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- Total revenue up 28% year-over-year to a first quarter record of $15.6 million
- Specialty foodservice revenue increased 69% year-over-year to a first quarter record
- Pursuing organic and non-organic initiatives to expand growth of digitally native brands on IVFH’s eCommerce platform
BONITA SPRINGS, Fla., May 17, 2022 (GLOBE NEWSWIRE) — Innovative Food Holdings, Inc. (OTCQB: IVFH) (“IVFH” or the “Company”), a leading end-to-end DTC eCommerce platform and direct-to-chef online platform that provides high-quality, unique specialty foods through eCommerce offerings and multichannel partnerships, today reported its financial results for the first quarter of 2022.
“Record first quarter sales are encouraging and reflect the benefits of our diversified revenue streams. We generated record specialty foodservice revenue driven by our nationwide direct-to-chef online program as well as strong demand from hospitality foodservice clients out of our Chicago and Pennsylvania facilities. Foodservice revenue has expanded above pre-COVID levels, as we successfully pursue growth opportunities on the back of positive market trends due to further reopening activities and we continue to leverage our platforms to provide unique high-quality specialty food offerings to chefs and other consumers across the U.S. In addition, our agile chef and consumer platforms are particularly important as we work with our customers and vendors to navigate unprecedented logistics, supply chain, and inflationary challenges,” stated Sam Klepfish, CEO of Innovative Food Holdings.
“While eCommerce sales remain above pre-COVID levels, we are not immune from the recent post-COVID challenges facing many eCommerce companies. There are significant market opportunities for companies like IVFH, which have a strong, agile and sophisticated end-to-end eCommerce platform. Our platform continues to attract experienced, talented and motivated team leaders, developing compelling partnerships, and increasing the effectiveness of our marketing initiatives to drive eCommerce sales in the coming quarters. In addition, we are pursuing additional organic and non-organic initiatives to leverage our eCommerce platform, which is supported by leading back-end logistics, fulfillment, and procurement capabilities, as well as our front-end digital infrastructure. We believe our powerful eCommerce platform is uniquely positioned to help small brands, as well as direct-to-consumer, and direct-to-chef companies navigate an increasingly complex business and eCommerce environment.”
“We believe we are well positioned for long-term sales growth driven by higher foodservice revenue as well as reaccelerating eCommerce growth. As revenues scale further, we believe we can improve profitability by enhancing gross margin and leveraging our fixed costs,” concluded Mr. Klepfish.
Financial Results
Revenues in the 2022 first quarter increased 28% to a first quarter record of $15.6 million, compared to $12.2 million for the three months ended March 31, 2021. First-quarter revenue benefited from a 69% increase in specialty foodservice revenue, which was partially driven by the nationwide opening of restaurants and other foodservice establishments previously affected by COVID-19, as well as strong increases in travel related foodservice. In addition, the Company’s unique supply chain capabilities continue to provide reliable, consistently high-quality specialty foodservice solutions for its customers. First quarter eCommerce revenue was down 28% to $3.6 from $5.0 million for the same period last year.
The following table sets forth IVFH’s revenue by business category for the three months ended March 31, 2022, and March 31, 2021 (unaudited):
| Three Months Ended | ||||||||||||||
| March 31, 2022 |
% of Net Sales |
March 31, 2021 |
% of Net Sales |
% Change |
||||||||||
| Specialty Foodservice | $ | 11,541,000 | 74 | % | $ | 6,828,000 | 56 | % | 69 | % | ||||
| E-Commerce | 3,612,000 | 23 | % | 4,980,000 | 41 | % | -28 | % | ||||||
| National Brand Management | 284,000 | 2 | % | 226,000 | 2 | % | 26 | % | ||||||
| Warehouse and Logistics Services | 206,000 | 1 | % | $ | 147,000 | 1 | % | 40 | % | |||||
| Total IVFH | $ | 15,643,000 | 100 | % | $ | 12,181,000 | 100 | % | 28 | % | ||||
For the 2022 first quarter, selling, general, and administrative (SG&A) expenses were $5.2 million, or 33% of revenue, compared to $4.9 million, or 39.8% of revenue for the same period last year. The $0.3 million increase was primarily due to increases in advertising and marketing costs, professional fees, and foodservice operating costs,
The Company recorded a GAAP net loss for the 2022 first quarter of $(1.2 million), or $(0.03) per share, compared to a GAAP net loss of $(1.8 million), or $(0.05) per share, in the prior year’s first quarter. Adjusted net income for the 2022 first quarter was a loss of $(1.4 million), or $(0.029) per share, compared to an adjusted net loss of $(1.5 million), or $(0.041) per share, for the same period last year.
Cash EBITDA, a non-GAAP metric (see tables below), for the 2022 first quarter was a loss of $(1.2 million), compared to Cash EBITDA loss of $(1.3 million) in the prior year’s first quarter.
About Innovative Food Holdings, Inc.
IVFH’s leading end-to-end direct-to-consumer e-commerce platform and direct-to-chef platform connect the world’s best artisan food makers with top chefs and epicurean consumers nationwide. Our unique ability to reach both specialty foodservice B2B customers and consumers positions IVFH as a compelling resource for artisanal food producers, CPG brands, chefs, and consumers. IVFH’s owned online retailer brands on its leading DTC e-commerce platform include www.igourmet.com and www.mouth.com.
Additional information is available at www.ivfh.com.
Forward-Looking Statements
This release contains certain forward-looking statements and information relating to Innovative Food Holdings, Inc. (the “Company”) that are based on the current beliefs of the Company’s management, as well as assumptions made by, and information currently available to, the Company. Such statements reflect the current views of the Company with respect to future events and are subject to certain assumptions, including those described in this release. Should one or more of these underlying assumptions prove incorrect, actual results may vary materially from those described herein as “should,” “could,” “will,” “anticipate,” “believe,” “intend,” “plan,” “might,” “potentially” “targeting” or “expect.” Additional factors that could also cause actual results to differ materially relate to the global COVID-19 crisis, international crisis, environmental and economic issues and other risk factors described in our public filings. The Company does not intend to update these forward-looking statements. The content of the websites referenced above are not incorporated herein.
| Innovative Food Holdings, Inc. Consolidated Balance Sheets (unaudited) |
|||||||
| March 31, | December 31, | ||||||
| 2022 | 2021 | ||||||
| (unaudited) | |||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 3,111,168 | $ | 6,122,671 | |||
| Accounts receivable, net | 3,422,003 | 3,256,764 | |||||
| Inventory | 3,209,945 | 3,109,984 | |||||
| Other current assets | 389,513 | 314,107 | |||||
| Total current assets | 10,132,629 | 12,803,526 | |||||
| Property and equipment, net | 8,094,038 | 8,186,227 | |||||
| Investments | 286,725 | 286,725 | |||||
| Right to use assets, operating leases, net | 199,474 | 232,381 | |||||
| Right to use assets, finance leases, net | 680,358 | 669,039 | |||||
| Other amortizable intangible assets, net | 61,987 | 72,218 | |||||
| Goodwill and other unamortizable intangible assets | 1,532,822 | 1,532,822 | |||||
| Total assets | $ | 20,988,033 | $ | 23,782,938 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities | |||||||
| Accounts payable and accrued liabilities | $ | 4,473,440 | $ | 5,702,905 | |||
| Accrued interest | 42,794 | 29,349 | |||||
| Deferred revenue | 1,250,944 | 1,631,406 | |||||
| Line of Credit | 2,000,000 | 2,000,000 | |||||
| Notes payable – current portion, net of discount | 412,491 | 412,961 | |||||
| Lease liability – operating leases, current | 63,361 | 74,088 | |||||
| Lease liability – finance leases, current | 182,664 | 159,823 | |||||
| Contingent liability – current portion | 187,000 | 187,000 | |||||
| Total current liabilities | 8,612,694 | 10,197,532 | |||||
| Lease liability – operating leases, non-current | 136,113 | 158,293 | |||||
| Lease liability – finance leases, non-current | 478,262 | 499,240 | |||||
| Contingent liability – long-term | 108,600 | 108,600 | |||||
| Note payable – long term portion, net | 5,319,914 | 5,409,172 | |||||
| Total liabilities | 14,655,583 | 16,372,837 | |||||
| Commitments & Contingencies (see note 16) | |||||||
| Stockholders’ equity | |||||||
| Common stock: $0.0001 par value; 500,000,000 shares authorized; 49,343,846 and 48,879,331 shares issued, and 46,506,266 and 46,041,751 shares outstanding at March 31, 2022 and December 31, 2021, respectively |
4,931 | 4,885 | |||||
| Additional paid-in capital | 41,815,390 | 41,662,710 | |||||
| Treasury stock: 2,623,171 and 2,623,171 shares outstanding at March 31, 2022 and December 31, 2021, respectively. |
(1,141,370 | ) | (1,141,370 | ) | |||
| Accumulated deficit | (34,346,501 | ) | (33,116,124 | ) | |||
| Total stockholders’ equity | 6,332,450 | 7,410,101 | |||||
| Total liabilities and stockholders’ equity | $ | 20,988,033 | $ | 23,782,938 | |||
| Innovative Food Holdings, Inc. Consolidated Statements of Operations (unaudited) |
|||||||
| For the Three | For the Three | ||||||
| Months Ended | Months Ended | ||||||
| March 31 | March 31 | ||||||
| 2022 | 2021 | ||||||
| Revenue | $ | 15,643,111 | $ | 12,180,899 | |||
| Cost of goods sold | 11,917,179 | 8,878,914 | |||||
| Gross margin | 3,725,932 | 3,301,985 | |||||
| Selling, general and administrative expenses | 5,172,426 | 4,850,828 | |||||
| Total operating expenses | 5,172,426 | 4,850,828 | |||||
| Operating loss | (1,446,494 | ) | (1,548,843 | ) | |||
| Other income (expense:) | |||||||
| Impairment of investment | – | (209,850 | ) | ||||
| Gain on interest rate swap | 294,000 | – | |||||
| Other leasing income | 5,090 | 5,140 | |||||
| Interest expense, net | (82,973 | ) | (90,318 | ) | |||
| Total other income (expense) | 216,117 | (295,028 | ) | ||||
| Net loss before taxes | (1,230,377 | ) | (1,843,871 | ) | |||
| Provision for income taxes | – | – | |||||
| Net loss | $ | (1,230,377 | ) | $ | (1,843,871 | ) | |
| Net loss per share – basic and diluted | $ | (0.03 | ) | $ | (0.05 | ) | |
| Weighted average shares outstanding – basic and diluted | 46,256,160 | 35,872,143 | |||||
| Innovative Food Holdings, Inc. Consolidated Statements of Cash Flows |
|||||||
| Three Months Ended (unaudited) |
|||||||
| March 31, 2022 |
March 31, 2021 |
||||||
| Adjusted Net Income and EPS(1) | |||||||
| Revenue | $ | 15,643,111 | $ | 12,180,899 | |||
| Net Income | (1,230,377 | ) | (1,843,871 | ) | |||
| Amortization of intangible assets(2) | 10,231 | 2,870 | |||||
| One-time charges | – | 209,850 | |||||
| One-time gain | (294,000 | ) | – | ||||
| Stock related expenses(3) | 152,726 | 157,791 | |||||
| Adjusted Net Income ( Loss) | $ | (1,361,420 | ) | $ | (1,473,360 | ) | |
| Weighted Avg. Shares Outstanding Diluted(4) | 46,256,160 | 35,872,143 | |||||
| Adjusted Fully Diluted EPS | $ | (0.029 | ) | $ | (0.041 | ) | |
| Three Months Ended (unaudited) |
|||||||
| March 31, 2022 |
March 31, 2021 |
||||||
| Cash EBITDA(1) | |||||||
| Net Income | $ | (1,230,377 | ) | $ | (1,843,871 | ) | |
| Interest expense, taxes | 77,883 | 85,178 | |||||
| Depreciation & amortization | 138,361 | 135,854 | |||||
| One-time charges | – | 209,850 | |||||
| One-time gain | (294,000 | ) | – | ||||
| Stock related expenses(3) | 152,726 | 157,791 | |||||
| Cash EBITDA | $ | (1,155,407 | ) | $ | (1,255,198 | ) | |
| (1) | Adjusted Net Income and Cash EBITDA are each 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. |
| (2) | Includes non-cash amortization charges related to assets acquired |
| (3) | Includes stock and options-based compensation and expenses |
| (4) | Full Year GAAP weighted fully diluted share count |
| Company Contact: | Investor and Media Contact: |
| Ronit Wallerstein | Andrew M. Berger |
| Investor Relations | Managing Director |
| Innovative Food Holdings, Inc. | SM Berger & Company, Inc. |
| (718) 645-1755 | (216) 464-6400 |
| rwallerstein@IVFH.com | andrew@smberger.com |
