Above Food Ingredients Inc.

Analysis for Ticker: ABVE

Above Food Ingredients Inc specializes in plant-based products and ingredients through a vertically integrated supply chain, managing the process from the seed to the final consumer across twenty-five thousand retail stores in six countries. The reality is that in the fiscal year ending in 01/2024, the company generated 368,4$ million in revenue but spent 374,3$ million just to acquire and process those goods. This business model is like a lemonade stand that pays its customers to take the drinks, ensuring that the more they sell, the faster they lose everything. Before they even paid for office rent or salaries, they lost 5,8$ million on their basic products. After all losses were counted, they had an accumulated deficit of 103,9$ million and only 1,0$ million in cash left to cover a working capital deficiency of 85,4$ million. The machine started with a shell company called Bite Acquisition Corp, which was designed to bring the business to the public stock market. When the public investors saw the math, they demanded their money back, taking over 201,0$ million out of the company trust at prices up to 10,91$ per share. To stay alive, the company turned to expensive debt and self-dealing transactions. Chief Executive Officer Lionel Kambeitz oversaw payments of 12,9$ million for grain to a farm his family controlled and 3,1$ million for a terminal lease to another related entity. They also paid executive Martin Williams and his firm 275.000$ in cash. The cost of just becoming a public company was 22,0$ million in fees and transaction costs.