Westrock Coffee Co. announced Tuesday it had a net loss of $31.9 million in the fourth quarter and a loss of $55.5 million for the year, both dropping from results in 2021.
The company reported a net loss of $5.2 million in the fourth quarter of 2021 and a loss of $21.3 million for the full year.
During 2022, the company endured "staggering challenges" that included inflation, rising gasoline prices and delays in production equipment delivery that dampened Westrock's ability to meet customer demand and lowered sales, Chief Executive Officer Scott Ford told the investment community on a conference call Thursday.
"It was a major pain in the neck for our customers," Ford said.
The Little Rock coffee and tea provider delivered net sales of $227.7 million in the quarter, a 20% increase from $190.4 million in 2021. Sales for the full year reached $867.9 million, up 24% compared with $698.1 million in 2021.
Cost increases and equipment delays ate into profits in 2022, Chief Financial Officer Chris Pledger said on Tuesday's call. "It took longer and cost more, in terms of equipment, labor and materials, to absorb the 50% year-over-year growth in our single-serve cup orders," Pledger said.
Those problems are being addressed by adding manufacturing equipment in the first quarter, with more on the way, Pledger said. "We have additional equipment coming on line in the second quarter, which will free up additional capacity," he said.
In February, Westrock announced the acquisition of Bixby Roasting Co., a specialty-grade roaster based in Los Angeles.
The company also is expanding production and distribution operations in Conway, where it plans to invest $70 million to build a 530,000-square-foot distribution center. The company will fully occupy the facility on 30 acres at William J. Clark Drive near Interstate 40 in Conway, just 2.2 miles from its manufacturing plant. Company officials have said the manufacturing plant would be the largest of its kind in the United States and would produce extracts, which are coffee-flavored concentrated liquids.
Westrock's stock closed at $11.60 on Tuesday, up 35 cents or 3.1%. The earnings report was released after the market closed.