Key first quarter data points:
- Revenue of
$15.7 million , -5.7% vs. Q1 2023 - Specialty Foodservice revenue +1.4% vs. Q1 2023, accelerating from -13.6% trend in Q4
- Gross margin improved by 174 basis points to 24.4% vs. Q1 2023
- GAAP net income from continuing operations of
$1.4 million , compared to a Q1 2023 loss of ($2.8 million ) - GAAP net income from continuing operations per fully diluted share of
$0.028 vs. Q1 2023 of ($0.060 ) - Adjusted net income from continuing operations of
$155K , compared to Q1 2023 of ($509K ) – an improvement of$665K , and the first profitable Q1 on an adjusted basis in five years - Adjusted net income per fully diluted share of
$0.003 , compared to an adjusted net loss per fully diluted share in Q1 2023 of ($0.011 ) - Adjusted EBITDA of
$481K , compared to ($202K ) in Q1 2023, an improvement of$683K - Sale of
Bonita Springs building netted the company$1.9 million in cash
“During the past twelve months as my tenure as CEO has progressed, my confidence in the opportunity that lies ahead for IVFH continues to increase. We have a solid foundation, a passionate and committed team, and an industry with tremendous long-term potential. We recognize the importance of maintaining a laser focus on our top priorities in a complex economic environment to create a robust, profitable, and sustainable business model. As we navigate the ever-changing landscape of the food industry, we believe in our ability to adapt, innovate, and capitalize on opportunities that will hopefully drive long-term shareholder value,” concluded
Financial Results
Revenues in the first quarter of 2024 decreased 5.7% to
The following table sets forth IVFH’s revenue by business category for the quarter ended
Year Ended | |||||||||||||
2024 | % of Net Sales | 2023 | % of Net Sales | % Change | |||||||||
Specialty Foodservice | 13,993,565 | 89.0 | % | 13,804,785 | 82.8 | % | 1.4 | % | |||||
E-Commerce | 1,528,337 | 9.7 | % | 2,621,405 | 15.7 | % | -41.7 | % | |||||
Logistics | 208,211 | 1.3 | % | 248,569 | 1.5 | % | -16.2 | % | |||||
Total IVFH | 15,730,113 | 100 | % | 16,674,759 | 100 | % | -5.7 | % |
During the first quarter of 2024, the company drove an increase in its gross margin as a percentage of sales, rising to 24.4% from 22.6% in the same period the previous year. This upward trend can be attributed to two main strategic decisions: first, the company’s ongoing efforts to manage prices in the specialty foodservice business; second, the decision to cease using a higher-cost shipping provider. These factors were instrumental in driving this positive change.
Selling, general, and administrative (“SG&A”) expenses were
The Company recorded GAAP net income from continuing operations for the 2024 first quarter of
Adjusted Net Income, a non-GAAP metric (see tables below), for the 2024 first quarter was
Adjusted EBITDA, a non-GAAP metric (see tables below), for the 2024 first quarter was
Adjusted Free Cash Flow, a non-GAAP metric (see tables below), for the 2024 first quarter was
Conference Call
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About
At IVFH, we help make meals special. We provide access to foods that are hard to find, have a compelling story, or are on the forefront of food trends. Our gourmet foods marketplace connects the world’s best artisan food makers with top professional chefs nationwide. We curate the assortment, experience, and tech enabled tools that help our professional and home chefs create unforgettable experiences for their guests. Additional information is available at www.ivfh.com.
Forward-Looking Statements
This release contains certain forward-looking statements and information relating to
Investor and Media contact:
Chief Financial Officer
investorrelations@ivfh.com
Consolidated Balance Sheets | |||||||
2024 | 2023 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 4,272,243 | $ | 5,327,016 | |||
Accounts receivable, net | 4,109,274 | 4,307,726 | |||||
Inventory | 2,840,682 | 2,973,134 | |||||
Other current assets | 348,926 | 287,528 | |||||
Assets held for sale | 5,941,933 | 649,884 | |||||
Current assets - discontinued operations | 20,649 | 95,861 | |||||
Total current assets | 17,533,707 | 13,641,149 | |||||
Property and equipment, net | 974,143 | 7,000,015 | |||||
Right of use assets, operating leases, net | 24,344 | 28,519 | |||||
Right of use assets, finance leases, net | 411,488 | 436,403 | |||||
Tradenames and other unamortizable intangible assets | 217,000 | 217,000 | |||||
Total assets | $ | 19,160,682 | $ | 21,323,086 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities | |||||||
Accounts payable and accrued liabilities | $ | 3,111,671 | 6,252,951 | ||||
Accrued separation costs, related parties, current portion | 418,635 | 463,911 | |||||
Accrued interest | 93,829 | 95,942 | |||||
Deferred revenue | 1,227,936 | 1,312,837 | |||||
Stock appreciation rights liability | 373,918 | 255,020 | |||||
Notes payable - current portion | 100,237 | 121,041 | |||||
Lease liability - operating leases, current | 17,422 | 17,131 | |||||
Lease liability - finance leases, current | 136,096 | 115,738 | |||||
Current liabilities - discontinued operations | 2,522 | 6,422 | |||||
Total current liabilities | 5,482,266 | 8,640,993 | |||||
Note payable, net of discount | 8,501,474 | 8,855,000 | |||||
Accrued separation costs, related parties, non-current | 707,692 | 791,025 | |||||
Lease liability - operating leases, non-current | 6,922 | 11,388 | |||||
Lease liability - finance leases, non-current | 148,931 | 219,266 | |||||
Total liabilities | 14,847,285 | 18,517,672 | |||||
Commitments & Contingencies (see note 18) | |||||||
Stockholders' equity | |||||||
Common stock: | 5,249 | 5,251 | |||||
Additional paid-in capital | 42,844,922 | 42,762,811 | |||||
(1,141,370 | ) | (1,141,370 | ) | ||||
Accumulated deficit | (37,395,404 | ) | (38,821,278 | ) | |||
Total stockholders' equity | 4,313,397 | 2,805,414 | |||||
Total liabilities and stockholders' equity | $ | 19,160,682 | $ | 21,323,086 |
Consolidated Statements of Operations | |||||||
For the Three | For the Three | ||||||
Months Ended | Months Ended | ||||||
2024 | 2023 | ||||||
(unaudited) | (unaudited) | ||||||
Revenue | 15,730,113 | 16,674,759 | |||||
Cost of goods sold | 11,895,799 | 12,900,609 | |||||
Gross margin | 3,834,314 | 3,774,150 | |||||
Selling, general and administrative expenses | 4,013,427 | 4,444,394 | |||||
Separation costs - executive officers | - | 1,945,650 | |||||
Total operating expenses | 4,013,427 | 6,390,044 | |||||
Operating (loss) | (179,113 | ) | (2,615,894 | ) | |||
Other income (expense): | |||||||
Interest expense, net | (215,450 | ) | (172,721 | ) | |||
Gain on sale of assets | 1,807,516 | - | |||||
Gain on sale of subsidiary | 21,126 | - | |||||
Other leasing income | 1,900 | 1,900 | |||||
Total other income (expense) | 1,615,092 | (170,821 | ) | ||||
Net income (loss) before taxes | 1,435,979 | (2,786,715 | ) | ||||
Income tax expense | - | - | |||||
Net income (loss) from continuing operations | $ | 1,435,979 | $ | (2,786,715 | ) | ||
Net (loss) from discontinued operations | $ | (10,105 | ) | $ | (42,051 | ) | |
Consolidated net income (loss) | $ | 1,425,874 | $ | (2,828,766 | ) | ||
Net income (loss) per share from continuing operations - basic | $ | 0.029 | $ | (0.06 | ) | ||
Net income (loss) per share from continuing operations - diluted | $ | 0.028 | $ | (0.06 | ) | ||
Net income (loss) per share from discontinued operations - basic | $ | (0.00 | ) | $ | (0.00 | ) | |
Net income (loss) per share from discontinued operations - diluted | $ | (0.00 | ) | $ | (0.00 | ) | |
Weighted average shares outstanding – basic | 49,707,036 | 48,462,234 | |||||
Weighted average shares outstanding – diluted | 50,603,891 | 48,462,234 |
Consolidated Statements of Cash Flows | |||||||
For the Three | For the Three | ||||||
Months Ended | Months Ended | ||||||
2024 | 2023 | ||||||
(unaudited) | (unaudited) | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | 1,425,874 | $ | (2,828,766 | ) | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||
Gain on disposition of asset | (1,807,516 | ) | - | ||||
Gain on sale of subsidiary | (21,126 | ) | - | ||||
Depreciation and amortization | 110,260 | 145,387 | |||||
Amortization of right of use asset | 4,175 | 16,314 | |||||
Amortization of discount on notes payable | 1,283 | - | |||||
Stock based compensation | 103,235 | 178,048 | |||||
Loss on value of stock appreciation rights | 118,898 | - | |||||
Provision for doubtful accounts | 22,882 | 4,666 | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable, net | 175,436 | 135,020 | |||||
Inventory and other current assets, net | 71,054 | (51,038 | ) | ||||
Accounts payable and accrued liabilities | (3,144,335 | ) | (2,056,459 | ) | |||
Accrued separation costs - related parties | (128,610 | ) | 1,600,795 | ||||
Deferred revenue | (84,548 | ) | (319,365 | ) | |||
Operating lease liability | (4,175 | ) | (16,314 | ) | |||
Net cash used in operating activities | (3,157,213 | ) | (3,191,712 | ) | |||
Cash flows from investing activities: | |||||||
Acquisition of property and equipment | (1,406 | ) | (7,995 | ) | |||
Cash received from disposition of asset, net of loan payoff | 2,101,185 | - | |||||
Net cash from (used in) investing activities | 2,099,779 | (7,995 | ) | ||||
Cash flows from financing activities: | |||||||
Principal payments on debt | (22,708 | ) | (2,757 | ) | |||
Principal payments financing leases | (49,977 | ) | (46,807 | ) | |||
Net cash (used in) financing activities | (72,685 | ) | (49,564 | ) | |||
Decrease in cash and cash equivalents | (1,130,119 | ) | (3,249,271 | ) | |||
Cash and cash equivalents at beginning of period | 5,422,335 | 4,899,398 | |||||
Cash and cash equivalents at end of period - continuing operations | $ | 4,272,243 | $ | 1,435,561 | |||
Cash and cash equivalents at end of period - discontinued operations | $ | 19,973 | $ | 214,566 | |||
Cash and cash equivalents at end of period | $ | 4,292,216 | $ | 1,650,127 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid during the period for: | |||||||
Interest | $ | 228,970 | $ | 174,410 | |||
Taxes | $ | - | $ | - | |||
Non-cash investing and financing activities: | |||||||
None. | |||||||
Reclassify fixed assets as held for sale | $ | 5,941,933 | $ | - | |||
Principal and accrued interest paid from escrow to | $ | 353,815 | $ | - | |||
Reconciliation of GAAP to Non-GAAP Measures Adjusted EBITDA Calculations (unaudited, except share and per share amounts) | |||||||
Q1 2024 | Q1 2023 | ||||||
Net Income (Loss) From Continuing Operations (GAAP) | $ | 1,435,979 | $ | (2,786,713 | ) | ||
Depreciation & Amortization (1) | $ | 110,260 | $ | 145,387 | |||
Interest expense – net | $ | 215,450 | $ | 172,721 | |||
EBITDA (Non-GAAP) (2) | $ | 1,761,689 | $ | (2,468,605 | ) | ||
Adjustments: | |||||||
Separation Costs | $ | 68,791 | $ | 1,952,060 | |||
Unaccrued 2022 Leadership Bonus Expensed & Paid in 2023 | $ | - | $ | 25,000 | |||
Other Restructuring Costs | $ | 48,200 | $ | 87,725 | |||
Stock Compensation Expense (3) | $ | 222,133 | $ | 178,033 | |||
Legal Fees - JIT Lawsuit | $ | 24,515 | $ | 24,192 | |||
Gain on Sale of Subsidiaries | $ | (21,126 | ) | $ | - | ||
Other Legal | $ | 37,159 | $ | - | |||
$ | 147,300 | $ | - | ||||
Gain on sale of assets | $ | (1,807,516 | ) | $ | - | ||
Adjusted EBITDA (Non-GAAP) (4) | $ | 481,147 | $ | (201,594 | ) | ||
Adjustments: | |||||||
Depreciation | $ | (110,260 | ) | $ | (135,055 | ) | |
Interest expense - net | $ | (215,450 | ) | $ | (172,721 | ) | |
Adjusted Net Income (Non-GAAP) (5) | $ | 155,435 | $ | (509,370 | ) | ||
Adjusted Diluted EPS (Non-GAAP) | $ | 0.003 | $ | (0.011 | ) | ||
Weighted-average diluted shares outstanding (6) | 49,707,036 | 48,462,234 |
Q1 2024 | Q1 2023 | ||||||
Revenue (GAAP) | $ | 15,730,113 | $ | 16,674,759 | |||
Gross profit (GAAP) | $ | 3,834,314 | $ | 3,774,150 | |||
Adjusted Gross profit margin % (Non-GAAP) | 24.38 | % | 22.63 | % |
Q1 2024 | Q1 2023 | ||||||
Adjusted EBITDA (Non-GAAP) (4) | $ | 481,147 | $ | (201,594 | ) | ||
Interest Expense -net | $ | (215,450 | ) | $ | (172,721 | ) | |
Maintenance Capital Expenditures (8) | $ | (1,406 | ) | $ | (7,995 | ) | |
Adjusted Free Cash Flow (Non-GAAP) (9) | $ | 264,291 | $ | (382,310 | ) |
(1) | Includes non-cash depreciation and amortization charges. |
(2) | Earnings before interest, taxes, depreciation, and amortization |
(3) | Includes stock and options-based compensation and expenses. |
(4) | Adjusted EBITDA is a non-GAAP metric. Management believes that the presentation of these non-GAAP financial measures provides useful information to investors because the information may allow investors to better evaluate ongoing business performance and certain components of the Company’s results. In addition, the Company believes that the presentation of these financial measures enhances an investor’s ability to make period-to-period comparisons of the Company’s operating results. This information should be considered in addition to the results presented in accordance with GAAP, and should not be considered a substitute for the GAAP results. |
(5) | Adjusted Net Income accounts for the impact of non-core expenses including addback for one-time organizational restructure expenses, gains or losses on sale of assets or subsidiaries, tradename impairments, amortization expense, expense on the extinguishment of debt, and stock related expenses in both 2024 and 2023 |
(6) | GAAP weighted average shares outstanding. |
(7) | Adjusted Free Cash Flow is defined as Adjusted EBITDA minus interest expense, minus income tax expense, minus capital expenditures. The company believes adjusted free cash flow is useful to investors in understanding how existing cash flow from operations before working capital changes and non-recurring items is utilized as a source of maintaining our business and for growth. Adjusted Free Cash Flow is not a measure of cash available for discretionary expenditures since the company has certain non-discretionary obligations that were not deducted from the measure. |
(8) | Maintenance Capital Expenditures is a component of “Acquisition of property and equipment (GAAP)” on the consolidated statement of cash flows. It represents management’s assumptions of capital spending to maintain the company’s current level of operations. It does not include expenditures on acquisitions (less cash acquired), nor does it include other capital expenditures made to fund growth of the current business. |
(9) | Adjusted Free Cash Flow is defined as Adjusted EBITDA less interest expense, income tax expense, and maintenance capital expenditures. The company believes adjusted free cash flow is useful to investors in understanding how existing cash flow from operations before working capital changes and non-recurring items after maintenance capital expenditures (which we believe the best proxy for over time is Adjusted EBITDA less interest expense, income tax expense, and maintenance capital expenditures) is utilized as a source of growing our business. Adjusted Free Cash Flow is not a measure of cash available for discretionary expenditures since the company has certain non-discretionary obligations that were not deducted from the measure. |
Source:
2024 GlobeNewswire, Inc., source