Stryve Foods, Inc.

Thank you for standing by. This is the conference operator. Welcome to the Strive Foods, Inc. Third Quarter 2021 Earnings Call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star and one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Austin Key, General Counsel. Please go ahead.

Thank you, Operator, and thank you all for joining us. With me today are Strive Foods Chief Executive Officer and Co-Founder Joe Oblos and Chief Operating Officer and Chief Financial Officer Alex Hawkins. Before we begin, I would like to remind everyone that part of our discussion today will include forward-looking statements. which are based on our current expectations of future performance. Our actual results could differ substantially from these expectations. These statements are not guarantees of future performance and therefore undue reliance should not be placed upon them. We do not undertake to update these forward-looking statements at a later date. We refer you to today's earnings press release and the SEC filings filed by Stripe Boots, Inc. for a more detailed discussion of the risk that could impact future operating results and financial condition. In addition, Today's call will also include a discussion of non-GAAP financial measures such as EBITDA. Non-GAAP financial measures should be considered as a supplement to and not a substitute for GAAP financial measures such as net income. We refer you to the reconciliation of the non-GAAP measures to the nearest GAAP measure included in today's earnings press release for further detail. I would now like to turn the call over to Strive Foods Chief Executive Officer and Co-Founder Joe Oblos.

Thank you, Austin. Good afternoon, everyone. Our strong top-line growth demonstrates that we are continuing to make great progress in helping Americans snack better, eat better, so they can live happier, healthier lives. During the third quarter, net sales more than doubled compared to last year, as we realized significant increases across all of our sales channels. This was particularly true in wholesale, where we have added thousands of additional doors to our retail footprint over the past year, and in doing so, have been able to introduce our Better For You air dried meat snacks to thousands of new customers. As Alex will explain later in greater detail, we held our gross margin steady versus the year ago quarter. We view this favorably considering the significant cost pressures the entire economy is facing because of both labor and commodity cost increases. In addition to these very pronounced headwinds, we deliberately invested heavily in our products to increase our retailer penetration by continuing to build awareness driving trial, and supporting repeat purchases. Through the first nine months of 2021, our gross profit margin was 40.9%, which is more than 500 basis points higher than the same period last year. We believe our gross margin remains among the highest in the healthy snacking space, and we look forward to maintaining our margin outperformance as we continue realizing the advantages of scale. We have accomplished this without taking price on our customers. In terms of the rest of our P&L, there were non-recurring costs during the quarter indirectly related to the business combination, as well as additional costs relative to last year's third quarter as we transitioned to public company status and invested in talent ahead of growth. This impacted our EBITDA net loss, which both grew on a quarter-over-quarter basis. That said, let me be clear that we are very pleased and optimistic by the trajectory of our business, We see great opportunity ahead of us as we drive market share growth in the snacking category while effectively managing through considerable cost headwinds affecting all CPG companies. We believe that our momentum has now reached an inflection point where retailer adoption and our strong in-store performance should lead to significant growth over the next several quarters. I would now like to provide an update on our expanding retail footprint. Please recall, that by the end of June, our products were available in more than 25,000 retail doors. During the third quarter, we added over 4,000 net new locations, including a significant expansion within Circle K. We also previously announced that we'll be going into approximately 2,600 Speedway convenience locations in early 2022. Further, we have been awarded additional expansion within 7-Eleven that will also take place in early 2022. This is impactful as continued expansions are a great indicator regarding the health of a brand. Recent expansion wins already secured in the fourth quarter have included a significant expansion in both store and SKUs in Walmart, along with another new region within Costco. Costco is proving to be a fantastic partner for us as we are consistently exceeding our own expectations of unit sales per week per store. We will also be participating in one of their multi-vendor mailers next year with on-shelf placement in all regions, which should expand brand awareness and drive significant incremental sales. Having national distribution with Costco is a huge achievement for the brand, and we understand that it is only awarded to those that perform at a very high level within their regional footprints. Retail velocity is an important indicator of the health and vitality of a brand as it informs you how much of a product is sold per store per week in a given channel. We believe that it's a key driving factor in a buyer's decision for increased store counts, SKUs, and additional placements. With that in mind, let me give you an update on this metric. Overall, based on the most recent SPINs and IRI data for the convenience channel, Our units per store per week were up 146% versus the same period last year. And the retail sales of our products are up 229% year over year. This underscores the argument that we are the fastest growing major meat snack brand in America within the convenience channel, with additional strong growth within natural and mulo. Let's now do a deeper dive on Vodka Dios, our newest brand that features carne seca. As you may recall, this brand targets the rapidly growing Hispanic community, but also has great crossover appeal because of its amazing taste and texture. We are seeing strong momentum and velocities with the brand overall, especially within the convenience channel. We are excited to announce that we plan to add sticks to the Vaca Dios product line in 2022, possibly as soon as the second quarter, which we believe should be very well received by our retailers in the marketplace. Sticks currently represent about half the market opportunity in meat snacks and are particularly popular in the convenience channel. We will also be looking to add Strive Slabs to our retail assortment next year. This is already a tremendously popular product purchased through e-commerce, representing about half of our sales through this channel, and we are optimistic that Slabs will continue to drive significant incremental growth for us for 2022. The launch of Slabs to retail provides us with an opportunity to generate revenues in additional locations within the retail environment as they are intended to be slotted in the charcuterie sections and not with the traditional jerky products. Slabs are also a high margin product that should be accretive to our long-term margin profile as they have a lower production cost on a per ounce basis. Since early August, the launch of Strive Nutrition We've had great feedback from customers who have purchased the products on strive.com, and we expect they will be available next year on Amazon and select retailers. We are also developing additional nutritional products to further scale this vertical and would expect the entire category to be a positive contributor to net sales throughout 2022. As we look to 2022 and we begin to see the revenue growth of the additional distribution wins that I've already mentioned, we want to ensure that our manufacturing capacity stay ahead of the curve. We will not only be continuing to expand our facility in Medill, Oklahoma, we will be adding a second manufacturing facility that will house all of our operations that are currently existing in the DFW area. This new factory is being designed to add additional manufacturing capabilities to allow us to continue to innovate and disrupt. We are excited about bringing another factory online next year as it further extends our protective moat that we have established in this industry and should help us significantly as we aim to become one of the largest participants in the wider meat snacks category. Next, I'd like to address leadership. In October, we welcomed Greg Christensen and Charlie Vogt to our board. Greg and Charlie both possess broad and deep experience in optimizing growth of public companies, and we believe that they will be instrumental in helping us achieve our strategic objectives. I also want to thank Jack Sealt for all her many contributions over the past three years. She is a wonderful friend and partner to us all. As you may be aware, she resigned as co-CEO and CMO effective November 17th to pursue other opportunities, but will stay on in an interim capacity to advise on sales, marketing, and strategic planning. While we are certainly sorry to see her step down, Let me reiterate that this management team and board have significant experience growing differentiated CPG businesses in a variety of channels, and therefore we have every confidence that we can continue to drive market share growth. Finally, while there are numerous M&A opportunities in the snacking and healthy eating categories, at this time we are squarely focused on building momentum for our existing business and setting ourselves up for a very strong 2022. We would consider acquisitions in the future if they made strategic and financial sense and align with our mission and thesis. But for now, our efforts and resources will be devoted to the significant opportunity we already have in front of us. And with that, I will turn the call over to Alex.