Where Food Comes From, Inc. Reports 2024 First Quarter Financial Results
02 Mayo 2024 - 8:00AM
Where Food Comes From, Inc. (WFCF) (Nasdaq: WFCF), the most trusted
resource for independent, third-party verification of food
production practices in North America, today announced financial
results for its first quarter ended March 31, 2024.
“Despite the lingering impact of drought conditions resulting in
smaller herd sizes, we reported solid first quarter results,
highlighted by 17% growth in core verification revenue and 47%
growth in net income year over year,” said John Saunders, chairman
and CEO. “Our ability to continue delivering profitable growth in
the face of persistent headwinds is a testament to the durability
and resiliency of our business model, which is predicated on having
the industry’s deepest solutions portfolio that helps to limit our
downside when one or more market segment we serve comes under
pressure. We continue to invest in new service offerings to further
strengthen our solutions set as evidenced by our December purchase
of Upcycled Certified®, a program addressing rapidly growing demand
for upcycled food products. We also continued to return value to
our shareholders in the form of stock repurchases, which totaled
more than 116,000 shares in the first quarter, raising to nearly
$11.0 million the total value returned to shareholders via buybacks
and a special dividend over the past 13 quarters.”
First Quarter Results – 2024 vs. 2023Total
revenue in the first quarter ended March 31, 2024, increased 6% to
$5.6 million from $5.3 million.
Revenue mix included:
- Verification and certification services, up 17% to $4.4 million
from $3.8 million.
- Product revenue, down 25% to $0.7 million from $1.0
million.
- Professional services revenue of $0.4 million vs. $0.5
million.
Gross profit in the third quarter increased 9% to $2.3 million
from $2.1 million.
Selling, general and administrative expense increased slightly
to $2.1 million from $2.0 million.
Operating income was 68% higher at $261,000 vs. $155,000.
Net income increased 47% to $178,000, or $0.03 per diluted
share, from $121,000, or $0.02 per diluted share.
Adjusted EBITDA in the first quarter increased 8% to $432,000
from $399,000.
Cash provided by operations in the first quarter increased 48%
to $0.7 million from $0.5 million.
The Company bought back 116,072 shares of its common stock
during the first quarter at a cost of $1.5 million.
Management will conduct a conference call today at 10:00 a.m.
Mountain Time to discuss these financial results.
Dial-in numbers for the conference
call:Domestic Toll Free: 1-877-407-8289International:
1-201-689-8341Conference Code: 13746431
Phone replay:A telephone replay
of the conference call will be available through May 16, 2024, as
follows:Domestic Toll Free: 1-877-660-6853International:
1-201-612-7415Conference Code: 13746431
About Where Food Comes From, Inc.Where Food
Comes From, Inc. is America’s trusted resource for third party
verification of food production practices. Through proprietary
technology and patented business processes, the Company
estimates that it supports more than 17,500 farmers, ranchers,
vineyards, wineries, processors, retailers, distributors, trade
associations, consumer brands and restaurants with a wide variety
of value-added services. Through its IMI Global, Validus
Verification Services, SureHarvest, WFCF Organic, and Postelsia
units, Where Food Comes From solutions are used to verify food
claims, optimize production practices and enable food supply chains
with analytics and data driven insights. In addition, the
Company’s Where Food Comes From® retail and restaurant labeling
program uses web-based customer education tools to connect
consumers to the sources of the food they purchase, increasing
meaningful consumer engagement for our clients.
*Note on non-GAAP Financial Measures This press
release and the accompanying tables include a discussion of EBITDA
and Adjusted EBITDA, which are non-GAAP financial measures provided
as a complement to the results provided in accordance with
generally accepted accounting principles ("GAAP"). The term
"EBITDA" refers to a financial measure that we define as earnings
(net income or loss) plus or minus net interest plus taxes,
depreciation and amortization. Adjusted EBITDA excludes from EBITDA
stock-based compensation and, when appropriate, other items that
management does not utilize in assessing WFCF’s operating
performance (as further described in the attached financial
schedules). None of these non-GAAP financial measures are
recognized terms under GAAP and do not purport to be an alternative
to net income as an indicator of operating performance or any other
GAAP measure. We have reconciled Adjusted EBITDA to GAAP net income
in the Consolidated Statements of Income table at the end of this
release. We intend to continue to provide these non-GAAP financial
measures as part of our future earnings discussions and, therefore,
the inclusion of these non-GAAP financial measures will provide
consistency in our financial reporting.
CAUTIONARY STATEMENT
This news release contains "forward-looking
statements" within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995, based on current expectations,
estimates and projections that are subject to risk. Forward-looking
statements are inherently uncertain, and actual events could differ
materially from the Company’s predictions. Important factors that
could cause actual events to vary from predictions include those
discussed in our SEC filings. Specifically, statements in this news
release about industry leadership, expectations for offsetting
industry headwinds, ability to continue expanding on the solutions
set, widening the competitive moat and providing customers with
convenience and price advantages, and demand for, and impact and
efficacy of, the Company’s products and services on the marketplace
are forward-looking statements that are subject to a variety of
factors, including availability of capital, personnel and other
resources; competition; governmental regulation of the agricultural
industry; the market for beef and other commodities; and other
factors. Financial results and the Company’s pace of stock buybacks
are not necessarily indicative of future results. Readers should
not place undue reliance on these forward-looking statements. The
Company assumes no obligation to update its forward-looking
statements to reflect new information or developments. For a more
extensive discussion of the Company’s business, please refer to the
Company’s SEC filings at www.sec.gov.
Company Contacts:
John SaundersChief Executive Officer303-895-3002
Jay PfeifferDirector, Investor
Relations303-880-9000jpfeiffer@wherefoodcomesfrom.com
Where Food Comes From, Inc. |
|
|
|
Statements of Income (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, |
(Amounts in thousands, except per share amounts) |
|
2024 |
|
|
|
2023 |
|
Revenues: |
|
|
|
|
Verification and certification service revenue |
$ |
4,434 |
|
|
$ |
3,806 |
|
|
Product sales |
|
733 |
|
|
|
971 |
|
|
Professional services |
|
415 |
|
|
|
490 |
|
|
|
Total revenues |
|
5,582 |
|
|
|
5,267 |
|
Costs of revenues: |
|
|
|
|
Costs of verification and certification services |
|
2,515 |
|
|
|
2,196 |
|
|
Costs of products |
|
434 |
|
|
|
568 |
|
|
Costs of professional services |
|
304 |
|
|
|
360 |
|
|
|
Total costs of revenues |
|
3,253 |
|
|
|
3,124 |
|
|
Gross profit |
|
2,329 |
|
|
|
2,143 |
|
Selling, general and administrative expenses |
|
2,068 |
|
|
|
1,988 |
|
Income from operations |
|
261 |
|
|
|
155 |
|
Other income/(expense): |
|
|
|
|
Dividend income from Progressive Beef |
|
- |
|
|
|
50 |
|
|
Loss on foreign currency exchange |
|
(2 |
) |
|
|
(2 |
) |
|
Other income, net |
|
7 |
|
|
|
9 |
|
|
Interest expense |
|
(1 |
) |
|
|
(1 |
) |
Income before income taxes |
|
265 |
|
|
|
211 |
|
Income tax expense |
|
87 |
|
|
|
90 |
|
|
Net income |
$ |
178 |
|
|
$ |
121 |
|
|
|
|
|
|
|
|
Per share - net income: |
|
|
|
|
Basic |
|
$ |
0.03 |
|
|
$ |
0.02 |
|
|
Diluted |
$ |
0.03 |
|
|
$ |
0.02 |
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding: |
|
|
|
|
Basic |
|
|
5,480 |
|
|
|
5,730 |
|
|
Diluted |
|
5,500 |
|
|
|
5,799 |
|
|
|
|
|
|
|
|
Where Food Comes From, Inc. |
|
|
|
Calculation of Adjusted EBITDA* |
|
|
(Unaudited) |
|
|
|
|
|
Three months ended March 31, |
(Amounts in thousands) |
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
Net income |
$ |
178 |
|
|
$ |
121 |
|
Adjustments to EBITDA: |
|
|
|
|
Interest expense |
|
1 |
|
|
|
1 |
|
|
Income tax expense |
|
87 |
|
|
|
90 |
|
|
Depreciation and amortization |
|
155 |
|
|
|
172 |
|
EBITDA* |
|
421 |
|
|
|
384 |
|
Adjustments: |
|
|
|
|
Stock-based compensation |
|
11 |
|
|
|
15 |
|
ADJUSTED EBITDA* |
$ |
432 |
|
|
$ |
399 |
|
|
|
|
|
|
|
|
|
|
|
*Use of Non-GAAP Financial Measures: Non-GAAP results are presented
only as a supplement to the financial statements and for use within
management's discussion and analysis based on U.S. generally
accepted accounting principles (GAAP). The non-GAAP financial
information is provided to enhance the reader's understanding of
the Company's financial performance, but non-GAAP measures should
not be considered in isolation or as a substitute for financial
measures calculated in accordance with GAAP. Reconciliations of the
most directly comparable GAAP measures to non-GAAP measures are
provided herein. |
All of the items included in the reconciliation from net income to
EBITDA and from EBITDA to Adjusted EBITDA are either (i) non-cash
items (e.g., depreciation, amortization of purchased intangibles,
stock-based compensation, etc.) or (ii) items that management does
not consider to be useful in assessing the Company's ongoing
operating performance (e.g., M&A costs, income taxes, gain on
sale of investments, loss on disposal of assets, etc.). In the case
of the non-cash items, management believes that investors can
better assess the Company's operating performance if the measures
are presented without such items because, unlike cash expenses,
these adjustments do not affect the Company's ability to generate
free cash flow or invest in its business. |
We use, and we believe investors benefit from the presentation of,
EBITDA and Adjusted EBITDA in evaluating our operating performance
because it provides us and our investors with an additional tool to
compare our operating performance on a consistent basis by removing
the impact of certain items that management believes do not
directly reflect our core operations. We believe that EBITDA is
useful to investors and other external users of our financial
statements in evaluating our operating performance because EBITDA
is widely used by investors to measure a company's operating
performance without regard to items such as interest expense,
taxes, and depreciation and amortization, which can vary
substantially from company to company depending upon accounting
methods and book value of assets, capital structure and the method
by which assets were acquired. |
Because not all companies use identical calculations, the Company's
presentation of non-GAAP financial measures may not be comparable
to other similarly titled measures of other companies. However,
these measures can still be useful in evaluating the Company's
performance against its peer companies because management believes
the measures provide users with valuable insight into key
components of GAAP financial disclosures. |
Where Food Comes From, Inc. |
Balance Sheets (Unaudited) |
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
(Amounts in thousands, except per share amounts) |
|
2024 |
|
|
|
2023 |
|
Assets |
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
1,882 |
|
|
$ |
2,641 |
|
|
Accounts receivable, net of allowance |
|
2,075 |
|
|
|
2,128 |
|
|
Inventory |
|
1,119 |
|
|
|
1,109 |
|
|
Prepaid expenses and other current assets |
|
375 |
|
|
|
335 |
|
|
|
Total current assets |
|
5,451 |
|
|
|
6,213 |
|
Property and equipment, net |
|
806 |
|
|
|
844 |
|
Right-of-use assets, net |
|
2,295 |
|
|
|
2,296 |
|
Equity investments |
|
1,191 |
|
|
|
1,191 |
|
Intangible and other assets, net |
|
2,222 |
|
|
|
2,303 |
|
Goodwill, net |
|
2,946 |
|
|
|
2,946 |
|
Deferred tax assets, net |
|
482 |
|
|
|
493 |
|
Total assets |
$ |
15,393 |
|
|
$ |
16,286 |
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
$ |
677 |
|
|
$ |
567 |
|
|
Accrued expenses and other current liabilities |
|
889 |
|
|
|
615 |
|
|
Deferred revenue |
|
1,457 |
|
|
|
1,485 |
|
|
Current portion of finance lease obligations |
|
14 |
|
|
|
14 |
|
|
Current portion of operating lease obligations |
|
321 |
|
|
|
298 |
|
|
|
Total current liabilities |
|
3,358 |
|
|
|
2,979 |
|
Finance lease obligations, net of current portion |
|
37 |
|
|
|
41 |
|
Operating lease obligation, net of current portion |
|
2,422 |
|
|
|
2,447 |
|
Total liabilities |
|
5,817 |
|
|
|
5,467 |
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
Common stock |
|
7 |
|
|
|
7 |
|
|
Additional paid-in-capital |
|
11,338 |
|
|
|
12,290 |
|
|
Treasury stock |
|
(11,688 |
) |
|
|
(11,219 |
) |
|
Retained earnings |
|
9,919 |
|
|
|
9,741 |
|
Total equity |
|
9,576 |
|
|
|
10,819 |
|
Total liabilities and stockholders' equity |
$ |
15,393 |
|
|
$ |
16,286 |
|
|
|
|
|
|
|
Where Food Comes From (NASDAQ:WFCF)
Gráfica de Acción Histórica
De Oct 2024 a Nov 2024
Where Food Comes From (NASDAQ:WFCF)
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De Nov 2023 a Nov 2024