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Edible Garden AG Inc (NASDAQ:EDBL), a company specializing in crop production with annual revenue of $13.86 million, has entered into a financial agreement with Arin Funding LLC, securing $1.5 million by selling future accounts receivable. The deal, dated April 1, 2025, was disclosed in a regulatory filing with the Securities and Exchange Commission. According to InvestingPro data, the company operates with a modest gross profit margin of 16.68% and is currently trading below its Fair Value.
Under the terms of the agreement, Edible Garden sold $2.04 million worth of its future accounts receivable for an upfront sum of $1.5 million, after accounting for fees and expenses totaling $65,000. The net proceeds received by the company amounted to $1.435 million. This financing move comes as InvestingPro analysis shows the company has been quickly burning through cash, with negative free cash flow of $8.91 million in the last twelve months.
A portion of this capital was used to negotiate a discount and settle an outstanding balance with Cedar Advance LLC from a previous cash advance agreement. The balance, originally $1.373 million, was reduced to $1.263 million, and the company agreed to prepay the remaining amount.
Edible Garden is now obligated to pay Arin 20% of weekly customer collections, with Arin set to withdraw $63,750 weekly from the company’s bank account until the full $2.04 million is repaid. The arrangement grants Arin a security interest in all of Edible Garden’s accounts, including receivables and proceeds, ensuring Arin’s ability to recover the funds in case of default by Edible Garden.
This strategic financial maneuver is designed to improve the company’s cash flow and facilitate ongoing operations. The full details of the agreement can be found in the exhibit attached to the SEC filing.
The information in this article is based on a press release statement. For deeper insights into Edible Garden’s financial health and 13 additional ProTips, including detailed cash flow analysis and valuation metrics, visit InvestingPro, where you’ll find comprehensive research reports covering over 1,400 US stocks.
In other recent news, Edible Garden AG Inc reported its financial results for the fourth quarter of 2024, revealing a mixed performance. The company saw a significant increase in gross profit by 181.3%, with gross margins improving to 16.7%. However, annual revenue decreased slightly by 1.4% to $13.9 million, and the net loss widened to $11.1 million from $10.2 million in 2023. Edible Garden also launched new product lines, including KICK Sports Nutrition and Squeezables, as part of its strategic shift to focus on higher-margin products. The company aims to expand its international presence with the potential acquisition of the Narayan Group, which could enhance its product offerings and operational efficiency. Analysts from firms such as Maxim Group have shown interest in the company’s gross margin improvements and the proposed acquisition’s potential impact on profitability. Additionally, Edible Garden is targeting a gross profit margin of 35-40% for the future and plans to introduce KICK Sports Nutrition in traditional retail channels. These developments reflect the company’s efforts to streamline operations and focus on long-term growth and profitability.
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