Agrify Corporation (NASDAQ:AGFY), a provider of advanced cultivation and extraction solutions for the agricultural industry, has announced a change in its certifying accountant. The company informed the Securities and Exchange Commission (SEC) of the update in a recent 8-K filing.
On Monday, Agrify disclosed that its previous independent registered public accounting firm, Marcum LLP, was dismissed on June 25, 2024, following a decision by the Audit Committee of the Board of Directors. Subsequently, the company appointed MATSUURA as its new independent registered public accounting firm for the fiscal year ending December 31, 2024.
However, due to a merger of MATSUURA's audit practice with GuzmanGray, a professional corporation, on July 19, 2024, MATSUURA resigned as the company's auditors. In response, Agrify's Audit Committee appointed GuzmanGray as its new independent registered public accounting firm, effective the same day.
The company clarified that during the interim period from June 25, 2024, to the effective date of the change, there were no disagreements or reportable events, as defined by SEC regulations, between Agrify and MATSUURA.
MATSUURA provided a letter, dated July 19, 2024, concurring with the company's statements regarding the absence of disagreements and reportable events. The letter is included as an exhibit in the 8-K filing.
In other recent news, Agrify Corporation has been actively fortifying its financial position and expanding its market reach. The agriculture services company converted approximately $13.8 million of debt into equity, a significant step towards regaining compliance with Nasdaq's shareholders' equity requirement. This strategic financial maneuver involved CP Acquisitions, LLC and GIC Acquisitions LLC, both entities affiliated with Agrify's CEO, Raymond Chang.
Furthermore, Agrify has amended agreements related to pre-funded warrants with CP Acquisitions, LLC and GIC Acquisition LLC. The amendments removed a provision that would have adjusted the number of shares underlying the warrants whenever Agrify conducted a qualifying equity financing. The company plans to seek shareholder approval at the next annual meeting to potentially reintroduce the adjustment provision.
In terms of business expansion, Agrify secured a $500,000 agreement with Grotech Farms LLC for a comprehensive hydrocarbon extraction and lab equipment package. The company also supplied comprehensive hydrocarbon extraction and lab equipment to SoundView, a Connecticut-based licensed operator, and entered into a collaboration with Massachusetts-based Blackstone (NYSE:BX) Valley Cannabis for the sale of solventless extraction and lab equipment.
Lastly, Agrify partnered with Justice Cannabis Co. for the provision of a comprehensive hydrocarbon extraction and lab equipment package, supporting the latter's expansion into the New Jersey market. These recent developments highlight Agrify's commitment to growth and broadening its market footprint.
InvestingPro Insights
In light of Agrify Corporation's recent announcement regarding its change in certifying accountant, it's important for investors to consider the financial health and performance of the company. According to InvestingPro data, Agrify has a market capitalization of just $4.3 million, reflecting a very small enterprise which may be more susceptible to market fluctuations. The company's revenue has experienced a significant downturn, with a 64.09% decline over the last twelve months as of Q1 2024. Additionally, the company's gross profit margin stands at 36.74%, which suggests that while Agrify is able to maintain a reasonable margin on its products, its net losses, indicated by an operating income margin of -108.68%, raise concerns about its operational efficiency.
Investors should note that Agrify's stock has been volatile, with a strong return of 23.25% over the last month, yet an overall decline of 88.28% over the past year. This volatility is a point of interest for those looking at the company's short-term trading opportunities. Furthermore, two key InvestingPro Tips for Agrify indicate that the company operates with a significant debt burden and may have trouble making interest payments on its debt, which is crucial information for assessing the risk associated with the investment.
For those who wish to delve deeper into Agrify's financials and stock performance, additional InvestingPro Tips are available, which can be accessed by visiting: https://www.investing.com/pro/AGFY. There are 13 more InvestingPro Tips that provide a comprehensive analysis of Agrify's financial state and market potential. For access to these insights, consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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