Welcome!

News Feed Item

Lifeway Foods Announces Record Fourth Quarter and Full Year 2013 Financial Results

Full Year 2013 Gross Sales Increase 21% to $109.0 Million

MORTON GROVE, Ill., March 31, 2014 /PRNewswire/ -- Lifeway Foods, Inc., (Nasdaq: LWAY), a leading supplier of cultured dairy products known as kefir and organic kefir, today announced results for the fourth quarter and full year ended December 31, 2013. 

Lifeway Foods logo.

"We are very pleased to report record net revenues for 2013, the highest in the Company's history, and are confident that our strong growth will continue in fiscal 2014," said Julie Smolyansky, CEO of Lifeway Foods, Inc.  "We are focused on our strategic plan to create innovative, healthy and nutritious food products for our customers while expanding distribution in the U.S. and abroad. We remain committed to wellness and continue to see positive business trends for Lifeway. We are already off to a strong start for 2014 and expect a 24% increase in net sales for the first quarter from the prior year. I am very excited for our future opportunities and believe we are well positioned for long-term sustainable growth that will allow us to increase value for shareholders."

Fourth Quarter Results
Fourth quarter of 2013 gross sales increased 26% to $28.9 million compared to $22.9 million for the fourth quarter of 2012.  This increase is primarily attributable to increased sales and awareness of the Company's flagship line, Kefir, as well as ProBugs® Organic Kefir for kids and BioKefir™.

Fourth quarter 2013 total consolidated net sales increased 26% to $26.3 million from $20.88 million in the fourth quarter of 2012. Net sales are recorded as gross sales less promotional activities such as slotting fees paid, couponing, spoilage and promotional allowances as well as early payment terms given to customers.

Cost of goods sold as a percentage of net sales, excluding depreciation expense, were approximately 80% during the fourth quarter of 2013, compared to approximately 65% during the same period in 2012. Gross profit for the fourth quarter of 2013 decreased 30% to approximately $4.8 million, compared to approximately $6.0 million in the fourth quarter of the prior year. The gross profit margin was 18% in the fourth quarter 2013 compared to 29% in the fourth quarter of 2012. The decrease was primarily attributable to the increased cost of conventional milk, the Company's largest raw material.  The total cost of milk was approximately 30% higher during the fourth quarter 2013 when compared to the same period in 2013. 

Operating expenses as a percentage of net sales were approximately 20% during the fourth quarter of 2013, compared to approximately 24% during the same period in 2012.  This was primarily attributable to a decrease in selling expenses, which decreased by $0.2 million to $3.0 million during the fourth quarter of 2013, from $3.2 million during the same period in 2012.

The Company reported a loss in operations of $0.4 million during the fourth quarter of 2013, a decrease of $2.2 million from reported income from operations of $1.8 million during the same period in 2012.

Provision for income tax was a benefit of $0.4 million for the fourth quarter 2013  compared to $0.7 million or a 40% effective tax rate during the same period in 2012.

Total net loss was $0.5 million, or $0.03 per diluted share, for the three-month period ended December 31, 2013 compared to net income of $1.1 million, or $0.07 per diluted share, in the same period in 2012. Net loss includes a $0.3 million pre-tax loss on disposition of assets due to the closing of a Starfruit store location. This is viewed as a one-time, non-cash expense. 

2013 Year End Results
Total consolidated gross sales increased 21% or $19.2 million to approximately $109.0 million during the twelve-month period ended December 31, 2013 from $90.0 million during the same twelve-month period in 2012.  This increase is primarily attributable to increased sales and awareness of the Company's flagship line, Kefir, as well as ProBugs® Organic Kefir for kids and BioKefir™. 

Total consolidated net sales increased 20% or $16.2 million to $97.5 million during the twelve-month period ended December 31, 2013 from $81.4 million during the same twelve- month period in 2012.

Cost of goods sold as a percentage of net sales, excluding depreciation expense, were approximately 70% during the twelve- month period ended December 31, 2013, compared to approximately 65% during the same period in 2011. Gross profit for 2013 increased 4% to $27.6 million, compared to $26.6 million in 2012. The Company's gross profit margin was 28% compared to 33% in 2012.

Total operating income decreased $0.8 million, or approximately 9%, to $8.0 million during the twelve-month period ended December 31, 2013, from $8.8 million during the same period in 2012. The gross profit margin decline was primarily attributable to the cost of conventional and organic milk, our largest raw material.  The total cost of milk was approximately 25% higher in 2013 versus 2012.

Total net income was $5.0 million, or $0.30 per diluted share, for the twelve-month period ended December 31, 2013 compared to $5.6 million, or $0.34 per diluted share, in the same period in 2012.

Balance Sheet/Cash Flow Highlights
The Company had a net increase in cash and cash equivalents of  approximately $1.0 million during the twelve-month period ended December 31, 2013 compared to a net increase in cash and cash equivalents of $1.2 million during the same period in 2012.  The Company had cash and cash equivalents of approximately $3.3 million as of December 31, 2013 compared to cash and cash equivalents of $2.3 million as of December 31, 2012.

Total stockholder's equity was approximately $42.9 million as of December 31, 2013, which is an increase of approximately $3.6 million when compared to December 31, 2012.  This is primarily due the increase in retained earnings of approximately $3.7 million when compared to December 31, 2012.

Conference Call
The Company will host a conference call to discuss these results with additional comments and details on Monday, March 31, 2014 at 4:30 p.m. ET. The call will be broadcast live over the Internet hosted at the Investor Relations section of Lifeway Foods' website at www.lifeway.net, and will be archived online through April 14, 2014. In addition, listeners may dial 877-407-3982 in North America, and international listeners may dial 201-493-6780. Participants from the Company will be Julie Smolyansky, President and Chief Executive Officer, and Edward Smolyansky, Chief Financial Officer and Chief Operating Officer.

About Lifeway Foods

Lifeway Foods, Inc. (Nasdaq: LWAY), recently named one of Fortune Small Business' Fastest Growing Companies for the fifth consecutive year, is America's leading supplier of the cultured dairy products known as kefir and organic kefir. Lifeway Kefir is a dairy beverage that contains 10 exclusive live and active probiotic cultures plus ProBoost™. In addition to its line of Kefir products, the company produces a variety of Frozen Kefir and probiotic cheese products. Lifeway also sells frozen kefir, kefir smoothies and kefir parfaits through its Starfruit™ retail stores.

Find Lifeway Foods, Inc. on Facebook: www.facebook.com/lifewaykefir 
Follow Lifeway Foods on Twitter: http://twitter.com/lifeway_kefir 
YouTube: http://www.youtube.com/user/lifewaykefir

Forward Looking Statements
This news release contains forward-looking statements. Investors are cautioned that actual results may differ materially from such forward-looking statements. Forward-looking statements involve risks and uncertainties including, but not limited to, competitive pressures and other important factors detailed in the Company's reports filed with the Securities and Exchange Commission.

Contact:

Lifeway Foods, Inc.
Phone: 877.281.3874 
Email: [email protected]

Investor Relations:

ICR 
Katie Turner 
John Mills
646.277.1228

Logo- http://photos.prnewswire.com/prnh/20131010/AQ95965LOGO

  


Consolidated Statements of Income and Comprehensive Income
For the Years Ended December 31, 2013 and 2012




(Unaudited)



Years Ended



December 31, 2013



2013


2012

Sales


$ 108,966,094




$  89,754,007



Less: discounts and allowances


(  11,441,952)




(    8,402,742)



Net sales


97,524,142


97,524,142


81,351,265


81,351,265










Cost of goods sold




68,290,014




53,098,191

Depreciation expense




1,626,575




1,629,594










Total cost of goods sold




69,916,589




54,727,785










Gross profit




27,607,553




26,623,480










Selling expenses




11,296,381




10,703,980

General and administrative




7,582,397




6,319,972

Amortization expense




712,803




754,817










Total operating expenses




19,591,581




17,778,769










Income from operations




8,015,972




8,844,711










Other income (expense):









Interest and dividend income




116,380




85,383

Rental income




11,727




12,285

Interest expense




(   203,365)




(       177,622)

Gain (loss) on sale of investments, net









reclassified from OCI




195,500




71,286

Loss on disposition of assets




(   304,958)





Other income (expense)




10,577




(11,169)

Total other income (expense)




(174,139)




(         19,837)










Income before provision for









   income taxes




7,841,833




8,824,874










Provision for income taxes




2,866,875




3,205,076










Net income




$ 4,974,958




$     5,619,798










Basic and diluted earnings









per common share




0.30




0.34










Weighted average number of 









  shares outstanding




16,346,017




16,373,224










COMPREHENSIVE INCOME


















Net income




$ 4,974,958




$     5,619,798










Other comprehensive income









    (loss), net of tax:









    Unrealized gains (losses) on 









      investments (net of tax)




64,674




102,816

    Less reclassification adjustment 









      for (gains) losses included in









      net income (net of taxes)




(   110,458)




(40,277)










Comprehensive income




$ 4,929,174




$     5,682,337

SOURCE Lifeway Foods, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that Peak 10, Inc., a national IT infrastructure and cloud services provider, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Peak 10 provides reliable, tailored data center and network services, cloud and managed services. Its solutions are designed to scale and adapt to customers’ changing business needs, enabling them to lower costs, improve performance and focus intern...
Everywhere we turn in our industry we can find strong opinions about the direction, type and nature of cloud’s impact on computing and business. Another word that is used in every context in our industry is “hybrid.” In his session at 20th Cloud Expo, Alvaro Gonzalez, Director of Technical, Partner and Field Marketing at Peak 10, will use a combination of a few conceptual props and some research recently commissioned by Peak 10 to offer a real-world consideration of how the various categories of...
Cloud applications are seeing a deluge of requests to support the exploding advanced analytics market. “Open analytics” is the emerging strategy to deliver that data through an open data access layer, in the cloud, to be directly consumed by external analytics tools and popular programming languages. An increasing number of data engineers and data scientists use a variety of platforms and advanced analytics languages such as SAS, R, Python and Java, as well as frameworks such as Hadoop and Spark...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in compute, storage and networking technologies, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology, is a premier provider of advanced server Building Block Solutions® for Data Center, Cloud Computing, Enterprise IT, Hadoop/...
This talk centers around how to automate best practices in a multi-/hybrid-cloud world based on our work with customers like GE, Discovery Communications and Fannie Mae. Today’s enterprises are reaping the benefits of cloud computing, but also discovering many risks and challenges. In the age of DevOps and the decentralization of IT, it’s easy to over-provision resources, forget that instances are running, or unintentionally expose vulnerabilities.
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deli...
In order to meet the rapidly changing demands of today’s customers, companies are continually forced to redefine their business strategies in order to meet these needs, stay relevant and continue to see profitable growth. IoT deployment and development is integral in this transformation, and today businesses are increasingly seeing the value of investing their resources into IoT deployments. These technologies are able increase ROI through projects such as connecting supply chains or enabling sm...
For financial firms, the cloud is going to increasingly become a crucial part of dealing with customers over the next five years and beyond, particularly with the growing use and acceptance of virtual currencies. There are new data storage paradigms on the horizon that will deliver secure solutions for storing and moving sensitive financial data around the world without touching terrestrial networks. In his session at 20th Cloud Expo, Cliff Beek, President of Cloud Constellation Corporation, w...
In his opening keynote at 20th Cloud Expo, Michael Maximilien, Research Scientist, Architect, and Engineer at IBM, will motivate why realizing the full potential of the cloud and social data requires artificial intelligence. By mixing Cloud Foundry and the rich set of Watson services, IBM's Bluemix is the best cloud operating system for enterprises today, providing rapid development and deployment of applications that can take advantage of the rich catalog of Watson services to help drive insigh...
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
IBM helps FinTechs and financial services companies build and monetize cognitive-enabled financial services apps quickly and at scale. Hosted on IBM Bluemix, IBM’s platform builds in customer insights, regulatory compliance analytics and security to help reduce development time and testing. In his session at 20th Cloud Expo, Tom Eck, Industry Platforms CTO at IBM Cloud, will discuss how these tools simplify the time-consuming tasks of selection, mapping and data integration, allowing developers ...
Most DevOps journeys involve several phases of maturity. Research shows that the inflection point where organizations begin to see maximum value is when they implement tight integration deploying their code to their infrastructure. Success at this level is the last barrier to at-will deployment. Storage, for instance, is more capable than where we read and write data. In his session at @DevOpsSummit at 20th Cloud Expo, Josh Atwell, a Developer Advocate for NetApp, will discuss the role and value...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend @CloudExpo | @ThingsExpo, June 6-8, 2017, at the Javits Center in New York City, NY and October 31 - November 2, 2017, Santa Clara Convention Center, CA. Learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.