Is Fresh Diet a money-loser? Can anyone else here break out the Fresh Diet ongoing revenues vs expenses? Twice they say that the results reflect a 'focus on ..profitable revenues' yet the 4th quarter loss was a whopping $3.7 million. With a profitable foodservice segment and apparent further acquisition costs of $1.1 million, it appears that Fresh Diet had a loss of over $2 million while they were 'focusing'. Am I missing something here? :
Fourth Quarter 2014 Financial Results
Fourth quarter 2014 total revenue was approximately $10 million, up 64% as compared to $6.1 million in the fourth quarter of 2013. Innovative Food Holdings' Specialty foodservice revenue grew approximately 13% to $6.8 million. Adjusted EBITDA for the Specialty foodservice segment increased 35% year over year to $737,731 for the 4th quarter.
The Fresh Diet acquisition resulted in a GAAP loss for the quarter ended December 31, 2014. Costs associated with The Fresh Diet include several accounting, legal and other charges, including over $1.1 million in a non-cash, GAAP-related charge associated with accounting for the acquisition of The Fresh Diet. This GAAP related charge had the effect of lowering GAAP revenues by over $1.1 million without any corresponding decrease in GAAP expenses. In addition, as expected, The Fresh Diet's transition to a metric-driven business with a key focus on long-term, profitable revenues, contributed to the loss in the fourth quarter.
As a result, Innovative Food Holdings reported a GAAP loss of $3.7 million for the quarter ended December 31, 2014 compared to a GAAP loss of approximately $1.0 million for the quarter ended December 31, 2013.
The Fresh Diet Financial information
The fourth quarter of 2014 included the contribution of The Fresh Diet, which was acquired on August 15, 2014 and as a result the fourth quarter of 2013 included no contribution from this acquisition. Revenues attributed to The Fresh Diet in this quarter were $3.1 million and results reflect the focus on profitable revenues described above. Furthermore, certain accounting adjustments, including over $875,000 in acquisition related GAAP amortization charges, had the direct effect of lowering The Fresh Diet GAAP revenues by over $875,000 without any corresponding decrease in GAAP expenses.
