U.S. plant-based foods company Tattooed Chef announced that it will file for chapter 11 and intends to market “substantially all of its assets,” Vegconomist reported. The publicly-listed company will also solicit competing bids from interested parties. The news follows several difficult quarters for the frozen foods company, which said in a statement that increased business costs and an inability to raise needed capital led to the decision to seek bankruptcy protection. Founded in 2018, Tattooed Chef is known for its range of plant-forward frozen meals and entrees, which include pizzas, heat-and-serve bowls, cauliflower burgers and smoothie bowls. While they offered a growing range of vegan items, much of the brand’s product line also contained dairy or eggs. Beginning in late 2022, the company began to report financial challenges due to inflationary pressures and decreasing sales in at least one key retailer. In 2022, Tattooed Chef’s revenues were up 11% to $230.9 million, but it posted a $141.5 million net loss. In Q1 2023, net revenues fell 12.7% to $59.1 million, while net losses reached $19 million due to increased costs of labor, packaging and raw materials, it said. While Tattooed Chef prided itself as a “leader in plant-based foods,” in December 2022 CEO Salvatore Galletti revealed the firm was considering a highly unusual move and might begin selling meat products. In March 2023, Tattooed Chef revealed it was working on several strategies to improve its fiscal outlook, noting that higher expenses related to labor, freight, energy costs, equipment, and its supply chain were all affecting the company’s quarterly performance. In May, Galletti said the brand’s focus had “shifted from growth to profitability,” but by June, it received notification from Nasdaq that its stock had failed to reach the $1 per share minimum bid price required for listing on the exchange. The company was given 180 days to comply or risk delisting.
