IVFH Innovative Food Holdings Inc (QB)

BONITA SPRINGS, Fla., May 11, 2015 /PRNewswire/ -- Innovative Food Holdings, Inc. (OTCQB: IVFH), a leading nationwide provider of specialty foods, healthcare foods, gluten free foods, and direct from source artisanal foods, to the professional foodservice market, and the leading, direct-to-consumer, freshly prepared meal company in the health and wellness category, announced today financial results for the first quarter ended March 31, 2015.

First Quarter Financial Highlights

• Total revenue of $11.1 million, an increase of 101% compared to the same period in 2014 and up 11% sequentially
• Direct to Consumer GAAP revenues associated with The Fresh Diet were $4.6 million and represented approximately 41% of total revenue compared to $3.1 million and 31% of total revenue in the fourth quarter of 2014
• Direct to Chef specialty food revenues ("Specialty Foodservice") were $6.5 million, an increase of 18% compared to the same period in 2014

Sam Klepfish, Chief Executive Officer of Innovative Food Holdings, commented, "We delivered strong sales growth of over 18% in our direct to chef business as more and more chefs continue to look to us to satisfy their specialty food culinary needs. We have also seen particularly strong growth of approximately 25% in our Chicago based Artisan Specialty Foods subsidiary as we continue to see chefs move towards the true specialty experience that Artisan Specialty Foods provides for its customers. We remain focused on leveraging the capabilities of our leading specialty foods direct to chef platform as well as our leading health and wellness direct to consumer Fresh Diet platform, to create significant value for our shareholders."

Mr. Klepfish added, "We have made notable progress in our efforts to accelerate and optimize The Fresh Diet's marketing efforts, and we believe that many of the performance metrics we track are moving in the right direction. In fact, our Fresh Diet meal bookings in March were particularly strong, further validating our marketing initiatives as we move forward. Throughout 2015, we will remain focused on growing The Fresh Diet brand and The Fresh Diet's leading market share in the fresh delivered health and wellness category, with a key focus on reaching profitability."

Mr. Klepfish concluded "We are pleased that during the first quarter we attracted key talent to The Fresh Diet brand and enriched The Fresh Diet's management team with several key individuals. These include Silvia De Antonio as our Chief Culinary Officer who brings 19 years in culinary management, research and development; Bernard Seay as Director of the Call Center who has 30 years of sales and service call center experience with former roles at Informix (now IBM) and Sprint, and Linda Mignone who joined as The Fresh Diet's new CMO, bringing more than 25 years of marketing leadership, data-driven digital marketing expertise, and brand, advertising and communications experience, and who formally served in marketing leadership roles at, Bridgepoint Education, Kerzner International and DHL."

First Quarter 2015 Financial Results

The financial results for the first quarter of 2015 include the contribution of The Fresh Diet, which was acquired on August 15, 2014 and as a result the first quarter of 2014 included no contribution from this acquisition.

First quarter 2015 total revenue was approximately $11.1 million, up 101% as compared to $5.5 million in the first quarter of 2014. Innovative Food Holdings' Specialty Foodservice revenue grew 18% over the same period in the prior year to $6.5 million. The Fresh Diet revenues were $4.6 million, up 43.9% compared to the fourth quarter of 2014. Certain accounting adjustments, had the direct effect of lowering The Fresh Diet GAAP revenues, increasing COGS and lowering net income by over $360,000 without any corresponding decrease in GAAP expenses.

Cost of goods sold for the three months ended March 31, 2015 was $8.1 million, an increase of $4.4 million, or approximately 120%, compared to $3.7 million for the three months ended March 31, 2014. The increase was primarily attributable to costs associated with The Fresh Diet and to an increase in organic revenues. Gross margin was 26.8% of total revenue in the first quarter of 2015 compared to 32.8% in the prior year's quarter. The decrease in gross margin is attributable primarily to the operations of The Fresh Diet. The gross margin includes the affect a GAAP related charged associated with the acquisition of the Fresh Diet. The gross margin without the GAAP charge would have been 29% for the quarter.

The Company reported a GAAP net loss of approximately $2.0 million for the quarter ended March 31, 2015 compared to net income of $189,000 in the prior year period.

On a per share basis, the Company reported a loss of $0.099 per basic and diluted share in the first quarter of 2015 compared to earnings of $0.025 and $0.014 per basic and diluted share, respectively, in the first quarter of 2014.

Adjusted Net Income (Net income without certain amortization charges, GAAP acquisition charges, and equity based compensation) was a loss of $584,936 vs. a profit $508,299 in Q1 2014 and Adjusted EPS (EPS without certain amortization charges, GAAP acquisition charges, and equity based compensation) was  a loss of $0.029 per share compared to earnings of $0.067 per share in the first quarter of 2014.

Cash EBITDA (EBITDA without equity based compensation) for the first quarter of 2015 was a loss of $466,000 compared to positive Cash EBITDA of $576,000 in the first quarter of 2014. This Cash EBITDA loss was driven primarily by a loss of $913,000 for The Fresh Diet in the current quarter. These numbers includes a spend of over $570,000 on digital and offline advertising and marketing expenses as The Fresh Diet accelerated its marketing spend in the first quarter of 2015.

Cash EBITDA for the Specialty Foodservice segment was $544,000 compared to $576,000 in the same period in 2014.  Cash EBITDA on the specialty foodservice segment includes expenses associated with the overall parent company including legal, accounting and other public company expenses, those expenses increased in the first quarter of 2015.

As of March 31, 2015, the Company had $3.2 million in cash and cash equivalents compared to $3.1 million as of December 31, 2014.

Conference call information:

• Date and time: Monday, May 11, 2015 at 5 p.m. ET
• Dial-in number: 1-888-466-4462 (domestic) or 1-719-457-2085 (international)
• Call/Conference ID: 1728951
• Replay number: Dial 1-877-870-5176 (domestic) or 1-858-384-5517 (international). Please use passcode 1728951 to access the replay. The replay will be available until May 18, 2015.
• Webcast link: http://public.viavid.com/index.php?id=114539

About Innovative Food Holdings

Innovative Food Holdings' (www.ivfh.com) subsidiaries distribute the highest quality, specialty foods to foodservice businesses nationwide and offer freshly prepared meals and ingredients to consumers across the country through a proprietary specialty food platform.

In the foodservice space, the Company's industry leading specialty food foodservice direct to chef distribution programs offer over 7,000 specialty food, direct from source, organic, artisanal and gluten free products, which are used on a daily basis by thousands of leading professional chefs across the United States.

In the direct to consumer channel, The Fresh Diet has helped clients meet their diet transformation goals with personalized healthy chef-prepared meals, hand-delivering three meals and two snacks daily to customer\'s doors in 44 metropolitan areas and over 570 cities and towns across the U.S. Our nutritionally balanced meals are freshly prepared daily with seasonal ingredients and are never frozen, freeze-dried or vacuum packed. For detailed delivery information, and to review available menu options or learn more about how The Fresh Diet works, please visit www.TheFreshDiet.com.

Forward-Looking Statements

This release contains 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," "anticipate," "believe," "intend," "plan," "might," "potentially," or "expect." The Company does not intend to update these forward-looking statements. Information about third parties was supplied to the company by third parties and we accept no reasonability for its accuracy.

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SOURCE Innovative Food Holdings, Inc.