Barfresh Provides Fourth Quarter and Full Year 2024 Results and Business Update

Company Achieves Highest Fiscal Year Revenue in Company History

Revenue of $10.7 Million, Gross Margin of 34% and Adjusted Gross Margin of 37% for Fiscal Year 2024

Pop & Go$(TM)$ 100% Juice Freeze Pops Launched with Initial Revenue Generation in Fourth Quarter 2024

Company Raises $3 Million in Profitable Growth Financing; Financing to Accelerate Manufacturing and Market Expansion

Company Expects Record Revenue for Fiscal Year 2025 of $14.5 Million to $16.6 Million

LOS ANGELES, March 27, 2025 (GLOBE NEWSWIRE) -- Barfresh Food Group Inc. (the "Company" or "Barfresh") (Nasdaq: BRFH), a provider of frozen, ready-to-blend and ready-to-drink beverages, is providing a business update for the full year ended December 31, 2024.

Management Comments

Riccardo Delle Coste, the Company's Chief Executive Officer, stated, "Our team delivered record annual revenue of $10.7 million in 2024, and we began generating initial revenue from Pop & Go(TM) 100% Juice Freeze Pops in the fourth quarter. We've secured an impressive string of new customer wins in the education channel as our product portfolio continues to resonate strongly with both school administrators and students alike. While fourth quarter results were impacted by costs associated with onboarding new co-manufacturers, temporary production inefficiencies and increased logistics costs as we maximized output to meet growing demand, we expect these headwinds to resolve by the end of the second quarter when our bottle co-manufacturing partners complete their equipment installations and we are positioned to meaningfully increase our bottling production."

"Looking ahead to 2025, with our recently strengthened balance sheet following our successful capital raise, we are well-positioned to leverage our enhanced production capacity and innovative product portfolio to capture significant opportunities in both the education and broader foodservice markets and improve cash flow and overall margins. Based on our strong pipeline and continued market momentum, we expect 2025 to deliver another record year with revenue projected to reach between $14.5 million and $16.6 million, depending on the outcome of end-user opportunities at later stages in our sales pipeline. With our strengthened manufacturing infrastructure and proven ability to scale, I am more confident than ever in our ability to deliver long-term value for our shareholders."

Fourth Quarter of 2024 Financial Results

Revenue for the fourth quarter of 2024 was $2.8 million, compared to $1.9 million in the fourth quarter of 2023. The increase in revenue is primarily due to expanded bottle production capacity compared to the prior year enabling higher sales volumes, complemented by improvements in smoothie carton and bulk sales. Gross Margin for the fourth quarter of 2024 was 26%, compared to 33% for the fourth quarter of fiscal year 2023. Adjusted Gross Margin for the fourth quarter of 2024 was 30%, compared to 33% in the prior year period. The decrease in gross margin was due to temporary production inefficiencies and increased logistics costs required to onboard new co-manufacturers to meet higher demand. This constraint will be resolved when specialized equipment is delivered and installed at the Company's co-manufacturing partners by the end of the second quarter of 2025. A reconciliation of Gross Profit to Adjusted Gross Profit is provided below.

Net loss for the fourth quarter of 2024 was $852,000, as compared to a loss of $701,000 in the fourth quarter of 2023. Selling, marketing and distribution for the fourth quarter of 2024 was $872,000 or 31% of revenue, compared to $624,000 or 32% of revenue in the fourth quarter of 2023. G&A expenses for the fourth quarter of 2024 were $620,000, compared to $624,000 in the fourth quarter of 2023.

Adjusted EBITDA was a loss of approximately $561,000 for the fourth quarter of 2024, compared to a loss of approximately $427,000 for the fourth quarter of 2023. A reconciliation of net loss to Adjusted EBITDA is provided below.

Fiscal Year 2024 Financial Results

Revenue for the full year of 2024 was $10.7 million, compared to $8.1 million in the same period of 2023. The increase in revenue is primarily due to expanded bottle production capacity enabling higher sales volumes, complemented by improvements in smoothie carton and bulk sales. Gross Margin for the full year of 2024 was 34%, compared to 35% for 2023. Adjusted Gross Margin for the full year of 2024 was 37%, compared to 35% for 2023. A reconciliation of Gross Profit to Adjusted Gross Profit is provided below. The improvement in Adjusted Gross Margin was a result of favorable product mix, pricing actions, and a slight improvement in the cost of supply chain components, partially offset by the temporary production inefficiencies and increased logistics costs experienced in the fourth quarter of 2024.

Net loss was $2.8 million for each of the full years of 2024 and 2023. Selling, marketing and distribution for the full year of 2024 was $3.1 million or 29% of revenue, compared to $2.6 million or 32% of revenue in the same period of 2023. The dollar increase is a result of increased sales and marketing personnel costs, broker commissions and outbound freight as a result of increased shipments. G&A expenses for the full year of 2024 increased to $3.0 million, compared to $2.7 million in the same period of 2023. The increase in G&A was driven by an increase to management headcount, an increase in stock-based compensation resulting from the increase in headcount and the extension of options previously issued to our board of directors, and the non-recurrence of recognizing Employee Retention Tax Credit benefits in 2023.

Adjusted EBITDA for the full year 2024 improved to a loss of $1.3 million, compared to a loss of $1.7 million for the same period of 2023. A reconciliation of net loss to Adjusted EBITDA is provided below.

Non-GAAP Financial Measures

The above information is presented in conformity with accounting principles generally accepted in the United States. In order to aid in the understanding of the Company's business performance, the Company has also presented below certain non-GAAP measures, including Adjusted Gross Profit, EBITDA and Adjusted EBITDA, which are reconciled in the table below to comparable GAAP measures, and certain calculations based on its results including Gross Margin and Adjusted Gross Margin. Management believes that Adjusted Gross Profit and Adjusted EBITDA provide useful information to the investor because it is directly reflective of the performance of the Company. The exclusion of certain items including manufacturing relocation costs in calculating Adjusted Gross Profit and stock compensation and other non-recurring costs such as those associated with the product withdrawal, the related dispute, and certain manufacturing relocation costs in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of the Company's core business performance. Adjusted Gross Profit and Adjusted EBITDA are not recognized measurements under GAAP and should not be considered as an alternative to Gross Profit, loss from operations, net loss or any other performance measure derived in accordance with GAAP.

 
 
                   For the three months ended           For the year ended 
                          December 31,                     December 31, 
                      2024            2023            2024             2023 
                 --------------  --------------  ---------------  --------------- 
Revenue          $2,788,000      $1,922,000      $10,717,000      $ 8,127,000 
Cost of revenue   2,058,000       1,280,000        7,049,000        5,243,000 
Gross profit        730,000         642,000        3,668,000        2,884,000 
Manufacturing 
 relocation 
 (1)                107,000               -          283,000                - 
Adjusted Gross 
 Profit          $  837,000      $  642,000      $ 3,951,000      $ 2,884,000 
                  =========       =========       ==========       ========== 
Gross Margin             26%             33%              34%              35% 
Adjusted Gross 
 Margin                  30%             33%              37%              35% 
 
(1) Represents costs incurred to relocate single-serve 
 ready-to-blend beverage pack production lines owned 
 by Barfresh at the conclusion of a multi-year manufacturing 
 agreement. 
 
 
                   For the three months ended           For the year ended 
                          December 31,                     December 31, 
                      2024            2023            2024             2023 
                 --------------  --------------  ---------------  --------------- 
Net loss         $ (852,000)     $ (701,000)     $(2,825,000)     $(2,824,000) 
                  =========       =========       ==========       ========== 
 
Depreciation 
 and 
 amortization        68,000          94,000          283,000          419,000 
Interest 
 expense             28,000           3,000           52,000            6,000 
EBITDA             (756,000)       (604,000)      (2,490,000)      (2,399,000) 
 
Stock based 
 compensation, 
 employees and 
 board of 
 directors           88,000         113,000          784,000          543,000 
Operating 
 expense 
 related to 
 withdrawn 
 product and 
 related 
 dispute (1)              -          64,000          108,000          182,000 
Manufacturing 
 relocation 
 (2)                107,000               -          283,000                - 
Adjusted EBITDA  $ (561,000)     $ (427,000)     $(1,315,000)     $(1,674,000) 
                  =========       =========       ==========       ========== 
 
(1) Barfresh experienced a quality issue with product 
 manufactured by one of its contract manufacturers, 
 which is the subject of a legal dispute as to the 
 source of complaints received. Operating expense in 

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