EX-99.1 2 ivfhex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 

 

Innovative Food Holdings, Inc. Reports Financial Results for Fourth Quarter and Fiscal Year 2024

 

March 7, 2025

 

Key Fiscal Year data points:

 

●Revenue of $72.1 million, +2.5% vs. 2023

 

●Organic revenue growth (1) of +11.4% vs. 2023

 

●Gross margin declined by 85 basis points vs. 2023 to 23.4%

 

●GAAP net income (loss) from continuing operations of $2.5 million vs. ($3.7) million in 2023

 

●GAAP net income (loss) from continuing operations per fully diluted share of $0.049 vs. ($0.076) in 2023

 

●Non-GAAP adjusted net income from continuing operations of $2.1 million vs. $1.3 million in 2023

 

●Non-GAAP adjusted net income per fully diluted share of $0.041 vs. $0.027 in 2023

 

●Non-GAAP adjusted EBITDA of $3.2 million vs. $2.7 million in 2023

 

(1)Organic revenue growth excludes the impact of divestitures and acquisitions

 

BONITA SPRINGS, Fla., March 07, 2025 (GLOBE NEWSWIRE) -- Innovative Food Holdings, Inc. (OTCQB: IVFH) (“IVFH” or the “Company”), a national seller of gourmet specialty foods to professional chefs, today reported its financial results for the fourth quarter and total fiscal year ended December 31, 2024.

 

Bill Bennett, Chief Executive Officer of IVFH, remarked, “2024 marked tremendous progress against our strategic plan as we finished our first phase (stabilization) and began our second phase (building the foundation for growth). Contributing to these efforts, we brought on a new CFO, added two new large distributor partners, on-boarded a large new retail customer, and completed two new acquisitions. Additionally, we sold our headquarters building, our direct-to-consumer e-commerce businesses, and several other smaller entities. These bold moves drove a significant improvement in our financials, with revenue growing 2.5% in the face of significant divestitures. Organic revenue growth, which excludes the impact of divestitures and acquisitions, was +11.4% for the full year. GAAP net income increased by $6.2 million in 2024 to $2.5 million, and adjusted EBITDA increased 18.5% during the year to $3.2 million. This improvement occurred despite significant inventory liquidation related to our divested businesses, and material upfront startup costs related to our new retail customer. These items contributed to an 85 basis point decline in gross margin, which was offset by a reduction in SG&A spend. Excluding non-cash stock compensation and non-recurring fees, SG&A spend decreased by approximately $1.0 million in 2024, amounting to 191 basis points of revenue. This is in addition to a reduction of over $1 million in 2023. It is exciting to see the growth and earnings potential of the organization begin to shine.”

 

Key Fourth Quarter data points:

 

●Revenue of $23.0 million, +19.2% vs. Q4 2023

 

●Organic revenue growth (1) of +44.3% vs. Q4 2023

 

●Gross margin declined by 235 basis points vs. Q4 2023 to 20.9%

 

●GAAP net income (loss) from continuing operations of ($0.2) million vs. ($1.4) million in Q4 2023

 

●GAAP net income (loss) from continuing operations per fully diluted share of ($0.001) vs. ($0.034) in Q4 2023

 

●Non-GAAP adjusted net income from continuing operations of $618 thousand vs. $197 thousand in Q4 2023

 

●Non-GAAP adjusted net income per fully diluted share of $0.012 vs. $0.004 in Q4 2023

 

●Non-GAAP adjusted EBITDA of $880 thousand vs. $559 thousand in Q4 2023

 

●Completed acquisition of Denver-based Golden Organics and Fort Collins-based LoCo Food Distribution

 

●New retail sales channel generated $5.3 million in revenue

 

●New acquisitions contributed $838 thousand in revenue

 

(1)Organic revenue growth excludes the impact of divestitures and acquisitions

 

 

Mr. Bennett continued, “Q4 2024 represented the first quarter of the ramp up of our new retail customer, as well as six weeks of contribution from our new Golden Organics business, and one week from our new LoCo Foods Distribution business. While revenue grew 19.2% compared to last year, organic revenue growth, which excludes the impact of divestitures and acquisitions, was an impressive 44.3% despite continued softness in our business with our largest drop ship customer. The new retail customer accounted for 79% of the increase in organic revenue. Despite a 235 basis point decline in our total company gross margin rate, gross margin dollars rose by $0.3 million on an additional $3.7 million in revenue. Excluding non-cash stock compensation and non-recurring fees, SG&A spend increased by $86 thousand, with SG&A as a percentage of revenue improving by 377 basis points. We are pleased with this performance, as we effectively managed expenses while significantly increasing growth-related spending compared to the same period last year. GAAP Net Income improved by $1.2 million vs. Q4 2023. Adjusted EBITDA improved by $321 thousand vs. Q4 2023 to $880 thousand in Q4 2024, despite the profit headwind of approximately $700 thousand driven by the ramp up of the retail business.”

 

Mr. Bennett added, “We’re very pleased to see our new growth businesses and acquisitions begin to materialize this quarter and demonstrate the growth potential of the Company. We also continue to see strong growth with our new national distributor partner announced last Spring, triple-digit growth in our Amazon sales channel, double-digit growth in our airline catering business, and double-digit growth in our Chicago Artisan business. In fact, we are continuing to experience greater than 25% organic growth in the first quarter-to-date of 2025. We’re also thrilled to have recently announced in Q1 of 2025 that the large retail customer we on-boarded in 2024 has expanded their program with us, and that we won a first-class custom cheese program with an international airline, which represents a new line of business for us.”

 

“The Company has 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 focused on driving long-term shareholder value,” concluded Mr. Bennett.

 

Conference Call

 

The Company’s management will hold an investor call on March 7, 2025 at 10:00 am Eastern Time to discuss the Company’s results for the quarter and year ended December 31, 2024. At the end of the meeting, the Company will host a question-and-answer session with investors. All interested participants may attend the call on the web or by phone. The Company encourages those who wish to ask questions to join the call virtually through Zoom, rather than on the phone, as Zoom’s “raise hand” feature makes it easier for management to identify questioners. Details for the meeting are as follows:

 

Join Zoom Meeting
https://us02web.zoom.us/j/84531400931?pwd=OxjOExa1VI0lDeGIzxplrD7iFwAIGX.1

 

Meeting ID: 845 3140 0931
Passcode: 000164

 

One tap mobile
+12532158782,,84531400931# US

 

About Innovative Food Holdings, Inc.

 

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 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 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, including those related to the Company’s growth plans, 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, which include words such as “should,” “could,” “will,” “anticipate,” “believe,” “intend,” “plan,” “might,” “potentially” “targeting” or “expect”, or similar expressions. Additional factors that could also cause actual results to differ materially relate to current conditions and expected future developments, international crises, environmental and economic issues and other risk factors described in the Company’s public filings. As a result, readers are cautioned not to place undue reliance on these forward-looking statements and should understand that these statements are not guarantees of performance or results and that there are a number of risks, uncertainties and other important factors, many of which are beyond the Company’s control, that could cause the Company’s actual results to differ materially from those expressed in these statements, including, among others: economic factors affecting consumer confidence and discretionary spending; cost inflation/deflation and commodity volatility; competition; reliance on third party suppliers and interruption of product supply or increases in product costs; and changes in the Company’s relationships with vendors and customers. The Company does not intend to update these forward-looking statements.

 

For a detailed discussion of these risks, uncertainties and other factors that could cause the Company’s actual results to differ materially from those anticipated or expressed in any forward-looking statements, see the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (“SEC”). Additional risks and uncertainties are discussed from time to time in current, quarterly and annual reports filed by the Company with the SEC, which are available on the SEC’s website at https://www.sec.gov/.

 

Investor and Media contact:

 

Gary Schubert
Chief Financial Officer
Innovative Food Holdings, inc.
[email protected]

 

2

 

Innovative Food Holdings, Inc.
Consolidated Balance Sheets
(unaudited)

 

   December 31,   December 31, 
   2024   2023 
ASSETS        
Current assets        
Cash and cash equivalents  $2,330,880   $5,235,102 
Accounts receivable, net   9,039,232    4,298,435 
Inventory, net   6,290,488    2,962,191 
Other current assets   238,526    287,528 
Assets held for sale   5,941,933    649,884 
Current assets - discontinued operations   49,315    208,009 
Total current assets   23,890,374    13,641,149 
           
Property and equipment, net   1,584,878    7,000,015 
Right of use assets, operating leases, net   705,476    28,519 
Right of use assets, finance leases, net   524,273    436,403 
Amortizable intangible assets, net   424,372    - 
Tradenames and other unamortizable intangible assets   217,000    217,000 
Total assets  $27,346,373   $21,323,086 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities          
Accounts payable and accrued liabilities  $6,653,622   $6,005,512 
Accrued separation costs, related parties, current portion   334,532    463,911 
Accrued interest   91,347    95,942 
Deferred revenue   349,600    1,014,847 
Stock appreciation rights liability   1,353,150    255,020 
Notes payable - current portion   190,052    121,041 
Lease liability - operating leases, current   239,660    17,131 
Lease liability - finance leases, current   147,797    115,738 
Contingent liability, current   54,430    - 
Current liabilities - discontinued operations   -    551,851 
Total current liabilities   9,414,190    8,640,993 
           
Note payable, net of discount   8,692,674    8,855,000 
Accrued separation costs, related parties, non-current   457,692    791,025 
Lease liability - operating leases, non-current   467,569    11,388 
Lease liability - finance leases, non-current   139,591    219,266 
Total liabilities   19,171,716    18,517,672 
           
Commitments & Contingencies          
Stockholders’ equity          
Common stock: $0.0001 par value; 500,000,000 shares authorized; 56,733,828 and 52,538,100 shares issued, and 53,889,531 and 49,714,929 shares outstanding at December 31, 2024 and December 31, 2023, respectively   5,670    5,251 
Additional paid-in capital   45,520,123    42,762,811 
Treasury stock: 2,644,297 and 2,623,171 shares outstanding at December 31, 2024 and 2023, respectively   (1,141,372)   (1,141,370)
Accumulated deficit   (36,209,764)   (38,821,278)
Total stockholders’ equity   8,174,657    2,805,414 
Total liabilities and stockholders’ equity  $27,346,373   $21,323,086 

 

3

 

Innovative Food Holdings, Inc.
Consolidated Statements of Operations
(unaudited)

 

    For the Twelve    For the Twelve 
    Months Ended    Months Ended 
    December 31,   December 31, 
   2024   2023 
Revenue  $72,134,376   $70,388,962 
Cost of goods sold   55,280,668    53,347,220 
Gross margin   16,853,708    17,041,742 
           
Selling, general and administrative expenses   16,314,986    16,720,523 
Separation costs - executive officers   -    2,074,063 
Impairment of intangible assets   -    1,055,400 
Total operating expenses   16,314,986    19,849,986 
           
Operating income (loss)   538,722    (2,808,244)
           
Other income (expense)          
Interest expense, net   (849,581)   (876,452)
Gain on sale of assets   2,816,616    9,360 
Gain (loss) on sale of subsidiary   21,126    (45,022)
Other income   -    14,925 
Other leasing income   5,700    7,600 
Total other income (expense)   1,993,861    (889,589)
           
Net income (loss) before taxes   2,532,583    (3,697,833)
           
Income tax expense   -    15,834 
           
Net income (loss) from continuing operations  $2,532,583   $(3,713,667)
           
Net income (loss) from discontinued operations  $78,931   $(641,485)
           
Consolidated net income (loss)  $2,611,514   $(4,355,152)
           
Net income (loss) per share from continuing operations – basic  $0.05   $(0.08)
           
Net income (loss) per share from continuing operations – diluted  $0.05   $(0.08)
           
Net (loss) per share from discontinued operations – basic  $0.01   $(0.01)
           
Net (loss) per share from discontinued operations – diluted  $0.01   $(0.01)
           
Weighted average shares outstanding – basic   50,563,992    49,076,880 
           
Weighted average shares outstanding – diluted   50,577,847    49,076,880 

 

4

 

Innovative Food Holdings, Inc.
Consolidated Statements of Cash Flows
(unaudited)

 

    For the Twelve    For the Twelve 
   Months Ended   Months Ended 
   December 31,   December 31, 
   2024   2023 
Cash flows used in operating activities:        
Net income (loss)  $2,611,514   $(4,355,152)
Adjustments to reconcile net income (loss) to net cash used in operating activities:          
Gain on disposition of assets   (2,816,616)   (9,360)
(Gain) Loss on sale of subsidiaries   (21,126)   45,022 
Impairment of intangible assets   -    1,315,822 
Amortization of intangible assets   7,193    - 
Depreciation and amortization   265,891    557,268 
Allowance for slow moving and obsolete inventory   -    189,582 
Amortization of right of use asset   54,609    51,756 
Amortization of prepaid loan fees   -    3,297 
Amortization of discount on notes payable   5,136      
Stock based compensation   437,339    405,503 
Value of stock appreciation rights   1,098,130    255,020 
Provision for doubtful accounts   4,599    73,330 
           
Changes in assets and liabilities:          
Accounts receivable, net   (3,826,006)   479,247 
Inventory and other current assets, net   (1,936,193)   (135,593)
Accounts payable and accrued liabilities   (850,125)   (439,336)
Accrued separation costs - related parties   (462,713)   1,422,937 
Deferred revenue   (790,769)   (243,149)
Operating lease liability   (52,856)   (51,756)
Net cash used in operating activities   (6,271,993)   (435,562)
           
Cash flows from investing activities:          
Cash paid for acquisition of Golden Organics   (1,231,379)   - 
Cash received in acquisition of LoCo Foods   42,000    - 
Acquisition of property and equipment   (316,567)   (122,403)
Cash received from sale of subsidiaries   -    75,000 
Cash received from disposition of asset, net of loan payoff   2,101,185    11,071 
Cash received from disposition of intangible assets, net of costs   617,000    - 
Net cash provided by (used in) investing activities   1,212,239    (36,332)
           
Cash flows from financing activities:          
Cash received from sale of common stock, net of costs   3,250,000    - 
Cash received from notes payable, net of costs   -    3,285,588 
Payment for taxes related to net share settlement of equity awards, net   (908,484)   - 
Principal payments on debt   (95,546)   (187,611)
Principal payments financing leases   (228,356)   (88,813)
Principal payments on line of credit   -    (2,014,333)
Net cash provided by financing activities   2,017,614    994,831 
           
Decrease in cash and cash equivalents   (3,042,140)   522,937 
           
Cash and cash equivalents at beginning of period   5,422,335    4,899,398 
           
Cash and cash equivalents at end of period - continuing operations  $2,330,880   $5,327,016 
Cash and cash equivalents at end of period - discontinued operations  $49,315   $95,319 
Cash and cash equivalents at end of period  $2,380,195   $5,422,335 
           
Supplemental disclosure of cash flow information:          
Cash paid during the period for:          
Interest  $896,709   $802,076 
           
Taxes  $-   $- 
           
Non-cash investing and financing activities:          
Reclassify fixed assets as held for sale  $5,941,933   $- 
Debt to Fifth Third Bank paid directly by Maple Mark Bank  $353,815   $- 
Issuance of common stock for severance agreement previously accrued  $-   $168,000 
Par value of shares issued, previously accrued  $-   $87 
Reclassify fixed assets as held for sale  $5,941,933   $649,984 
Issuance of stock for cashless exercise of options  $2   $- 

 

5

 

Innovative Food Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Measures
Adjusted EBITDA Calculations
(unaudited)

 

 

   Q4 2024    Q4 2023    2024 Full Year   2023 Full Year 
Net Income (Loss) From Continuing Operations (GAAP)  $(201,241)  $(1,402,928)  $2,532,583   $(3,697,833)
Depreciation & Amortization (1)  $61,596   $128,220   $273,084   $557,268 
Interest expense – net  $207,369   $233,097   $849,581   $876,452 
Income tax provision  $-   $-   $-   $15,834 
EBITDA (Non-GAAP) (2)  $67,724   $(1,041,611)  $3,655,248   $(2,248,279)
Adjustments:                    
Separation Costs  $60,000   $203,272   $128,791   $2,174,007 
Impairment of Tradenames - igourmet & Mouth  $-   $1,055,400   $-   $1,055,400 
Unaccrued 2022 Leadership Bonus’ Expensed & Paid in 2023  $-   $-   $-   $125,923 
Other Restructuring Costs  $203,000   $233,611   $388,087   $846,943 
Stock Compensation Expense (3)  $679,478   $57,591   $1,469,412   $658,481 
Legal Fees - JIT Lawsuit  $-   $14,576   $26,325   $91,052 
(Gain) / Loss on Sale of Subsidiaries  $-   $45,022   $(21,126)  $45,022 
Other Legal & Transactional  $44,096   $-   $268,023   $- 
Commission on Sale of Asset  $-   $-   $247,300   $- 
(Gain) on sale of assets  $(174,637)  $(9,361)  $(2,816,616)  $(9,360)
Adjusted EBITDA(Non-GAAP) (4)  $879,661   $558,501   $3,245,443   $2,739,189 
Adjustments:                    
Depreciation  $(54,403)  $(128,220)  $(265,891)  $(526,274)
Interest expense – net  $(207,369)  $(233,097)  $(849,581)  $(876,452)
Income tax provision  $-   $-   $-   $(15,834)
Adjusted Net Income (Non-GAAP) (5)  $617,889   $197,184   $2,129,971   $1,320,629 
                     
Adjusted Diluted EPS (Non-GAAP)  $0.012   $0.004   $0.041   $0.027 
                     
Weighted-average diluted shares outstanding (Non-GAAP) (6)   51,833,213    49,577,983    51,847,068    49,076,880 

  

   Q4 2024   Q4 2023     2024 Full Year   2023 Full Year 
Revenue (GAAP)  $23,003,336   $19,301,245   $72,134,376   $70,388,962 
Gross profit (GAAP)  $4,797,640   $4,479,903   $16,853,708   $17,041,742 
Inventory Reserve  $203,000   $-   $332,287   $- 
Adjusted Gross profit (Non-GAAP) (7)  $5,000,640   $4,479,903   $17,185,995   $17,041,742 
Adjusted Gross profit margin % (Non-GAAP)   21.74%   23.21%   23.82%   24.21%

 

   Q4 2024   Q4 2023   2024 Full Year   2023 Full Year 
Adjusted EBITDA(Non-GAAP) (4)  $879,661   $558,501   $3,245,443   $2,739,189 
Interest Expense -net  $(207,369)  $(233,097)  $(849,581)  $(876,452)
Income Tax Expense - net  $-   $-   $-   $(15,834)
Maintenance Capital Expenditures (8)  $(3,404)  $(55,856)  $(10,773)  $(108,488)
Adjusted Free Cash Flow (Non-GAAP) (9)  $668,888   $269,548   $2,385,089   $1,738,414 

 

(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.

 

6

 

(4)Adjusted EBITDA is a non-GAAP metric. Management believes that the presentation of Adjusted EBITDA and other 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 Gross profit is gross profit adjusted to remove the impact of inventory reserve adjustments or non-recurring inventory related gains or losses.

 

(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.

 

7