AppHarvest has landed $50 million to support the development of its high-tech indoor berry farm in Somerset, Kentucky.
The agritech company, based in Morehead, Kentucky, secured the fresh funding in the form of two loans guaranteed by the United States Department of Agriculture (USDA) through Greater Commercial Lending (GCL), a subsidiary of Greater Nevada Credit Union, according to a news release. The new farm is about 80% complete and is expected to be operational by the end of the year.
“Securing non-dilutive sources of capital to fund our growth has been a top priority since going public early last year, and I’m pleased with our team’s ability to source lower-cost funding in a higher-cost lending environment,” said AppHarvest President David Lee, in the release. “This funding agreement with the USDA allows us to continue to scale operations as we plan to bring the Somerset farm and two additional CEA (controlled environment agriculture) facilities online before the end of the year, which would quadruple our farm network and diversify our product portfolio to include berries and salad greens.”
AppHarvest (Nasdaq: APPH) will use some of the funds to pay back an existing $46 million loan with J.P. Morgan that was used in part to fund the initial construction phase of AppHarvest’s Somerset farm, the release continued.
As I previously reported, AppHarvest also has two other projects in development: a 15-acre salad greens facility in Berea, Kentucky, and a 60-acre tomato facility in Richmond, Kentucky. Its flagship farm is in Morehead, Kentucky.
In an earnings call in May, founder and CEO Jonathan Webb said he expects the new farms will accelerate the company's sales growth, enable it to become financially self-sufficient and attract new investment.
In total, AppHarvest anticipates it will invest between $140 million and $150 million this year in the construction of the three new Kentucky facilities. It also expects to deliver total net sales of $24 million to $32 million in 2022, more than double 2021 net sales.
AppHarvest had a net sales of $5.2 million in the first quarter of the year, and a net loss of $30.6 million. It will release second quarter earnings results on Wednesday, Aug. 3.
