DAVIS, CALIF. — Executives of Arcadia Biosciences, Inc. expect the GoodWheat brand to continue increasing its retail and online presence as well as enter other categories besides pasta, but no plans exist right now to enter the foodservice channel.
“GoodWheat has consistently added distribution in hundreds of stores every quarter, and Q1 2023 was no exception,” said Stanley E. Jacot, president and chief executive officer, in a May 11 earnings call to discuss results for the first quarter ended March 31. “Retailer acceptance of GoodWheat continues to grow, and we are targeting many large 1,000 store-plus retail chains as they plan their annual shelf resets in Q3 and Q4.”
Arcadia Biosciences, for competitive reasons, will wait to share the next GoodWheat launch category outside of pasta until a future earnings call, he said.
“So right now, grocery, especially conventional grocery, is where we are currently selling our (GoodWheat) products, and we do expect to expand into other channels as well,” Mr. Jacot said. “For example, mass, club. There’s also naturals, which is an opportunity for us, and we expect all of those channels to be relatively similar in terms of their gross profit contribution.”
Mr. Jacot was asked about a possible GoodWheat expansion into foodservice.
“So for right now, our focus is on retail and e-commerce,” he said. “We do feel like there is opportunity in foodservice, but instead of building an infrastructure to support that, we’d rather use a partner that would be able to quickly reach all those foodservice contacts.”
The Retail Dietitians Business Alliance, a network of registered dietitians in the United States and Canada, in May named GoodWheat pasta as its “Best New Product.” Launched in June 2022, GoodWheat pasta contains four times as much fiber as regular pasta and 9 grams of protein per serving, according to Davis-based Arcadia.
Arcadia’s loss from operations in the quarter was $4 million, which compared with a loss of $4.6 million in the previous year’s first quarter. Net revenues of $1.5 million were down from $3.2 million in the previous year’s first quarter, which included $1.8 million in sales of grain and body care products that no longer are part of Arcadia’s portfolio. Distribution losses impacted Zola brand coconut water negatively as its revenues declined 6% compared to the previous year’s first quarter.
“While the high-quality revenues in Q1 2023 are substantially less than the low-quality revenues in Q1 last year, the result is a more than $900,000 improvement in gross profit dollars,” Mr. Jacot said. “These gross profit dollars were the main contributor to a $575,000 improvement in the loss from operations.”
