Barfresh Food Group (BRFH) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 revenue of $3.64 million, a 40% year-over-year increase, driven by expanded product offerings, strong Twist & Go smoothie sales, and improved product availability.

• Launched new Pop & Go freeze pops in Q4 2024, targeting the higher-volume school lunch menu segment, with strong early demand and expected to drive future growth.

• Broker network now covers over 95% of the U.S., significantly expanding sales reach and customer onboarding.

• Strategic investments in manufacturing, ERP systems, and expanded co-manufacturing capacity position the company for sustained long-term growth.

• The company continues to address supply chain disruptions and a contract manufacturer dispute, with expanded capacity expected to come online in Q4 2024.

Financial highlights

• Q3 2024 revenue rose 40% to $3.64 million from $2.6 million in Q3 2023; nine-month revenue reached $7.93 million, up 28%.

• Gross margin for Q3 2024 was 35%; adjusted gross margin (excluding relocation costs) improved to 38% due to favorable mix and pricing.

• Net loss for Q3 2024 was $513,000, slightly higher than $476,000 in Q3 2023, mainly due to increased headcount and absence of prior tax credits.

• Adjusted EBITDA loss for Q3 2024 was $124,000, compared to a loss of $89,000 in the prior year.

• Selling, marketing, and distribution expenses increased to $990,000 in Q3 2024, and to $2.3 million for the nine months, reflecting higher personnel and broker costs.

Outlook and guidance

• Expects record annual revenue and improved adjusted gross margin for FY 2024, with Pop & Go contributing in Q4.

• Anticipates breakeven or positive adjusted EBITDA in Q4 2024 with incremental sales growth.

• Expanded production capacity and sales network set to drive further growth into 2025.