Ecoark Holdings, Inc. Announces Operating Results for Fiscal First Quarter of 2021; Reiterates Forecast for 1,000 BOPD

FRISCO, Texas, Aug. 13, 2020 (GLOBE NEWSWIRE) — Ecoark Holdings, Inc. (“Ecoark”) (OTC: ZEST), announced the following results for the quarter ended June 30, 2020 as compared to the corresponding period of last fiscal year.

  • Achieved revenue of $2.31 million versus $0.04 million in the prior year quarter
  • Reported operating loss of $2.20 million versus $2.53 million in the prior year quarter
  • Adjusted EBITDA loss of $0.78 million versus a loss of $1.88 million in the prior year quarter1
  • Exited June 30, 2020 with cash on hand of $1.793 million versus $0.034 million as of June 30, 2019
  • Reiterating forecast of achieving 1,000 BOPD by end of September 2020

“Our underlying operations continue to perform extremely well, and we are pleased with the actions we have taken to further diversify our business, increase operating revenues, and shore up our balance sheet and cash reserves,” stated Randy May, Chief Executive Officer of Ecoark. “We remain on track to achieve several key objectives in the coming months, including growing crude oil production to greater than 1,000 BOPD and uplisting to a national exchange.  We successfully increased current production to 250 BOPD, and with initiatives underway, expect to grow production to 400 BOPD by the end August and a full ramp to 1,000 BOPD by the end of September 2020. We are building a company able to withstand current market uncertainty and succeed over the long-term.”

“For our fiscal first quarter results, over 80% of our net loss resulted from temporary non-cash adjustments from marking-to-market the derivative liability associated with our warrants issued in May 2020,” stated Brad Hoagland, CFA, Principal Financial Officer of Ecoark. “Net loss for the quarter was $21.18 million, which includes a $17.39 million loss for the change in the fair value of derivative liability.  Net loss excluding the change in fair value of derivative liability would have been $3.79 million.  While these warrants were at levels similar to then current market price, Ecoark common stock has experienced a dramatic increase, particularly during the latter part of our fiscal first quarter. As a result of the increase in the market price for our common shares, the derivative liability on our balance sheet has been adjusted accordingly with accounting standards. The Form S-1 registering these warrants was recently declared effective by the SEC. As a result, we expect to realize an offsetting non-cash gain in the third quarter associated with the exercise of the warrants which will remove the liability from our balance sheet. As of today, our institutional investors have exercised more than 20% of the total warrants issued that created the loss and the resulting derivative liability.

As disclosed in the chart below, our adjusted EBITDA is calculated as follows:

          Three Months Ended
June 30,
2020 2019
(Dollars in thousands,
except per share data)
REVENUES $ 2,313 $ 35
GROSS PROFIT (LOSS) 1,220 (10 )
Selling, general and administrative 2,884 1,550
Depreciation, amortization, depletion and accretion 301 77
Research and development 230 897
Total operating expenses 3,415 2,524
   Add: Depreciation, amortization, depletion and accretion 301 77
EBITDA (1,894 ) (2,457 )
   Add: Stock-based compensation 1,114 582
ADJUSTED EBITDA $ (780 ) $ (1,875 )

About Ecoark Holdings, Inc.

Founded in 2011, Ecoark is a diversified holding company.  The company has three wholly owned subsidiaries: Zest Labs, Inc. (“Zest Labs”), Banner Midstream Corp (“Banner Midstream”) and Trend Discovery Holdings (“Trend Discovery”).  Zest Labs, offers the Zest FreshTM solution, a breakthrough approach to quality management of fresh food, is specifically designed to help substantially reduce the $161 billion amount of food loss the U.S. experiences each year. Banner Midstream is engaged in oil and gas exploration, production, and drilling operations on over 20,000 cumulative acres of active mineral leases in Texas, Louisiana, and Mississippi. Banner Midstream also provides transportation and logistics services and procures and finances equipment to oilfield transportation services contractors.  Trend Discovery invests in a select number of early stage startups each year as part of the fund’s Venture Capital strategy; we are open-minded investors with a founder-first mentality.  Trend Discovery LP has an audited track record of uncorrelated outperformance of the S&P 500 since inception.

Use of Non-GAAP Financial Measures

In evaluating our business, we consider and use EBITDA as a supplemental measure of operating performance. We define EBITDA as earnings before interest, taxes, depreciation and amortization and other income and expense items such as the fair value adjustments to our derivative liabilities as well as gains and losses on disposal of assets and liabilities. We define Adjusted EBITDA as EBITDA before stock-based compensation.

The terms EBITDA and Adjusted EBITDA are not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and are not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. EBITDA and Adjusted EBITDA have limitations as an analytical tool, and when assessing our operating performance, investors should not consider EBITDA or Adjusted EBITDA in isolation, or as a substitute for net income (loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Among other things, EBITDA and Adjusted EBITDA do not reflect our actual cash expenditures. Other companies may calculate similar measures differently than us, limiting their usefulness as comparative tools. We compensate for these limitations by relying on U.S. GAAP results and using EBITDA and Adjusted EBITDA only as supplemental.

Forward Looking Statements

In addition to historical information, this release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this release that address activities, events or developments that are expected or anticipated to occur in the future are forward-looking statements and are identified with, but not limited to, words such as “anticipate”, “believe”, “expect”, “estimate”, “plan”, “outlook”, and “project” and other similar expressions (or the negative versions of such words or expressions). Forward-looking statements include, without limitation, information concerning possible or assumed future results of operations, including all statements regarding financial guidance, anticipated future growth, business strategies, competitive position, industry environment, potential growth opportunities and the effectiveness of the technology discussed in this release and the effects of regulation. These statements are based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. Such forward-looking statements are subject to known and unknown risks, uncertainties, assumptions, and other important factors, many of which are outside management’s control that could cause actual results to differ materially from the results discussed in the forward-looking statements. These risks include, without limitation, the risk of increased competition; the potential inability to grow and manage growth profitably, including that the collaboration between AgroFresh and Zest may not yield the results expected, the technology described herein may not perform as intended, risks associated with acquisitions and investments, changes in applicable laws or regulations, commodities prices, and the possibility of adverse economic, business, and/or competitive factors. Additional risks and uncertainties are identified and discussed in each company’s filings with the SEC, which are available at the SEC’s website at

ZEST FRESH™ and Zest Labs™ are trademarks of Zest Labs, Inc.

1 Adjusted EBTIDA is Loss from continuing operations + share-based compensation + depreciation, amortization, depletion and accretion.


Investor Relations:
John Mills