CASTLE ROCK, CO--(Marketwired - Feb 17, 2015) - Where Food Comes From, Inc. (
Full Year revenue up 51% to $8.8 million from $5.8 million last year
Fourth quarter revenue up 41% to $2.6 million from $1.9 million last year
Net income of $64,000 in fourth quarter and $229,000 for full year
Net cash generated from operations up 172% to $590,000 from $217,000
Where Food Comes From, Inc. (d.b.a. IMI Global, Inc.) (
"In 2014, Where Food Comes From achieved strong year-over-year revenue and earnings growth and extended its leadership position in an industry that is still in its infancy," said John Saunders. "Solid growth in our core services and hardware businesses was driven by diverse factors ranging from an increase in the number of consumer-driven verification standards to continued execution of our M&A strategy to initial phase-in of the USDA's mandatory Animal Disease Traceability (ADT) program.
"Over the past several years we have positioned Where Food Comes From as the go-to company for more than 30 verification standards for food industry players ranging from farmers, ranchers and packers to distributors and retailers -- all of which are working hard to meet consumer and regulatory demand for increased transparency in the entire food chain continuum. We look forward to continued growth in 2015 as demand for our core solutions continues to grow and new opportunities such as ADT gain momentum."
Fourth Quarter Results
Fourth quarter revenue increased 41% to $2,614,300 from revenue of $1,856,300 in the same quarter last year. Verification services revenue was up 40% to $2,307,500 from $1,643,000. Product revenue (cattle identification tags) increased 67% to $299,700 from $179,200. Other revenue, primarily associated with the Company's Where Food Comes From® labeling program, decreased 79% to $7,200 from $34,000 year over year. Increased verification and hardware revenue resulted from a combination of organic growth -- driven in part by initial compliance with the USDA's animal disease traceability (ADT) program -- and the effects of the Company's M&A strategy. The reduction in labeling revenue resulted from a change in the beef supplier for the Company's largest labeling customer -- Heinen's fine foods. Heinen's is working to replace that supplier with another supplier whose products can be source verified by Where Food Comes From. In the meantime, the Company continues to generate labeling revenue from other products in the Heinen's meat department.
Gross profit in the fourth quarter increased 43% to $1,141,500 from $798,400 year over year. Selling, general and administrative expenses as a percent of revenue improved to 39% in the fourth quarter from 42% in the same quarter last year.
Operating income in the fourth quarter increased four-fold to $127,700 from $25,300 in the same quarter last year. Net income attributable to Where Food Comes From, Inc. increased to $64,200, or less than one cent per share, compared with a net loss of $11,300, or less than one cent per share, in the same quarter a year ago.
Full Year Results
Revenue for the full year increased 51% to $8,764,900 from $5,798,200 in the same period last year. Verification revenue increased 53% to $7,564,600 from $4,947,400 year over year. Hardware revenue increased 50% to $1,085,700 from $723,400 a year ago. Revenue from Where Food Comes From® labeling decreased 10% to $114,700 from $127,300.
Gross profit for the year increased 39% to $3,763,300 from $2,706,400 a year ago. Selling, general and administrative expense improved to 39% of revenue from 46% of revenue a year ago, reflecting the scalability of the Company's business model.
Operating income increased to $344,700 from $27,300 year over year. Net income attributable to Where Food Comes From, Inc. was $229,095, or $0.01 per share, versus a net loss of $33,600, or less than one cent per share, in the prior year.
Net cash generated from operations increased 172% to $590,000 from $216,900 in the same period last year.
The Company's cash balance at December 31, 2014, increased to $2,583,100 from $1,067,500 at 2013 year-end. Working capital increased to $3,380,700 from $1,533,600 over the same period.
The Company will conduct a conference call today at 10:00 a.m. Mountain Time.
Domestic Toll Free: 1-877-407-8289
Conference ID: 13601280
A telephone replay of the conference call will be available through March 3, 2015, as follows:
Domestic Toll Free: 1-877-660-6853
Conference Code: 13601280
About Where Food Comes From, Inc.
Where Food Comes From, Inc. (d.b.a. IMI Global) is America's trusted resource for third party verification of food production practices. The Company supports more than 10,000 farmers, ranchers, processors, retailers, distributors and restaurants with a wide variety of value-added services through its IMI Global, International Certification Services, Validus Verification Services, and Sterling Solutions units. In addition, the Company's Where Food Comes From® retail and restaurant labeling program utilizes the verification of product attributes to connect consumers to the sources of the food they purchase through product labeling and web-based information sharing and education. Go to www.wherefoodcomesfrom.com for additional information.
This news release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, based on current expectations, estimates and projections that are subject to risk. Forward-looking statements are inherently uncertain, and actual events could differ materially from the Company's predictions. Important factors that could cause actual events to vary from predictions include those discussed in our SEC filings. Specifically, statements in this news release about industry leadership; expectations for continued profitable growth; and the demand for, and impact and efficacy of, the Company's and its subsidiaries' products and services on the marketplace are forward-looking statements that are subject to a variety of factors, including availability of capital, personnel and other resources; competition; governmental regulation of the agricultural industry; the market for beef and other commodities; and other factors. Financial results for the fourth quarter and full year are not necessarily indicative of future results. Readers should not place undue reliance on these forward-looking statements. The Company assumes no obligation to update its forward-looking statements to reflect new information or developments. For a more extensive discussion of the Company's business, please refer to the Company's SEC filings at www.sec.gov.
|Where Food Comes From, Inc.|
|Statements of Income (Loss)|
|Three Months Ended||Year Ended|
|December 31,||December 31,|
|Costs of revenue|
|Labor and other costs of services||1,282,104||934,788||4,283,218||2,572,538|
|Costs of products||190,708||123,057||718,410||519,221|
|Total costs of revenue||1,472,812||1,057,845||5,001,628||3,091,759|
|Selling, general and administrative expenses||1,013,802||773,156||3,418,578||2,679,089|
|Income from operations||127,694||25,261||344,726||27,308|
|Other expense (income):|
|Other income, net||(1,221||)||(354||)||(3,204||)||(1,469||)|
|Income (loss) before income taxes||128,422||21,899||338,112||(4,811||)|
|Income tax expense (benefit)||43,744||10,451||140,876||(1,778||)|
|Net income (loss)||84,678||11,448||197,236||(3,033||)|
|Net loss (income) attributable to non-controlling interest||
|Net income (loss) attributable to Where Food Comes From, Inc.||
|Net income (loss) per share:|
|Weighted average number of common shares outstanding:|
|* Less than a penny ($0.01) per share|
|Note 1: Certain revenue and cost of revenue amounts presented in prior 2014 quarters and 2013 have been reclassified to conform to fourth quarter 2014 presentation.|
|Where Food Comes From, Inc.|
|December 31,||December 31,|
|Accounts receivable, net||979,532||683,800|
|Prepaid expenses and other current assets||126,938||143,576|
|Deferred tax assets||167,805||190,184|
|Total current assets||4,107,333||2,085,097|
|Property and equipment, net||231,886||253,206|
|Intangible and other assets, net||1,952,678||1,716,115|
|Long-term deferred tax assets||361,797||480,294|
|LIABILITIES AND SHAREHOLDERS' EQUITY|
|Accrued expenses and other current liabilities||65,849||56,091|
|Short-term debt and current portion of notes payable||7,425||24,782|
|Current portion of capital lease obligations||4,397||4,173|
|Total current liabilities||726,616||551,473|
|Capital lease obligations, net of current portion||6,410||10,808|
|Notes payable and other long-term debt, net||16,245||165,755|
|Contingently redeemable non-controlling interest||974,019||1,018,396|
|Additional paid-in capital||7,428,754||5,216,327|
|Total Where Food Comes From, Inc. equity||6,210,166||3,767,611|
|Total liabilities and stockholders' equity||$||7,933,456||$||5,814,474|
Chief Executive Officer
Pfeiffer High Investor Relations, Inc.