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Rubicon Reports Fourth Quarter and Full Year 2022 Financial Results
Rubicon reported financial and operational results for the fourth quarter and full year of 2022.
March 9, 2023
8 Min Read
Rubicon
NEW YORK--Rubicon Technologies, Inc. (“Rubicon” or the “Company”) (NYSE: RBT), a leading digital marketplace for waste and recycling and provider of innovative software-based products for businesses and governments worldwide, today reported financial and operational results for the fourth quarter and full year of 2022.
Fourth Quarter 2022 Financial Highlights
Revenue was $166.0 million, 2% higher compared to $163.3 million in the fourth quarter of 2021.
Gross Profit was $6.8 million, 17% higher compared $5.8 million in the fourth quarter of 2021.
Adjusted Gross Profit was $13.4 million, which is roughly flat to the fourth quarter of 2021.
Net loss was $18.0 million versus a loss of $30.3 million in the fourth quarter of 2021.
Adjusted EBITDA was negative $17.6 million versus negative $19.5 million in the fourth quarter of 2021.
Full Year 2022 Financial Highlights
Revenue was $675.4 million, which was 16% higher compared to $583.1 million the full year 2021.
Gross Profit was $25.0 million for the full year 2022, an increase of 17% compared to $21.4 million generated in 2021.
Adjusted Gross Profit was $53.3 million in 2022, an increase of 14% compared to the $46.9 million generated in 2021.
Net loss for the full year 2022 was $281.8 million versus a loss of $73.2 million for the full year 2021.
Adjusted EBITDA for the full year 2022 was a negative $74.3 million, compared to negative $57.7 million in 2021.
Operational and Business Highlights
Rubicon made substantial progress on the ‘Bridge to Profitability’ plan during the quarter. This plan seeks to increase financial flexibility, curtail lower-ROI investments, achieve cost reductions, and increase profitability. The Company expects to generate positive Adjusted EBITDA for the fourth quarter 2023.
Rubicon raised over $39 million of net funded capital and successfully extended certain debt maturities, with the earliest maturities now due at the end of this year. The Company also upsized its revolving credit facility.
In the fourth quarter, Rubicon signed a two-year extension and expansion of its contract with Walmart, which has been a flagship customer since 2013.
Also in Q4 2022, Rubicon secured a three-year extension with Sweetgreen, the mission-driven restaurant brand which seeks to serve healthy food at scale. The partnership is enabling Rubicon to continue to expand Sweetgreen’s waste diversion efforts and provide enhanced account management as its lead partner for waste, recycling, and composting services.
In February, Rubicon established a multi-year channel sales partnership with Bartec, for the license of Rubicon’s products across the UK, furthering progress in the Company’s global expansion.
In March, Rubicon announced significant growth within its RUBICONSmartCity business, adding 11 new customers in Q4 2022 including the cities of Rochester, NY; Manchester, NH: Surprise, AZ; and Rockville, MD. These cities chose RUBICONSmartCity to help them save money and run more efficient and effective solid waste collection operations.
“We are very proud of our achievements to date and are excited to begin our journey as a publicly traded company. It is a testament to the dedication and diligence of our team that we have already demonstrated significant progress against the goals we set out during our Q3 2022 earnings call,” said Phil Rodoni, CEO of Rubicon. “We believe we have built the definitive platform for eliminating waste which enables us to provide a differentiated service offering to our customers. Our core business is strong, and we are focused on accelerating the Company’s progress to profitability while driving Rubicon’s next phase of growth.”
Fourth-Quarter Review
In the fourth quarter, Revenue totaled $166.0 million, an increase of $2.7 million or 2% from $163.3 million in the fourth quarter of 2021. This growth was driven primarily by increased service with both new and existing customers across business lines.
Gross Profit in the fourth quarter was $6.8 million, 17% higher compared $5.8 million in the fourth quarter of 2021. The growth in Gross Profit was driven primarily by increased service with both new and existing customers across business lines.
In the fourth quarter, Adjusted Gross Profit was $13.4 million, a decrease of $0.1 million or 1% compared to $13.5 million generated in the fourth quarter 2021. This decline was driven by one-time customer expenses but was largely offset by stronger performance in the SaaS product lines.
Net loss was $18.0 million in the fourth quarter, an improvement of $12.3 million compared to $30.3 million in the fourth quarter of 2021. Impacts from increased revenue and decrease in general and administrative expenses as a result of a $10.4 million gain on the settlement of certain management bonuses contributed to the result in the fourth quarter of 2022.
In the fourth quarter, Adjusted EBITDA was negative $17.6 million compared to negative $19.5 million in the fourth quarter of 2021. Impacts from the Company’s merger with Founder SPAC (the “Mergers”) and strategic shift contributed to the result in the fourth quarter of 2022.
Full-Year 2022 Review
Revenue for the full year 2022 totaled $675.4 million, which was $92.3 million or 16% higher compared to the full year 2021. This revenue growth was driven by volume growth in the Company’s core business.
Gross Profit in 2022 totaled $25.0 million, which was $3.6 million or 17% higher compared to $21.4 million in 2021. The growth in Gross Profit was driven primarily by continued expansion within the Company’s existing customer base, as well as the addition of new customers.
In 2022, Adjusted Gross Profit totaled $53.3 million, an increase $6.4 million or 14% compared to $46.9 million generated in 2021. This growth was driven primarily by continued expansion within the Company’s existing customer base, as well as the addition of new customers.
Net losses totaled $281.8 million in 2022, compared to net losses of $73.2 million in 2021. Impacts from nonrecurring expenses in connection with the Mergers, including management bonus payments and equity compensation costs, contributed to the annual result in 2022.
Adjusted EBITDA totaled a negative $74.3 million compared to negative $57.7 in 2021. Impacts from the Mergers and strategic shift as well as a software expense increase related to our license and strategic partnership agreement with Palantir contributed to the lower result in 2022.
Strategic Progress
To address cash needs and increase working capital, the Company is currently in discussions with financing sources to potentially raise new equity and recapitalize debt prior to its maturity. In parallel, management is implementing additional measures to further reduce spending and extend cash availability. Though there is no guarantee the Company will be able to successfully implement any or all of its current plans, these initiatives are intended to increase financial flexibility and push out debt maturities with the ultimate goal of realizing greater shareholder value by improving Rubicon’s financial position and future liquidity.
Rubicon is aiming to accelerate its progress to profitability, investing in its leading digital marketplace and suite of products, and further developing the strategic vision and execution plan for Rubicon’s next phase of growth. Rubicon has increased focus on operational efficiencies and working to accelerate cost reduction measures across the organization, with a goal of thoughtfully and diligently optimizing margins across the portfolio. The Company will share additional information on its “bridge to profitability” plan in the coming quarters as we continue to develop our plans.
Management Announcement
On February 21, 2023, Rubicon announced that the Company’s President, Kevin Schubert, had been appointed Chief Financial Officer. Schubert had served as Rubicon’s Chief Development Officer since August 2022, until the time of his appointment as President in October 2022. Schubert now oversees Rubicon’s end-to-end financial operations and is working to further develop the financial infrastructure, teams, and processes to enable the Company to meet its strategic goals, including the acceleration of the Company’s progress to profitability. In addition, Schubert also oversees Rubicon’s legal function. Schubert brings a wealth of finance, legal, and corporate development experience to his roles as President and Chief Financial Officer. Prior to Rubicon, Schubert held senior executive and advisory roles with multiple public companies, including Red Rock Resorts Inc., the Las Vegas Sands Corp, and he recently held the role of Chief Financial Officer for Ocean Park Group, an early stage company focused on experiential hospitality.
Webcast Information
The Rubicon Technologies management team will host a conference call to discuss its fourth quarter and full year 2022 financial results this afternoon, Wednesday, March 8, 2023, at 5pm ET. The call can also be accessed live via telephone by dialing (888) 660-6863 or for international callers (929) 203-2112, and referencing Rubicon Technologies. Please log in to the webcast or dial in to the call at least 10 minutes prior to the start of the event. The live webcast of the conference will also be available at https://investors.rubicon.com/events-presentations/default.aspx, on the Events and Presentations page on the Investor Relations section of Rubicon’s website..
About Rubicon
Rubicon Technologies, Inc. (NYSE: RBT) is a digital marketplace for waste and recycling, and provider of innovative software-based products for businesses and governments worldwide. Striving to create a new industry standard by using technology to drive environmental innovation, the Company helps turn businesses into more sustainable enterprises, and neighborhoods into greener and smarter places to live and work. Rubicon’s mission is to end waste. It helps its partners find economic value in their waste streams and confidently execute on their sustainability goals. To learn more, visit www.Rubicon.com.
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