Marrone Bio reports year-over-over increases in revenue and gross margins for 2019

Marrone Bio Innovations Inc (NASDAQ:MBII) announced Thursday year-over-over increases in revenue and gross margins for the fourth quarter of 2019 as well as the full year.

For the quarter ended December, the company saw revenue increased 17% to a record $6.7 million thanks to increased sales of its Regalia biofungicide and Majestene/Zelto nematicide and its recently acquired Pro Farm bionutrient products.

Marrone Bio said sales of seed treatments continued to be strong, including revenue in Europe from its Pro Farm products.

For full-year 2019, revenue increased 38% to a record $29.4 million, reflecting double-digit sales growth across the Venerate and Regalia product families, and the addition of partial year sales for the newly acquired Pro Farm portfolio and Jet-Ag/Jet-Oxide assets.

Gross margins for the 4Q improved by 530 basis points to 55.8% with gross profits of $3.7 million, as the company logged its fifth consecutive quarter of achieving gross margins above 50%.

In 2019, gross profit growth outpaced revenue growth and rose 56% to $16.1 million. Gross margins reached 54.9%in 2019, a 630 basis point improvement over 2018. Strong sales and a favorable product mix drove the gross margin improvement, the company said

In a statement, CEO Dr Pam Marrone said the company delivered across-the-board on its growth initiatives in 2019.

“The investments made in our commercial operations and R&D-led process improvements paid significant dividends with substantial revenue growth and gross margin expansion,” Dr Marrone said. “The success of our BioUnite program, the power of biology with the performance of chemistry, drove home the value of biologicals in our customers crop production programs.”

She added: “With the acquisition of Pro Farm and our continued investment in our bioprotection seed treatment portfolio, we have significantly transitioned the company to a point where row crop seed treatments represent approximately one-third of our 2019 revenue, and we expect will continue to grow as we move forward – making us an emerging leader in the significant row crop seed treatment market.”

2019 operational highlights:

- 2019 field trial results for MBI-203 and MBI-206 biological seed treatments in Europe demonstrated improved yields and cost-effective control of soil insects and nematodes equivalent to or better than current industry standards.

- Results of 2019 US field trials at six Midwest locations of the company’s next-generation nematicide/insecticide showed cost-effective control of yield-robbing corn pests (corn rootworm, seed corn maggot).

- In US corn and soybean field trials showing the power of Marrone Bio’s BioUnite programs, Regalia biofungicide, or Pro Farm products, combined with a chemical fungicide significantly increased yields above the chemical fungicide or Marrone Bio’s products used alone. 

- Market share in California almonds increased substantially due to BioUnite integrated pest management programs for key pests such as navel orangeworm.

- Two of its biofungicide products -- Stargus and Regalia -- have been approved by the US Environmental Protection Agency for indoor and outdoor use on hemp plants.

- Stargus has been approved by the California Department of Pesticide Regulation for immediate use by growers on several crops, including grapes, leafy greens, brassicas, strawberries, cucurbits and fruiting vegetables.

- A new study, the first of its kind, was conducted to determine the greenhouse gas effects of selected Marrone Bio biopesticides and plant health products compared with conventional chemical pesticide products. 

- Announced a $13 million expansion of its existing accounts-receivable credit facility, which now totals $20 million, as well as the addition of a $3 million inventory-backed credit facility to support the company as it continues to grow its revenue.

Author: Patrick M. Graham