The owner of Pasco’s new multimillion indoor greenhouse has secured additional funding to support its growth plans as lack of capital threatened delays.
Local Bounti reported a net loss of $111.1 million in 2022, compared to a net loss of $56.1 million the prior year.
The Montana-based company recently filed its 2022 annual report, which includes a detailed overview of the company’s business and financial condition.
It paints a picture of a young company aware of its risks but excited and confident about its potential.
The report notes that “the early-stage company with a history of losses” expects to incur significant expenses and continuing losses for the foreseeable future, as it only recently started to generate revenue. Additional financing also may be required, the report said.
Local Bounti secured the additional funding March 28 through Cargill Financial, from $170 million up to $280 million, which includes capital to pay for the construction for the Pasco greenhouse at 950 S. Elm Ave., as well as new facilities in Georgia and Texas.
Local Bounti also received term sheets from a licensed U.S. Department of Agriculture (USDA) lender for its Washington and Texas facilities, which is expected to reduce its use of construction financing by about $80 million and lower its cost of capital.
The five-year-old company said in the annual report that it plans to complete construction of the 244,101-square-foot Pasco facility, which will include 3 acres of greenhouse and multiple “stack zones,” in the first quarter of 2024.
Its proprietary stack process uses vertical farming in early plant growth, followed by greenhouse farming for final grow out.
Local Bounti said the Pasco project continues to progress but has pushed back the completion date to first quarter 2024, reflecting the company’s decision to stagger construction to accommodate the commissioning of the Texas facility in the fourth quarter of 2023.
Construction is underway on Local Bounti greenhouses in Byron, Georgia, and Mount Pleasant, Texas. Both are expected to open later this year.
The company said it wants to maximize its national distribution footprint and key considerations for future developments include meeting known demand from key existing customers within the network, as well as optimizing freight routes to ensure that transportation is optimized to limit cost while enhancing customer service with consistent delivery schedules.
Local Bounti has four operating facilities (one Montana, one in Georgia and two in California).
It acquired commercial greenhouse rival Hollandia Produce Group Inc., which operated under the name Pete’s, in 2022 in a $123 million cash-and-stock deal.
Local Bounti focuses on “controlled environment agriculture,” or CEA, to produce sustainably-grown produce, focusing on living and loose leaf lettuce.
It distributes its greens to more than 10,000 retail locations across 35 U.S. states and Canadian provinces, primarily through direct relationships with blue-chip retail customers, including Albertsons, Sam’s Club, Kroger, Target, Walmart, Whole Foods and AmazonFresh.
Its primary products include living butter lettuce – for which it is a leading provider with an approximate 80% share of the CEA market within the western U.S. – as well as packaged salads and cress.
It plans to expand its offerings to include spinach, kale and arugula.
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