The Branson-backed sustainable consumer goods company reports soft Q1 results ahead of 6.14 merger vote
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Grove Collaborative Announces Q1 Earnings Results
Grove Collaborative announced disappointing Q1 earnings results, with revenues and margins showing sequential and YoY declines. The sustainable consumer goods company has a DA with Richard Branson-backed Virgin Group Acquisition Corp. II (VGII). Grove’s Q1 revenue of $90.5 million declined 11% year-over-year. EBITDA margin deteriorated considerably — (43.8)% versus (30.7)% in the first quarter of 2021Q4 2021.
The company issued revised 2022, 2033 and 2024 guidance. Notably, 2022 revenue guidance calls for a YoY revenue decline of 21% at the midpoint (Grove’s 2021 revenues were $383.7 million).
- 2022E – Net revenue of $300 to $310 million; adjusted EBITDA margin of -29% to -32%
- 2023E – Net revenue of $300 to $310 million; adjusted EBITDA margin of -13% to -16%
- 2024E – Net revenue of $330 to $360 million; adjusted EBITDA margin of greater than 0%
Despite bold plans to launch multiple sustainable brands spanning the personal care, paper and beauty categories, Grove laid off approximately 17% of its workforce in March. The transaction, which is expected to close in Q2, values Grove at $1.5 billion. Merger vote is coming up on 6.14. VGI already announced a $50M backstop back in April.
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