BONITA SPRINGS, Fla., April 16, 2021 (GLOBE NEWSWIRE) — Innovative Food Holdings, Inc. (OTCQB: IVFH), a leading direct-to-consumer e-commerce platform with complete multi-channel, specialty food and grocery capabilities for both consumers and professional chefs today reported its financial results for the fourth quarter and full year of 2020.
“Throughout 2020, despite unprecedented industry-wide COVID-19 challenges, we accelerated our digital transformation, invested in our infrastructure, and leveraged our leading direct-to-chef and direct-to-consumer platform to support record e-commerce demand. Our full year and fourth quarter e-commerce results demonstrate the power and scalability of our DTC e-commerce platform. We successfully navigated the COVID-19 pandemic and the unprecedented disruption it caused within the specialty foodservice industry by rapidly expanding our e-commerce business thanks to the hard work of our dedicated team,” stated Sam Klepfish, CEO of Innovative Food Holdings.
“We believe that our leading direct-to-consumer platform provides unparalleled ‘plug and play’ e-commerce capabilities both through our existing online properties as well as through the ability to build or acquire additional brands to add to our platform. We continue to see increased interest in our platform from both current and potential partners and we believe that we are well positioned to expand e-commerce efficiencies and drive top-line and bottom-line e-commerce results during 2021.”
“We have emerged from the COVID-19 crisis better positioned than ever to further continue and accelerate the expansion and growth of our DTC e-commerce platform. In addition, we have been seeing improving trends within our foodservice business, and we look forward to continued improvements as restaurants, hotels, airlines, and other foodservice customers reopen for business. I am extremely proud of our success during 2020 and excited by the opportunities we have to grow our brands and create long-term value for our shareholders in 2021 and beyond,” concluded Mr. Klepfish.
Financial Results
E-commerce revenue for full year 2020 increased by over 100%, driven by the Company’s ability to increase conversion rates and sales. Deferred revenue which includes e-commerce orders associated with the Company’s subscription services, including both Mouth and iGourmet, and representing a pipeline of future revenues, increased by nearly 500% to $2.9 million at December 31, 2020, compared to $0.5 million at December 31, 2019. Revenues in the 2020 fourth quarter declined to $15.1 million compared to $17.7 million in the 2019 fourth quarter as specialty foodservice revenues declined 43% to $6.8 million, as a result of the continued impact the COVID-19 pandemic had on the foodservice industry. This decline was partially offset by strong e-commerce revenue growth of over 50% to $7.9 million in the 2020 fourth quarter, compared to $5.3 million in e-commerce revenues in the 2019 fourth quarter.
2020 full year total revenue was $51.7 million compared to $57.9 million in 2019. The decline in full year 2020 revenue was driven by an approximately 40% decline in foodservice revenues as a result of the continued impact the COVID-19 pandemic had on the foodservice industry. This decline which was partially offset by strong e-commerce revenue growth of over 100%.
IVFH continued to build its brands and expand its e-commerce customer base and for full year 2020 IVFH had over 188,000 active and unique e-commerce customers, which is an increase of over 88% from 2019.
The following table sets forth IVFH’s revenue by business category for the three and twelve months ended December 31, 2020 and December 31, 2019 (unaudited):
| Three Months Ended | ||||||||||||
| December 31, 2020 |
% of Net Sales |
December 31, 2019 |
% of Net Sales |
% Change |
||||||||
| Specialty Foodservice | $ | 6,793,000 | 44% | $ | 11,835,000 | 67% | -43% | |||||
| E-Commerce | 7,881,000 | 52% | 5,253,000 | 30% | 50% | |||||||
| National Brand Management | 313,000 | 2% | 389,000 | 2% | -20% | |||||||
| Warehouse and Logistics Services | 151,000 | 1% | 176,000 | 1% | -14% | |||||||
| Total IVFH | $ | 15,138,000 | 100% | $ | 17,653,000 | 100% | -14% | |||||
| Year Ended Months Ended | ||||||||||||
| December 31, 2020 |
% of Net Sales |
December 31, 2019 |
% of Net Sales |
% Change |
||||||||
| Specialty Foodservice | $ | 27,544,000 | 53% | $ | 45,377,000 | 78% | -39% | |||||
| E-Commerce | 22,371,000 | 44% | 10,704,000 | 19% | 109% | |||||||
| National Brand Management | 1,100,000 | 2% | 1,645,000 | 3% | -33% | |||||||
| Warehouse and Logistic Services | 661,000 | 1% | 176,000 | 0% | 276% | |||||||
| Total IVFH | $ | 51,676,000 | 100% | $ | 57,903,000 | 100% | -11% | |||||
For the 2020 fourth quarter, selling and administrative (SG&A) expenses were $5.6 million, compared to $4.9 million for the same period last year. For full year 2020, SG&A expenses were $19.5 million, compared to $16.5 million in the prior year period. The year-over-year increases, which included costs associated with COVID-19, were primarily driven by higher marketing and advertising costs, increases in payroll and insurance costs, and other operating expenses.
The Company reported a net loss for the 2020 fourth quarter of $(1.1 million), or $(0.03) per share, compared to a net income of $195,000, or $0.01 per diluted share, in the prior year’s fourth quarter. For 2020, the Company reported a net loss of $(7.7 million), or $(0.22) per share, compared to net income of $223,000, or $0.01 per diluted share for 2019. The 2020 net loss included a non-cash $1.7 million impairment charge recorded during the 2020 first quarter and other non-cash charges of $1.5 million. The Company generated $1.8 million in cash from operating activities for the 2020 fourth quarter, compared to $2.4 million for the same period last year.
Adjusted net income for the 2020 fourth quarter was a loss of $(1.0 million), or $(0.028) per share, compared to adjusted net income of $527,000, or $0.015 per diluted share, for the same period last year. For 2020, adjusted net income was a loss of $(5.0 million), or $(0.144) per share, compared to adjusted net income of $1.5 million, or $0.045 per diluted share last year.
Cash EBITDA, a non-GAAP metric (see tables below), for the 2020 fourth quarter was a $(0.7 million), compared to Cash EBITDA of $0.7 million in the prior year fourth quarter. For 2020, Cash EBITDA was $(4.2 million), compared to Cash EBITDA of $2.0 million for the same period a year ago.
About Innovative Food Holdings, Inc.
Innovative Food Holdings (Ticker: IVFH): has built a leading D2C ecommerce platform with complete multi-channel, specialty food and grocery capabilities for both consumers and professional chefs. Wholly owned D2C brands on the platform include www.igourmet.com and www.mouth.com.
Additional information is available at www.ivfh.com.
