Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 11, 2024 | Jun. 30, 2023 | |
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38180 | ||
Entity Registrant Name | HF Foods Group Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 81-2717873 | ||
Entity Address, Address Line One | 6325 South Rainbow Boulevard | ||
Entity Address, Address Line Two | Suite 420 | ||
Entity Address, City or Town | Las Vegas | ||
Entity Address, State or Province | NV | ||
Entity Address, Postal Zip Code | 89118 | ||
City Area Code | 888 | ||
Local Phone Number | 905-0988 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 237.7 | ||
Entity Common Stock, Shares Outstanding | 52,155,968 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant’s Proxy Statement for the 2024 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. The registrant’s Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2023. | ||
Entity Central Index Key | 0001680873 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Common Stock | |||
Title of 12(b) Security | Common Stock, $0.0001 par value | ||
Trading Symbol | HFFG | ||
Security Exchange Name | NASDAQ | ||
Preferred Stock | |||
Title of 12(b) Security | Preferred Share Purchase Rights |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Name | BDO USA, P.C. |
Auditor Location | Troy, Michigan |
Auditor Firm ID | 243 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
CURRENT ASSETS: | ||
Cash | $ 15,232 | $ 24,289 |
Inventories | 105,618 | 120,291 |
Prepaid expenses and other current assets | 10,145 | 8,937 |
TOTAL CURRENT ASSETS | 178,827 | 197,916 |
Property and equipment, net | 133,136 | 140,330 |
Operating lease right-of-use assets | 12,714 | 14,164 |
Long-term investments | 2,388 | 2,679 |
Customer relationships, net | 147,181 | 157,748 |
Trademarks, trade names and other intangibles, net | 30,625 | 36,343 |
Goodwill | 85,118 | 85,118 |
Other long-term assets | 6,531 | 3,231 |
TOTAL ASSETS | 596,520 | 637,529 |
CURRENT LIABILITIES: | ||
Checks issued not presented for payment | 4,494 | 21,946 |
Line of credit | 58,564 | 53,056 |
Current portion of long-term debt, net | 5,450 | 6,266 |
Current portion of obligations under finance leases | 1,749 | 2,254 |
Current portion of obligations under operating leases | 3,706 | 3,676 |
Accrued expenses and other liabilities | 17,287 | 19,648 |
TOTAL CURRENT LIABILITIES | 143,264 | 163,890 |
Long-term debt, net of current portion | 108,711 | 115,443 |
Obligations under finance leases, non-current | 11,229 | 11,441 |
Obligations under operating leases, non-current | 9,414 | 10,591 |
Deferred tax liabilities | 29,028 | 34,443 |
Other long-term liabilities | 6,891 | 5,472 |
TOTAL LIABILITIES | 308,537 | 341,280 |
COMMITMENTS AND CONTINGENCIES (Note 16) | ||
SHAREHOLDERS’ EQUITY: | ||
Preferred Stock, $0.001 par value; 1,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common Stock, $0.0001 par value; 100,000,000 shares authorized; 54,153,391 and 53,813,777 shares issued and 52,155,968 and 53,813,777 shares outstanding as of December 31, 2023 and December 31, 2022, respectively | 5 | 5 |
Treasury Stock, Common, Value | (7,750) | 0 |
Additional paid-in capital | 603,094 | 598,322 |
Accumulated deficit | (308,688) | (306,514) |
TOTAL SHAREHOLDERS’ EQUITY ATTRIBUTABLE TO HF FOODS GROUP INC. | 286,661 | 291,813 |
Noncontrolling interests | 1,322 | 4,436 |
TOTAL SHAREHOLDERS’ EQUITY | 287,983 | 296,249 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 596,520 | 637,529 |
Series A Preferred Stock | ||
SHAREHOLDERS’ EQUITY: | ||
Preferred Stock, $0.001 par value; 1,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Nonrelated Party | ||
CURRENT ASSETS: | ||
Accounts receivable, net of allowances of $2,119 and $1,442 | 47,524 | 44,186 |
CURRENT LIABILITIES: | ||
Accounts payable | 51,617 | 55,515 |
Related Party | ||
CURRENT ASSETS: | ||
Accounts receivable, net of allowances of $2,119 and $1,442 | 308 | 213 |
CURRENT LIABILITIES: | ||
Accounts payable | $ 397 | $ 1,529 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Allowance for credit loss, current | $ (2,119) | $ (1,442) |
Preferred stock. par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 54,153,391 | 53,813,777 |
Common stock, outstanding (in shares) | 52,155,968 | 53,813,777 |
Series A Preferred Stock | ||
Preferred stock. par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 100,000 | 100,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
TOTAL NET REVENUE | $ 1,148,493 | $ 1,170,467 | $ 796,884 |
TOTAL COST OF REVENUE | 944,462 | 964,955 | 645,372 |
GROSS PROFIT | 204,031 | 205,512 | 151,512 |
Distribution, selling and administrative expenses | 195,062 | 194,953 | 122,030 |
INCOME FROM OPERATIONS | 8,969 | 10,559 | 29,482 |
Other expenses (income): | |||
Interest expense | 11,478 | 7,457 | 4,091 |
Other income | (1,091) | (1,829) | (508) |
Change in fair value of interest rate swap contracts | 1,580 | (817) | (1,425) |
Lease guarantee expense | (377) | 5,744 | 0 |
(LOSS) INCOME BEFORE INCOME TAXES | (2,621) | 4 | 27,324 |
Income tax expense (benefit) | 41 | (231) | 4,503 |
NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME | (2,662) | 235 | 22,821 |
Less: net (loss) income attributable to noncontrolling interests | (488) | (225) | 676 |
NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO HF FOODS GROUP INC. | $ (2,174) | $ 460 | $ 22,145 |
(LOSS) EARNINGS PER COMMON SHARE - BASIC (in USD per share) | $ (0.04) | $ 0.01 | $ 0.43 |
(LOSS) EARNINGS PER COMMON SHARE - DILUTED (in USD per share) | $ (0.04) | $ 0.01 | $ 0.43 |
WEIGHTED AVERAGE SHARES - BASIC (in shares) | 53,878,237 | 53,757,162 | 51,918,323 |
WEIGHTED AVERAGE SHARES - DILUTED (in shares) | 53,878,237 | 53,863,448 | 52,091,822 |
Third Party | |||
TOTAL NET REVENUE | $ 1,142,648 | $ 1,163,525 | $ 787,829 |
TOTAL COST OF REVENUE | 938,815 | 958,775 | 636,253 |
Related Party | |||
TOTAL NET REVENUE | 5,845 | 6,942 | 9,055 |
TOTAL COST OF REVENUE | $ 5,647 | $ 6,180 | $ 9,119 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (2,662) | $ 235 | $ 22,821 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||
Depreciation and amortization expense | 25,918 | 24,936 | 19,126 |
Treasury stock received via legal settlement | (7,750) | 0 | 0 |
Treasury stock received via legal settlement | 7,750 | 0 | 0 |
Asset impairment charges | 1,200 | 422 | 0 |
Gain from disposal of property and equipment | (362) | (1,327) | (1,636) |
Provision for credit losses | 701 | 82 | (433) |
Deferred tax benefit | (5,415) | (5,012) | (6,870) |
Change in fair value of interest rate swap contracts | 1,580 | 817 | (1,425) |
Stock-based compensation | 3,352 | 1,257 | 635 |
Non-cash lease expense | 4,033 | 4,442 | 861 |
Lease guarantee expense | (377) | 5,744 | 0 |
Other non-cash expense (income) | 493 | (266) | (85) |
Changes in operating assets and liabilities (excluding effects of acquisitions): | |||
Accounts receivable | (4,039) | (8,577) | (10,999) |
Accounts receivable - related parties | (95) | 36 | 1,020 |
Inventories | 14,673 | (3,755) | (19,426) |
Advances to suppliers - related parties | 0 | 0 | 197 |
Prepaid expenses and other current assets | (1,069) | (4,008) | (944) |
Other long-term assets | (3,418) | (1,199) | (1,337) |
Accounts payable | (3,898) | 15,207 | 12,978 |
Accounts payable - related parties | (1,132) | (412) | (365) |
Operating lease liabilities | (3,730) | (4,408) | (724) |
Accrued expenses and other liabilities | (2,199) | 7,070 | 4,115 |
Net cash provided by operating activities | 15,804 | 31,284 | 17,509 |
Cash flows from investing activities: | |||
Purchase of property and equipment | (3,514) | (6,287) | (2,205) |
Proceeds from sale of property and equipment | 2,000 | 7,794 | 3,246 |
Payment made for acquisition of Sealand | 0 | (34,848) | 0 |
Payment made for acquisition of Great Wall Group | 0 | (17,445) | (37,841) |
Payment made for acquisition of noncontrolling interests | 0 | 0 | (5,000) |
Settlement of interest rate swap contracts | 0 | 0 | 718 |
Net cash used in investing activities | (1,514) | (50,786) | (41,082) |
Cash flows from financing activities: | |||
Payments for tax withholding related to vested stock awards | (394) | 0 | 0 |
Checks issued not presented for payment | (17,452) | 4,112 | 2,994 |
Proceeds from line of credit | 1,237,101 | 1,200,996 | 857,304 |
Repayment of line of credit | (1,231,647) | (1,203,112) | (820,422) |
Proceeds from long-term debt | 0 | 45,956 | 0 |
Repayment of long-term debt | (7,591) | (11,336) | (6,599) |
Payment of debt financing costs | 0 | (544) | 0 |
Repayment of obligations under finance leases | (2,480) | (2,626) | (2,135) |
Repayment of promissory note payable - related party | 0 | (4,500) | (2,500) |
Proceeds from noncontrolling interests shareholders | 0 | 240 | 480 |
Cash distribution to shareholders | (884) | (187) | (338) |
Net cash (used in) provided by financing activities | (23,347) | 28,999 | 28,784 |
Net (decrease) increase in cash | (9,057) | 9,497 | 5,211 |
Cash at beginning of the period | 24,289 | 14,792 | 9,581 |
Cash at end of the period | 15,232 | 24,289 | 14,792 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Cash paid for interest | 10,407 | 6,230 | 3,177 |
Cash paid for income taxes | 4,040 | 8,655 | 9,527 |
Right-of-use assets obtained in exchange for operating lease liabilities | 2,583 | 6,815 | 10,983 |
Property acquired in exchange for finance leases | 1,763 | 1,272 | 8,947 |
Treasury stock received via legal settlement | 7,750 | 0 | 0 |
Stock issued during period, acquisitions | 12,869 | ||
Note receivable related to property and equipment sales | 300 | 0 | 257 |
Intangible asset acquired in exchange for noncontrolling interests | 0 | 566 | 0 |
B&R Global | |||
Supplemental disclosure of non-cash investing and financing activities: | |||
Stock issued during period, acquisitions | 1,652 | 0 | 0 |
Great Wall Asset Purchase Agreement | |||
Supplemental disclosure of non-cash investing and financing activities: | |||
Stock issued during period, acquisitions | 0 | 0 | 14,541 |
Deferred consideration from Great Wall Acquisition | 17,400 | ||
B&R Realty, LLC | |||
Supplemental disclosure of non-cash investing and financing activities: | |||
Deferred consideration from Great Wall Acquisition | $ 0 | $ 0 | $ 17,330 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Cumulative Effect, Period of Adoption, Adjusted Balance | Total Shareholders’ Equity Attributable to HF Foods Group Inc. | Total Shareholders’ Equity Attributable to HF Foods Group Inc. Cumulative Effect, Period of Adoption, Adjustment | Total Shareholders’ Equity Attributable to HF Foods Group Inc. Cumulative Effect, Period of Adoption, Adjusted Balance | Common Stock | Common Stock Cumulative Effect, Period of Adoption, Adjusted Balance | Additional Paid-in Capital | Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjusted Balance | Retained Earnings (Accumulated Deficit) | Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment | Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjusted Balance | Noncontrolling Interests | Noncontrolling Interests Cumulative Effect, Period of Adoption, Adjusted Balance | Treasury Stock | Treasury Stock Cumulative Effect, Period of Adoption, Adjusted Balance |
Beginning balance (in shares) at Dec. 31, 2020 | 51,913,411 | ||||||||||||||||
Beginning balance at Dec. 31, 2020 | $ 263,522 | $ 259,155 | $ 5 | $ 587,579 | $ (328,429) | $ 4,367 | $ 0 | ||||||||||
Beginning balance, Treasury Stock (in shares) at Dec. 31, 2020 | 0 | ||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net income | 22,821 | 22,145 | 22,145 | 676 | |||||||||||||
Capital contribution by shareholders | 480 | 480 | |||||||||||||||
Distribution to shareholders | (338) | (338) | |||||||||||||||
Acquisition of noncontrolling interest | (5,000) | (3,856) | (3,856) | (1,144) | |||||||||||||
Stock issued during period, acquisitions (in shares) | 1,792,981 | ||||||||||||||||
Stock issued during period, acquisitions | 12,869 | 12,869 | 12,869 | ||||||||||||||
Stock-based compensation | 635 | 635 | 635 | 0 | |||||||||||||
Treasury stock received via legal settlement | 0 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2021 | 53,706,392 | 53,706,392 | |||||||||||||||
Ending balance at Dec. 31, 2021 | 294,989 | $ (690) | $ 294,299 | 290,948 | $ (690) | $ 290,258 | $ 5 | $ 5 | 597,227 | $ 597,227 | (306,284) | $ (690) | $ (306,974) | 4,041 | $ 4,041 | $ 0 | $ 0 |
Ending balance, Treasury Stock (in shares) at Dec. 31, 2021 | 0 | 0 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net income | 235 | 460 | 460 | (225) | |||||||||||||
Capital contribution by shareholders | 806 | 806 | |||||||||||||||
Distribution to shareholders | (186) | (186) | |||||||||||||||
Stock-based compensation | 1,257 | 1,257 | 1,257 | ||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 139,239 | ||||||||||||||||
Shares withheld for tax withholdings on vested awards (in shares) | (31,854) | ||||||||||||||||
Shares withheld for tax withholdings on vested awards | (162) | (162) | (162) | ||||||||||||||
Treasury stock received via legal settlement | 0 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2022 | 53,813,777 | ||||||||||||||||
Ending balance at Dec. 31, 2022 | $ 296,249 | 291,813 | $ 5 | 598,322 | (306,514) | 4,436 | $ 0 | ||||||||||
Ending balance, Treasury Stock (in shares) at Dec. 31, 2022 | 0 | 0 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net income | $ (2,662) | (2,174) | (2,174) | (488) | |||||||||||||
Distribution to shareholders | (884) | (884) | |||||||||||||||
Adjustments to Additional Paid in Capital, Other | (90) | 1,652 | 1,652 | (1,742) | |||||||||||||
Stock-based compensation | 3,352 | 3,352 | 3,352 | ||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 391,983 | ||||||||||||||||
Shares withheld for tax withholdings on vested awards (in shares) | (52,369) | ||||||||||||||||
Shares withheld for tax withholdings on vested awards | (232) | (232) | (232) | ||||||||||||||
Treasury stock received via legal settlement | 7,750 | 7,750 | 0 | $ 7,750 | |||||||||||||
Treasury Stock, Shares, Acquired | 1,997,423 | ||||||||||||||||
Ending balance (in shares) at Dec. 31, 2023 | 54,153,391 | ||||||||||||||||
Ending balance at Dec. 31, 2023 | $ 287,983 | $ 286,661 | $ 5 | $ 603,094 | $ (308,688) | $ 1,322 | $ (7,750) | ||||||||||
Ending balance, Treasury Stock (in shares) at Dec. 31, 2023 | (1,997,423) | 1,997,423 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Note 1 - Organization and Description of Business Organization and General HF Foods Group Inc. and subsidiaries (collectively “HF Foods”, or the “Company”) is an Asian foodservice distributor that markets and distributes fresh produce, seafood, frozen and dry food, and non-food products to primarily Asian restaurants and other foodservice customers throughout the United States. The Company's business consists of one operating segment, which is also its one reportable segment: HF Foods, which operates solely in the United States. The Company's customer base consists primarily of Chinese and Asian restaurants, and it provides sales and service support to customers who mainly converse in Mandarin or Chinese dialects. On December 30, 2021, the Company completed the acquisition of Great Wall Seafood Supply, Inc., Great Wall Restaurant Supplier, Inc., and First Mart Inc. (collectively the “Great Wall Group”), and substantially all of the operating assets of the Great Wall Group’s seafood and restaurant products sales, marketing, and distribution businesses (the “Great Wall Acquisition”). The acquisition was completed as part of the Company’s strategy to develop a national footprint through expansion into the Midwest, Southwest and Southern regions of the United States. On April 29, 2022, the Company completed the acquisition of substantially all of the operating assets of Sealand Food, Inc. ("Sealand") including equipment, machinery and vehicles. The acquisition was completed to expand the Company's territory along the East Coast, from Massachusetts to Florida, as well as Pennsylvania, West Virginia, Ohio, Kentucky, and Tennessee. See Note 7 - Acquisitions for additional information on the Great Wall Group and Sealand acquisitions. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 - Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). All adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying consolidated financial statements for 2023 include the accounts of HF Foods, and for 2022 and 2021, the accounts of HF Foods and certain variable interest entities for which the Company was the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. For consolidated entities where we own or are exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interest in its consolidated statements of operations and comprehensive income (loss) equal to the percentage of the economic or ownership interest retained in such entity by the respective noncontrolling party. Variable Interest Entities GAAP provides guidance on the identification of a variable interest entity (“VIE”) and financial reporting for an entity over which control is achieved through means other than voting interests. The Company evaluates each of its interests in an entity to determine whether or not the investee is a VIE and, if so, whether the Company is the primary beneficiary of such VIE. In determining whether the Company is the primary beneficiary, the Company considers if the Company (1) has power to direct the activities that most significantly affect the economic performance of the VIE, and (2) has the obligation to absorb losses or the right to receive the economic benefits of the VIE that could be potentially significant to the VIE. If deemed the primary beneficiary, the Company consolidates the VIE. As of and for the year ended December 31, 2023, the Company has one VIE, AnHeart, Inc. (“AnHeart”), for which the Company is not the primary beneficiary and therefore does not consolidate. The Company did not incur expenses from VIEs and did not have any sales to or income from any VIEs during the years ended December 31, 2023 and 2022. See Note 16 - Commitments and Contingencies for additional information on AnHeart. For the years ended December 31, 2022 and 2021, the Company had both VIEs for which it was not the primary beneficiary and therefore did not consolidate, and VIEs for which it was the primary beneficiary and did consolidate. The VIEs are summarized as follows: • Consolidated VIEs (collectively "Consolidated VIEs"): • FUSO Trucking LLC (“FUSO”) – Dissolved in 2022 • 8 staffing agencies (collectively, the “Staffing Agencies”) – Suppliers of staffing services through 2021: ◦ Anfu, Inc. ◦ Anshun, Inc. ◦ Inchoi, Inc. ◦ Malways, Inc. ◦ Rousafe ◦ S&P ◦ SNP ◦ Suntone • Unconsolidated VIEs (collectively "Unconsolidated VIEs"): • Revolution Industry, LLC (“Revolution Industry”) – Supplier of goods (until March 2021) • UGO USA, Inc. (“UGO”) – Supplier of online goods, customer, and lessee (until April 2021) • AnHeart, Inc. (“AnHeart”) Consolidated VIEs FUSO FUSO was established solely to provide exclusive trucking services to the Company and was dissolved in 2022. The entity lacked sufficient equity to finance its activities without additional subordinated financial support from the Company, and the Company had the power to direct the VIEs’ activities. In addition, the Company received economic benefits from the entity and concluded that the Company was the primary beneficiary. The carrying amounts of the assets, liabilities, the results of operations and cash flows of the VIE included in the Company’s consolidated balance sheets, statements of operations and comprehensive income (loss) and statements of cash flows were immaterial. Staffing Agencies The Staffing Agencies were set up by an employee of the Company, or their relatives, and provided temporary labor services exclusively to the Company at the direction of the Company. There were no other substantive business activities of the Staffing Agencies. There were immaterial assets held, or liabilities owed by the Staffing Agencies and immaterial equity. The Company determined it was the primary beneficiary for the Staffing Agencies through 2021 as it controlled how and when the labor force would be utilized. The Company consolidated the Staffing Agencies, recognizing compensation expense within distribution, selling, and administrative expenses in the consolidated statements of operations and comprehensive income (loss), and the related accrued expenses in the consolidated balance sheets. The Company did not have any guarantees, commitments or other forms of financing to the Staffing Agencies. As of December 31, 2021, the Company no longer had involvement with any of the Staffing Agencies and therefore was no longer considered a VIE and was no longer consolidated. Unconsolidated VIEs Revolution Industry and UGO Revolution Industry was established to produce egg roll mix for the Company. UGO was originally designed to be an online marketplace for various Asian goods. Revolution Industry and UGO were thinly capitalized and were not able to finance their activities without additional subordinated support. The former Co-CEO's (Mr. Ni) son, as sole equity holder of Revolution Industry, had unilateral control over the ongoing activities of Revolution Industry and significantly benefited from their operations. Therefore, the Company was not the primary beneficiary for Revolution Industry. The former Co-CEO (Mr. Ni) and his niece, as equity holders, had unilateral control over the ongoing activities of UGO and significantly benefited from its operations. Therefore, the Company was not the primary beneficiary for UGO. Revolution Industry and UGO are also related parties and were generally the Company’s suppliers or customers and the Company did not have other involvement with these entities. Therefore, the Company’s exposure to loss due to its involvement with these entities was limited to amounts due from these entities, which was included in Accounts receivable – related parties. The Company did not have any guarantees, commitments, or other forms of financing with these entities. All transactions with Revolution Industry and UGO ceased in 2021. Related party transactions with Revolution Industry and UGO are disclosed in Note 13 - Related Party Transactions. AnHeart AnHeart was previously a subsidiary of the Company designed to sell traditional Chinese medicine, sold to a third-party in February 2019. As discussed in Note 6 - Leases, after the sale, the Company continued to provide a guarantee for all rent and related costs associated with two leases of AnHeart in Manhattan, New York. The Company has determined that AnHeart is a VIE as a result of the guarantee. However, the Company concluded it is not the primary beneficiary of AnHeart because it does not have the power to direct the activities of AnHeart that most significantly impact AnHeart's economic performance. Please refer to Note 6 - Leases for additional information regarding the Company's maximum exposure to loss related to AnHeart. The Company did not have any sales to or rental income from any of the other VIEs during the three years ended December 31, 2023. Noncontrolling Interests GAAP requires that noncontrolling interests in subsidiaries and affiliates be reported in the equity section of the Company’s consolidated balance sheets. In addition, the amounts attributable to the net income (loss) of those noncontrolling interests are reported separately in the consolidated statements of operations and comprehensive income (loss). As of December 31, 2023 and December 31, 2022, noncontrolling interest equity consisted of the following: ($ in thousands) Ownership of noncontrolling interest at December 31, 2023 December 31, 2023 December 31, 2022 HF Foods Industrial, LLC ("HFFI") (a) 45.00% $ (759) $ 204 Min Food, Inc. 39.75% 1,715 1,704 Monterey Food Service, LLC 35.00% 366 452 Ocean West Food Services, LLC (b) —% — 1,986 Syncglobal Inc. (c) —% — 90 Total $ 1,322 $ 4,436 _________________ (a) During the year ended December 31, 2023, the Company exited HFFI operations. Accordingly, the machinery used in HFFI operations was impaired and subsequently sold. See Note 4 - Balance Sheet Components for additional information. (b) Effective June 30, 2023, Ocean West Food Services, LLC (“Ocean West”) became a wholly-owned subsidiary of the Company. In accordance with ASC Topic 810 (“ASC 810”), Consolidation , changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary shall be accounted for as equity transactions. No gain or loss was recognized. As a result of this transaction, noncontrolling interests of $1.7 million was reclassified to additional paid-in capital on the consolidated balance sheets. (c) During the year ended December 31, 2023 the Company ceased operations of Syncglobal Inc. and dissolved the entity. Uses of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during each reporting period. Actual results could differ from those estimates. Significant accounting estimates reflected in the Company’s consolidated financial statements include, but are not limited to, inventory reserves, impairment of long-lived assets, impairment of goodwill, and the purchase price allocation and fair value of assets and liabilities acquired with respect to business combinations. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 3 - Revenue The following table presents the Company's net revenue disaggregated by principal product categories: Year Ended December 31, ($ in thousands) 2023 2022 2021 Seafood $ 361,219 31 % $ 354,220 30 % $ 123,808 16 % Asian Specialty 305,466 27 % 299,215 26 % 236,489 29 % Meat and Poultry 215,789 19 % 238,276 20 % 214,504 27 % Fresh Produce 123,202 11 % 126,560 11 % 103,168 13 % Packaging and Other 71,245 6 % 84,489 7 % 69,187 9 % Commodity 71,572 6 % 67,707 6 % 49,728 6 % Total $ 1,148,493 100 % $ 1,170,467 100 % $ 796,884 100 % |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Note 4 - Balance Sheet Components Accounts receivable, net consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Accounts receivable $ 49,643 $ 45,628 Less: allowance for expected credit losses (2,119) (1,442) Accounts receivable, net $ 47,524 $ 44,186 Movement of allowance for expected credit losses was as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Beginning balance $ 1,442 $ 840 $ 909 Adjustment for adoption of the CECL standard — 690 — Increase (decrease) in provision for expected credit losses/doubtful accounts 701 82 (433) Bad debt (write-offs) recoveries (24) (170) 364 Ending balance $ 2,119 $ 1,442 $ 840 Prepaid expenses and other current assets consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Prepaid expenses $ 4,591 $ 1,504 Advances to suppliers 3,340 4,494 Other current assets 2,214 2,939 Prepaid expenses and other current assets $ 10,145 $ 8,937 Property and equipment, net consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Automobiles $ 37,883 $ 34,891 Buildings 63,145 63,045 Building improvements 22,120 20,637 Furniture and fixtures 474 444 Land 49,929 49,929 Machinery and equipment 12,090 17,210 Subtotal 185,641 186,156 Less: accumulated depreciation (52,505) (45,826) Property and equipment, net $ 133,136 $ 140,330 Depreciation expense was $9.6 million, $9.2 million and $8.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. During the year ended December 31, 2023, the Company impaired machinery and recognized impairment expense of $1.2 million in distribution, selling and administrative expense in the consolidated statements of operations and comprehensive income (loss). See Note 2 - Summary of Significant Accounting Policies for additional information regarding the Company’s operations at HFFI. Long-term investments consisted of the following: (In thousands) Ownership as of December 31, December 31, 2023 December 31, 2022 Asahi Food, Inc. ("Asahi") 49% $ 588 $ 879 Pt. Tamron Akuatik Produk Industri ("Tamron") 12% 1,800 1,800 Total long-term investments $ 2,388 $ 2,679 The investment in Tamron is accounted for using the measurement alternative under Accounting Standards Codification (“ASC”) Topic 321 Investments—Equity Securities , which is measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments, if any. The investment in Asahi is accounted for under the equity method due to the fact that the Company has significant influence but does not exercise control over this investee. The Company determined there was no impairment for the years ended December 31, 2023, 2022 and 2021 for these investments. Accrued expenses and other liabilities consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Accrued compensation $ 7,941 $ 6,798 Accrued professional fees 1,353 3,866 Accrued interest and fees 1,276 1,082 Self-insurance liability 1,723 1,286 Accrued other 4,994 6,616 Total accrued expenses and other liabilities $ 17,287 $ 19,648 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 5 - Fair Value Measurements The following table presents the Company's hierarchy for its assets and liabilities measured at fair value on a recurring basis as of the dates indicated: December 31, 2023 December 31, 2022 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (In thousands) Assets: Interest rate swaps $ — $ 412 $ — $ 412 $ — $ 530 $ — $ 530 Liabilities: Interest rate swaps $ — $ (1,601) $ — $ (1,601) $ — $ — $ — $ — The Company follows the provisions of ASC Topic 820 Fair Value Measurement which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: • Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. • Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. • Level 3 - Inputs are unobservable inputs which reflect the reporting entity’s own assumptions about what assumptions market participants would use in pricing the asset or liability based on the best available information. Any transfers of assets or liabilities between Level 1, Level 2, and Level 3 of the fair value hierarchy will be recognized at the end of the reporting period in which the transfer occurs. There were no transfers between fair value levels in any of the periods presented herein. The carrying amounts reported in the consolidated balance sheets for cash, accounts receivable, other current assets, accounts payable, checks issued not presented for payment and accrued expenses and other liabilities approximate their fair value based on the short-term maturity of these instruments. Please refer to Note 9 - Derivative Financial Instruments for additional information regarding the Company’s interest rate swaps. Carrying Value and Estimated Fair Value of Outstanding Debt - The following table presents the carrying value and estimated fair value of the Company’s outstanding debt as described in Note 10 - Debt of the Notes to the Consolidated Financial Statements, including the current portion, as of the dates indicated: Fair Value Measurements (In thousands) Level 1 Level 2 Level 3 Carrying Value December 31, 2023 Fixed rate debt: Bank of America $ — $ — $ 151 $ 169 Other finance institutions — — 43 45 Variable rate debt: JPMorgan Chase $ — $ 106,079 $ — $ 106,079 Bank of America — 2,193 — 2,193 East West Bank — 5,675 — 5,675 December 31, 2022 Fixed rate debt: Bank of America $ — $ — $ 1,630 $ 1,948 Other finance institutions — — 186 197 Variable rate debt: JPMorgan Chase $ — $ 111,413 $ — $ 111,413 Bank of America — 2,330 — 2,330 East West Bank — 5,822 — 5,822 The carrying value of the variable rate debt approximates its fair value because of the variability of interest rates associated with these instruments. For the Company's fixed rate debt, the fair values were estimated using discounted cash flow analyses, based on the current incremental borrowing rates for similar types of borrowing arrangements. Please refer to Note 10 - Debt for additional information regarding the Company's debt. Nonrecurring Fair Values The Company measures fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Adjustments to fair value resulted from the write-down of asset values due to impairment. During the year ended December 31, 2023, the Company partially impaired machinery related to the operations of HFFI and recognized impairment expense of $1.2 million in distribution, selling and administrative expense in the consolidated statements of operations and comprehensive income (loss). The machinery was sold during the year ended December 31, 2023. The impairment was based on sales prices of similar equipment listed by third-party sellers and considered a Level 3 fair value measurement. During the year ended December 31, 2022, the Company fully impaired its acquired developed technology associated with the Syncglobal, Inc. joint venture and recognized impairment expense of $0.4 million in distribution, selling and administrative expenses in the consolidated statements of operations and comprehensive income (loss) during the year ended December 31, 2022 . |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | Note 6 - Leases The Company leases office space, warehouses and vacant land under non-cancelable operating leases, with terms typically ranging from one Operating and finance lease assets and lease liabilities are recognized at commencement date and initially measured based on the present value of lease payments over the defined lease term. Operating lease expense is recognized on a straight-line basis over the lease term. The Company also recognizes finance lease assets and finance lease liabilities at inception, with lease expense recognized as interest expense and amortization of the lease payment. Variable lease costs were insignificant in the years ended December 31, 2023, 2022 and 2021. As of December 31, 2023, the balances for operating lease right-of-use ("ROU") assets and liabilities were $12.7 million and $13.1 million, respectively. As of December 31, 2022, the balances for operating lease ROU assets and liabilities were $14.2 million and $14.3 million, respectively. Operating Leases The components of operating lease expense were as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Operating lease cost $ 4,342 $ 4,045 $ 967 Short-term lease cost $ 1,507 $ 1,037 $ 1,699 Weighted average remaining lease term (months) 42 47 56 Weighted average discount rate 4.5% 3.8% 3.9% Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from operating leases $ 4,234 $ 4,005 $ 822 Finance Leases The components of lease expense were as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Finance leases cost: Amortization of ROU assets $ 2,639 $ 2,808 $ 2,416 Interest on lease liabilities 755 787 820 Total finance leases cost $ 3,394 $ 3,595 $ 3,236 Supplemental cash flow information related to finance leases was as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from finance leases $ 657 $ 670 $ 701 Supplemental balance sheet information related to finance leases was as follows: ($ in thousands) December 31, 2023 December 31, 2022 Property and equipment, at cost $ 22,203 $ 20,339 Accumulated depreciation (10,288) (7,615) Property and equipment, net $ 11,915 $ 12,724 Weighted average remaining lease term (months) 219 215 Weighted average discount rate 5.7 % 5.7 % Maturities of lease liabilities are as follows: Operating Leases (In thousands) Related Party (1) Third Party Total Finance Year Ended December 31, 2024 $ 321 $ 4,253 $ 4,574 $ 2,396 2025 331 4,216 4,547 1,747 2026 — 4,164 4,164 1,365 2027 — 1,696 1,696 1,100 2028 — 933 933 929 Thereafter — — — 16,407 Total lease payments 652 15,262 15,914 23,944 Less: Imputed interest (23) (2,771) (2,794) (10,966) Total $ 629 $ 12,491 $ 13,120 $ 12,978 _______________ (1) See Note 13 - Related Party Transactions |
Leases | Note 6 - Leases The Company leases office space, warehouses and vacant land under non-cancelable operating leases, with terms typically ranging from one Operating and finance lease assets and lease liabilities are recognized at commencement date and initially measured based on the present value of lease payments over the defined lease term. Operating lease expense is recognized on a straight-line basis over the lease term. The Company also recognizes finance lease assets and finance lease liabilities at inception, with lease expense recognized as interest expense and amortization of the lease payment. Variable lease costs were insignificant in the years ended December 31, 2023, 2022 and 2021. As of December 31, 2023, the balances for operating lease right-of-use ("ROU") assets and liabilities were $12.7 million and $13.1 million, respectively. As of December 31, 2022, the balances for operating lease ROU assets and liabilities were $14.2 million and $14.3 million, respectively. Operating Leases The components of operating lease expense were as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Operating lease cost $ 4,342 $ 4,045 $ 967 Short-term lease cost $ 1,507 $ 1,037 $ 1,699 Weighted average remaining lease term (months) 42 47 56 Weighted average discount rate 4.5% 3.8% 3.9% Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from operating leases $ 4,234 $ 4,005 $ 822 Finance Leases The components of lease expense were as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Finance leases cost: Amortization of ROU assets $ 2,639 $ 2,808 $ 2,416 Interest on lease liabilities 755 787 820 Total finance leases cost $ 3,394 $ 3,595 $ 3,236 Supplemental cash flow information related to finance leases was as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from finance leases $ 657 $ 670 $ 701 Supplemental balance sheet information related to finance leases was as follows: ($ in thousands) December 31, 2023 December 31, 2022 Property and equipment, at cost $ 22,203 $ 20,339 Accumulated depreciation (10,288) (7,615) Property and equipment, net $ 11,915 $ 12,724 Weighted average remaining lease term (months) 219 215 Weighted average discount rate 5.7 % 5.7 % Maturities of lease liabilities are as follows: Operating Leases (In thousands) Related Party (1) Third Party Total Finance Year Ended December 31, 2024 $ 321 $ 4,253 $ 4,574 $ 2,396 2025 331 4,216 4,547 1,747 2026 — 4,164 4,164 1,365 2027 — 1,696 1,696 1,100 2028 — 933 933 929 Thereafter — — — 16,407 Total lease payments 652 15,262 15,914 23,944 Less: Imputed interest (23) (2,771) (2,794) (10,966) Total $ 629 $ 12,491 $ 13,120 $ 12,978 _______________ (1) See Note 13 - Related Party Transactions |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Note 7 - Acquisitions Acquisition of Sealand On April 29, 2022, the Company completed the acquisition of substantially all of the operating assets of Sealand, including equipment, machinery and vehicles. The acquisition was completed to expand the Company's territory along the East Coast, from Massachusetts to Florida, as well as Pennsylvania, West Virginia, Ohio, Kentucky, and Tennessee. The price for the purchased assets was $20.0 million paid in cash at closing. In addition to the closing cash payment, the Company separately acquired all of the sellers' saleable product inventory, for approximately $14.4 million and additional fixed assets for approximately $0.5 million. The Company accounted for this transaction under ASC 805 Business Combinations, by applying the acquisition method of accounting and established a new basis of accounting on the date of acquisition. The assets acquired by the Company were measured at their estimated fair values as of the date of acquisition. Goodwill is calculated as the excess of the purchase price over the net assets recognized and represent synergies and benefits expected as a result from combining operations with an emerging national presence. The transaction costs for the acquisition for the year ended December 31, 2022 totaled approximately $0.7 million and were reflected in distribution, selling and administrative expenses in the consolidated statement of operations and comprehensive income. The information included herein was prepared based on the allocation of the purchase price using estimates of the fair value of assets acquired and liabilities assumed which were determined using a combination of quoted market prices, discounted cash flows, and other estimates made by management. Purchase Price Allocation The total consideration paid to acquire the assets and liabilities of Sealand, as set forth below: (In thousands) Amount Inventory $ 13,846 Property plant, and equipment 1,424 Right-of-use assets 127 Intangible assets 14,717 Total assets acquired 30,114 Obligations under operating leases 127 Total liabilities assumed 127 Net assets 29,987 Goodwill 4,861 Total consideration $ 34,848 |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Note 8 - Goodwill and Acquired Intangible Assets Goodwill |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 9 - Derivative Financial Instruments Derivative Instruments The Company utilizes interest rate swaps ("IRS") for the sole purpose of mitigating interest rate fluctuation risk associated with floating rate debt instruments (as defined in Note 10 - Debt ). The Company does not use any other derivative financial instruments for trading or speculative purposes. On August 20, 2019, HF Foods entered into two IRS contracts with East West Bank (the "EWB IRS") for initial notional amounts of $1.1 million and $2.6 million, respectively. On April 20, 2023, the Company amended the corresponding mortgage term loans, which pegged the two mortgage term loans to 1-month Term SOFR (Secured Overnight Financing Rate) + 2.29% per annum for the remaining duration of the term loans. The amended EWB IRS contracts fixed the two term loans at 4.23% per annum until maturity in September 2029. On December 19, 2019, HF Foods entered into an IRS contract with Bank of America (the "BOA IRS") for an initial notional amount of $2.7 million in conjunction with a newly contracted mortgage term loan of corresponding amount. On December 19, 2021, the Company entered into the Second Amendment to Loan Agreement, which pegged the mortgage term loan to Term SOFR + 2.5% . The BOA IRS was modified accordingly to fix the SOFR based loan to approximately 4.50%. The term loan and corresponding BOA IRS contract mature in December 2029. On March 15, 2023, the Company entered into an amortizing IRS contract with JPMorgan Chase for an initial notional amount of $120.0 million, effective from March 1, 2023 and expiring in March 2028, as a means to partially hedge its existing floating rate loans exposure. Pursuant to the agreement, the Company will pay the swap counterparty a fixed rate of 4.11% in exchange for floating payments based on Term SOFR. The Company evaluated the aforementioned IRS contracts currently in place and did not designate those as cash flow hedges. Hence, the fair value change on these IRS contracts are accounted for and recognized as a change in fair value of IRS contracts in the consolidated statements of operations and comprehensive income (loss). As of December 31, 2023, the Company determined that the fair values of the IRS contracts were $0.4 million in an asset position and $1.6 million in a liability position. As of December 31, 2022, the fair values of the IRS contracts were $0.5 million in an asset position. The Company includes these in other long-term assets other long-term liabilities |
Debt
Debt | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Note 10 - Debt Long-term debt at December 31, 2023 and December 31, 2022 is summarized as follows: ($ in thousands) Bank Name Maturity Interest Rate at December 31, 2023 December 31, 2023 December 31, 2022 Bank of America (a) October 2026 - December 2029 4.34% - 7.95% $ 2,362 $ 4,315 East West Bank (b) August 2027 - September 2029 7.64% - 9.00% 5,675 5,822 JPMorgan Chase (c) January 2030 7.32% - 7.44% 106,337 111,714 Other finance institutions (d) January 2024 - July 2024 5.99% - 6.17% 45 160 Total debt, principal amount 114,419 122,011 Less: debt issuance costs (258) (302) Total debt, carrying value 114,161 121,709 Less: current portion (5,450) (6,266) Long-term debt $ 108,711 $ 115,443 _______________ (a) Loan balance consists of real estate term loan and equipment term loan, collateralized by one real property and specific equipment. The real estate term loan is pegged to TERM SOFR + 2.5%. (b) Real estate term loans with East West Bank are collateralized by three real properties. Balloon payments of $1.8 million and $2.9 million are due at maturity in 2027 and 2029, respectively. (c) Real estate term loan with a principal balance of $106.3 million as of December 31, 2023 and $111.4 million as of December 31, 2022 is secured by assets held by the Company and has a maturity date of January 2030. Equipment term loan with a principal balance of $0.02 million as of December 31, 2023 and $0.3 million as of December 31, 2022 is secured by specific vehicles and equipment as defined in loan agreements. Equipment term loan matured in December 2023 and retired after December 31, 2023 with the final payment of remaining outstanding principal. (d) Secured by vehicles. The terms of the various loan agreements related to long-term bank borrowings require the Company to comply with certain financial covenants, including, but not limited to, a fixed charge coverage ratio and effective tangible net worth. As of December 31, 2023, the Company was in compliance with its covenants. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | The Company computes earnings per share (“EPS”) in accordance with ASC Topic 260 (“ASC 260”), Earnings per Share |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12 - Income Taxes |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 13 - Related Party Transactions |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 14 - Stock-Based Compensation The Company has a stock-based employee compensation plan, known as the HF Foods Group Inc. 2018 Omnibus Equity Incentive Plan (the “2018 Incentive Plan”). The 2018 Incentive Plan allows for up to 3,000,000 shares of common stock reserved for issuance of awards to employees, non-employee directors, and consultants. The 2018 Incentive Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, other stock awards, and performance awards that may be settled in stock, or other property. The Company began issuing awards under the 2018 Incentive Plan in February 2021. As of December 31, 2023, the Company had 810,944 time-based vesting restricted stock units (“RSUs”) unvested, 665,932 performance-based restricted stock units (“PSUs”) unvested, 531,222 shares of common stock vested and 991,902 shares remaining available for future awards under the 2018 Incentive Plan. RSUs granted to employees vest over time based on continued service (vesting over a period between one A summary of RSU and PSU activity for the year ended December 31, 2023 is as follows: Shares Weighted Average Grant Date Fair Value Unvested RSUs at December 31, 2022 598,325 $ 5.39 Granted 520,248 3.86 Forfeited (54,589) 4.94 Vested (253,040) 5.45 Unvested RSUs at December 31, 2023 810,944 4.43 Shares Weighted Average Grant Date Fair Value Unvested PSUs at December 31, 2022 382,662 $ 4.95 Granted 441,288 3.86 Forfeited (38,926) 4.19 Vested (119,092) 5.19 Unvested PSUs at December 31, 2023 665,932 4.23 The weighted-average grant date fair value per share of RSUs granted during the years ended December 31, 2023, 2022, and 2021 was $3.86, $5.04 and $5.22, respectively. The weighted-average grant date fair value per share of PSUs granted during the years ended December 31, 2023, 2022 and 2021 was $3.86, $4.76 and $4.94, respectively. The total fair value of equity based awards that vested during the years ended December 31, 2023, 2022 and 2021 was $1.5 million, $0.8 million and zero, respectively. The Company accounts for stock-based compensation in accordance with ASC Topic 718 Compensation - Stock Compensation (“ASC 718”). ASC 718 addresses all forms of share-based payment awards including shares issued under employee stock purchase plans and stock incentive shares. The fair value of the RSUs and Financial PSUs are measured using the closing price of the Company’s common stock on NASDAQ Global Capital Market on the date preceding grant date. The fair value of the TSR PSUs are determined using a Monte Carlo simulation model. No TSR PSUs were granted during the years ended December 31, 2023 and 2022. The assumptions used to estimate the fair value of the TSR PSUs granted during the year ended December 31, 2021 and valued under the Monte Carlo simulation model were as follows: 2021 PSU Grants Risk-free interest rate 0.20% - 0.34% Expected dividend yield 0.00% Expected term (years) 2.56 - 3.15 Expected volatility (1) 62.08% - 65.74% _______________ (1) Expected volatility is based on a 50/50 blending of (i) the average historical volatility of a select group of industry peers with a look-back period equal to the expected term, and (ii) the historical volatility of the Company with a look-back period of 0.75 years - 1.17 years, the time from the valuation date to the date six months after the completion of the merger with B&R Global, using daily stock prices. The expected volatility of peer companies was 54.96% – 63.45%. The expected volatility of the Company's common stock was 66.10% – 69.19%. The fair value of RSUs are amortized on a straight-line basis over the requisite service period for each award. For the PSUs, the Company recognizes stock-based compensation expense on a straight-line basis for each vesting tranche over the longer of the derived, explicit, or implicit service period for the vesting tranche. As of interim and annual reporting periods, the Financial PSUs stock-based compensation expense is adjusted based on expected achievement of performance targets, while TSR PSUs stock-based compensation expense is not adjusted. The Company recognizes forfeitures as they occur. Stock-based compensation expense is included in distribution, selling and administrative expenses in the Company's consolidated statements of operations and comprehensive income (loss). The components of stock-based compensation expense for the years ended December 31, 2023 and 2022 and 2021 were as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Stock-based compensation (RSUs) expense $ 2,118 $ 897 $ 405 Stock-based compensation (PSUs) expense 1,234 360 230 Total stock-based compensation expense $ 3,352 $ 1,257 $ 635 Tax benefit of stock-based compensation expense $ 931 $ 366 $ 132 |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Note 15 - Employee Benefit Plan |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 16 - Commitments and Contingencies From time to time, the Company is a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. When the Company becomes aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. In accordance with authoritative guidance, the Company records loss contingencies in its financial statements only for matters in which losses are probable and can be reasonably estimated. Where a range of loss can be reasonably estimated with no best estimate in the range, the Company records the minimum estimated liability. If the loss is not probable or the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the specific claim if the likelihood of a potential loss is reasonably possible and the amount involved is material. The Company continuously assesses the potential liability related to its pending litigation and revise its estimates when additional information becomes available. Adverse outcomes in some or all of these matters may result in significant monetary damages or injunctive relief against the Company that could adversely affect its ability to conduct business. There also exists the possibility of a material adverse effect on the Company’s financial statements for the period in which the effect of an unfavorable outcome becomes probable and reasonably estimable. Legal costs associated with loss contingencies are expensed as incurred. As previously disclosed, in March 2020, an analyst report suggested certain improprieties in the Company’s operations, and in response to those allegations, the Company’s Board of Directors appointed a Special Committee of Independent Directors (the “Special Investigation Committee”) to conduct an internal independent investigation with the assistance of counsel. These allegations became the subject of two putative stockholder class actions filed on or after March 29, 2020 in the United States District Court for the Central District of California generally alleging the Company and certain of its current and former directors and officers violated the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements (the “Class Actions”). These Class Actions have since been dismissed and are now closed. In addition, the SEC initiated a formal, non-public investigation of the Company, and the SEC informally requested, and later issued a subpoena for, documents and other information. The subpoena relates to but is not necessarily limited to the matters identified in the Class Actions. The Special Investigation Committee and the Company have been cooperating with the SEC. Certain factual findings were made based on evidence adduced by the Special Investigation Committee during its internal investigation. After the conclusion of its internal investigation, the Special Investigation Committee also made recommendations to management regarding improvements to Company operations and structure, including but not limited to its dealings with related parties. The Company has implemented numerous improvements and continues to improve its compliance program. The Company has also instituted structural changes including the appointment of an independent Chairman of the Board to replace the former Co-Chief Executive Officer and Chairman of the Board. In addition, as of January 31, 2023, three other independent directors serve on the Company’s Board of Directors. The Company’s senior executive team now includes a General Counsel and Chief Compliance Officer, a Chief Operations Officer who was hired in May 2022, and a new Chief Financial Officer who joined the Company in August 2022. We also hired a Vice President and Head of Internal Audit in April 2022 who reports directly to the Chief Financial Officer and to the Audit Committee Chair. In November 2022, we hired a Vice President of Compliance and Associate General Counsel, who reports directly to the General Counsel and Chief Compliance Officer. The Company also created a Special Litigation Committee which determined to pursue claims against certain former officers and directors. As a result, pursuant to the previously disclosed settlement agreement (as amended on November 1, 2023, the “Settlement Agreement”) between the Company and certain parties to the verified stockholder derivative complaint filed by James Bishop in the Court of Chancery of the State of Delaware, on October 16, 2023, the Company received $1.5 million on behalf of Zhou Min Ni, a former Chairman and Chief Executive Officer of the Company, and Chan Sin Wong, a former President and Chief Operating Officer of the Company (together, the “Ni Defendants”). Subsequently, on December 1, 2023, the Company received 1,997,423 shares (valued at $7.75 million) of the Company’s common stock, based on the closing price of $3.88 on October 13, 2023, plus a cash payment of approximately $0.1 million of accrued interest through the date of payment, in satisfaction of the Ni Defendant’s payment obligations totaling $9.25 million under the Settlement Agreement. The receipt of the settlement proceeds were recorded in distribution, selling, and administrative expense in the consolidated statement of operations (as a recovery of previously recorded expenses related to the litigation) and cash and treasury stock in the consolidated balance sheet. Pursuant to the terms of the Settlement Agreement, Mr. Ni, Ms. Wong and Jonathan Ni, the former Chief Financial Officer of the Company, agreed to give up any rights to indemnification or the advancement of fees in connection with the SEC investigation and any actions the SEC might take against them relating to the SEC investigation. On October 13, 2023, the Company received a “Wells Notice” from the staff of the SEC (the “Wells Notice”) relating to the previously disclosed formal, non-public SEC investigation of allegations that the Company and certain of its current and former directors and officers violated the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements. A Wells Notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law and invites recipients to submit a response if they wish. The Company made a submission in response to the Wells Notice explaining why an enforcement action would not be appropriate. Following that submission, the staff of the SEC determined that it would no longer be recommending that the SEC file an enforcement action against the Company at this time pending a potential agreed-upon resolution between the Company and the SEC. The Company is in negotiations with the SEC over a potential resolution, which could include fines and penalties, but the terms of that settlement are not set. The Company has made no formal offer of settlement to the SEC as of this filing, and therefore, a reasonable estimate of the contingency cannot be made. AnHeart Lease Guarantee The Company provided a guarantee for two separate leases for two properties located in Manhattan, New York, at 273 Fifth Avenue and 275 Fifth Avenue, for 30 years and 15 years, respectively. The Company has determined that AnHeart is a VIE as a result of the guarantee. However, the Company concluded it is not the primary beneficiary of AnHeart and therefore does not consolidate, because it does not have the power to direct the activities of AnHeart that most significantly impact AnHeart's economic performance. On February 10, 2021, the Company entered into an Assignment and Assumption of Lease Agreement (“Assignment”), dated effective as of January 21, 2021, with AnHeart and Premier 273 Fifth, LLC, pursuant to which it assumed the lease of the premises at 273 Fifth Avenue (the “273 Lease Agreement”). At the same time, the closing documents were delivered to effectuate the amendment of the 273 Lease Agreement pursuant to an Amendment to Lease (the “Lease Amendment”). The Assignment and the Lease Amendment were negotiated in light of the Company’s guarantee obligations as guarantor under the Lease Agreement. The Company agreed to observe all the covenants and conditions of the Lease Agreement, as amended, including the payment of all rents due. Under the terms of the Lease Agreement and the Assignment, the Company has undertaken to construct, at its own expense, a building on the premises at a minimum cost of $2.5 million. The Lease Amendment permits subletting of the premises, and the Company intends to sublease the newly constructed premises to defray the rental expense undertaken pursuant to its guaranty obligations. On January 17, 2022, the Company received notice that AnHeart had defaulted on its obligations as tenant under the lease for 275 Fifth Avenue. On February 7, 2022, the Company undertook its guaranty obligations by assuming responsibility for payment of monthly rent and other tenant obligations, including past due rent as well as property tax obligations beginning with the January 2022 rent due. On February 25, 2022, the Company instituted a legal action to pursue legal remedies against AnHeart and Minsheng. In March 2022, the Company agreed to stay that litigation against AnHeart in exchange for AnHeart’s payment of certain back rent from January to April 2022 and its continued partial payment of monthly rent. AnHeart subsequently defaulted on these obligations. On October 25, 2023, the Company commenced a new legal action by filing a complaint in New York County Supreme Court to pursue legal remedies against AnHeart and Minsheng. As of the filing of the new summons and complaint, AnHeart and Minsheng are indebted to the Company in the amount of $474,000. In accordance with ASC Topic 460, Guarantees , the Company has determined that its maximum exposure resulting from the 275 Fifth Avenue lease guarantee includes future minimum lease payments plus potential additional payments to satisfy maintenance, property tax and insurance requirements under the leases with a remaining term of approximately 10 years. The Company elected a policy to apply the discounted cash flow method to loss contingencies with more than 18 months of payments. AnHeart is obligated to pay all costs associated with the properties, including taxes, insurance, utilities, maintenance and repairs. During the year ended December 31, 2022, the Company recorded a lease guarantee liability of $5.9 million. The Company determined the discounted value of the lease guarantee liability using a discount rate of 4.55%. As of December 31, 2023, the Company had a lease guarantee liability of $5.5 million. The current portion of the lease guarantee liability of $0.3 million is recorded in accrued expenses and other liabilities, while the long-term portion is recorded in other long-term liabilities on the consolidated balance sheet. The Company's monthly rental payments range from approximately $42,000 per month to $63,000 per month, with the final payment due in 2034. The changes in the lease guarantee liability are presented below: (In thousands) Amount Balance at December 31, 2021 $ — Lease guarantee liability recorded 5,942 Lease guarantee liability activity (182) Balance at December 31, 2022 5,760 Lease guarantee liability activity (288) Balance at December 31, 2023 $ 5,472 The estimated future minimum lease payments as of December 31, 2023 are presented below: (In thousands) Amount Year Ending December 31, 2024 $ 582 2025 604 2026 621 2027 638 2028 656 Thereafter 3,822 Total 6,923 Less: imputed interest (1,451) Total minimum lease payments $ 5,472 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 17 - Subsequent Events Other than as disclosed elsewhere in this report, no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the accompanying notes. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). All adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying consolidated financial statements for 2023 include the accounts of HF Foods, and for 2022 and 2021, the accounts of HF Foods and certain variable interest entities for which the Company was the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation. For consolidated entities where we own or are exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interest in its consolidated statements of operations and comprehensive income (loss) equal to the percentage of the economic or ownership interest retained in such entity by the respective noncontrolling party. |
Noncontrolling Interests | Noncontrolling Interests GAAP requires that noncontrolling interests in subsidiaries and affiliates be reported in the equity section of the Company’s consolidated balance sheets. In addition, the amounts attributable to the net income (loss) of those noncontrolling interests are reported separately in the consolidated statements of operations and comprehensive income (loss). |
Use of Estimates | Uses of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during each reporting period. Actual results could differ from those estimates. Significant accounting estimates reflected in the Company’s consolidated financial statements include, but are not limited to, inventory reserves, impairment of long-lived assets, impairment of goodwill, and the purchase price allocation and fair value of assets and liabilities acquired with respect to business combinations. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or shorter as cash equivalents. As of December 31, 2023 and December 31, 2022, the Company had no cash equivalents. Accounts at banks with an aggregate excess of the amount of outstanding checks over the cash balances are included in checks issued not presented for payment in current liabilities in the consolidated balance sheets. |
Accounts Receivable, net | Accounts Receivable, net |
Inventories | Inventories The Company’s inventories, consisting mainly of food and other foodservice-related products, are considered finished goods. Inventory costs, including the purchase price of the product and freight charges to deliver it to the Company’s warehouses, are net of certain cash consideration received from vendors, primarily in the form of rebates. The Company adjusts its inventory balance for slow-moving, excess and obsolete inventories to the net recoverable value of such goods based upon inventory category, inventory age, specifically identified items, and overall economic conditions. Inventories are stated at the lower of cost or net realizable value using the first-in, first-out (FIFO) method. |
Property and Equipment, net | Property and Equipment, net Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Following are the estimated useful lives of the Company’s property and equipment: Estimated Useful Lives Automobiles 3 to 7 years Buildings and improvements 7 to 39 years Furniture and fixtures 4 to 10 years Machinery and equipment 3 to 10 years Leasehold improvements are amortized over the shorter of the useful life of those leasehold improvements and the remaining lease term. Repair and maintenance costs are charged to expense as incurred, whereas the cost of renewals and betterment that extends the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the cost and accumulated depreciation from the asset and accumulated depreciation accounts with any resulting gain or loss reflected in the consolidated statements of operations and comprehensive income (loss) in distribution, selling and administrative expenses. Software Costs In accordance with ASC 350-40, Internal-Use Software, the Company capitalizes certain computer software licenses and software implementation costs related to developing or obtaining computer software for internal use. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task that it previously did not perform. Internal use software is amortized on a straight-line basis over a three to five year period. Capitalized costs include direct acquisitions as well as software and software development acquired under capitalized leases and internal labor where appropriate. Capitalized software purchases and related development costs, net of accumulated amortization, were $5.1 million as of December 31, 2023 and zero as of December 31, 2022, and are included in other long-term assets on the consolidated balance sheets. |
Business Combinations | Business Combinations The Company accounts for its business combinations using the purchase method of accounting in accordance with ASC Topic 805, Business Combinations . The purchase method of accounting requires that the consideration transferred be allocated to the assets, including separately identifiable assets and liabilities the Company acquired, based on their estimated fair values. The consideration transferred in an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any noncontrolling interests. The excess of (i) the total of cost of acquisition, fair value of the noncontrolling interests and acquisition date fair value of any previously held equity interest in the acquiree over, (ii) the fair value of the identifiable net assets of the acquiree, is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in earnings. The Company estimates the fair value of assets acquired and liabilities assumed in a business combination. While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, its estimates are inherently uncertain and subject to refinement. Significant estimates in valuing certain intangible assets include, but are not limited to future expected revenues and cash flows, useful lives, discount rates, and selection of comparable companies. Although the Company believes the assumptions and estimates it has made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from management of the acquired companies and are inherently uncertain. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. On the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations and comprehensive income (loss). Transaction costs associated with business combinations are expensed as incurred, and are included in distribution, selling and administrative expenses in the Company’s consolidated statements of operations and comprehensive income (loss). The results of operations of the businesses that the Company acquired are included in the Company’s consolidated financial statements from the date of acquisition. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets acquired in a business combination. The Company tests goodwill for impairment at least annually, as of December 31, or whenever events or changes in circumstances indicate that goodwill might be impaired. The Company's policy is to test goodwill for impairment annually on the last day of the fourth quarter, or more frequently if certain triggering events or circumstances indicate it could be impaired. Potential impairment indicators include (but are not limited to) macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, other relevant entity-specific events, specific events affecting the reporting unit, or sustained decrease in share price. This guidance provides the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If, based on a review of qualitative factors, it is more likely than not that the fair value of a reporting unit is less than its carrying value, or at management’s discretion, the Company performs a quantitative analysis. If the quantitative analysis indicates the carrying value of a reporting unit exceeds its fair value, the Company measures any goodwill impairment losses as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. As of December 31, 2023 and December 31, 2022, the Company has one reporting unit for purposes of testing goodwill for impairment. See Note 8 - Goodwill and Acquired Intangible Assets for additional information. |
Intangible Assets, Net | Intangible Assets, net Intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company determines the appropriate useful life of its intangible assets by measuring the expected cash flows of acquired assets. The estimated useful lives of intangible assets are as follows: Estimated Useful Lives Non-competition agreement 3 years Tradenames 10 years Customer relationships 10 to 20 years |
Long-term Investments | Long-term Investments The Company’s investments in unconsolidated entities consist of an equity investment and an investment without readily determinable fair value. The Company follows ASC Topic 321 (“ASC 321”), Investments – Equity Securities , using the measurement alternative to measure investments in investees that do not have readily determinable fair value and over which the Company does not have significant influence at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer, if any. The Company makes a qualitative assessment of whether the investment is impaired at each reporting date. If a qualitative assessment indicates that the investment is impaired, the Company has to estimate the investment’s fair value in accordance with the principles of ASC Topic 820 (“ASC 820”), Fair Value Measurements and Disclosures. If the fair value is less than the investment’s carrying value, the entity has to recognize an impairment loss in earnings equal to the difference between the carrying value and fair value. Investments in entities in which the Company can exercise significant influence but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC Topic 323 (“ASC 323”), Investments-Equity Method and Joint Ventures |
Impairment of Long-Lived Assets | Impairment of Long-lived Assets The Company assesses its long-lived assets such as property and equipment and intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. Factors which may indicate potential impairment include a significant underperformance related to the historical or projected future operating results or a significant negative industry or economic trend. Recoverability of an asset or asset group is measured by comparison of its carrying amount to future undiscounted cash flows the asset or asset group is expected to generate. If property and equipment, and intangible assets are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset or asset group exceeds its fair value. |
Insurance and Claim Costs | Insurance and Claim Costs The Company maintains workers compensation and general liability insurance with licensed insurance carriers. Beginning in April 2020, the Company is self-insured for auto claims less than $100,000 per claim. Insurance and claims expense represent premiums the Company paid and the accruals made for claims within the Company’s self-insured retention amounts. A liability is recognized for the estimated cost of all self-insured claims including an estimate of incurred but not reported claims based on historical experience and for claims expected to exceed the Company's policy limits. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from the sale of products when control of each product passes to the customer and the customer accepts the goods, which occurs at delivery. The majority of customer orders are fulfilled within a day and customer payment terms are typically thirty days or less from invoice date. Our 100% satisfaction guarantee permits our customers to reject part of the order or the entire order within twenty-four hours of receipt without any penalty. Sales taxes invoiced to customers and remitted to government authorities are excluded from net sales. The Company follows ASC Topic 606 , Revenue from Contracts with Customers . The Company recognizes revenue that represents the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. This requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfer to a customer. The Company’s contracts contain performance obligations which are satisfied when customers have physical possession of each product. The Company’s revenue streams are recognized at a specific point in time. |
Cost of Revenue | Cost of Revenue Cost of revenue primarily includes inventory costs (net of vendor consideration, primarily in the form of rebates), inbound freight, customs clearance fees and other miscellaneous expenses. |
Distribution, Selling and Administrative Expenses | Distribution, Selling and Administrative Expenses Distribution, selling and administrative expenses consist primarily of salaries and benefits for employees and contract laborers, trucking and fuel expenses for deliveries, utilities, maintenance and repair expenses, insurance expenses, depreciation and amortization expenses, selling and marketing expenses, professional fees and other operating expenses. |
Shipping and Handling Costs | Shipping and Handling Costs |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities based on the differences between the financial statement and tax basis of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. A valuation allowance is provided when it is more likely than not that some portion or all of the net deferred tax assets will not be realized. Based on our assessment, it is more likely than not that most of the net deferred tax assets will be realized through future taxable income. Management has established a valuation allowance against certain deferred taxes attributable to the Company's subsidiary, HFFI. Management believes the realization of these deferred tax assets will be limited as the Company exited HFFI operations during the year ended December 31, 2023. As such, the Company has recorded a valuation allowance of $0.7 million on the deferred tax assets of HFFI. The Company will continue to assess the need for a valuation allowance in the future by evaluating both positive and negative evidence that may exist. The Company records uncertain tax positions in accordance with ASC Topic 740, Income Taxes (“ASC 740”), on the basis of a two-step process in which (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. See Note 12 - Income Taxes for additional information. The Company adopted ASU 2019-12 (“ASU 2019-12”), Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , on January 1, 2021. ASU 2019-12 is intended to simplify various aspects related to managerial accounting for income taxes. The adoption had no material impact on the Company's consolidated financial statements. In 2021, the Organization for Economic Co-operation and Development (“OECD”) published the Tax Challenges Arising from the Global Anti-Base Erosion Model Rules (“Pillar Two”), also referred to as the GloBE Rules or Pillar Two. The rules are designed to ensure large multinational enterprises (“MNEs”) pay a minimum level of tax (15%) on income of each jurisdiction and are expected to be effective for the first time in January 2024. The legislation applies to MNEs with annual consolidated group revenues of at least €750 million if at least one jurisdiction in which the MNE operates has enacted tax laws in accordance with the Pillar Two framework. The Company continues to monitor the effects of Pillar Two but does not believe it will have a material impact on the financial statements provided that the Company currently has no foreign operations that would be expected to result in the application of Pillar Two. |
Leases | Leases The Company accounts for leases following ASC Topic 842, Leases ("ASC 842"). The Company determines if an arrangement is a lease at inception and also considers classification of leases as operating or finance. Operating leases are included in operating lease ROU assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on the Company’s consolidated balance sheets. Finance leases are included in property and equipment, net, current portion of obligations under finance leases, and obligations under finance leases, non-current on the consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and initial direct costs incurred and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Variable rent payments related to both operating and finance leases are expensed as incurred. The Company's variable lease payments primarily consist of real estate, maintenance and usage charges. The Company has elected to exclude short-term leases from the recognition requirements of ASC 842. A lease is short-term if, at the commencement date, it has a term of less than or equal to one year. Lease expense related to short-term leases is recognized on a straight-line basis over the lease term. The Company has also elected to combine lease and non-lease components when measuring lease liabilities for vehicle and equipment leases. |
Derivative Financial Instruments | Derivative Financial Instruments In accordance with the guidance in ASC Topic 815, Derivatives and Hedging ("ASC 815") , d |
Concentrations and Credit Risk | Concentrations and Credit Risk Credit risk Accounts receivable are typically unsecured and derived from revenue earned from customers, and thereby exposed to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances. The Company maintains cash balances with banks which at times exceed federally insured limits. The Company has not experienced any losses in such accounts. |
Segment Reporting | Segment Reporting ASC Topic 280, Segment Reporting, |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 was further amended in November 2019 in “Codification Improvements to Topic 326, Financial Instruments-Credit Losses.” The Company adopted this ASU within the annual reporting period ending as of December 31, 2022. The adoption of this guidance resulted in an adjustment to retained earnings of $0.7 million as of January 1, 2022 as evidenced in the Company’s consolidated statements of changes in shareholders’ equity. In November 2023, the FASB issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires enhanced disclosures about segment expenses on an annual and interim basis. This standard is effective for the Company’s consolidated financial statements for the year ending December 31, 2024 and for interim periods beginning in 2025. The impact of the adoption of this ASU is not expected to have a material effect on the Company’s financial position, or operations, however, the Company is currently evaluating the impact of this standard on its disclosures to the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (ASC 740): Improvement to Income Tax Disclosures, which requires (1) disclosure of specific categories in the rate reconciliation and (2) additional information for reconciling items that meet a quantitative threshold. Additionally, the amendment requires disclosure of certain disaggregated information about income taxes paid, income from continuing operations before income tax expense (benefit) and income tax expense (benefit). The standard is effective for the Company’s consolidated financial statements for the year ending December 31, 2025. The Company is currently evaluating the impact of this standard on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Noncontrolling Interest | As of December 31, 2023 and December 31, 2022, noncontrolling interest equity consisted of the following: ($ in thousands) Ownership of noncontrolling interest at December 31, 2023 December 31, 2023 December 31, 2022 HF Foods Industrial, LLC ("HFFI") (a) 45.00% $ (759) $ 204 Min Food, Inc. 39.75% 1,715 1,704 Monterey Food Service, LLC 35.00% 366 452 Ocean West Food Services, LLC (b) —% — 1,986 Syncglobal Inc. (c) —% — 90 Total $ 1,322 $ 4,436 _________________ (a) During the year ended December 31, 2023, the Company exited HFFI operations. Accordingly, the machinery used in HFFI operations was impaired and subsequently sold. See Note 4 - Balance Sheet Components for additional information. (b) Effective June 30, 2023, Ocean West Food Services, LLC (“Ocean West”) became a wholly-owned subsidiary of the Company. In accordance with ASC Topic 810 (“ASC 810”), Consolidation , changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary shall be accounted for as equity transactions. No gain or loss was recognized. As a result of this transaction, noncontrolling interests of $1.7 million was reclassified to additional paid-in capital on the consolidated balance sheets. (c) During the year ended December 31, 2023 the Company ceased operations of Syncglobal Inc. and dissolved the entity. |
Schedule of Useful Lives of Property, Plant, and Equipment | Following are the estimated useful lives of the Company’s property and equipment: Estimated Useful Lives Automobiles 3 to 7 years Buildings and improvements 7 to 39 years Furniture and fixtures 4 to 10 years Machinery and equipment 3 to 10 years |
Schedule of Finite-lived Intangible Assets, Useful Life | The estimated useful lives of intangible assets are as follows: Estimated Useful Lives Non-competition agreement 3 years Tradenames 10 years Customer relationships 10 to 20 years |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table presents the Company's net revenue disaggregated by principal product categories: Year Ended December 31, ($ in thousands) 2023 2022 2021 Seafood $ 361,219 31 % $ 354,220 30 % $ 123,808 16 % Asian Specialty 305,466 27 % 299,215 26 % 236,489 29 % Meat and Poultry 215,789 19 % 238,276 20 % 214,504 27 % Fresh Produce 123,202 11 % 126,560 11 % 103,168 13 % Packaging and Other 71,245 6 % 84,489 7 % 69,187 9 % Commodity 71,572 6 % 67,707 6 % 49,728 6 % Total $ 1,148,493 100 % $ 1,170,467 100 % $ 796,884 100 % |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 | Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Schedule of Accounts, Notes, Loans and Financing Receivable | Accounts receivable, net consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Accounts receivable $ 49,643 $ 45,628 Less: allowance for expected credit losses (2,119) (1,442) Accounts receivable, net $ 47,524 $ 44,186 | |
Schedule of Financing Receivable, Allowance for Credit Loss | Movement of allowance for expected credit losses was as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Beginning balance $ 1,442 $ 840 $ 909 Adjustment for adoption of the CECL standard — 690 — Increase (decrease) in provision for expected credit losses/doubtful accounts 701 82 (433) Bad debt (write-offs) recoveries (24) (170) 364 Ending balance $ 2,119 $ 1,442 $ 840 | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Prepaid expenses $ 4,591 $ 1,504 Advances to suppliers 3,340 4,494 Other current assets 2,214 2,939 Prepaid expenses and other current assets $ 10,145 $ 8,937 | |
Schedule of Property and Equipment | Property and equipment, net consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Automobiles $ 37,883 $ 34,891 Buildings 63,145 63,045 Building improvements 22,120 20,637 Furniture and fixtures 474 444 Land 49,929 49,929 Machinery and equipment 12,090 17,210 Subtotal 185,641 186,156 Less: accumulated depreciation (52,505) (45,826) Property and equipment, net $ 133,136 $ 140,330 | |
Schedule of Long-Term Investments | Long-term investments consisted of the following: (In thousands) Ownership as of December 31, December 31, 2023 December 31, 2022 Asahi Food, Inc. ("Asahi") 49% $ 588 $ 879 Pt. Tamron Akuatik Produk Industri ("Tamron") 12% 1,800 1,800 Total long-term investments $ 2,388 $ 2,679 | |
Schedule of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following: (In thousands) December 31, 2023 December 31, 2022 Accrued compensation $ 7,941 $ 6,798 Accrued professional fees 1,353 3,866 Accrued interest and fees 1,276 1,082 Self-insurance liability 1,723 1,286 Accrued other 4,994 6,616 Total accrued expenses and other liabilities $ 17,287 $ 19,648 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Measurements, Assets and Liabilities | The following table presents the Company's hierarchy for its assets and liabilities measured at fair value on a recurring basis as of the dates indicated: December 31, 2023 December 31, 2022 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (In thousands) Assets: Interest rate swaps $ — $ 412 $ — $ 412 $ — $ 530 $ — $ 530 Liabilities: Interest rate swaps $ — $ (1,601) $ — $ (1,601) $ — $ — $ — $ — |
Schedule of Debt Securities, Carrying Value and Fair Value | The following table presents the carrying value and estimated fair value of the Company’s outstanding debt as described in Note 10 - Debt of the Notes to the Consolidated Financial Statements, including the current portion, as of the dates indicated: Fair Value Measurements (In thousands) Level 1 Level 2 Level 3 Carrying Value December 31, 2023 Fixed rate debt: Bank of America $ — $ — $ 151 $ 169 Other finance institutions — — 43 45 Variable rate debt: JPMorgan Chase $ — $ 106,079 $ — $ 106,079 Bank of America — 2,193 — 2,193 East West Bank — 5,675 — 5,675 December 31, 2022 Fixed rate debt: Bank of America $ — $ — $ 1,630 $ 1,948 Other finance institutions — — 186 197 Variable rate debt: JPMorgan Chase $ — $ 111,413 $ — $ 111,413 Bank of America — 2,330 — 2,330 East West Bank — 5,822 — 5,822 The carrying value of the variable rate debt approximates its fair value because of the variability of interest rates associated with these instruments. For the Company's fixed rate debt, the fair values were estimated using discounted cash flow analyses, based on the current incremental borrowing rates for similar types of borrowing arrangements. Please refer to Note 10 - Debt for additional information regarding the Company's debt. Nonrecurring Fair Values The Company measures fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Adjustments to fair value resulted from the write-down of asset values due to impairment. During the year ended December 31, 2023, the Company partially impaired machinery related to the operations of HFFI and recognized impairment expense of $1.2 million in distribution, selling and administrative expense in the consolidated statements of operations and comprehensive income (loss). The machinery was sold during the year ended December 31, 2023. The impairment was based on sales prices of similar equipment listed by third-party sellers and considered a Level 3 fair value measurement. During the year ended December 31, 2022, the Company fully impaired its acquired developed technology associated with the Syncglobal, Inc. joint venture and recognized impairment expense of $0.4 million in distribution, selling and administrative expenses in the consolidated statements of operations and comprehensive income (loss) during the year ended December 31, 2022 . |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense | The components of operating lease expense were as follows: Year Ended December 31, ($ in thousands) 2023 2022 2021 Operating lease cost $ 4,342 $ 4,045 $ 967 Short-term lease cost $ 1,507 $ 1,037 $ 1,699 Weighted average remaining lease term (months) 42 47 56 Weighted average discount rate 4.5% 3.8% 3.9% Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from operating leases $ 4,234 $ 4,005 $ 822 Finance Leases The components of lease expense were as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Finance leases cost: Amortization of ROU assets $ 2,639 $ 2,808 $ 2,416 Interest on lease liabilities 755 787 820 Total finance leases cost $ 3,394 $ 3,595 $ 3,236 |
Schedule of Operating and Finance Leases, Supplemental Cash Flow Information | Supplemental cash flow information related to finance leases was as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Operating cash flows from finance leases $ 657 $ 670 $ 701 |
Schedule of Operating and Finance Leases, Supplemental Balance Sheet Information | Supplemental balance sheet information related to finance leases was as follows: ($ in thousands) December 31, 2023 December 31, 2022 Property and equipment, at cost $ 22,203 $ 20,339 Accumulated depreciation (10,288) (7,615) Property and equipment, net $ 11,915 $ 12,724 Weighted average remaining lease term (months) 219 215 Weighted average discount rate 5.7 % 5.7 % |
Schedule of Operating Lease Maturities | Maturities of lease liabilities are as follows: Operating Leases (In thousands) Related Party (1) Third Party Total Finance Year Ended December 31, 2024 $ 321 $ 4,253 $ 4,574 $ 2,396 2025 331 4,216 4,547 1,747 2026 — 4,164 4,164 1,365 2027 — 1,696 1,696 1,100 2028 — 933 933 929 Thereafter — — — 16,407 Total lease payments 652 15,262 15,914 23,944 Less: Imputed interest (23) (2,771) (2,794) (10,966) Total $ 629 $ 12,491 $ 13,120 $ 12,978 The estimated future minimum lease payments as of December 31, 2023 are presented below: (In thousands) Amount Year Ending December 31, 2024 $ 582 2025 604 2026 621 2027 638 2028 656 Thereafter 3,822 Total 6,923 Less: imputed interest (1,451) Total minimum lease payments $ 5,472 |
Schedule of Finance Lease Maturities | Maturities of lease liabilities are as follows: Operating Leases (In thousands) Related Party (1) Third Party Total Finance Year Ended December 31, 2024 $ 321 $ 4,253 $ 4,574 $ 2,396 2025 331 4,216 4,547 1,747 2026 — 4,164 4,164 1,365 2027 — 1,696 1,696 1,100 2028 — 933 933 929 Thereafter — — — 16,407 Total lease payments 652 15,262 15,914 23,944 Less: Imputed interest (23) (2,771) (2,794) (10,966) Total $ 629 $ 12,491 $ 13,120 $ 12,978 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The total consideration paid to acquire the assets and liabilities of Sealand, as set forth below: (In thousands) Amount Inventory $ 13,846 Property plant, and equipment 1,424 Right-of-use assets 127 Intangible assets 14,717 Total assets acquired 30,114 Obligations under operating leases 127 Total liabilities assumed 127 Net assets 29,987 Goodwill 4,861 Total consideration $ 34,848 The following table presents the allocation of the total consideration paid to acquire the assets and liabilities of the Great Wall Group: (In thousands) Amount Inventory $ 24,728 Property plant, and equipment 1,537 Intangible assets 30,145 Total assets acquired 56,410 Goodwill 11,745 Total consideration $ 68,155 |
Schedule of Pro Forma Information | The unaudited pro forma financial information presented includes the effects of adjustments related to the amortization of acquired intangible assets and excludes other non-recurring transaction costs directly associated with the acquisition such as legal and other professional service fees. Statutory rates were used to calculate income taxes. (In thousands, except share and per share data) Year Ended December 31, 2022 2021 Pro forma net revenue $ 1,202,296 $ 1,072,653 Pro forma net income attributable to HF Foods $ 35 $ 33,724 Pro forma earnings per common share — basic $ — $ 0.65 Pro forma earnings per common share — diluted $ — $ 0.65 Pro forma weighted average shares — basic 53,757,199 53,706,392 Pro forma weighted average shares — diluted 53,757,199 53,809,020 |
Goodwill and Acquired Intangi_2
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill are presented below: (In thousands) Amount Balance at December 31, 2021 $ 80,257 Acquisition of Sealand Food, Inc. 4,861 Balance at December 31, 2022 85,118 No Goodwill activity — Balance at December 31, 2023 $ 85,118 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt at December 31, 2023 and December 31, 2022 is summarized as follows: ($ in thousands) Bank Name Maturity Interest Rate at December 31, 2023 December 31, 2023 December 31, 2022 Bank of America (a) October 2026 - December 2029 4.34% - 7.95% $ 2,362 $ 4,315 East West Bank (b) August 2027 - September 2029 7.64% - 9.00% 5,675 5,822 JPMorgan Chase (c) January 2030 7.32% - 7.44% 106,337 111,714 Other finance institutions (d) January 2024 - July 2024 5.99% - 6.17% 45 160 Total debt, principal amount 114,419 122,011 Less: debt issuance costs (258) (302) Total debt, carrying value 114,161 121,709 Less: current portion (5,450) (6,266) Long-term debt $ 108,711 $ 115,443 _______________ (a) Loan balance consists of real estate term loan and equipment term loan, collateralized by one real property and specific equipment. The real estate term loan is pegged to TERM SOFR + 2.5%. (b) Real estate term loans with East West Bank are collateralized by three real properties. Balloon payments of $1.8 million and $2.9 million are due at maturity in 2027 and 2029, respectively. (c) Real estate term loan with a principal balance of $106.3 million as of December 31, 2023 and $111.4 million as of December 31, 2022 is secured by assets held by the Company and has a maturity date of January 2030. Equipment term loan with a principal balance of $0.02 million as of December 31, 2023 and $0.3 million as of December 31, 2022 is secured by specific vehicles and equipment as defined in loan agreements. Equipment term loan matured in December 2023 and retired after December 31, 2023 with the final payment of remaining outstanding principal. (d) Secured by vehicles. |
Schedule of Maturities of Long-term Debt | The future maturities of long-term debt as of December 31, 2023 are as follows: (In thousands) Amount Year ending December 31, 2024 $ 5,450 2025 5,378 2026 5,385 2027 7,194 2028 5,229 Thereafter 85,525 Total $ 114,161 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share Basic and Diluted | The following table sets forth the computation of basic and diluted EPS: Year Ended December 31, ($ in thousands, except share and per share data) 2023 2022 2021 Numerator: Net (loss) income attributable to HF Foods Group Inc. $ (2,174) $ 460 $ 22,145 Denominator: Weighted-average common shares outstanding 53,878,237 53,757,162 51,918,323 Effect of dilutive securities — 106,286 173,499 Weighted-average dilutive shares outstanding 53,878,237 53,863,448 52,091,822 Earnings (Loss) per common share: Basic $ (0.04) $ 0.01 $ 0.43 Diluted $ (0.04) $ 0.01 $ 0.43 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule Federal Income Tax Note | The provision (benefit) for income taxes of the Company for the years ended December 31, 2023, 2022 and 2021 consists of the following: Year Ended December 31, (In thousands) 2023 2022 2021 Current: Federal $ 4,237 $ 3,620 $ 9,044 State 1,219 1,161 2,329 Current income taxes 5,456 4,781 11,373 Deferred income benefit: Federal (4,550) (4,321) (2,823) State (865) (691) (4,047) Deferred income benefit: (5,415) (5,012) (6,870) Total income tax expense (benefit) $ 41 $ (231) $ 4,503 |
Schedule of Deferred Tax Assets and Liabilities | Temporary differences and carryforwards of the Company that created significant deferred tax assets and liabilities are as follows: (In thousands) December 31, 2023 December 31, 2022 Deferred tax assets: Allowance for expected credit losses $ 523 $ 301 Inventories 1,216 1,185 Equity compensation 552 467 Compensation related accruals 984 1,031 Guarantee liability 1,326 1,528 Fair value change in interest rate swap contracts 233 — Leases 5,325 6,553 Accrued expenses 902 304 Interest expense limitation 415 — Equity investments 80 — Net operating loss carryovers 706 38 Other 49 — Total deferred tax assets 12,311 11,407 Deferred tax liabilities: Property and equipment (4,588) (5,845) Intangible assets (32,959) (35,740) Right of use assets (3,069) (3,466) Equity investments — (649) Fair value change in interest rate swap contracts — (150) Total deferred tax liabilities (40,616) (45,850) Less: Valuation allowance (723) — Net deferred tax liabilities $ (29,028) $ (34,443) |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliations of the statutory income tax rate to the effective income tax rate are as follows: Year Ended December 31, 2023 2022 2021 Federal statutory tax rate (21%) 21.0 % 21.0 % 21.0 % State statutory tax rate (13.9) % 3,963.2 % 5.8 % U.S permanent differences (8.7) % 207.1 % 1.9 % Noncontrolling interests 5.5 % 3,164.6 % — % Officers’ compensation (12.5) % — % — % Rate change — % (2,566.3) % (13.7) % Return to provision 21.6 % — % — % Change in valuation allowance (35.9) % — % — % Tax credits 6.7 % — % — % Uncertain tax positions 14.9 % (10,573.0) % 0.6 % Stock compensation (6.6) % — % — % Payable adjustments 6.0 % — % — % Other 0.3 % 634.7 % 1.0 % Effective tax rate (1.6) % (5,148.7) % 16.6 % |
Schedule of Unrecognized Tax Benefits Roll Forward | Unrecognized Tax Benefits Year Ended December 31, (In thousands) 2023 2022 2021 Total unrecognized tax benefits on January 1, $ 350 $ 752 $ 752 Decrease related to positions taken on items from prior years (244) (402) — Increase related to positions taken in the current year — — — Total unrecognized tax benefits on December 31, $ 106 $ 350 $ 752 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Purchases With Related Parties | Below is a summary of purchases of goods and services from related parties recorded for the years ended December 31, 2023, 2022 and 2021, respectively: Year Ended December 31, (In thousands) Nature 2023 2022 2021 (a) Conexus Food Solutions (formerly as Best Food Services, LLC) Trade $ 8,581 $ 10,514 8,341 (b) Eagle Food Services, LLC Trade — — 4 (c) Eastern Fresh NJ, LLC Trade — 1,093 5,509 (c) Enson Seafood GA, Inc. (formerly “GA-GW Seafood, Inc.”) Trade 37 — 128 (d) First Choice Seafood, Inc. Trade — 134 322 (d) Fujian RongFeng Plastic Co., Ltd Trade — 372 3,108 (c) Hanfeng Information Technology (Jinhua), Inc. Service — — 122 (c) N&F Logistics, Inc. Trade — — 3 (e) North Carolina Good Taste Noodle, Inc. Trade N/A 7,227 5,520 (c) Ocean Pacific Seafood Group, Inc. Trade 381 589 452 (f) Revolution Industry, LLC Trade — — 190 (c) UGO USA, Inc. Trade — — 212 Others Trade 205 332 133 Total $ 9,204 $ 20,261 $ 24,044 _______________ (a) An equity interest is held by three Irrevocable Trusts for the benefit of Mr. Zhang's children. (b) Tina Ni, one of Mr. Zhou Min Ni’s family members, owns an equity interest in this entity indirectly through its parent company. (c) Mr. Zhou Min Ni owns an equity interest in this entity. (d) Mr. Zhou Min Ni owns an equity interest in this entity indirectly through its parent company. (e) No longer considered a related party as of January 1, 2023 since it has been three years since Mr. Jian Ming Ni resigned from the Company . As a result, 2023 amounts have not been disclosed. (f) Raymond Ni, one of Mr. Zhou Min Ni’s family members, owned an equity interest in this entity. On February 25, 2021, the Company executed an asset purchase agreement to acquire the machinery and equipment of Revolution Industry, LLC ("RIL"). The Company acquired substantially all of the operating assets used or held for use in such business operation for the amount of $250,000 plus the original wholesale purchase value of all verified, useable cabbage and egg roll mix inventory of RIL. Advances due from RIL at the time of transaction were an offset to the purchase price paid to RIL. Going forward, the Company has taken the egg roll production business in house and ceased its vendor relationship with RIL. |
Schedule of Revenue With Related Parties | Below is a summary of sales to related parties recorded for the years ended December 31, 2023, 2022 and 2021, respectively: Year Ended December 31, (In thousands) 2023 2022 2021 (a) ABC Food Trading, LLC $ 2,078 $ 3,949 $ 2,642 (b) Asahi Food, Inc. 791 639 704 (a) Conexus Food Solutions (formerly as Best Food Services, LLC) 928 1,285 792 (c) Eagle Food Service, LLC 1,942 879 2,864 (d) Eastern Fresh NJ, LLC — — 155 (d) Enson Group, Inc. (formerly as Enson Group, LLC) — — 101 (d) Enson Seafood GA, Inc. (formerly as GA-GW Seafood, Inc.) — — 573 (e) First Choice Seafood, Inc. 31 35 99 (e) Fortune One Foods, Inc. 42 115 418 (d) Heng Feng Food Services, Inc. — — 163 (d) N&F Logistics, Inc. 6 40 531 (f) Union Food LLC 27 — — Other — — 13 Total $ 5,845 $ 6,942 $ 9,055 _______________ (a) An equity interest is held by three Irrevocable Trusts for the benefit of Mr. Zhang's children. (b) The Company, through its subsidiary MF, owns an equity interest in this entity. (c) Tina Ni, one of Mr. Zhou Min Ni’s family members, owns an equity interest in this entity indirectly through its parent company. (d) Mr. Zhou Min Ni owns an equity interest in this entity. (e) Mr. Zhou Min Ni owns an equity interest in this entity indirectly through its parent company. (f) Tina Ni, one of Mr. Zhou Min Ni’s family members, owns an equity interest in this entity. |
Schedule of Accounts Receivable With Related Parties | Below is a summary of accounts receivable with related parties recorded as of December 31, 2023 and December 31, 2022, respectively: (In thousands) December 31, 2023 December 31, 2022 (a) ABC Food Trading, LLC $ 94 $ — (b) Asahi Food, Inc. 69 81 (a) Conexus Food Solutions (formerly as Best Food Services, LLC) 84 — (c) Eagle Food Service, LLC — 69 (d) Enson Seafood GA, Inc. (formerly as GA-GW Seafood, Inc.) 59 59 (e) Fortune One Foods, Inc. — 4 (f) Union Food LLC 2 — Total $ 308 $ 213 _______________ (a) An equity interest is held by three Irrevocable Trusts for the benefit of Mr. Zhang's children. (b) The Company, through its subsidiary MF, owns an equity interest in this entity. (c) Tina Ni, one of Mr. Zhou Min Ni’s family members, owns an equity interest in this entity indirectly through its parent company. (d) Mr. Zhou Min Ni owns an equity interest in this entity. (e) Mr. Zhou Min Ni owns an equity interest in this entity indirectly through its parent company. (f) |
Schedule of Accounts Payable With Related Parties | All the accounts payable to related parties are payable upon demand without interest. Below is a summary of accounts payable with related parties recorded as of December 31, 2023 and December 31, 2022, respectively: (In thousands) December 31, 2023 December 31, 2022 (a) Conexus Food Solutions (formerly as Best Food Services, LLC) $ 379 $ 729 (b) North Carolina Good Taste Noodle, Inc. N/A 731 Others 18 69 Total $ 397 $ 1,529 _______________ (a) An equity interest is held by three Irrevocable Trusts for the benefit of Mr. Zhang's children. (b) No longer considered a related party as of January 1, 2023 since it has been three years since Mr. Jian Ming Ni resigned from the Company . As a result, 2023 amounts have not been disclosed. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of RSU Activity | A summary of RSU and PSU activity for the year ended December 31, 2023 is as follows: Shares Weighted Average Grant Date Fair Value Unvested RSUs at December 31, 2022 598,325 $ 5.39 Granted 520,248 3.86 Forfeited (54,589) 4.94 Vested (253,040) 5.45 Unvested RSUs at December 31, 2023 810,944 4.43 |
Schedule of PSU Activity | Shares Weighted Average Grant Date Fair Value Unvested PSUs at December 31, 2022 382,662 $ 4.95 Granted 441,288 3.86 Forfeited (38,926) 4.19 Vested (119,092) 5.19 Unvested PSUs at December 31, 2023 665,932 4.23 |
Schedule of Assumptions Used to Estimate Fair Value of the TSR PSUs | The assumptions used to estimate the fair value of the TSR PSUs granted during the year ended December 31, 2021 and valued under the Monte Carlo simulation model were as follows: 2021 PSU Grants Risk-free interest rate 0.20% - 0.34% Expected dividend yield 0.00% Expected term (years) 2.56 - 3.15 Expected volatility (1) 62.08% - 65.74% _______________ (1) Expected volatility is based on a 50/50 blending of (i) the average historical volatility of a select group of industry peers with a look-back period equal to the expected term, and (ii) the historical volatility of the Company with a look-back period of 0.75 years - 1.17 years, the time from the valuation date to the date six months after the completion of the merger with B&R Global, using daily stock prices. The expected volatility of peer companies was 54.96% – 63.45%. The expected volatility of the Company's common stock was 66.10% – 69.19%. |
Schedule of Components of Stock-based Compensation | The components of stock-based compensation expense for the years ended December 31, 2023 and 2022 and 2021 were as follows: Year Ended December 31, (In thousands) 2023 2022 2021 Stock-based compensation (RSUs) expense $ 2,118 $ 897 $ 405 Stock-based compensation (PSUs) expense 1,234 360 230 Total stock-based compensation expense $ 3,352 $ 1,257 $ 635 Tax benefit of stock-based compensation expense $ 931 $ 366 $ 132 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Operating Lease Maturities | Maturities of lease liabilities are as follows: Operating Leases (In thousands) Related Party (1) Third Party Total Finance Year Ended December 31, 2024 $ 321 $ 4,253 $ 4,574 $ 2,396 2025 331 4,216 4,547 1,747 2026 — 4,164 4,164 1,365 2027 — 1,696 1,696 1,100 2028 — 933 933 929 Thereafter — — — 16,407 Total lease payments 652 15,262 15,914 23,944 Less: Imputed interest (23) (2,771) (2,794) (10,966) Total $ 629 $ 12,491 $ 13,120 $ 12,978 The estimated future minimum lease payments as of December 31, 2023 are presented below: (In thousands) Amount Year Ending December 31, 2024 $ 582 2025 604 2026 621 2027 638 2028 656 Thereafter 3,822 Total 6,923 Less: imputed interest (1,451) Total minimum lease payments $ 5,472 |
Organization and Description _2
Organization and Description of Business (Details) - segment | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of operating segments | 1 | 1 |
Number of reportable segments | 1 | 1 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Noncontrolling Interests (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Noncontrolling Interest [Line Items] | ||
Noncontrolling interests | $ 1,322 | $ 4,436 |
HF Foods Industrial, LLC ("HFFI") (a) | ||
Noncontrolling Interest [Line Items] | ||
Ownership of noncontrolling interest at December 31, 2023 | 45% | |
Noncontrolling interests | $ (759) | 204 |
Min Food, Inc. | ||
Noncontrolling Interest [Line Items] | ||
Ownership of noncontrolling interest at December 31, 2023 | 39.75% | |
Noncontrolling interests | $ 1,715 | 1,704 |
Monterey Food Service, LLC | ||
Noncontrolling Interest [Line Items] | ||
Ownership of noncontrolling interest at December 31, 2023 | 35% | |
Noncontrolling interests | $ 366 | 452 |
Ocean West Food Services, LLC (b) | ||
Noncontrolling Interest [Line Items] | ||
Ownership of noncontrolling interest at December 31, 2023 | 0% | |
Noncontrolling interests | $ 0 | 1,986 |
Syncglobal Inc. (c) | ||
Noncontrolling Interest [Line Items] | ||
Ownership of noncontrolling interest at December 31, 2023 | 0% | |
Noncontrolling interests | $ 0 | $ 90 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Cash equivalents at carrying value | $ 0 | $ 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Accounts Receivable, net (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Allowance for credit loss, current | $ (2,119) | $ (1,442) |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Property and Equipment, net (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Capitalized Computer Software, Net | $ 5,100 | $ 0 |
Maximum | Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 7 years | |
Maximum | Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 39 years | |
Maximum | Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 10 years | |
Maximum | Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 10 years | |
Minimum | Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 3 years | |
Minimum | Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 7 years | |
Minimum | Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 4 years | |
Minimum | Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life (in years) | 3 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Additional Information (Details) | 9 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) segment | Sep. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Jan. 01, 2022 USD ($) | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||||||
Number of reporting units | segment | 1 | 1 | 1 | 1 | ||||
Other than temporary impairment | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Impairment, Intangible Asset, Finite-Lived, Statement of Income or Comprehensive Income [Extensible Enumeration] | Distribution, selling and administrative expenses | |||||||
Impairment of long-lived assets held-for-use | $ 0 | 0 | ||||||
Number of reportable segments | segment | 1 | 1 | ||||||
Number of operating segments | segment | 1 | 1 | ||||||
Beginning balance | $ 296,249,000 | $ 294,989,000 | $ 287,983,000 | $ 296,249,000 | 294,989,000 | $ 263,522,000 | ||
Retained Earnings (Accumulated Deficit) | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Beginning balance | $ (306,514,000) | (306,284,000) | (308,688,000) | (306,514,000) | (306,284,000) | $ (328,429,000) | ||
Cumulative Effect, Period of Adoption, Adjustment | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Beginning balance | (690,000) | (690,000) | ||||||
Cumulative Effect, Period of Adoption, Adjustment | Retained Earnings (Accumulated Deficit) | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Beginning balance | $ (690,000) | $ (690,000) | $ 700,000 | |||||
Machinery and equipment | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Tangible Asset Impairment Charges | $ 1,200,000 | |||||||
Developed Technology Rights | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Impairment expenses | $ 400,000 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Intangible Assets, net (Details) | Dec. 31, 2023 |
Non-competition agreement | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life (in years) | 3 years |
Tradenames | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life (in years) | 10 years |
Customer relationships | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life (in years) | 20 years |
Customer relationships | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life (in years) | 10 years |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Insurance and Claim Costs (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Accounting Policies [Abstract] | ||
Self insurance auto claims | $ 100 | |
Self-insurance liability | $ 1,723 | $ 1,286 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Shipping and Handling Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Selling, General and Administrative Expenses | |||
Property, Plant and Equipment [Line Items] | |||
Cost of goods and services sold | $ 76 | $ 83.7 | $ 58.3 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 1,148,493 | $ 1,170,467 | $ 796,884 |
Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 100% | 100% | 100% |
Seafood | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 361,219 | $ 354,220 | $ 123,808 |
Seafood | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 31% | 30% | 16% |
Asian Specialty | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 305,466 | $ 299,215 | $ 236,489 |
Asian Specialty | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 27% | 26% | 29% |
Meat and Poultry | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 215,789 | $ 238,276 | $ 214,504 |
Meat and Poultry | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 19% | 20% | 27% |
Fresh Produce | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 123,202 | $ 126,560 | $ 103,168 |
Fresh Produce | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 11% | 11% | 13% |
Packaging and Other | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 71,245 | $ 84,489 | $ 69,187 |
Packaging and Other | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 6% | 7% | 9% |
Commodity | |||
Disaggregation of Revenue [Line Items] | |||
TOTAL NET REVENUE | $ 71,572 | $ 67,707 | $ 49,728 |
Commodity | Revenue Benchmark | Product Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Operating concentration risk (percentage) | 6% | 6% | 6% |
Balance Sheet Components - Acco
Balance Sheet Components - Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Less: allowance for expected credit losses | $ (2,119) | $ (1,442) | $ (840) | $ (909) |
Nonrelated Party | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Accounts receivable | 49,643 | 45,628 | ||
Less: allowance for expected credit losses | (2,119) | (1,442) | ||
Accounts receivable, net | $ 47,524 | $ 44,186 |
Balance Sheet Components - Allo
Balance Sheet Components - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Beginning balance | $ 1,442 | $ 840 | $ 909 |
Adjustment for adoption of the CECL standard | 0 | 690 | 0 |
Increase (decrease) in provision for expected credit losses/doubtful accounts | 701 | 82 | (433) |
Bad debt (write-offs) recoveries | (24) | (170) | 364 |
Ending balance | $ 2,119 | $ 1,442 | $ 840 |
Balance Sheet Components - Prep
Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Prepaid expenses | $ 4,591 | $ 1,504 |
Advances to suppliers | 3,340 | 4,494 |
Other current assets | 2,214 | 2,939 |
Prepaid expenses and other current assets | $ 10,145 | $ 8,937 |
Balance Sheet Components - Prop
Balance Sheet Components - Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | $ 185,641 | $ 185,641 | $ 186,156 | |
Less: accumulated depreciation | (52,505) | (52,505) | (45,826) | |
Property and equipment, net | 133,136 | 133,136 | 140,330 | |
Depreciation | 9,600 | 9,200 | $ 8,100 | |
Restructuring, Settlement and Impairment Provisions | 1,200 | |||
Automobiles | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 37,883 | 37,883 | 34,891 | |
Buildings | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 63,145 | 63,145 | 63,045 | |
Building improvements | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 22,120 | 22,120 | 20,637 | |
Furniture and fixtures | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 474 | 474 | 444 | |
Land | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | 49,929 | 49,929 | 49,929 | |
Machinery and equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Property and equipment, at cost | $ 12,090 | $ 12,090 | $ 17,210 |
Balance Sheet Components - Narr
Balance Sheet Components - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Depreciation | $ 9,600,000 | $ 9,200,000 | $ 8,100,000 | |
Other than temporary impairment | $ 0 | $ 0 | $ 0 | $ 0 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Long-Term Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Long-term investments | $ 2,388 | $ 2,679 |
Asahi Food, Inc. ("Asahi") | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 49% | |
Long-term investments | $ 588 | 879 |
Pt. Tamron Akuatik Produk Industri ("Tamron") | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 12% | |
Long-term investments | $ 1,800 | $ 1,800 |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued compensation | $ 7,941 | $ 6,798 |
Accrued professional fees | 1,353 | 3,866 |
Accrued interest and fees | 1,276 | 1,082 |
Self-insurance liability | 1,723 | 1,286 |
Accrued other | 4,994 | 6,616 |
Total accrued expenses and other liabilities | $ 17,287 | $ 19,648 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value Measurements, Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Assets | ||
DerivativeAssetsStatementOfFinancialPositionExtensibleEnumerationNotDisclosedFlag | Interest rate swaps | Interest rate swaps |
Liabilities | ||
DerivativeLiabilityStatementOfFinancialPositionExtensibleEnumerationNotDisclosedFlag | Interest rate swaps | Interest rate swaps |
Recurring | ||
Assets | ||
Assets: | $ 412 | $ 530 |
Liabilities | ||
Liabilities: | (1,601) | 0 |
Recurring | Level 1 | ||
Assets | ||
Assets: | 0 | 0 |
Liabilities | ||
Liabilities: | 0 | 0 |
Recurring | Level 2 | ||
Assets | ||
Assets: | 412 | 530 |
Liabilities | ||
Liabilities: | (1,601) | 0 |
Recurring | Level 3 | ||
Assets | ||
Assets: | 0 | 0 |
Liabilities | ||
Liabilities: | $ 0 | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Debt Securities, Carrying Value and Fair Value (Details) - Reported Value Measurement - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Bank of America | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | $ 169 | $ 1,948 |
Bank of America | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 2,193 | 2,330 |
Bank of America | Level 1 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Bank of America | Level 1 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Bank of America | Level 2 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Bank of America | Level 2 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 2,193 | 2,330 |
Bank of America | Level 3 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 151 | 1,630 |
Bank of America | Level 3 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
East West Bank | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 5,675 | 5,822 |
East West Bank | Level 1 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
East West Bank | Level 2 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 5,675 | 5,822 |
East West Bank | Level 3 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Other Finance Institutions | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 45 | 197 |
Other Finance Institutions | Level 1 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Other Finance Institutions | Level 2 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
Other Finance Institutions | Level 3 | Fixed Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 43 | 186 |
JP Morgan | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 106,079 | 111,413 |
JP Morgan | Level 1 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 0 | 0 |
JP Morgan | Level 2 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | 106,079 | 111,413 |
JP Morgan | Level 3 | Variable Rate Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument, fair value disclosure | $ 0 | $ 0 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | Mar. 26, 2024 | Dec. 31, 2023 | Dec. 31, 2022 |
Lessee, Lease, Description [Line Items] | |||
Operating lease right-of-use assets | $ 12,714 | $ 14,164 | |
Operating lease right-of-use liabilities | 13,120 | $ 14,300 | |
Additional leases that have not yet commenced | $ 7,000 | ||
Subsequent Event | |||
Lessee, Lease, Description [Line Items] | |||
Additional leases that have not yet commenced | $ 15,500 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, term of contract (in years) | 1 year | ||
Leases that have not yet commenced, term of contract | 4 years | ||
Minimum | Subsequent Event | |||
Lessee, Lease, Description [Line Items] | |||
Leases that have not yet commenced, term of contract | 4 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, term of contract (in years) | 30 years | ||
Leases that have not yet commenced, term of contract | 7 years | ||
Maximum | Subsequent Event | |||
Lessee, Lease, Description [Line Items] | |||
Leases that have not yet commenced, term of contract | 6 years |
Leases - Components of Operatin
Leases - Components of Operating and Finance Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating lease cost | $ 4,342 | $ 4,045 | $ 967 |
Short-term lease cost | $ 1,507 | $ 1,037 | $ 1,699 |
Weighted average remaining lease term (months) | 42 months | 47 months | 56 months |
Weighted average discount rate | 4.50% | 3.80% | 3.90% |
Operating cash flows from operating leases | $ 4,234 | $ 4,005 | $ 822 |
Amortization of ROU assets | 2,639 | 2,808 | 2,416 |
Interest on lease liabilities | 755 | 787 | 820 |
Total finance leases cost | $ 3,394 | $ 3,595 | $ 3,236 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Operating and Finance Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating cash flows from finance leases | $ 657 | $ 670 | $ 701 |
Leases - Balance Sheet (Details
Leases - Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Property and equipment, at cost | $ 22,203 | $ 20,339 |
Accumulated depreciation | $ (10,288) | $ (7,615) |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net | Property and equipment, net |
Property and equipment, net | $ 11,915 | $ 12,724 |
Weighted average remaining lease term (months) | 219 months | 215 months |
Weighted average discount rate | 5.70% | 5.70% |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2024 | $ 4,574 | |
2025 | 4,547 | |
2026 | 4,164 | |
2027 | 1,696 | |
2028 | 933 | |
Thereafter | 0 | |
Total lease payments | 15,914 | |
Less: Imputed interest | (2,794) | |
Total | 13,120 | $ 14,300 |
Finance Leases | ||
2024 | 2,396 | |
2025 | 1,747 | |
2026 | 1,365 | |
2027 | 1,100 | |
2028 | 929 | |
Thereafter | 16,407 | |
Total lease payments | 23,944 | |
Less: Imputed interest | (10,966) | |
Total | 12,978 | |
Related Party | ||
Operating Leases | ||
2024 | 321 | |
2025 | 331 | |
2026 | 0 | |
2027 | 0 | |
2028 | 0 | |
Thereafter | 0 | |
Total lease payments | 652 | |
Less: Imputed interest | (23) | |
Total | 629 | |
Third Party | ||
Operating Leases | ||
2024 | 4,253 | |
2025 | 4,216 | |
2026 | 4,164 | |
2027 | 1,696 | |
2028 | 933 | |
Thereafter | 0 | |
Total lease payments | 15,262 | |
Less: Imputed interest | (2,771) | |
Total | $ 12,491 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Apr. 29, 2022 | Dec. 30, 2021 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | |||
Share price (in dollars per share) | $ 7.36 | ||
Trademarks and Trade Names | |||
Business Acquisition [Line Items] | |||
Royalty rate | 1% | 1% | |
Sealand Food Inc Asset Purchase Agreement | |||
Business Acquisition [Line Items] | |||
Consideration transferred | $ 20,000 | ||
Payment to acquire saleable product inventory | 14,400 | ||
Automobile | 500 | ||
Transaction costs | $ 700 | ||
Intangible assets | $ 14,717 | ||
Estimated amortization period (in years) | 9 years | ||
Inventory | $ 13,846 | ||
Total consideration | 34,848 | ||
Sealand Food Inc Asset Purchase Agreement | Trademarks and Trade Names | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 4,400 | ||
Estimated amortization period (in years) | 10 years | ||
Sealand Food Inc Asset Purchase Agreement | Trademarks and Trade Names | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 17.50% | ||
Sealand Food Inc Asset Purchase Agreement | Trademarks and Trade Names | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 18% | ||
Sealand Food Inc Asset Purchase Agreement | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 8,900 | ||
Estimated amortization period (in years) | 10 years | ||
Sealand Food Inc Asset Purchase Agreement | Customer relationships | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 17.50% | ||
Sealand Food Inc Asset Purchase Agreement | Customer relationships | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 18% | ||
Sealand Food Inc Asset Purchase Agreement | Non-competition agreement | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 1,400 | ||
Estimated amortization period (in years) | 3 years | ||
Sealand Food Inc Asset Purchase Agreement | Non-competition agreement | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 17.50% | ||
Sealand Food Inc Asset Purchase Agreement | Non-competition agreement | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 18% | ||
Sealand Food Inc Asset Purchase Agreement | Level 3 | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 14,700 | ||
Great Wall Asset Purchase Agreement | |||
Business Acquisition [Line Items] | |||
Consideration transferred | $ 43,700 | ||
Payment to acquire saleable product inventory | 6,800 | ||
Automobile | 200 | ||
Intangible assets | $ 30,145 | ||
Estimated amortization period (in years) | 9 years | ||
Payments to acquire businesses | $ 30,800 | ||
Equity interest issued in business acquisition (in shares) | 1,792,981 | ||
Share price (in dollars per share) | $ 8.11 | ||
Business acquisition, shares issued valuation | $ 12,900 | ||
Discount due to a lock-up restriction | 11.50% | ||
Inventory | $ 24,728 | 24,300 | |
Deferred consideration from Great Wall Acquisition | $ 17,400 | ||
Total consideration | 68,155 | ||
Business acquisition, transaction costs during period | 900 | ||
Great Wall Asset Purchase Agreement | Trademarks and Trade Names | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 10,500 | ||
Estimated amortization period (in years) | 10 years | ||
Great Wall Asset Purchase Agreement | Trademarks and Trade Names | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 11.50% | ||
Great Wall Asset Purchase Agreement | Trademarks and Trade Names | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 14% | ||
Great Wall Asset Purchase Agreement | Customer relationships | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 17,200 | ||
Estimated amortization period (in years) | 10 years | ||
Great Wall Asset Purchase Agreement | Customer relationships | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 11.50% | ||
Great Wall Asset Purchase Agreement | Customer relationships | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 14% | ||
Estimated amortization period (in years) | 10 years | ||
Great Wall Asset Purchase Agreement | Non-competition agreement | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 2,400 | ||
Estimated amortization period (in years) | 3 years | ||
Great Wall Asset Purchase Agreement | Non-competition agreement | Minimum | |||
Business Acquisition [Line Items] | |||
Discount rates | 11.50% | ||
Great Wall Asset Purchase Agreement | Non-competition agreement | Maximum | |||
Business Acquisition [Line Items] | |||
Discount rates | 14% |
Acquisitions - Assets Acquired
Acquisitions - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Apr. 29, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 85,118 | $ 85,118 | $ 80,257 | |
Sealand Food Inc Asset Purchase Agreement | ||||
Business Acquisition [Line Items] | ||||
Inventory | $ 13,846 | |||
Property plant, and equipment | 1,424 | |||
Right-of-use assets | 127 | |||
Intangible assets | 14,717 | |||
Total assets acquired | 30,114 | |||
Obligations under operating leases | 127 | |||
Total liabilities assumed | 127 | |||
Net assets | 29,987 | |||
Goodwill | 4,861 | |||
Total consideration | $ 34,848 |
Acquisitions - Pro Forma Inform
Acquisitions - Pro Forma Information (Details) - Sealand Food Inc Asset Purchase Agreement - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Business Acquisition, Pro Forma Revenue | $ 1,202,296 | $ 1,072,653 |
Business Acquisition, Pro Forma Net Income (Loss) | $ 35 | $ 33,724 |
Acquisitions - Assets Acquire_2
Acquisitions - Assets Acquired and Liabilities Assumed Great Wall (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 30, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 85,118 | $ 85,118 | $ 80,257 | |
Great Wall Asset Purchase Agreement | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | $ 24,300 | $ 24,728 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 1,537 | |||
Intangible assets | 30,145 | |||
Total assets acquired | 56,410 | |||
Goodwill | 11,745 | |||
Total consideration | $ 68,155 |
Acquisitions - Pro Forma Info_2
Acquisitions - Pro Forma Information Great Wall (Details) - Sealand Food Inc Asset Purchase Agreement - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Business Acquisition, Pro Forma Revenue | $ 1,202,296 | $ 1,072,653 |
Business Acquisition, Pro Forma Net Income (Loss) | $ 35 | $ 33,724 |
Pro forma (loss) earnings per common share- basic (in dollars per share) | $ 0 | $ 0.65 |
Pro forma (loss) earnings per common share- diluted (in dollars per share) | $ 0 | $ 0.65 |
Weighted average shares - basic (in shares) | 53,757,199 | 53,706,392 |
Weighted average shares - diluted (in shares) | 53,757,199 | 53,809,020 |
Acquisitions - Assets Acquire_3
Acquisitions - Assets Acquired and Liabilities Assumed Sealand (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 85,118 | $ 85,118 | $ 80,257 |
Goodwill and Acquired Intangi_3
Goodwill and Acquired Intangible Assets - Narrative (Details) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2022 USD ($) segment | Apr. 29, 2022 USD ($) | Dec. 31, 2021 segment | Dec. 30, 2021 USD ($) | Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | |
Goodwill [Line Items] | |||||||
Accumulated impairment for goodwill | $ 338,200 | $ 338,200 | $ 338,200 | ||||
Number of reporting units | segment | 1 | 1 | 1 | 1 | |||
Goodwill impairment loss | $ 0 | ||||||
Amortization expense | $ 16,300 | 15,700 | $ 10,900 | ||||
Developed Technology Rights | |||||||
Goodwill [Line Items] | |||||||
Impairment expenses | $ 400 | ||||||
Sealand Food Inc Asset Purchase Agreement | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 14,717 | ||||||
Estimated amortization period (in years) | 9 years | ||||||
Sealand Food Inc Asset Purchase Agreement | Trademarks and Trade Names | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 4,400 | ||||||
Estimated amortization period (in years) | 10 years | ||||||
Sealand Food Inc Asset Purchase Agreement | Customer relationships | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 8,900 | ||||||
Estimated amortization period (in years) | 10 years | ||||||
Sealand Food Inc Asset Purchase Agreement | Non-competition agreement | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 1,400 | ||||||
Estimated amortization period (in years) | 3 years | ||||||
Sealand Food Inc Asset Purchase Agreement | Level 3 | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 14,700 | ||||||
Great Wall Asset Purchase Agreement | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 30,145 | ||||||
Estimated amortization period (in years) | 9 years | ||||||
Great Wall Asset Purchase Agreement | Trademarks and Trade Names | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 10,500 | ||||||
Estimated amortization period (in years) | 10 years | ||||||
Great Wall Asset Purchase Agreement | Customer relationships | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 17,200 | ||||||
Estimated amortization period (in years) | 10 years | ||||||
Great Wall Asset Purchase Agreement | Customer relationships | Maximum | |||||||
Goodwill [Line Items] | |||||||
Estimated amortization period (in years) | 10 years | ||||||
Great Wall Asset Purchase Agreement | Non-competition agreement | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 2,400 | ||||||
Estimated amortization period (in years) | 3 years | ||||||
Great Wall Asset Purchase Agreement | Tradenames | |||||||
Goodwill [Line Items] | |||||||
Estimated amortization period (in years) | 10 years | ||||||
B&R Global | |||||||
Goodwill [Line Items] | |||||||
Intangible assets | $ 188,500 | ||||||
B&R Global | Trade Names and Customer Relationships | Maximum | |||||||
Goodwill [Line Items] | |||||||
Estimated amortization period (in years) | 20 years | ||||||
B&R Global | Trade Names and Customer Relationships | Minimum | |||||||
Goodwill [Line Items] | |||||||
Estimated amortization period (in years) | 10 years |
Goodwill and Acquired Intangi_4
Goodwill and Acquired Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 85,118 | $ 80,257 |
Acquisition | 0 | |
Goodwill, ending balance | $ 85,118 | 85,118 |
Sealand Food, Inc. | ||
Goodwill [Roll Forward] | ||
Acquisition | $ 4,861 |
Goodwill and Acquired Intangi_5
Goodwill and Acquired Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 233,365 | $ 233,414 |
Accumulated Amortization | (55,559) | (39,323) |
Net Carrying Amount | 177,806 | 194,091 |
Non-competition agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,892 | 3,892 |
Accumulated Amortization | (2,429) | (1,132) |
Net Carrying Amount | 1,463 | 2,760 |
Tradenames | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 44,207 | 44,256 |
Accumulated Amortization | (15,045) | (10,673) |
Net Carrying Amount | 29,162 | 33,583 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 185,266 | 185,266 |
Accumulated Amortization | (38,085) | (27,518) |
Net Carrying Amount | $ 147,181 | $ 157,748 |
Goodwill and Acquired Intangi_6
Goodwill and Acquired Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 16,285 | |
2025 | 15,152 | |
2026 | 14,987 | |
2027 | 14,987 | |
2028 | 14,987 | |
Thereafter | 101,408 | |
Net Carrying Amount | $ 177,806 | $ 194,091 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Details) $ in Millions | 12 Months Ended | |||||
Dec. 19, 2021 | Aug. 20, 2019 USD ($) derivative termLoan | Dec. 31, 2023 USD ($) | Mar. 15, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 19, 2019 USD ($) | |
Derivative [Line Items] | ||||||
Number of mortgage term loans | termLoan | 2 | |||||
Derivative Asset, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other long-term assets | |||||
Derivative Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other long-term liabilities | |||||
Derivative Asset, Noncurrent | $ 0.4 | $ 0.5 | ||||
Derivative Liability, Noncurrent | (1.6) | |||||
Derivative Asset, Noncurrent | $ 0.4 | $ 0.5 | ||||
Mortgage-Secured Term Loans | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||
Derivative [Line Items] | ||||||
Derivative, fixed interest rate | 4.11% | |||||
Mortgage-Secured Term Loans | East West Bank | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||
Derivative [Line Items] | ||||||
Basis spread on variable rate | 2.29% | |||||
Derivative, fixed interest rate | 4.23% | |||||
Mortgage-Secured Term Loans | Bank of America | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||
Derivative [Line Items] | ||||||
Basis spread on variable rate | 2.50% | 2.50% | ||||
Derivative, fixed interest rate | 4.50% | |||||
Interest Rate Swap | ||||||
Derivative [Line Items] | ||||||
Number of derivatives | derivative | 2 | |||||
Interest Rate Swap | Not Designated as Hedging Instrument | ||||||
Derivative [Line Items] | ||||||
Derivative liability, notional amount | $ 1.1 | $ 120 | $ 2.7 | |||
Interest Rate Swap Two | Not Designated as Hedging Instrument | ||||||
Derivative [Line Items] | ||||||
Derivative liability, notional amount | $ 2.6 |
Debt - Long-term Debt (Details)
Debt - Long-term Debt (Details) $ in Thousands | 12 Months Ended | |||
Dec. 19, 2021 | Aug. 20, 2019 | Dec. 31, 2023 USD ($) property | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 114,419 | $ 122,011 | ||
Less: debt issuance costs | (258) | (302) | ||
Total | 114,161 | 121,709 | ||
Less: current portion | (5,450) | (6,266) | ||
Long-term debt | 108,711 | 115,443 | ||
Bank of America | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 2,362 | 4,315 | ||
Number of real properties secured | property | 1 | |||
Bank of America | Mortgage-Secured Term Loans | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.50% | 2.50% | ||
Bank of America | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 4.34% | |||
Bank of America | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 7.95% | |||
East West Bank | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 5,675 | 5,822 | ||
Number of real properties secured | property | 3 | |||
East West Bank | Mortgage-Secured Term Loans | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.29% | |||
East West Bank | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 7.64% | |||
Collateral amount | $ 1,800 | |||
East West Bank | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 9% | |||
Collateral amount | $ 2,900 | |||
JP Morgan Chase | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | 106,337 | 111,714 | ||
JP Morgan Chase | Assets Held by Subsidiaries | ||||
Debt Instrument [Line Items] | ||||
Collateral amount | 106,300 | 111,400 | ||
JP Morgan Chase | Vehicles and Equipment | ||||
Debt Instrument [Line Items] | ||||
Collateral amount | $ 20 | 300 | ||
JP Morgan Chase | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 7.32% | |||
JP Morgan Chase | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 7.44% | |||
Other finance institutions | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 45 | $ 160 | ||
Other finance institutions | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 5.99% | |||
Other finance institutions | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate, stated percentage | 6.17% |
Debt - Narrative (Details)
Debt - Narrative (Details) $ in Thousands | Mar. 31, 2022 USD ($) | Dec. 30, 2021 USD ($) | Dec. 31, 2023 USD ($) | Jan. 17, 2020 USD ($) | Nov. 04, 2019 USD ($) |
Debt Instrument [Line Items] | |||||
Letters of Credit Outstanding, Amount | $ 3,800 | ||||
Great Wall Asset Purchase Agreement | |||||
Debt Instrument [Line Items] | |||||
Consideration transferred | $ 43,700 | ||||
JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, credit adjustment | 0.001 | ||||
Basis spread on variable rate | 1.875% | ||||
JP Morgan | Mortgage-Secured Term Loans | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, credit adjustment | 0.001 | ||||
Amended Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 115,000 | ||||
Amended Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Credit agreement, term (in years) | 5 years | ||||
Maximum borrowing capacity | $ 100,000 | ||||
Amended Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.375% | ||||
Line of Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 69,000 | ||||
Second Amended Credit Agreement | JP Morgan | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 100,000 | ||||
Additional funds remaining | 37,600 | ||||
Second Amended Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 75,600 | ||||
Amended and Restated Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 100,000 | ||||
Third Amended Credit Agreement | JP Morgan | Revolving Credit Facility | Great Wall Asset Purchase Agreement | |||||
Debt Instrument [Line Items] | |||||
Consideration transferred | $ 33,300 | ||||
Third Amended Credit Agreement | JP Morgan | Mortgage-Secured Term Loans | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.375% | ||||
Long-term line of credit | $ 58,600 |
Debt - Future Maturities (Detai
Debt - Future Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2024 | $ 5,450 | |
2025 | 5,378 | |
2026 | 5,385 | |
2027 | 7,194 | |
2028 | 5,229 | |
Thereafter | 85,525 | |
Total | $ 114,161 | $ 121,709 |
Earnings (Loss) Per Share - Nar
Earnings (Loss) Per Share - Narrative (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 862,182 | 348,610 | 130,668 |
Earnings (Loss) Per Share - Sch
Earnings (Loss) Per Share - Schedule of Computation of Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator: | |||
Net (loss) income attributable to HF Foods Group Inc. | $ (2,174) | $ 460 | $ 22,145 |
Denominator: | |||
Weighted-average common shares outstanding (in shares) | 53,878,237 | 53,757,162 | 51,918,323 |
Effect of dilutive securities (in shares) | 0 | 106,286 | 173,499 |
Weighted-average dilutive shares outstanding (in shares) | 53,878,237 | 53,863,448 | 52,091,822 |
Earnings (Loss) per common share: | |||
Basic (in dollars per share) | $ (0.04) | $ 0.01 | $ 0.43 |
Diluted (in dollars per share) | $ (0.04) | $ 0.01 | $ 0.43 |
Income Taxes - Income Tax Provi
Income Taxes - Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 4,237 | $ 3,620 | $ 9,044 |
State | 1,219 | 1,161 | 2,329 |
Current income taxes | 5,456 | 4,781 | 11,373 |
Deferred income benefit: | |||
Federal | (4,550) | (4,321) | (2,823) |
State | (865) | (691) | (4,047) |
Deferred income benefit: | (5,415) | (5,012) | (6,870) |
Total income tax expense (benefit) | $ 41 | $ (231) | $ 4,503 |
Effective tax rate | (1.60%) | (5148.70%) | 16.60% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Tax Credit Carryforward [Line Items] | ||
Unrecognized tax benefits expected to reverse | $ 100,000 | |
Unrecognized tax benefits, interest and penalties | 200,000 | |
Unrecognized tax benefits accrued penalties | 17,000 | $ 50,000 |
Unrecognized tax benefits, accrued interest | 10,000 | 34,000 |
Unrecognized tax benefits accrued penalties reversed | 28,000 | |
Unrecognized tax benefits accrued interest reversed | 39,000 | |
Domestic Tax Authority | ||
Tax Credit Carryforward [Line Items] | ||
Operating loss carryforwards | 3,000,000 | 0 |
State and Local Jurisdiction | ||
Tax Credit Carryforward [Line Items] | ||
Operating loss carryforwards | $ 2,200,000 | $ 800,000 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Allowance for expected credit losses | $ 523 | $ 301 |
Inventories | 1,216 | 1,185 |
Equity compensation | 552 | 467 |
Compensation related accruals | 984 | 1,031 |
Guarantee liability | 1,326 | 1,528 |
Fair value change in interest rate swap contracts | 233 | 0 |
Leases | 5,325 | 6,553 |
Accrued expenses | 902 | 304 |
Interest expense limitation | 415 | 0 |
Equity investments | 80 | 0 |
Net operating loss carryovers | 706 | 38 |
Other | 49 | 0 |
Total deferred tax assets | 12,311 | 11,407 |
Deferred tax liabilities: | ||
Property and equipment | (4,588) | (5,845) |
Intangible assets | (32,959) | (35,740) |
Right of use assets | (3,069) | (3,466) |
Equity investments | 0 | (649) |
Fair value change in interest rate swap contracts | 0 | (150) |
Total deferred tax liabilities | (40,616) | (45,850) |
Less: Valuation allowance | (723) | 0 |
Net deferred tax liabilities | $ (29,028) | $ (34,443) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory tax rate (21%) | 21% | 21% | 21% |
State statutory tax rate | (13.90%) | 3,963.20% | 5.80% |
U.S permanent differences | (8.70%) | 207.10% | 1.90% |
Noncontrolling interests | 5.50% | 3,164.60% | 0% |
Officers’ compensation | (12.50%) | 0% | 0% |
Rate change | 0% | (2566.30%) | (13.70%) |
Return to provision | 21.60% | 0% | 0% |
Change in valuation allowance | (35.90%) | 0% | 0% |
Tax credits | 6.70% | 0% | 0% |
Uncertain tax positions | 14.90% | (10573.00%) | 0.60% |
Stock compensation | (6.60%) | 0% | 0% |
Payable adjustments | 6% | 0% | 0% |
Other | 0.30% | 634.70% | 1% |
Effective tax rate | (1.60%) | (5148.70%) | 16.60% |
Income Taxes (Details) - Unreco
Income Taxes (Details) - Unrecognized Tax Benefits - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Total unrecognized tax benefits on January 1, | $ 350 | $ 752 | $ 752 |
Decrease related to positions taken on items from prior years | (244) | (402) | 0 |
Increase related to positions taken in the current year | 0 | 0 | 0 |
Total unrecognized tax benefits on December 31, | $ 106 | $ 350 | $ 752 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) $ in Thousands | 12 Months Ended | |||||
May 18, 2022 USD ($) | Nov. 03, 2021 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Feb. 28, 2021 renewalPeriod | |
Related Party Transaction [Line Items] | ||||||
Repayments of long-term debt | $ 7,591 | $ 11,336 | $ 6,599 | |||
First Horizon Bank | ||||||
Related Party Transaction [Line Items] | ||||||
Sale of properties | $ 7,200 | |||||
Gain from sale of properties | 1,500 | |||||
Repayments of long-term debt | $ 4,500 | 4,500 | ||||
Facility | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | 42 | |||||
HG Realty | Buildings | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | 200 | 500 | ||||
Kirnland | Buildings | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | $ 300 | $ 300 | 300 | |||
Operating lease, term of contract (in years) | 5 years | |||||
Enson Seafood GA, Inc. (formerly as GA-GW Seafood, Inc.) | ||||||
Related Party Transaction [Line Items] | ||||||
Accounts receivables reserved percentage | 1 | 0.80 | ||||
B&R Group Realty | Mortgage-Secured Term Loans | ||||||
Related Party Transaction [Line Items] | ||||||
Debt instrument, periodic payment, principal | $ 100 | |||||
Asahi Food, Inc. | Buildings | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | $ 100 | $ 100 | 100 | |||
Term of contract | 1 year | |||||
Number of renewal periods | renewalPeriod | 4 | |||||
Length of renewal term option | 1 year | |||||
Han Feng | Production Area | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | 6 | |||||
Rental Income, Nonoperating, Monthly Rent | 3 | |||||
Rental Income, Nonoperating, Monthly Rent | 3 | |||||
Union Food LLC | ||||||
Related Party Transaction [Line Items] | ||||||
Accounts receivables reserved percentage | 1 | |||||
R&N Holdings | Buildings | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | 7 | |||||
R&N Holdings | Facility | ||||||
Related Party Transaction [Line Items] | ||||||
Sale of investment | $ 800 | |||||
Gain on sale of investment | 500 | |||||
Sale of investment | 800 | |||||
Gain on sale of investment | 500 | |||||
Chief Financial Officer | ||||||
Related Party Transaction [Line Items] | ||||||
Rental income | $ 50 | |||||
Gain on sale of investment | 800 | |||||
Proceeds from sale of real estate | 1,500 | |||||
Gain on sale of investment | 800 | |||||
Proceeds from sale of real estate | $ 1,500 | |||||
HF Foods | Shareholder | ||||||
Related Party Transaction [Line Items] | ||||||
Ownership of noncontrolling interest at December 31, 2023 | 10% |
Related Party Transactions - Su
Related Party Transactions - Summary of Purchases with Related Parties (Details) $ in Thousands | 12 Months Ended | ||||||
Jan. 01, 2023 | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Feb. 25, 2021 USD ($) | Nov. 01, 2020 trust | Oct. 31, 2020 trust | |
Related Party Transaction [Line Items] | |||||||
CEO resignation period | 3 years | ||||||
Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | $ 9,204 | $ 20,261 | $ 24,044 | ||||
Revolution Industry, LLC | Asset Purchase Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Purchase obligation | $ 250 | ||||||
Purchase obligation | $ 250 | ||||||
Conexus Food Solutions (formerly as Best Food Services, LLC) | |||||||
Related Party Transaction [Line Items] | |||||||
Number of irrecoverable trusts | trust | 3 | 3 | |||||
Conexus Food Solutions (formerly as Best Food Services, LLC) | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 8,581 | 10,514 | 8,341 | ||||
Eastern Fresh NJ, LLC | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 1,093 | 5,509 | ||||
Enson Seafood GA, Inc. (formerly “GA-GW Seafood, Inc.”) | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 37 | 0 | 128 | ||||
First Choice Seafood, Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 134 | 322 | ||||
Fujian RongFeng Plastic Co., Ltd | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 372 | 3,108 | ||||
North Carolina Good Taste Noodle, Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 7,227 | 5,520 | |||||
Ocean Pacific Seafood Group, Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 381 | 589 | 452 | ||||
Others | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 205 | 332 | 133 | ||||
Eagle Food Services, LLC | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 0 | 4 | ||||
Hanfeng Information Technology (Jinhua), Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 0 | 122 | ||||
N&F Logistics, Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 0 | 3 | ||||
Revolution Industry, LLC | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | 0 | 0 | 190 | ||||
UGO USA, Inc. | Related Party | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Purchases from Related Party | $ 0 | $ 0 | $ 212 |
Related Party Transactions - _2
Related Party Transactions - Summary of Sales to Related Parties (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Nov. 01, 2020 trust | Oct. 31, 2020 trust | |
Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | $ 5,845 | $ 6,942 | $ 9,055 | ||
ABC Food Trading, LLC | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 2,078 | 3,949 | 2,642 | ||
Asahi Food, Inc. | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 791 | 639 | 704 | ||
Conexus Food Solutions (formerly as Best Food Services, LLC) | |||||
Related Party Transaction [Line Items] | |||||
Number of irrecoverable trusts | trust | 3 | 3 | |||
Conexus Food Solutions (formerly as Best Food Services, LLC) | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 928 | 1,285 | 792 | ||
Eagle Food Services, LLC | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 1,942 | 879 | 2,864 | ||
First Choice Seafood, Inc. | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 31 | 35 | 99 | ||
Fortune One Foods, Inc. | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 42 | 115 | 418 | ||
N&F Logistics, Inc. | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 6 | 40 | 531 | ||
Union Food LLC | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 27 | 0 | 0 | ||
Eastern Fresh NJ, LLC | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 0 | 0 | 155 | ||
Enson Seafood GA, Inc. (formerly “GA-GW Seafood, Inc.”) | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 0 | 0 | 101 | ||
Enson Seafood GA, Inc. (formerly as GA-GW Seafood, Inc.) | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 0 | 0 | 573 | ||
Hengfeng Food Service Inc | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | 0 | 0 | 163 | ||
Other | Sales | |||||
Related Party Transaction [Line Items] | |||||
Sales - related party | $ 0 | $ 0 | $ 13 |
Related Party Transactions - _3
Related Party Transactions - Summary of Accounts Receivable With Related Parties (Details) $ in Thousands | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Nov. 01, 2020 trust | Oct. 31, 2020 trust |
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | $ 308 | $ 213 | ||
ABC Trading, LLC | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 94 | 0 | ||
Asahi Food, Inc. | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 69 | 81 | ||
Conexus Food Solutions (formerly as Best Food Services, LLC) | ||||
Related Party Transaction [Line Items] | ||||
Number of irrecoverable trusts | trust | 3 | 3 | ||
Conexus Food Solutions (formerly as Best Food Services, LLC) | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 84 | 0 | ||
Eagle Food Services, LLC | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 0 | 69 | ||
Enson Seafood GA, Inc. (formerly as GA-GW Seafood, Inc.) | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 59 | 59 | ||
Fortune One Foods, Inc. | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | 0 | 4 | ||
Union Food LLC | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts receivable, net of allowances of $2,119 and $1,442 | $ 2 | $ 0 |
Related Party Transactions - _4
Related Party Transactions - Summary of Accounts Payable with Related Parties (Details) $ in Thousands | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Nov. 01, 2020 trust | Oct. 31, 2020 trust |
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | $ 397 | $ 1,529 | ||
B&R Group Realty | Mortgage-Secured Term Loans | ||||
Related Party Transaction [Line Items] | ||||
Other Receivables | 7,000 | |||
Conexus Food Solutions (formerly as Best Food Services, LLC) | ||||
Related Party Transaction [Line Items] | ||||
Number of irrecoverable trusts | trust | 3 | 3 | ||
Conexus Food Solutions (formerly as Best Food Services, LLC) | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | 379 | 729 | ||
North Carolina Good Taste Noodle, Inc. | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | 731 | |||
Other | Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | $ 18 | $ 69 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Number of shares authorized under plan (in shares) | 3,000,000 | ||
Shares remaining available for future unvested awards (in shares) | 531,222 | ||
Shares remaining available for future awards (in shares) | 991,902 | ||
Total stock-based compensation expense | $ 3,352 | $ 1,257 | $ 635 |
Unrecognized compensation cost | $ 4,200 | ||
Unrecognized compensation cost, period for recognition | 1 year 9 months 25 days | ||
Fair value of equity based awards | $ 1,500 | 800 | 0 |
RSUs | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Equity instruments outstanding (in shares) | 810,944 | ||
Total stock-based compensation expense | $ 2,118 | 897 | 405 |
Unrecognized compensation cost | $ 2,300 | ||
RSUs | Minimum | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Award vesting period | 1 year | ||
RSUs | Maximum | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Award vesting period | 3 years | ||
PSUs | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Equity instruments outstanding (in shares) | 665,932 | ||
Total stock-based compensation expense | $ 1,234 | $ 360 | $ 230 |
Unrecognized compensation cost | $ 1,900 | ||
Award vesting period | 3 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of RSU and PSU Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
RSUs | |||
Shares | |||
Beginning balance (in shares) | 598,325 | ||
Granted (in shares) | 520,248 | ||
Forfeited (in shares) | (54,589) | ||
Vested (in shares) | (253,040) | ||
Ending balance (in shares) | 810,944 | 598,325 | |
Weighted Average Grant Date Fair Value | |||
Weighted average grant date fair value, beginning (in dollars per share) | $ 5.39 | ||
Granted (in dollars per share) | 3.86 | $ 5.04 | $ 5.22 |
Forfeited (in dollars per share) | 4.94 | ||
Vested (in dollars per share) | 5.45 | ||
Weighted average grant date fair value, ending (in dollars per share) | $ 4.43 | $ 5.39 | |
PSUs | |||
Shares | |||
Beginning balance (in shares) | 382,662 | ||
Granted (in shares) | 441,288 | ||
Forfeited (in shares) | (38,926) | ||
Vested (in shares) | (119,092) | ||
Ending balance (in shares) | 665,932 | 382,662 | |
Weighted Average Grant Date Fair Value | |||
Weighted average grant date fair value, beginning (in dollars per share) | $ 4.95 | ||
Granted (in dollars per share) | 3.86 | $ 4.76 | $ 4.94 |
Forfeited (in dollars per share) | 4.19 | ||
Vested (in dollars per share) | 5.19 | ||
Weighted average grant date fair value, ending (in dollars per share) | $ 4.23 | $ 4.95 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value Assumptions (Details) - PSUs | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free rate, minimum | 0.20% |
Risk-free rate, maximum | 0.34% |
Expected dividend yield | 0% |
Expected volatility, minimum | 62.08% |
Expected volatility, maximum | 65.74% |
Period after completion of merger | 6 months |
Common Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility, minimum | 66.10% |
Expected volatility, maximum | 69.19% |
Peer Companies | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility, minimum | 54.96% |
Expected volatility, maximum | 63.45% |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (years) | 2 years 6 months 21 days |
Look-back period | 9 months |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (years) | 3 years 1 month 24 days |
Look-back period | 1 year 2 months 1 day |
Stock-Based Compensation - Comp
Stock-Based Compensation - Components of Stock-based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | $ 3,352 | $ 1,257 | $ 635 |
Tax Benefit of stock-based compensation expense | 931 | 366 | 132 |
RSUs | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 2,118 | 897 | 405 |
PSUs | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | $ 1,234 | $ 360 | $ 230 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Percent of compensation that can be deferred | 100% | ||
Defined contribution plan contributions | $ 831 | $ 432 | $ 240 |
First Contribution | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contribution percent match | 100% | ||
Employer contribution limit per calendar year (as a percent of compensation) | 3% | ||
Second Contribution | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contribution percent match | 50% | ||
Second Contribution | Minimum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contribution limit per calendar year (as a percent of compensation) | 3% | ||
Second Contribution | Maximum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contribution limit per calendar year (as a percent of compensation) | 5% |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||
Dec. 01, 2023 USD ($) $ / shares shares | Oct. 16, 2023 USD ($) | Feb. 10, 2021 USD ($) | Dec. 31, 2023 USD ($) property lease | Dec. 31, 2022 USD ($) | Oct. 25, 2023 USD ($) | Dec. 30, 2021 $ / shares | |
Loss Contingencies [Line Items] | |||||||
Share price (in dollars per share) | $ / shares | $ 7.36 | ||||||
Property Lease Guarantee | |||||||
Loss Contingencies [Line Items] | |||||||
Guarantor lease obligation term (in years) | 10 years | ||||||
Loss contingencies payments term | 18 months | ||||||
Lease guarantee liability recorded | $ 5,500 | $ 5,942 | |||||
Lessee guarantee, lease discount rate | 4.55% | ||||||
Guarantor lease obligation, maximum exposure | $ 300 | ||||||
Minimum | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, term of contract (in years) | 1 year | ||||||
Payment to construct building | $ 2,500 | ||||||
Minimum | Property Lease Guarantee | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, rent expense | $ 42 | ||||||
Maximum | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, term of contract (in years) | 30 years | ||||||
Maximum | Property Lease Guarantee | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, rent expense | $ 63 | ||||||
Buildings | |||||||
Loss Contingencies [Line Items] | |||||||
Number of leases | lease | 2 | ||||||
Number of properties | property | 2 | ||||||
Buildings | Lease for 273 Fifth Avenue, Manhattan,New York | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, term of contract (in years) | 30 years | ||||||
Buildings | Lease for 275 Fifth Avenue, Manhattan,New York | |||||||
Loss Contingencies [Line Items] | |||||||
Operating lease, term of contract (in years) | 15 years | ||||||
AnHeart and Minsheng Case | Pending Litigation | |||||||
Loss Contingencies [Line Items] | |||||||
Amount receivable | $ 474 | ||||||
Delaware Action Case | Settled Litigation | |||||||
Loss Contingencies [Line Items] | |||||||
Proceeds from legal settlements | $ 9,250 | $ 1,500 | |||||
Shares received (in shares) | shares | 1,997,423 | ||||||
Share price (in dollars per share) | $ / shares | $ 3.88 | ||||||
Cash payment | $ 100 | ||||||
Amount receivable | $ 7,750 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Operating Lease Maturities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |||
2024 | $ 582 | ||
2025 | 604 | ||
2026 | 621 | ||
2027 | 638 | ||
2028 | 656 | ||
Thereafter | 3,822 | ||
Total | 6,923 | ||
Less: imputed interest | (1,451) | ||
Total minimum lease payments | 5,472 | ||
Loss Contingencies [Line Items] | |||
Operating lease right-of-use liabilities | 13,120 | $ 14,300 | |
Operating lease liabilities | (3,730) | (4,408) | $ (724) |
Property Lease Guarantee | |||
Loss Contingencies [Line Items] | |||
Operating lease right-of-use liabilities | 5,472 | 5,760 | $ 0 |
Lease guarantee liability recorded | 5,500 | 5,942 | |
Operating lease liabilities | $ (288) | $ (182) |
Uncategorized Items - hffg-2023
Label | Element | Value |
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-13 [Member] |