Bonita Springs / FL. (ifh) Innovative Food Holdings, an interconnected data driven platform of specialty food companies that provides chefs and consumers direct access to the highest quality unique specialty food products across the U.S., reported its financial results for the second quarter and first half of 2021.
«We are thrilled by the return to year-over-year growth within our specialty foodservice operations, which helped produce record second-quarter revenues and a 17 percent increase over the prior year period. Our foodservice business increased 148 percent despite continued uncertainty related to increasing Covid-19 cases. In addition, IVFH’s agile operations, strong supplier network, and leading procurement teams allowed the Company to navigate unprecedented industry-wide supply chain challenges during the second quarter. We continue to leverage our strong platform and leading service-oriented culture to help our foodservice customers and e-commerce partners navigate rapidly evolving market conditions,» stated Sam Klepfish, CEO of Innovative Food Holdings.
«As expected, second quarter e-commerce sales were down compared to last year’s heightened level during the Covid-19 pandemic. Compared to pre-covid levels, second quarter e-commerce sales were up 84 percent from the 2019 second quarter and have grown 113 percent from the 2019 first half. In addition, our average order value continues to experience improving trends throughout our e-commerce platform. Our growth-oriented e-commerce strategies remain focused on pursuing additional partnerships, creating new transformative verticals, and introducing additional subscription-based products. We are also differentiating our brands and creating heightened awareness of our unique value propositions, while leveraging our leading digitally enabled, plug-and-play, direct-to-consumer platform. The progress we are making is encouraging, and I am excited by the positive momentum underway across our strong distribution channels, especially as we prepare for the seasonally strong holiday season.»
«We are also focused on transforming our operations, controlling costs, and returning to profitability. During the second quarter our gross margin improved from the first quarter, and we continue to prudently control SG+amp;A expenses. We are working to leverage our fixed expenses and labor costs and, as a percent of revenue, SG+amp;A expenses were the lowest level since 2019. I believe we have a significant opportunity to leverage our cost structure and further improve efficiencies as our business scales,» concluded Klepfish.
Financial Results
Revenues in the 2021 second quarter increased 17 percent to USD 14.0 million, compared to USD 12.0 million for the three months ended June 30, 2020. Second-quarter revenue benefitted from an 148 percent increase in specialty foodservice revenue, which was driven by the nationwide opening of restaurants and other foodservice establishments previously affected by Covid-19. The increase in specialty foodservice revenue was partially offset by a 56 percent decrease in e-commerce revenues as a result of heightened Covid-19 driven demand in 2020 compared to 2021. Compared to pre-covid levels, second quarter e-commerce revenue is up 84 percent from the 2019 second quarter, reflecting strong organic growth. For the first half of fiscal 2021, total revenue was USD 26.2 million, compared to USD 25.3 million last year.
The following table sets forth IVFH’s revenue by business category for the three and six months ended June 30, 2021 and June 30, 2020 (unaudited):
| Q2-2021 | % of Net Revenues | Q2-2020 | % of Net Revenues | Change | |||||||||||
| Specialty Foodservice | USD | 10,161,000 | 73 | % | USD | 4,105,000 | 34 | % | 148 | % | |||||
| E-commerce | 3,285,000 | 23 | % | 7,454,000 | 62 | % | -56 | % | |||||||
| National Brand Management | 265,000 | 2 | % | 283,000 | 3 | % | -6 | % | |||||||
| Logistics | 263,000 | 2 | % | 156,000 | 1 | % | 69 | % | |||||||
| Total IVFH | USD | 13,974,000 | 100 | % | USD | 11,998,000 | 100 | % | 16 | % | |||||
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| H1-2021 | % of Net Revenues | H1-2020 | % of Net Revenues | Change | |||||||||||
| Specialty Foodservice | USD | 16,989,000 | 65 | % | USD | 14,018,000 | 55 | % | 21 | % | |||||
| E-commerce | 8,265,000 | 32 | % | 10,332,000 | 41 | % | -20 | % | |||||||
| National Brand Management | 491,000 | 2 | % | 533,000 | 2 | % | -8 | % | |||||||
| Logistics | 411,000 | 1 | % | 421,000 | 2 | % | -2 | % | |||||||
| Total IVFH | USD | 26,156,000 | 100 | % | USD | 25,304,000 | 100 | % | 3 | % | |||||
For the 2021 second quarter, selling, general, and administrative (SG+amp;A) expenses were USD 4.7 million, compared to USD 4.9 million for the same period last year, and USD 4.9 million for the 2021 first quarter. The USD 0.2 million decrease was primarily due to lower payroll and related costs, advertising costs, and increased efficiencies.
The Company reported a net loss for the 2021 second quarter of USD (0.9 million), or USD (0.03) per share, compared to a net loss of USD (1.7 million), or USD (0.05) per share, in the prior year’s second quarter. For the first six months of 2021, the Company reported a net loss of USD (2.8 million), or USD (0.08) per share, compared to a net loss of USD (4.9 million), or USD (0.14) per share, for the first six months of 2020.
Adjusted net income (see tables below) for the 2021 second quarter was a loss of USD (0.8 million), or USD (0.022) per share, compared to an adjusted net loss of USD (1.5 million), or USD (0.043) per share, for the same period last year. For the six months of 2021, adjusted net income was a loss of USD (2.3 million), or USD (0.063) per share, compared to an adjusted net loss of USD (2.6 million), or USD (0.074) per share, for the same period last year
Cash Ebitda, a non-GAAP metric, for the 2021 second quarter was a loss of USD (0.6 million), compared to Cash Ebitda loss of USD (1.3 million), in the prior year quarter. For the 2021 first six months, Cash Ebitda was a loss of USD (1.8 million), compared to an Ebitda loss of USD (2.2 million) for the same period a year ago.
