Laird Superfood - Earnings Call - Q4 2024

Executive Summary

• Q4 2024 delivered 26% YoY revenue growth to $11.6M with Gross Margin of 38.6% (down ~440 bps sequentially vs Q3’s 43.0% on higher slotting and prior-period promotional accruals), and GAAP diluted EPS of -$0.04; Adjusted EBITDA was $0.15M, marking a third straight breakeven-to-positive quarter.
• Channel mix remained balanced: e-commerce 58% (+12% YoY) and wholesale 42% (+52% YoY); management cited strong Amazon momentum and accelerating grocery distribution/velocity as key drivers.
• 2025 outlook reaffirmed: net sales +20–25%, Gross Margin “upper 30s,” Adj. EBITDA ~breakeven, and ($1–$2M) operating cash outflow to build inventory; management flagged Q1 2025 growth below full-year cadence due to stock-outs, with recovery by end of Q1/early Q2 and acceleration in 2H.
• Supply constraints limited Q4 by an estimated >$1M of forgone sales; LSF added qualified suppliers (esp. coconut milk powder) and is prioritizing subscribers and key accounts—context for near-term revenue and working capital adds.

What Went Well and What Went Wrong

• What Went Well

  • Strong top-line and balanced channels: Q4 net sales +26% YoY to $11.6M; wholesale +52% YoY; e-commerce +12% YoY; Amazon delivered its strongest quarter ever on better inventory, media efficiency, and demand.
  • Structural margin elevation maintained: FY24 GM reached 40.9% (+1,070 bps YoY) from co-manufacturing shift, direct ingredient sourcing, reduced trade spend; Q4 GM 38.6% despite commodity pressure and higher slotting.
  • Cash discipline and profitability trajectory: third consecutive quarter of positive total cash flow (Q4 +$0.31M) and FY cash up +$0.8M to $8.5M with no debt; Adj. EBITDA positive in Q4.

• What Went Wrong

  • Stock-outs constrained revenue: management estimates >$1M of lost Q4 sales (creamer/instant latte SKUs); Q1 2025 growth will be below FY pace as supply recovers by end of Q1/early Q2.
  • Sequential margin pressure: GM fell ~440 bps vs Q3 (43.0%→38.6%) on higher prior-period promotional spend and slotting tied to distribution expansion.
  • Operating expense uptick: Q4 net loss of $0.4M vs prior-year income of $0.1M, driven by personnel costs and higher stock-based comp; Adj. EBITDA dipped vs Q4’23.

Transcript

Speaker 5

Good afternoon. Thank you for attending today's Laird Superfood Fourth Quarter 2024 Financial Results Conference Call. My name is Tamia, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I would now pass the conference over to your host, Trevor, with Laird Superfood. You may proceed.

Speaker 0

Thank you, and good afternoon. Welcome to Laird Superfood's Fourth Quarter and Fiscal Year 2024 Earnings Conference Call and Webcast. On today's call are Jason Vieth, Laird Superfood's President and Chief Executive Officer, and Anya Hamill, our Chief Financial Officer. By now, everyone should have access to the company's earnings release, which was filed today after market closed. It is available on the Investor Relations section of Laird Superfood's website at www.lairdsuperfood.com. Before we begin, please note that during this call, management may make forward-looking statements within the context of federal securities laws. These statements are based on management's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those described. Please refer to today's press release and other filings with the SEC for a detailed discussion of these risks and uncertainties. With that, I'll turn it over to Jason.

Speaker 1

Thank you, Trevor, and hello to everyone on the call. I'm thrilled to share with you today what has been an exceptional close to 2024 for Laird Superfood, a year that truly underscores our transformation into a high-growth premium brand with strong margins and unlimited potential. For the full year 2024, we achieved a remarkable 27% top-line growth, with net sales reaching $43.3 million, up from $34.2 million in 2023. In the fourth quarter alone, net sales grew to $11.6 million, a 26% increase over Q4 2023. This growth rate isn't just impressive in isolation; it significantly outpaces the consumer goods and food industry averages, where top-line growth typically hovers around 3-5% annually, according to industry benchmarks. We're not just keeping up; we're leading the pack. Equally exciting is our improvement in profitability metrics. For the full year, we maintained gross margins at nearly 41%.

This is a roughly 11-point leap from the 30.1% that we reported for 2023, driven by strategic sourcing, a shift to a variable-cost manufacturing model, and disciplined trade spend management. To put this in perspective, the average gross margin for food companies often sits in the mid-20s to low-30s, and at 25-35% for many of our most premium peers. Our ability to sustain these margins while growing at nearly 30% demonstrates the strength of our business model and our strategic focus on operational efficiency and premium positioning. This success has been driven by two key strategic pillars that we outlined on previous calls: rapid growth in e-commerce, particularly on Amazon, and significant strides in expanding our wholesale distribution. Let's start with e-commerce.

In 2024, our e-commerce channel grew by 32% year-over-year, led by our Amazon platform that not only recovered lost ground from our 2022 quality event but exceeded our internal expectations by a significant margin. Q4 was no exception, with Amazon delivering its strongest quarter ever for Laird Superfood, fueled by improved inventory management, targeted marketing, and growing consumer demand for our plant-based creamers, coffee, and hydration products. Amazon now makes up more than 40% of our e-commerce channel, and we expect that share to continue to grow in 2025 and beyond. Our direct-to-consumer business also saw a healthy increase for the year, bolstered by a shift toward a subscription model, which now accounts for nearly half of our DTC sales and serves as a testament to the loyalty and trust that our consumers place in our brand. On the wholesale front, we've made tremendous progress expanding our retail footprint.

In Q4, we secured new distribution with major retailers like Kroger and Safeway Albertsons, building on earlier and ongoing wins with partners like Whole Foods and Sprouts. Full-year wholesale net sales grew 19% year-over-year, contributing 41% of our total company revenue. This expansion reflects not just broader reach but also improved dollar sales velocity at existing accounts, driven by existing promotional strategies and strong consumer pull for our products. During the 12 weeks ending December 29, we grew our retail sales across the MULO universe by approximately 35%, which included strong growth in both distribution points as well as dollar sales velocity. During Q4, we were also able to initiate the upsizing of our liquid creamer to a 750-milliliter package, which is aligned with the category norm and represents a 50% volume upsizing for our product.

At the same time, we were able to improve the nutritional benefits and taste profile of our formula. I am pleased to report that this transition is being completed now and has seemingly gone well, with a minimal amount of out-of-stocks and very little excess inventory of the discontinued size. In the past, I've seen these types of product transitions go off the rails at much larger companies with far more resources, and so I am extremely proud of the Laird Superfood team for its execution of this important initiative. Taking a look at supply chain, I am pleased to report the strong quarter and a very solid year for the operation of our business.

Despite persistent commodity pressure in coffee, cacao, and coconut milk powder, our team has been extremely resourceful in establishing and cultivating supplier relationships across our ingredients, manufacturing, and distribution partners, and we were able to largely mitigate the cost impact during this period. We have repeatedly stated that our goal is to achieve a gross margin in the upper 30s, and we finished 2024 at nearly 41%, with Q4 coming in at nearly 39% despite the aforementioned cost pressures. Speaking of which, by now it is no secret that there continues to be persistent inflation in the food industry. It is our belief that many of the recent commodity increases have been opportunistic and trader-driven, and we believe there could be a correction in some, if not many, of these costs over the course of 2025 and beyond.

We have managed the procurement of our ingredients very carefully and are also finding efficiencies in our operation to offset a portion of the cost increases. As a result, we intend to take price only when and if necessary, preferring to maintain our strong volume growth whenever possible. That means that we may choose to temporarily trade away gross margin points for gross margin dollars so that when some of these costs again normalize to lower levels, we can have a bigger business with a strong gross margin profile. In this way, we believe that we can optimize the future size and profitability of our business in order to maximize long-term shareholder value. When you have a business growing as rapidly as ours, it can be challenging for the supply chain to keep pace.

This has been the case for us over the last months, as the sales of our creamers and instant latte products have repeatedly outrun the sales forecasts and thereby created out-of-stock situations for some of our most popular SKUs. If not for these out-of-stock issues, we estimate that we would have captured more than $1 million of additional net sales during Q4. As we've worked to resolve these issues, our team has successfully identified additional raw material supply and supplemental suppliers, which should help us to mitigate future product shortages and to control input costs. We have already begun bringing these products back in stock over the past weeks and expect to have outrun these shortages very soon after Q1 is complete.

These out-of-stock products will have an impact on our sales during Q1, though we remain on pace for strong growth during 2025 and have confidence in the overall trajectory of our business. Now, let me hand it over to Anya to dive into the financial details for the quarter and for the full year.

Speaker 5

Thank you, Jason, and good afternoon, everyone. Today, I'm pleased to share our fourth quarter and full year 2024 financial results. Coming off a record high net sales in the third quarter, we delivered another nearly equally strong quarter of top-line growth in Q4. Net sales grew 26% to $11.6 million, compared to $9.2 million in the prior year period. This quarter, our wholesale channel led the company's growth, increasing by 52% year-over-year and accounting for 42% of our total net sales. This growth was driven by distribution expansion in grocery and velocity acceleration at shelf in both retail and club. E-commerce sales increased by 12% year-over-year and contributed 58% of total net sales, with significant improvements in media efficiency in this channel. The growth was driven by strong sales on Amazon, building on the momentum over the previous three quarters and due to an outstanding commercial execution.

Full year 2024 net sales grew 27% to $43.3 million, compared to $34.2 million in prior year period, posting strong growth across all channels. E-commerce sales increased by 32% year-over-year and contributed 59% of total net sales. Sales on both Amazon.com and the DTC platform contributed to this outstanding result, driven by growth in subscription revenue and repeat customer purchases, as well as higher order values. Beginning with this reporting period, we will be reporting net sales from Amazon and DTC platforms under a combined e-commerce channel to reflect the fact that this is how we manage our business internally, as we have structured ourselves to be agnostic to consumer shopping on whatever digital platform they prefer. Wholesale sales increased by 19% year-over-year and contributed 41% of total net sales, driven by velocity improvements in retail and distribution expansion in grocery, as well as more efficient promotional spend.

Gross margin for the fourth quarter came in at 38.6%, compared to 40.4% in the corresponding prior year period. This margin contraction was driven by increased gross-to-net sales spend in retail channel related to prior periods and not related to the fourth quarter activity. Slot-in expenses were also higher, driven by new distribution expansion, and contributed to increased trade spend in the quarter. Sequentially, gross margin contracted 4.4 percentage points versus the third quarter of 2024, due to the benefit of supply settlement recognized in the third quarter and higher trade spend in Q4. On a full-year basis, gross margin was 40.9%, as compared to 30.1% in a corresponding prior year period. This represents 10.7 percentage points expansion, driven by lower raw material costs due to shift to direct procurement of key ingredients, full realization of co-manufacturing model benefit, and planned reductions in promotional trade spend.

We are confident in our ability for sustainably achieving gross margins at at least in the high 30s in the coming quarters. Operating expenses increased $1.3 million in the fourth quarter, compared to the same period last year, driven by slightly higher marketing investment, broker and Amazon selling fees related to volume growth, people-related costs such as stock-based compensation, which is a non-cash expense. Net loss for the fourth quarter was $0.4 million, compared to net income of $0.1 million in the prior year period. On a full-year basis, net loss was $1.8 million, compared to net loss of $10.2 million in the prior year period, representing 82% improvement driven by top-line growth, gross margin expansion, and lower operating costs. Turning to our balance sheet, we ended the quarter with $8.5 million in cash and no debt.

I am particularly pleased to report that for the third consecutive quarter, we have delivered a positive quarterly cash flow, which was $312,000 in Q4 and totaled $807,000 for the year, reflecting our improved performance and disciplined management of our working capital, which decreased year-over-year excluding cash while driving year-to-date revenue growth of 27%. We continue to project that we have sufficient cash to fund our operations as we grow our business and make operating improvements that drive us towards break-even and profitability. We also have an asset-backed line of credit available for our use should we need it. Looking ahead to 2025, we expect continued growth in our core business segments and channels as we remain focused on executing our strategic priorities.

As such, we are reaffirming the guidance we gave last quarter and expect net sales to grow in the 20%-25% range for the full year 2025 and gross margins to hold in the upper 30s despite commodities cost pressures. I expect the first quarter net sales growth to be below the full-year target due to out-of-stocks impacting our creamer business early in the quarter. We are well on the way of resolving this issue and expect a full recovery by the end of Q1 or early Q2. I expect net sales to accelerate growth in the second part of the year relative to full-year guidance. We will target our adjusted EBITDA to break even on a full-year basis and reinvest any surplus in traditional top-line growth. We expect $1 million-$2 million negative operating cash flow in order to invest into inventory to support top-line growth and minimize out-of-stocks.

I will turn the discussion back over to Jason for any closing remarks.

Speaker 1

Thank you, Anya. Thank you once again to all of you who are supporting our journey. In a crowded food market, Laird Superfood is carving out a unique space with our whole food functional ingredient portfolio. Our 27% sales growth outpaces nearly all of the household names in our industry, and our 40% gross margin surpasses even long-established players. What's more, our dual-channel success across retail and Amazon gives us a versatility that many competitors lack. We're not just a DTC darling or a brick-and-mortar relic. We're thriving in both worlds and meeting consumers where they prefer to shop. It has been an exceptional couple of years for our brand and our business, but we really do believe that we are just getting started. I couldn't be more proud of our team for what we have already accomplished or more excited for our continued expansion as we go forward.

Operator, this concludes our prepared remarks, and we are now ready to open the call to questions.

Speaker 4

Thank you. If you would like to ask a question, please press Star followed by 1 on your telephone keypad. If for any reason at all you would like to remove that question, please press Star followed by 2. Again, to ask a question, please press Star 1. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking your question. The first comes from Alex Furman with Craig-Hallum Capital Group. You may proceed.

Speaker 2

Hey, guys. Thanks very much for taking my question. You mentioned having some stockouts that you've been dealing with lately. Did those impact Q4 at all, or is that really more of a Q1 issue? Can you give us a timeline of when you think that will be resolved and what exactly the inventory investments you're making this year to help to alleviate that?

Speaker 1

Hey, Alex. It's Jason. Thanks for that question. It's one that we want to make sure that we address really clearly here. I mean, the reality is what happened last year as we were rolling into Q4, I think a number of folks on this call probably saw we started to have products that were out of stock in DTC in particular and sometimes at retail as well. The reality is we just started moving through at a pace even faster than we expected, especially on the coconut milk-related products. What we did is we started to prioritize where we put that product. We took care of our subscribers ahead of any new customers and then slowed down some of our marketing as a result.

At the same time, we made sure that we were able to keep our main customers in stock as much as possible, which was mostly in stock. In total, I mean, it ended up probably costing us, I would guess, based on our estimates, somewhere close to $1 million of sales to the top line, which is a two-edged sword. A, we would have loved to have reported it and had those sales. On the flip side, it just demonstrates the demand. Even growing almost 30%, we still had another $1 million or so that we could have sold if we had been in stock. This is a top priority for us.

The reality, though, is you have to remember, unlike a lot of our peers who can simply throw more ingredients and chemicals, etc., into pots and spit out new "food," our food is all just a couple of ingredients. When we're short on coconut milk powder products, we need more coconut milk powder. That takes time. It comes in from Asia. It just puts a little crimp into your supply chain. We've gone out. We've identified a couple of new suppliers. We have a more robust supply than we've ever had. We're very, as you guys know, we are very quality-oriented. Those suppliers have been vetted very carefully. They are all direct relationships for us as well. They give us the ability to really expand our supply from here, which will work out nicely as we're seeing demand really kick up here.

We've got, to your question, in Q1, there will be some impact. We still expect robust growth here. As you saw in the earnings release, we're reiterating our call for the year. We believe that we have 20%-25% growth in the year despite some early challenges. We're really actually a two-edged sword, as I say. We're excited about the demand. We're in position to be able to increase our supply. It just takes a minute to work it through the supply chain and get it over here and put it into bags and onto the shelves.

Speaker 2

Great. That's really helpful. Thanks for that explanation, Jason. I guess talking about some of your products that don't have the coconut in them, I was impressed to see it looks like the coffee category, the beans, grew something like 40% this year and more than 50% in the fourth quarter. Can you talk a little bit about what's driving that? Looks like you've been having a lot of success with the functional coffees that you have a lot of differentiation with in the marketplace. Has that been the biggest driver of your wholesale growth? I know you've had a really strong business in some key retailers with coffee beans.

Speaker 1

Yeah, that's right, Alex. We've had really what we call our coffee solutions, which is our coffees, ground and whole bean coffees, as well as our creamers, plus our instant lattes, have all been doing exceptionally well over the last couple of years. We're seeing a lot of uptake with retailers. Coffee, for us, has been a bit surprisingly strong. Again, areas that we've been pleasantly surprised by demand-wise. We've just had some really strong uptake not only in the wholesale segment but also online, Amazon, and DTC as well. It's an area, obviously, with escalating costs that we have that we've been watching closely. We bought, I would say, in an advantaged position a lot of our coffee up until now. We're watching it carefully and making choices, I think, that are very strong relative to our P&L. We did take pricing recently on our coffee.

We announced a small price increase of a dollar per bag online channels and then passed through commensurately to the retail trade. We have taken a position on price, as I mentioned. We are really more interested in gross margin dollars than we are in gross margin percentages. We still very much intend to keep our gross margin in the high 30s, but we are willing to trade away a couple of points in order to gain a couple of dollars of incremental sales because, remember, versus our expectation, we have opportunity to sell products that we did not expect to gain additional revenue and thereby additional gross profit dollars, which is very meaningful to our business and our cash position. That is the way we are managing it. I think we are managing it very smartly. We have got eyes on all of this, trackers that we are reviewing daily.

We saw some relief in the coffee market recently and have taken advantage of that. I think we're in a really strong position to continue to grow that business. Consumers want it. It's the functional coffee, as you said. It's the functional lattes as well, where we put our performance mushrooms into these coffees. We have some innovation in both of those areas with new products that have been doing well. We're really excited about that entire category of the business for us.

Speaker 2

Okay. That is great to hear that you're seeing a lot of traction there. I certainly agree. Not a lot else out there in the marketplace with the functional benefits for coffee that you guys have. I am glad to see that that is doing well and appreciate the thorough explanation, Jason.

Speaker 1

You bet. Thanks, Alex.

Speaker 4

Thank you. Our next question comes from George Kelly with Roth Capital Partners. You may proceed.

Speaker 3

Hey, everybody. Thanks for taking my questions. First, maybe a modeling question for Anya. I was curious, the commentary around gross margin, could you maybe be more specific about how much you're willing to kind of digest or give up in the early part of 2025? Do you expect gross margins to step down a little bit from what you reported in Q4? What happens sort of throughout the year?

Speaker 5

Hi, George. This is Anya. Thank you for your question. Yes, we intend to hold our gross margins in our high 30s. Obviously, commodities are being inflationary, and we are closely watching that dynamic. As Jason just mentioned, we have taken some pricing on our coffee business, which is breaking records in terms of cost inflation. We have taken that price increase on our online channel as well as in wholesale. We are going to continue monitoring the situation. As Jason just talked about, we are willing to trade off a couple of points of margins from where we have been before, which was in the 40s or above, in favor of market share and really growing the top line. I am going to say we do not really give quarterly guidance, so I am going to stick with our annual guidance of our gross margins being in high 30s.

Speaker 3

Okay. Fair enough. Next question, with respect to the new sizing on the liquid product, I was curious, Jason, you mentioned in the prepared remarks that I think your comment was that it had seemingly, that launch had seemingly gone well. I was just curious if you could give any more specifics about velocities or really just what you've seen since that product has hit shelf. Maybe a secondary question on the same topic is just how are you incorporating the new liquid product in your 20-25% revenue growth target? It just seems like such a big category. You've got this product now that's more competitive. Sort of how are you baking that in?

Is it a material portion of the growth that is in that target, or are you kind of just letting it develop, and it could represent upside to that target if it's a successful launch?

Speaker 1

Yeah. Great questions, George. Thanks, by the way, for those. I think that the way that I would think about this, it's too early to tell. That is why I said it seemingly has gone well instead of outright saying it had gone well. What I know has gone well is that we managed to complete the transition with very little inventory or waste. We are very pleased with how that transition went. The retailers, I do not know of any meaningful loss distribution. I do not have any loss distribution, but certainly nothing meaningful that happened as a result of the upsizing, which is not always easy because you are going with different shelf heights, etc. We did not have any challenges with that. As far as I know, the production ran well. As far as I know, it has gone exceptionally well.

Now, having said that, we don't have any sales data yet. Back to your question, your real question here, which is, what do we know about sales? Our expectation is that there will be something less than a one-to-one translation. We've upsized the volume by 50%, but we're only expecting somewhere around an 80% translation of volume units where you had product on shelf and then you have now larger product on shelf. The reality is a lot of times in consumer goods, you don't actually see a step down. We are hopeful that that will be the case. We are prepared to support that demand should it materialize ahead of our expectation. We are, of course, aggressively outselling additional volume. I agree with you, George. Very big category. We are actually holding our own nicely within a couple of key retailers in the natural channel.

We have just started to make some of the expansion to the conventional channel, as we discussed on previous calls. Fingers crossed, we think that this is the most likely product to really cross the Rubicon into the conventional channel over the next couple of years. Although, quite frankly, a number of our other products are starting to show real opportunity to do that as well. We do have, I would tell you, high hopes for this product. We anticipate that there could be some outperformance this year, but it is just too early to call it.

Speaker 3

Okay. That's helpful context. Thank you. Maybe just one last one.

Speaker 1

Sure.

Speaker 3

Back to the out-of-stocks. I guess the question is, is there sort of a ceiling on these products that you're bumping into? How much more supply out there is there for coconut milk powder? I mean, as you look out over the next two to three years, is there just like, is this going to be an ongoing challenge, or is it really just sort of a timing issue?

Speaker 1

Yeah. Great question, George. I would tell you, we barely dent the overall supply of coconut with what we utilize. The reality is coconuts get used in a variety of ways. You have coconut milk, you have coconut sugar, you have coconut oil. As you have additional demand that comes up for one of those products, they can shift. You can only produce one of those three with the coconuts as they mature. You have to make a choice. If we were to ramp up demand and require more, there would be opportunity to shift from some of the lower-value products over to the coconut milk powder anyhow. We are barely scratching the surface, so we are not worried about that.

The issue for us, a little bit idiosyncratic to us, is the level of quality that we demand from our coconut milk supply just means that we need to go over, we need to qualify the suppliers, we need to taste the products, we need to understand how they make their product. We are a little bit of a slower process. We thought we had all of our demand captured by a single supplier for this year and then for next as well. They were adding additional facilities specifically for us, which ended up getting delayed, and we just were not able to pivot as quickly as we needed to. It was the perfect storm because demand also ramped up on those particular products at the same time. It put us into an out-of-stock situation, which, as you know, just takes some time to recover from.

We're filling everything hand to mouth. I think keeping everybody in pretty decent stock, but certainly there's additional opportunity. Once we are able to get all of this supply fully online, we anticipate being able to fulfill that demand as well. As I mentioned in the prepared remarks, we anticipate that happening sometime right around the end of Q1. We're not far away from it right now. It's not like we're out of stock. We certainly are; it's just a little bit of Whac-A-Mole where you're out of sweet and creamy, and then you might be out of sweet and creamy with adaptogens, and then you're out of turmeric. You produce those as they come up as the additional coconut milk powder is received. That's what we've been doing. It's just a tough game to be in.

Certainly, there are some lost sales, but we feel confident that we can recapture those and that we'll have the supply to do so over the course of the next, call it, four to six weeks.

Speaker 3

Okay. Understood. Thank you.

Speaker 1

Yep.

Speaker 4

Thank you. There are currently no other questions queued. As a quick reminder, it is Star One on your telephone keypad if you'd like to ask a question. No more questions have queued at this time. I'll turn it back over for any closing remarks.

Speaker 1

Thank you. Yeah. The only thing I want to add really beyond the discussion that we've had is 2024 was a really exciting year for us at Laird Superfood. It's the year that we proved that we came through the transition, the turnaround that we had been talking about, and were able to establish gross margins even in excess of what our target was. There was a little bit of an extra bounty that was there for us. We really anticipate as we go forward that we'll be a high-growth company with high 30% gross margins, which really puts us in a class with very few in there. We're really excited about that, excited about where we go. These challenges that we have right now are going to pass with the out-of-stocks. I do believe the commodity pressures are going to pass as well.

As I mentioned, I believe that these truly are transitory inflationary costs, especially if we treat them as such. I do believe that we will see them back down from where they are right now. Even where they are right now, as we mentioned, our P&L can handle it. Very exciting time for us. I think we're in great position to really be able to take advantage of the healthy food trends that are sweeping America right now. Our products are an incredible fit for those trends. The demand increase that we're seeing is really proof of that. We're excited. We'll be back in not long, just a few more weeks, to be able to talk about Q1 and look forward to giving an update then. Thank you all.

Speaker 4

This concludes today's conference call. Thank you for your participation. You may now disconnect your line.