reduced by over $1 million from the prior quarter’s levels. We expect adjusted EBITDA losses to narrow further in the fourth quarter and are in the midst of a 2021 budgeting process with the goal of driving the company to strong growth and overall positive adjusted EBITDA in 2021.”
 
Third Quarter 2020 Financial Highlights
 
Revenue: Revenues of $5.2 million decreased 3% from $5.3 million in the third quarter of 2019. The year-over-year decrease in revenue included a 50% decline in revenues from Golden Ridge, which was only partially offset by mid-single-digit growth in core RiceBran revenue, and mid-double-digit growth at MGI. Golden Ridge’s decline was due to high levels of downtime as we could not acquire grain economically for much of the quarter. Core RiceBran growth was driven by strong demand for SRB derivatives, while MGI’s growth reflects our successful sales efforts to utilize increased capacity. Year-to-date revenues grew 8% to $19.4 million from $17.9 million for the same period in 2019.
 
Gross Losses: Gross losses were $0.8 million in the third quarter of 2020 compared to gross losses of $0.4 million in the third quarter of 2019. The increase in gross loss was primarily attributable to Golden Ridge due to higher input commodity prices, $0.5 million in expenses related to the resolution of contract disputes, and the impact of higher downtime during the quarter compared to the same period a year ago. Year-to-date gross losses were $2.4 million up from $0.3 million for the same period in 2019. Over 100% of gross losses year-to-date is attributable to Golden Ridge.
 
SG&A: SG&A expenses decreased to $1.9 million from $3.8 million in the third quarter of 2019, a decrease of $1.9 million. There were about $0.3 million in non-recurring expenses in the third quarter of 2019, and $0.1 million in losses in the third quarter of 2020 due to hurricane damage to our Lake Charles facility. The rest of this decline reflects cost-cutting initiatives that began in the first quarter of 2020 as well as actions in the third quarter to achieve another $2 million in annualized savings. Year-to-date SG&A dropped 34% to $7.0 million from $10.6 million for the same period in 2019.
 
Net Loss and Adj. EBITDA: Net loss for the third quarter of 2020 was $2.8 million, compared to a net loss of $3.3 million in the third quarter of 2019. Adjusted EBITDA (Non-GAAP) losses were $1.8 million in the third quarter of 2020, compared to adjusted EBITDA losses of $3.4 million in the third quarter of 2019. Adjusted EBITDA losses also declined $1.0 million from $2.9 million in the second quarter of 2020. Year-to-date net losses were $9.8 million compared to $10.2 million in the comparable period, and adjusted EBITDA losses were $6.7 million compared to $8.1 million.
 
Liquidity: Capital resources and operating liquidity remain adequate with $3.9 million in cash and an incremental $1.0 million in available borrowing capacity at the end of the third quarter of 2020. Management drew down $1.0 million in term loan funding and raised $0.7 million, net of issuance costs, through the sales of common shares in the third quarter of 2020. Management remains focused on maintaining adequate liquidity and expects to fund operations through a combination of activities including the utilization of our term loan and ATM equity facilities when necessary. 
 

Conference Call Information
 
RiceBran Technologies will host a conference call today, Thursday, November 5, at 4:30 p.m. Eastern Time to discuss these results. The conference call information is as follows:
 

Direct Dial-in number for US/Canada: (212) 271-4615


Toll Free Dial-in number for US/Canada: (800) 908-8375


Dial-In number for international callers: (212) 271-4615


Participants will ask for the RiceBran Technologies Q3 2020 Financial Results Call

This call is being webcast by ViaVid and can be accessed at http://public.viavid.com/index.php?id=142229.


The call will also be available for replay by accessing http://public.viavid.com/index.php?id=142229.

About RiceBran Technologies
 
RiceBran Technologies is a global leader in the production and marketing of value-added products derived from rice bran as well as a producer of rice, rice co-product, and barley and oat products. The target markets for our products include food and animal nutrition manufacturers and retailers, as well as specialty food, functional food and nutritional supplement manufacturers and retailers. Our highly nutritious and clean label ingredient products derived from rice bran, one of the world’s most underutilized food sources, are produced utilizing our proprietary stabilization technology. More information can be found in the Company’s filings with the SEC and by visiting our website at http://www.ricebrantech.com.
 
Forward-Looking Statements
 
This release contains forward-looking statements, including, but not limited to, statements about RiceBran Technologies’ expectations regarding its future financial results, sales growth, EBITDA improvements, and SG&A. These statements are made based upon current expectations that are subject to known and unknown risks and uncertainties, including the risks that RBT operations are disrupted by the COVID-19 pandemic. RiceBran Technologies does not undertake to update forward-looking statements in this news release to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information. Assumptions and other information that could cause results to differ from those set forth in the forward-looking information can be found in RiceBran Technologies’ filings with the Securities and Exchange Commission, including its most recent periodic reports.
 

Use of Non-GAAP Financial Information
 
We utilize “Adjusted EBITDA” as a supplemental measure in our ongoing analysis of short term and long-term cash requirement and liquidity needs. Management uses Adjusted EBITDA as an indicator of our current financial performance. By eliminating the impact of all material non-cash charges as well as items that do not regularly occur, we believe that Adjusted EBITDA provides a more accurate and informative indicator of our cash requirements. Adjusted EBITDA does not represent cash flows from operations as defined by generally accepted accounting principles (“GAAP”), is not a measure derived in accordance with GAAP and should not be considered as an alternative to net income (the most comparable GAAP financial measure to EBITDA).
 
The table below contains a reconciliation of net loss (GAAP) and Adjusted EBITDA (Non-GAAP) for the three and nine months ended September 30, 2020.  We do not provide a reconciliation of forward-looking net loss (GAAP) to Adjusted EBITDA (Non-GAAP).  Due to the nature of certain reconciling items, it is not possible to predict with any reliability what future outcomes may be with regard to the expense or income that may ultimately be recognized in future periods.  Any forward-looking Adjusted EBITDA information that we may provide from time to time consistently excludes the same items from projected net loss that are excluded from actual net loss in the table below.
 
Investor Contact
 
Richard Galterio, Ascendant Partners, LLC, (732) 410-9810, rich@ascendantpartnersllc.com


RiceBran Technologies
Consolidated Income Statement (Unaudited) (GAAP).
(in $000, except per share amounts)

   
3 Months Ended
         
9 Months Ended
       
   
9/30/20
   
9/30/19
   
% Chg.
   
9/30/20
   
9/30/19
   
% Chg.
 
                                     
Revenue
 
$
5,160
   
$
5,300
     
(3
%)
 
$
19,393
   
$
17,883
     
8
%
Cost of Goods Sold
   
(5,955
)
   
(5,659
)
   
5
%
   
(21,817
)
   
(18,143
)
   
20
%
Gross (Loss) Profit
   
(795
)
   
(359
)
   
121
%
   
(2,424
)
   
(260
)
   
832
%
Gross Margin
   
(15
%)
   
(7
%)
           
(12
%)
   
(1
%)
       
                                                 
Selling, General & Admin.
   
(1,875
)
   
(3,835
)
   
(51
%)
   
(7,040
)
   
(10,598
)
   
(34
%)
Operating (Loss)
   
(2,670
)
   
(4,194
)
   
(36
%)
   
(9,464
)
   
(10,858
)
   
(13
%)
                                                 
Interest Income (Expense)
   
(70
)
   
10
     
(800
%)
   
(176
)
   
2
     
(8900
%)
Other Income (Expense)
   
(26
)
   
858
     
(103
%)
   
(108
)
   
860
     
(113
%)
Loss Before Income Taxes
   
(2,766
)
   
(3,326
)
   
(17
%)
   
(9,748
)
   
(9,996
)
   
(2
%)
                                                 
Taxes
   
(8
)
   
-
     
-
     
(8
)
   
-
     
-
 
Net Loss - Cont. Ops.
   
(2,774
)
   
(3,326
)
   
(17
%)
   
(9,756
)
   
(9,996
)
   
(2
%)
                                                 
Disc. Ops.
   
-
     
-
     
-
     
-
     
(216
)
   
(100
%)
Net Loss
 
(2,774
)
 
(3,326
)
   
(17
%)
 
(9,756
)
 
(10,212
)
   
(4
%)
                                                 
Basic & Diluted Loss per Share:
                                               
Cont. Ops.
   
(0.07
)
   
(0.10
)
   
(0.30
)
   
(0.24
)
   
(0.31
)
   
(23
%)
Disc. Ops.
   
-
     
-
     
-
     
-
     
(0.01
)
   
(100
%)
                                                 
Weighted Average Shares Outstanding (Basic & Diluted)
   
40,824,281
     
33,057,010
     
23
%
   
40,279,866
     
31,947,087
     
26
%

RiceBran Technologies
EBITDA and Adjusted EBITDA Reconciliation (Non-GAAP)
(in $000)

   
3 Months Ended
         
9 Months Ended
       
   
9/30/20
   
9/30/19
   
% Chg.
   
9/30/20
   
9/30/19
   
% Chg.
 
                                     
Net Loss
 
(2,774
)
 
(3,326
)
   
(17
%)
 
(9,756
)
 
(9,996
)
   
(2
%)
Interest Expense (income)
   
70
     
(10
)
   
(800
%)
   
176
     
(2
)
   
(8900
%)
Depreciation and Amortization
   
703
     
498
     
41
%
   
1,977
     
1,371
     
44
%
EBITDA
   
(2,001
)
   
(2,838
)
   
(29
%)
   
(7,603
)
   
(8,627
)
   
(12
%)
 
                                               
Other Income (Expense)
   
26
     
(858
)
   
(103
%)
   
108
     
(860
)
   
(113
%)
Share Based Comp
   
153
     
282
     
(46
%)
   
817
     
925
     
(12
%)
Acquisition Related
   
-
     
27
     
(100
%)
   
-
     
508
     
(100
%)
Adjusted EBITDA
 
(1,822
)
 
(3,387
)
   
(46
%)
 
(6,678
)
 
(8,054
)
   
(17
%)


RiceBran Technologies
Consolidated Statement of Cash Flows (Unaudited)
(in $000)

   
3 Months Ended
   
9 Months Ended
 
   
9/30/20
   
9/30/19
   
9/30/20
   
9/30/19
 
Cash Flow from Operations
                       
Net Loss - Cont. Ops.
 
(2,774
)
 
(3,326
)
 
(9,756
)
 
(9,996
)
Adjustments to reconcile net losses to net cash used in operating activities:
                               
Depreciation
   
647
     
479
     
1,804
     
1,332
 
Amortization
   
56
     
19
     
173
     
39
 
Share Based Comp
   
153
     
282
     
817
     
925
 
Loss on disposition of property and equipment
   
305
     
-
     
305
     
-
 
Loss on involuntary conversion of assets
   
(208
)
   
-
     
100
     
-
 
Settlement with sellers of Golden Ridge
   
-
     
(849
)
   
-
     
(849
)
Other
   
89
     
168
     
(18
)
   
166
 
Changes in operating assets and liabilities (net of acquisitions)
                               
Accounts Receivable
   
270
     
559
     
1,360
     
(215
)
Inventories
   
344
     
393
     
(767
)
   
388
 
Accounts Payable
   
(450
)
   
77
     
(651
)
   
(271
)
Commodities Payable
   
356
     
(1,128
)
   
(275
)
   
(1,896
)
Other
   
355
     
90
     
(320
)
   
(308
)
Net Cash Flow from Operations
 
(857
)
 
(3,236
)
 
(7,228
)
 
(10,685
)
                                 
Cash Flow from Investing
                               
Plant, Property & Equipment purchases
   
(217
)
   
(1,194
)
   
(1,060
)
   
(3,513
)
Proceeds from Insurance
   
250
     
-
     
250
     
-
 
Proceeds from sale of property
   
15
     
-
     
15
     
-
 
Acquisition of MGI
   
-
     
28
     
-
     
(3,767
)
Net Cash Flow from Investing - Cont. Ops.
   
48
     
(1,166
)
   
(795
)
   
(7,280
)
Net Cash Flow from Investing - Disc. Ops.
   
-
     
(475
)
   
-
     
(475
)
                                 
Cash Flow from Financing
                               
Proceeds from Stock Issuance, net
   
657
     
-
     
657
     
11,593
 
Proceeds from Warrants Exercised
   
-
     
-
     
12
     
1,990
 
Proceeds from Options Exercised
   
-
     
9
     
-
     
156
 
Net Change in Debt
   
695
     
1,144
     
2,800
     
1,122
 
Net Cash Flow from Financing
   
1,352
     
1,153
     
3,469
     
14,861
 
                                 
Net Change in Cash
   
543
     
(3,724
)
   
(4,554
)
   
(3,579
)
                                 
BOP Cash Balance
   
3,347
     
7,414
     
8,444
     
7,269
 
Net Change in Cash
   
543
     
(3,724
)
   
(4,554
)
   
(3,579
)
EOP Cash Balance
 
$
3,890
   
$
3,690
   
$
3,890
   
$
3,690
 


RiceBran Technologies
Consolidated Balance Sheets (Unaudited)
(in $000)

   
Period Ended
 
   
9/30/20
   
12/31/19
 
Assets
           
             
Cash and Cash Equivalents
 
$
3,890
   
$
8,444
 
Accounts Receivable, net
   
2,446
     
3,738
 
Inventory
   
1,665
     
898
 
Other Current Assets
   
1,619
     
691
 
Total Current Assets
   
9,620
     
13,771
 
                 
PP&E, Net
   
17,289
     
19,077
 
Operating Lease right-of-use assets
   
2,527
     
2,752
 
Goodwill & Intangibles
   
4,692
     
4,865
 
Other Long-term Assets
   
-
     
27
 
Total Assets
 
$
34,128
   
$
40,492
 
                 
Liabilities and Shareholders' Equity
               
                 
Accounts Payable
 
$
845
   
$
833
 
Commodities Payable
   
554
     
829
 
Accruals & Prepayments
   
1,318
     
1,773
 
Leases, Current
   
423
     
410
 
Debt, Current
   
2,716
     
1,967
 
Total Current Liabilities
   
5,856
     
5,812
 
                 
Leases, Not Current
   
2,535
     
2,864
 
Debt, Not Current
   
2,264
     
73
 
Total Liabilities
   
10,655
     
8,749
 
                 
Preferred Stock
   
112
     
112
 
Common Stock
   
320,297
     
318,811
 
Accumulated Deficit
   
(296,936
)
   
(287,180
)
Total Shareholders’ Equity
   
23,473
     
31,743
 
                 
Total Liabilities and Shareholders’ Equity
 
$
34,128
   
$
40,492