VANCOUVER, BC, Sept. 12, 2022 /CNW/ - CubicFarm® Systems Corp. ("CubicFarms" or the "Company") (TSX: CUB) a leading local chain agricultural technology company, today announced additional cost reduction measures to optimize operating efficiency and accelerate its path to profitability. All amounts are in Canadian dollars.
In addition to previously announced cost reduction measures, the Special Committee of the Board of Directors has been working closely with management to prioritize the Company's lines of business. In order to focus on key ongoing strategic initiatives and realign its corporate structure, the Company is further reducing operating expenses by approximately $9.0 million on an annualized basis, consisting of $6.4 million of payroll related expenses and $2.6 million of non-payroll related expenses.
Combined with previously announced cost reduction measures on August 15, 2022, the Company has provided notice to 87 employees or 50.4% of its workforce. This translates to an estimated annualized savings of $15.6 million, or 50.3% of cash-based operating expenses on a 12-month basis as of July 31, 2022.
"Today was a tough day at CubicFarms because exceptional people will be leaving our company. I am grateful to each person for what they have contributed; their world-class talents will continue to have positive ripple effects, not only in our company, but for the future of ag-tech and we owe them a debt of gratitude," said Edoardo De Martin, interim Chief Executive Officer.
De Martin added, "Going forward, CubicFarms will operate and succeed as a nimble, cost-conscious business, driven by disciplined growth and data from key strategic initiatives. In particular, our HydroGreen systems put us in a great position with on-site US-based manufacturing capability and an expanding dealer network, giving us immediate access to the farm and cattle industries where there is strong demand for our technologies. We must conserve agricultural resources such as land, water, and energy using innovative indoor growing technologies. Farmers around the world want nutritious livestock feed for their animals and they need innovative solutions to address drought, water shortages, and land scarcity issues. As climate change, persistent drought, and long supply chains continue to disrupt populations and economies, the demand for our on-farm solutions has never been greater."
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