Lifeway Foods (LWAY) 10-Q 14 Nov 24 2024 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2024	Nov. 06, 2024
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2024
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	000-17363
Entity Registrant Name	LIFEWAY FOODS, INC.
Entity Central Index Key	0000814586
Entity Tax Identification Number	36-3442829
Entity Incorporation, State or Country Code	IL
Entity Address, Address Line One	6431 West Oakton
Entity Address, City or Town	Morton Grove
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60053
City Area Code	847
Local Phone Number	967-1010
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		14,816,470
Common Stock [Member]
Title of 12(b) Security	Common Stock, No Par Value
Trading Symbol	LWAY
Security Exchange Name	NASDAQ
Preferred Stock Purchase Rights [Member]
Title of 12(b) Security	Preferred Stock Purchase Rights
Trading Symbol	n/a
Security Exchange Name	NASDAQ

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 20,558	$ 13,198
Accounts receivable, net of allowance for credit losses and discounts & allowances of $1,320 and $1,270 at September 30, 2024 and December 31, 2023 respectively	13,495	13,875
Inventories, net	8,441	9,104
Prepaid expenses and other current assets	1,893	2,019
Refundable income taxes	379	0
Total current assets	44,766	38,196
Property, plant and equipment, net	26,310	22,764
Operating lease right-of-use asset	136	192
Goodwill	11,704	11,704
Intangible assets, net	6,493	6,898
Other assets	1,900	1,900
Total assets	91,309	81,654
Current liabilities
Current portion of note payable	0	1,250
Accounts payable	11,117	9,976
Accrued expenses	5,589	4,916
Accrued income taxes	0	474
Total current liabilities	16,706	16,616
Note payable	0	1,483
Operating lease liabilities	79	118
Deferred income taxes, net	3,001	3,001
Total liabilities	19,786	21,218
Commitments and contingencies (Note 9)
Stockholders’ equity
Preferred stock, no par value; 2,500 shares authorized; no shares issued or outstanding at September 30, 2024 and December 31, 2023	0	0
Common stock, no par value; 40,000 shares authorized; 17,274 shares issued; 14,816 and 14,691 outstanding at September 30, 2024 and December 31, 2023, respectively	6,509	6,509
Paid-in capital	5,915	4,825
Treasury stock, at cost	(15,883)	(16,695)
Retained earnings	74,982	65,797
Total stockholders' equity	71,523	60,436
Total liabilities and stockholders' equity	$ 91,309	$ 81,654

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Net of allowance for credit losses and discounts & allowances	$ 1,320	$ 1,270
Preferred stock, par value	$ 0	$ 0
Preferred stock, shares authorized	2,500	2,500
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0	$ 0
Common stock, shares authorized	40,000	40,000
Common stock, shares issued	17,274	17,274
Common stock, shares outstanding	14,816	14,691

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
Net sales	$ 46,095	$ 40,896	$ 139,886	$ 118,030
Cost of goods sold	33,508	29,099	101,127	85,428
Depreciation expense	720	654	2,082	1,953
Total cost of goods sold	34,228	29,753	103,209	87,381
Gross profit	11,867	11,143	36,677	30,649
Selling expense	3,979	2,884	11,256	8,974
General and administrative expense	3,564	3,085	11,877	10,028
Amortization expense	135	135	405	405
Total operating expenses	7,678	6,104	23,538	19,407
Income from operations	4,189	5,039	13,139	11,242
Other income (expense):
Interest expense	(4)	(109)	(102)	(322)
Gain on sale of property and equipment	3	0	3	33
Other income (expense), net	138	(1)	153	(1)
Total other income (expense)	137	(110)	54	(290)
Income before provision for income taxes	4,326	4,929	13,193	10,952
Provision for income taxes	1,350	1,517	4,008	3,554
Net income	$ 2,976	$ 3,412	$ 9,185	$ 7,398
Net earnings per common share:
Basic	$ 0.20	$ 0.23	$ 0.62	$ 0.50
Diluted	$ 0.19	$ 0.23	$ 0.60	$ 0.49
Weighted average common shares outstanding:
Basic	14,801	14,677	14,740	14,659
Diluted	15,265	15,101	15,194	15,063

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Common Stock [Member]	Treasury Stock, Common [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Beginning balance, value at Dec. 31, 2022	$ 6,509	$ (16,993)	$ 3,624	$ 54,430	$ 47,570
Beginning balance, shares at Dec. 31, 2022	17,274	(2,629)
Stock-based compensation			343		343
Net income				830	830
Ending balance, value at Mar. 31, 2023	$ 6,509	$ (16,993)	3,967	55,260	48,743
Ending balance, shares at Mar. 31, 2023	17,274	(2,629)
Beginning balance, value at Dec. 31, 2022	$ 6,509	$ (16,993)	3,624	54,430	47,570
Beginning balance, shares at Dec. 31, 2022	17,274	(2,629)
Net income					7,398
Ending balance, value at Sep. 30, 2023	$ 6,509	$ (16,995)	4,338	61,828	55,980
Ending balance, shares at Sep. 30, 2023	17,274	(2,583)
Beginning balance, value at Mar. 31, 2023	$ 6,509	$ (16,993)	3,967	55,260	48,743
Beginning balance, shares at Mar. 31, 2023	17,274	(2,629)
Issuance of common stock in connection with stock-based compensation		$ 73	(112)		(39)
Issuance of common stock in connection with stock-based compensation, shares		11
Stock-based compensation			312		312
Net income				3,156	3,156
Ending balance, value at Jun. 30, 2023	$ 6,509	$ (16,920)	4,167	58,416	52,172
Ending balance, shares at Jun. 30, 2023	17,274	(2,618)
Issuance of common stock in connection with stock-based compensation		$ 225	(252)		(27)
Issuance of common stock in connection with stock-based compensation, shares		35
Stock-based compensation			423		423
Net income				3,412	3,412
Ending balance, value at Sep. 30, 2023	$ 6,509	$ (16,995)	4,338	61,828	55,980
Ending balance, shares at Sep. 30, 2023	17,274	(2,583)
Beginning balance, value at Dec. 31, 2023	$ 6,509	$ (16,695)	4,825	65,797	60,436
Beginning balance, shares at Dec. 31, 2023	17,274	(2,583)
Stock-based compensation			673		673
Net income				2,426	2,426
Ending balance, value at Mar. 31, 2024	$ 6,509	$ (16,695)	5,498	68,223	63,535
Ending balance, shares at Mar. 31, 2024	17,274	(2,583)
Beginning balance, value at Dec. 31, 2023	$ 6,509	$ (16,695)	4,825	65,797	60,436
Beginning balance, shares at Dec. 31, 2023	17,274	(2,583)
Net income					9,185
Ending balance, value at Sep. 30, 2024	$ 6,509	$ (15,883)	5,915	74,982	71,523
Ending balance, shares at Sep. 30, 2024	17,274	(2,457)
Beginning balance, value at Mar. 31, 2024	$ 6,509	$ (16,695)	5,498	68,223	63,535
Beginning balance, shares at Mar. 31, 2024	17,274	(2,583)
Issuance of common stock in connection with stock-based compensation		$ 575	(739)		(164)
Issuance of common stock in connection with stock-based compensation, shares		89
Issuance of common stock on exercise of stock options		$ 70	36		106
Issuance of common stock on exercise of stock options, shares		11
Stock-based compensation			737		737
Net income				3,783	3,783
Ending balance, value at Jun. 30, 2024	$ 6,509	$ (16,050)	5,532	72,006	67,997
Ending balance, shares at Jun. 30, 2024	17,274	(2,483)
Issuance of common stock in connection with stock-based compensation		$ 167	(220)		(53)
Issuance of common stock in connection with stock-based compensation, shares		26
Stock-based compensation			603		603
Net income				2,976	2,976
Ending balance, value at Sep. 30, 2024	$ 6,509	$ (15,883)	$ 5,915	$ 74,982	$ 71,523
Ending balance, shares at Sep. 30, 2024	17,274	(2,457)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities:
Net income	$ 9,185	$ 7,398
Adjustments to reconcile net income to operating cash flow:
Depreciation and amortization	2,487	2,358
Stock-based compensation	1,898	1,078
Non-cash interest expense	17	5
Bad debt expense	0	2
Gain on sale of equipment	(3)	(33)
(Increase) decrease in operating assets:
Accounts receivable	379	(1,683)
Inventories	663	310
Refundable income taxes	(379)	(216)
Prepaid expenses and other current assets	125	(176)
Increase (decrease) in operating liabilities:
Accounts payable	949	928
Accrued expenses	694	1,673
Accrued income taxes	(474)	500
Net cash provided by operating activities	15,541	12,144
Cash flows from investing activities:
Purchases of property and equipment	(5,445)	(3,146)
Proceeds from sales or equipment	14	40
Purchase of investments	0	(100)
Net cash used in investing activities	(5,431)	(3,206)
Cash flows from financing activities:
Repayment of note payable	(2,750)	(750)
Net cash used in financing activities	(2,750)	(750)
Net increase in cash and cash equivalents	7,360	8,188
Cash and cash equivalents at the beginning of the period	13,198	4,444
Cash and cash equivalents at the end of the period	20,558	12,632
Supplemental cash flow information:
Cash paid for income taxes, net of (refunds)	4,861	3,270
Cash paid for interest	95	343
Non-cash investing activities
Accrued purchase of property and equipment	331	194
Increase in right-of-use assets and operating lease obligations	$ 0	$ 86

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ 2,976	$ 3,783	$ 2,426	$ 3,412	$ 3,156	$ 830	$ 9,185	$ 7,398

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2024
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Basis of Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	Note 1 – Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) for interim financial information, and do not include certain information and footnote disclosures required for complete, audited financial statements. In the opinion of management, these statements include all adjustments necessary for a fair presentation of the results of all interim periods reported herein. The consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and related notes included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed by Lifeway Foods, Inc. (together with all of its wholly-owned subsidiaries unless the context otherwise requires, the “Company”). Results of operations for any interim period are not necessarily indicative of future or annual results. Principles of consolidation The consolidated financial statements include the accounts of Lifeway Foods, Inc. and all its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Note 2 – Summary of Significant Accounting Policies Our significant accounting policies, which are summarized in detail in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, have not materially changed. The following is a description of certain of our significant accounting policies. Use of estimates The preparation of consolidated financial statements in conformity with U.S. 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 reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made in preparing the consolidated financial statements include the reserve for promotional allowances, the valuation of goodwill and intangible assets, stock-based and incentive compensation, and deferred income taxes. Cash and cash equivalents Lifeway considers cash and all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents are stated at cost, which approximates or equals fair value due to their short-term nature. Lifeway from time to time may have bank deposits in excess of insurance limits of the Federal Deposit Insurance Corporation. The Company places its cash and cash equivalents with high credit quality financial institutions. Lifeway has not experienced any losses in such accounts and believes the financial risks associated with these financial instruments are minimal. Advertising and promotional costs Advertising costs are expensed as incurred and reported in Selling expense in the Company’s consolidated statement of operations. Total advertising expense was $ 4,131 2,884 1,599 878 Segments The Company is managed as a single reportable segment. The Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), reviews financial information on an aggregate basis for purposes of allocating resources and assessing financial performance, as well as for making strategic operational decisions and managing the organization. Substantially all of Lifeway’s consolidated revenues relate to the sale of cultured dairy products that it produces using the same processes and materials and are sold to consumers through a common network of distributors and retailers in the United States. Recent accounting pronouncements Issued but not yet effective In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07: Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The new standard requires entities to report incremental information about significant segment expenses included in a segment’s profit or loss measure as well as the name and title of the chief operating decision maker. The new standard also requires interim disclosures related to reportable segment profit or loss and assets that had previously only been disclosed annually. The new standard is effective for our annual period ending December 31, 2024 and our interim periods during the fiscal year ending December 31, 2025. The new standard does not affect recognition or measurement in the Company’s consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09: Income Taxes (Topic 740): Improvements to Income Tax Disclosures that requires entities to disclose additional information about federal, state, and foreign income taxes primarily related to the income tax rate reconciliation and income taxes paid. The new standard also eliminates certain existing disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities. The new standard is effective for our fiscal year ending December 31, 2025. The guidance does not affect recognition or measurement in the Company’s consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Topic 220): Disaggregation of Income Statement Expenses. The new standard requires additional disclosure of certain amounts included in the expense captions presented on the Statement of Operations as well as disclosures about selling expenses. The new standard is effective on a prospective basis, with the option for retrospective application, for our annual period ending December 31, 2027 and our interim periods during the fiscal year ending December 31, 2028. The new standard does not affect recognition or measurement in the Company’s consolidated financial statements.

Inventories, net

Inventories, net	9 Months Ended
	Sep. 30, 2024
Inventory Disclosure [Abstract]
Inventories, net	Note 3 – Inventories, net Inventories consisted of the following: Schedule of inventories September 30, December 31, Ingredients $ 2,360 $ 2,929 Packaging 2,532 3,014 Finished goods 3,549 3,161 Total inventories, net $ 8,441 $ 9,104

Property, Plant and Equipment,

Property, Plant and Equipment, net	9 Months Ended
	Sep. 30, 2024
Property, Plant and Equipment [Abstract]
Property, Plant and Equipment, net	Note 4 – Property, Plant and Equipment, net Property, plant and equipment consisted of the following: Schedule of property, plant and equipment September 30, December 31, Land $ 1,565 $ 1,565 Buildings and improvements 22,667 21,661 Machinery and equipment 36,222 33,573 Vehicles 626 705 Office equipment 1,072 1,072 Construction in process 3,843 2,154 65,995 60,730 Less accumulated depreciation (39,685 ) (37,966 ) Total property, plant and equipment, net $ 26,310 $ 22,764

Goodwill and Intangible Assets

Goodwill and Intangible Assets	9 Months Ended
	Sep. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets	Note 5 – Goodwill and Intangible Assets Goodwill Goodwill consisted of the following: Schedule of goodwill Total Balance at December 31, 2023 Goodwill $ 12,948 Accumulated impairment losses (1,244 ) $ 11,704 Balance at September 30, 2024 Goodwill $ 12,948 Accumulated impairment losses (1,244 ) $ 11,704 Intangible Assets Other intangible assets, net consisted of the following: Schedule of other intangible assets, net September 30, 2024 December 31, 2023 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Recipes $ 44 $ (44 ) $ – $ 44 $ (44 ) $ – Customer lists and other customer related intangibles 4,529 (4,529 ) – 4,529 (4,529 ) – Customer relationships 3,385 (1,492 ) 1,893 3,385 (1,372 ) 2,013 Brand names 7,948 (3,348 ) 4,600 7,948 (3,063 ) 4,885 Formula 438 (438 ) – 438 (438 ) – Total intangible assets, net $ 16,344 $ (9,851 ) $ 6,493 $ 16,344 $ (9,446 ) $ 6,898 Estimated amortization expense on intangible assets for the next five years is as follows: Schedule of estimated amortization expense on intangible assets Year Amortization Three months ended December 31, 2024 $ 135 2025 $ 540 2026 $ 540 2027 $ 540 2028 $ 540 The weighted-average remaining amortization expense period for the customer relationship and brand name intangible assets is 11.8 12.1 12.0

Accrued Expenses

Accrued Expenses	9 Months Ended
	Sep. 30, 2024
Payables and Accruals [Abstract]
Accrued Expenses	Note 6 – Accrued Expenses Accrued expenses consisted of the following: Schedule of accrued expense September 30, December 31, 2023 Payroll and incentive compensation $ 4,747 $ 3,853 Real estate taxes 410 442 Utilities 209 241 Current portion of operating lease liabilities 57 74 Other 166 306 Total accrued expenses $ 5,589 $ 4,916

Debt

Debt	9 Months Ended
	Sep. 30, 2024
Debt Disclosure [Abstract]
Debt	Note 7 – Debt Note payable consisted of the following: Schedule of note payable September 30, 2024 December 31, 2023 Term loan due August 18, 2026. Interest payable monthly. $ – $ 2,750 Unamortized deferred financing costs – (17 ) Total note payable – 2,733 Less current portion – (1,250 ) Total long-term portion $ – $ 1,483 The Company paid the outstanding term loan balance of $ 2,250 Credit Agreement The Company is party to an Amended and Restated Loan and Security Agreement (as amended and modified from time to time, the “Credit Agreement”) with its existing lender and certain of its subsidiaries. The Credit Agreement provides for, among other things, a $ 5 5 5 August 18, 2026 June 30, 2025 All outstanding amounts under the Credit Agreement bear interest at the Secured Overnight Financing Rate (“SOFR”), plus 2.07%. Interest is payable monthly in arrears. 0.20 0.20 The Credit Agreement includes customary representations, warranties, and covenants, including financial covenants requiring the Company to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00, and a minimum working capital financial covenant, as defined, of no less than $11.25 million, in each of the fiscal quarters ending through the expiration date. The Credit Agreement provides for events of default, including failure to repay principal and interest when due and failure to perform or violation of the provisions or covenants of the agreement, as a result of which amounts due under the Credit Agreement may be accelerated. The loans and all other amounts due and owed under the Credit Agreement and related documents are secured by substantially all of the Company’s assets. Lifeway was in compliance with the fixed charge coverage ratio and minimum working capital covenants at September 30, 2024. Revolving Credit Facility As of September 30, 2024, the Company had $ 0 5,000

Leases

Leases	9 Months Ended
	Sep. 30, 2024
Leases
Leases	Note 8 – Leases The Company leases certain machinery and equipment with fixed base rent payments and variable costs based on usage. Remaining lease terms for these leases range from less than one year to five years. The Company includes lease extension options, if applicable and reasonably certain to be exercised, in the calculation of the right-of-use asset and lease liabilities. Lifeway includes only fixed payments for lease components in the measurement of the right-of-use asset and lease liability. Variable lease payments are those that vary because of changes in facts or circumstances occurring after the commencement date, other than the passage of time. There are no residual value guarantees. Lifeway does not currently have leases which meet the finance lease classification as defined under ASC 842. Lifeway treats contracts as a lease when the contract conveys the right to use a physically distinct asset for a period of time in exchange for consideration, it directs the use of the asset and obtains substantially all the economic benefits of the asset. Right-of-use assets and lease liabilities are measured and recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Lifeway has elected the practical expedient to combine lease and non-lease components into a single component for all of its leases. When the Company is unable to determine an implicit interest rate, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments for those leases. Lifeway includes options to extend or terminate the lease in the measurement of the right-of-use asset and lease liability when it is reasonably certain that it will exercise such options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company does not record leases with an initial term of 12 months or less on the balance sheet. Expense for these short-term leases is recorded on a straight-line basis over the lease term. Total lease expense was $ 110 102 33 41 Future maturities of lease liabilities were as follows: Schedule of future maturities of lease liabilities Year Operating Leases Three months ended December 31, 2024 $ 21 2025 55 2026 31 2027 21 2028 17 Thereafter 10 Total lease payments 155 Less: Interest (19 ) Present value of lease liabilities $ 136 The weighted-average remaining lease term for its operating leases was 3.4 8.94 68 70 22 24

Commitments and contingencies

Commitments and contingencies	9 Months Ended
	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies	Note 9 – Commitments and contingencies Litigation Lifeway is involved in various legal proceedings, claims, disputes, regulatory matters, audits, and proceedings arising in the ordinary course of, or incidental to, the Company’s business, including commercial disputes, product liabilities, intellectual property matters and employment-related matters. Lifeway records provisions in the consolidated financial statements for pending legal matters when it believes it is probable that a loss will be incurred and the amount of such loss can be reasonably estimated. The Company evaluates, on a periodic basis, developments in legal matters that could affect the amount of any accrual and developments that would make a loss contingency both probable and reasonably estimable. If a loss contingency is not both probable and estimable, it does not establish an accrued liability. Currently, none of its accruals for outstanding legal matters are material individually or in the aggregate to its financial position and it is management’s opinion that the ultimate resolution of these outstanding legal matters will not have a material adverse effect on its business, financial condition, results of operations, or cash flows. However, if the Company is ultimately required to make payments in connection with an adverse outcome, it is possible that such contingency could have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

Income taxes

Income taxes	9 Months Ended
	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income taxes	Note 10 – Income taxes Income taxes were recognized at effective rates of 30.4 32.5 31.2 30.8 The Company calculates the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full year, excluding unusual or infrequently occurring discrete items, and applies that rate to income (loss) before provision for income taxes for the period. The Company’s effective tax rate may change from period to period based on recurring and non-recurring factors including the relative mix of pre-tax earnings (or losses), the jurisdictional mix of earnings, enacted tax legislation, state income taxes, the impact of non-deductible items, changes in valuation allowances, settlement of tax audits, and the expiration of the statute of limitations in relation to unrecognized tax benefits. The Company records discrete income tax items such as enacted tax rate changes and completed tax audits in the period in which they occur. The Company consistently reflects non-deductible officer compensation expense, non-deductible compensation expense related to equity incentive awards and separate state tax rates from period to period. Although similar items were reflected in 2024, the percentage effect is different due to the difference in pre-tax income in 2024 compared to 2023. Unrecognized tax benefits were $ 0

Stock-based and Other Compensat

Stock-based and Other Compensation	9 Months Ended
	Sep. 30, 2024
Share-Based Payment Arrangement [Abstract]
Stock-based and Other Compensation	Note 11 – Stock-based and Other Compensation Omnibus Incentive Plan In December 2015, Lifeway stockholders approved the 2015 Omnibus Incentive Plan, which authorized the issuance of an aggregate of 3.5 On August 31, 2022, Lifeway stockholders approved the 2022 Plan. Under the 2022 Plan, the Compensation Committee of the Board of Directors may grant awards of various types of compensation, including, nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. The maximum number of shares authorized to be awarded under the 2022 Plan is 3.25 Awards granted under the 2022 Plan are generally subject to a minimum vesting period of at least one year. Awards may be subject to cliff-vesting or graded-vesting conditions, with graded vesting starting no earlier than one year after the grant date. The Plan Administrator may provide for shorter vesting periods in an award agreement for no more than five percent of the maximum number of shares authorized for issuance under the 2022 Plan. As of September 30, 2024, 2.64 Stock Options The following table summarizes stock option activity during the nine months ended September 30, 2024: Schedule of stock option activity Options Weighted Weighted contractual life Aggregate (In thousands) Outstanding at December 31, 2023 41 $ 10.42 2.21 $ 121 Granted – – – – Exercised (11 ) 10.41 – – Forfeited – – – – Outstanding at September 30, 2024 30 $ 10.42 1.46 $ 460 Exercisable at September 30, 2024 30 $ 10.42 1.46 $ 460 Restricted Stock Units A Restricted Stock Unit (“RSU”) represents the right to receive one share of common stock in the future. RSUs have no exercise price. The grant date fair value of the awards is determined by the Company’s closing stock price on the grant date. Lifeway expenses RSUs over the vesting period. The following table summarizes RSU activity during the three months ended September 30, 2024. Schedule of RSUs activity Restricted Stock Units Weighted Average Grant Date Fair Value (In thousands) Outstanding at December 31, 2023 207 $ 6.89 Granted 57 13.12 Shares issued upon vesting (35 ) 7.27 Forfeited – – Outstanding at September 30, 2024 229 $ 8.38 Vested and deferred at September 30, 2024 109 $ 7.02 For the nine months ended September 30, 2024 and 2023 total pre-tax stock-based compensation expense recognized in the consolidated statements of operations was $ 703 356 197 100 235 154 66 43 793 1.25 Long-Term Incentive Plan Compensation Lifeway has established long-term incentive-based compensation programs for certain senior executives and key employees pursuant to the terms of its incentive plans. 2020 CEO Incentive Award During the fourth quarter 2020, Lifeway awarded a long-term equity-based incentive of $ 750 24 87 0 18 2021 Equity Award The 2021 long-term equity incentive plan compensation is based on Lifeway’s achievement of adjusted EBITDA performance versus the respective target established by the Board of Directors for 2021. Under the 2021 plan, collectively the participants earned equity-based incentive compensation of $ 1,069 40 161 0 33 2022 Equity Award Under the 2022 long-term incentive plan, participants can earn a specified number of target level Performance Share Units (“PSUs”) contingent upon the achievement of strategic milestones during the three-year Measurement Period, which is fiscal year 2022 to 2024. The strategic milestones are 1) 3-year cumulative net revenue, and 2) 3-year cumulative adjusted EBITDA. The target number of PSU awards are weighted 50% on net revenue and 50% on adjusted EBITDA. Collectively, the participants can earn 125,066 PSUs at the target level. Participants may earn more or less than the target number of shares based on actual results, however the minimum and maximum number of shares that can be earned are bound by minimum and maximum thresholds of net revenue and adjusted EBITDA. The PSU awards will be earned and will vest, if at all, after the end of the three-year measurement period based on achievement of the milestones. The PSU awards do not vest during the three-year measurement period. The PSUs have a grant date fair value of $6.25 per share. For the nine months ended September 30, 2024 and 2023, $ 420 356 132 116 The 2022 long-term incentive plan also granted restricted stock unit awards that contain only a service condition and vest on the passage of time in three equal installments on each of the first three anniversaries of the August 31, 2022 grant date. The stock-based compensation expense for these awards is included in the Restricted Stock Units section above. 2023 Equity Award Under the 2023 long-term incentive plan, participants can earn a specified number of target level Performance Share Units (“PSUs”) contingent upon the achievement of strategic milestones during the three-year Measurement Period, which is fiscal year 2023 to 2025. The strategic milestones are 1) 3-year cumulative net revenue, and 2) 3-year cumulative adjusted EBITDA. The target number of PSU awards are weighted 50% on net revenue and 50% on adjusted EBITDA. Collectively, the participants can earn 115,622 PSUs at the target level. Participants may earn more or less than the target number of shares based on actual results, however the minimum and maximum number of shares that can be earned are bound by minimum and maximum thresholds of net revenue and adjusted EBITDA. The PSU awards will be earned and will vest, if at all, after the end of the three-year measurement period based on achievement of the milestones. The PSU awards do not vest during the three-year measurement period. The PSUs have a grant date fair value of $6.88 per share. For the nine months ended September 30, 2024 and 2023, $ 377 118 122 102 The 2023 long-term incentive plan also granted restricted stock unit awards that contain only a service condition and vest on the passage of time in three equal installments on each of the first three anniversaries of the June 16, 2023 grant date. The stock-based compensation expense for these awards is included in the Restricted Stock Units section above. 2024 Equity Award Under the 2024 long-term incentive plan, participants can earn a specified number of target level Performance Share Units (“PSUs”) contingent upon the achievement of strategic milestones during the three-year Measurement Period, which is fiscal year 2024 to 2026. The strategic milestones are 1) 3-year cumulative net revenue, and 2) 3-year cumulative adjusted EBITDA. The target number of PSU awards are weighted 50% on net revenue and 50% on adjusted EBITDA. Collectively, the participants can earn 64,986 PSUs at the target level. Participants may earn more or less than the target number of shares based on actual results, however the minimum and maximum number of shares that can be earned are bound by minimum and maximum thresholds of net revenue and adjusted EBITDA. The PSU awards will be earned and will vest, if at all, after the end of the three-year measurement period based on achievement of the milestones. The PSU awards do not vest during the three-year measurement period. The PSUs have a grant date fair value of $13.73 per share. For the nine months ended September 30, 2024 and 2023, $ 334 0 113 0 The 2024 long-term incentive plan also granted restricted stock unit awards that contain only a service condition and vest on the passage of time in three equal installments on each of the first three anniversaries of the January 10, 2024 grant date. The stock-based compensation expense for these awards is included in the Restricted Stock Units section above. Non-Employee Director Plan On August 31, 2022, Lifeway stockholders approved the 2022 Non-Employee Director Equity and Deferred Compensation Plan, as amended by Amendment No. 1 approved by the Board on June 7, 2024 (the “2022 Director Plan”), which authorizes the grant of restricted stock units (“RSUs”), which will vest on such schedule as the Company, in its sole discretion, shall determine. Each non-employee director of the Company is eligible to be a participant in the 2022 Director Plan until they no longer serve as a non-employee director. As of the date of each annual shareholder meeting, or such other date as the Board shall determine, the Company may grant each director a number of RSUs for such year and set the vesting schedule for the RSUs granted. Whether and how many RSUs the Company will grant to directors in any year is subject to the sole discretion of the Company and shall in any event be subject to the 2022 Director Plan’s overall share limits. The maximum aggregate number of shares of common stock that may be issued under the 2022 Director Plan is 500 thousand shares. As of September 30, 2024, 394 Retirement Benefits Lifeway has a defined contribution plan which is available to all full-time employees. Under the terms of the plan, the Company matches employee contributions under a prescribed formula. For the nine months ended September 30, 2024 and 2023 total contribution expense recognized in the consolidated statements of operations was $ 495 364 133 106

Earnings Per Share

Earnings Per Share	9 Months Ended
	Sep. 30, 2024
Net earnings per common share:
Earnings Per Share	Note 12 - Earnings Per Share The following table summarizes the effects of the share-based compensation awards on the weighted average number of shares outstanding used in calculating diluted earnings per share: Schedule of weighted average number of shares outstanding Three Months Ended Nine months Ended September 30, September 30, 2024 2023 2024 2023 (In thousands) Weighted average common shares outstanding 14,801 14,677 14,740 14,659 Assumed exercise/vesting of equity awards 464 424 454 404 Weighted average diluted common shares outstanding 15,265 15,101 15,194 15,063

Disaggregation of Revenue and S

Disaggregation of Revenue and Significant Customers	9 Months Ended
	Sep. 30, 2024
Segment Reporting [Abstract]
Disaggregation of Revenue and Significant Customers	Note 13 – Disaggregation of Revenue and Significant Customers Lifeway’s primary product is drinkable kefir. The Company manufactures (directly or through a co-manufacturer) and markets products under the Lifeway, Fresh Made, and GlenOaks Farms brand names, as well as under private labels on behalf of certain customers. The Company’s product categories are: · Drinkable kefir, a cultured dairy product sold in a variety of organic and non-organic sizes, flavors, and types. · European-style soft cheeses, including farmer cheese, white cheese, and Sweet Kiss. · Cream and other, which primarily consists of cream, a byproduct of raw milk processing. · Drinkable yogurt, sold in a variety of sizes and flavors. · ProBugs, a line of kefir products designed for children. · Other dairy, which primarily consists of Fresh Made butter and sour cream. Net sales of products by category were as follows for the nine months ended September 30: Schedule of net sales of products by category 2024 2023 In thousands $ % $ % Drinkable Kefir other than ProBugs 115,280 82 94,174 80 Cheese 10,476 8 10,074 9 Cream and other 6,202 4 5,362 4 Drinkable Yogurt 4,419 3 4,760 4 ProBugs Kefir 2,494 2 2,490 2 Other dairy 1,015 1 1,170 1 Net Sales 139,886 100 118,030 100 Net sales of products by category were as follows for the three months ended September 30: 2024 2023 In thousands $ % $ % Drinkable Kefir other than ProBugs 37,737 82 33,035 81 Cheese 3,584 8 3,353 8 Cream and other 2,215 5 1,811 4 Drinkable Yogurt 1,501 3 1,485 4 ProBugs Kefir 744 1 820 2 Other dairy 314 1 392 1 Net Sales 46,095 100 40,896 100 Significant Customers Sales are predominately to companies in the retail food industry located within the United States. Two major customers accounted for a total of approximately 25 23 24 Geographic Information Net sales outside the of the United States represented less than 1% of total consolidated net sales for the nine months and three months ended September 30, 2024 and 2023. Net sales outside of the United States are determined based on where ownership transfers to the customer. All the Company’s long-lived assets are in the United States.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Subsequent Events	Note 14 – Subsequent Events On November 4, 2024, the Company entered into a Shareholder Rights Agreement with Computershare Trust Company, N.A., as rights agent (the “Rights Agreement”). Pursuant to the Rights Agreement, the Company’s board of directors declared a dividend of one preferred share purchase right (each a “Right”) for each outstanding share of Company common stock to stockholders of record as of the close of business on November 18, 2024. Each Right entitles its holder, subject to the terms of the Rights Agreement, to purchase from the Company one one-thousandth of one share of Series A Junior Participating Preferred Stock, no par value, of the Company at an exercise price of $130.00 per Right, subject to adjustment. Rights will attach to any shares of Company common stock that become outstanding after November 18, 2024 and prior to the earlier of the Distribution Time (as defined in the Rights Agreement) and the redemption or expiration of the Rights, and in certain other circumstances described in the Rights Agreement.

Basis of Presentation (Policies

Basis of Presentation (Policies)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Principles of consolidation	Principles of consolidation The consolidated financial statements include the accounts of Lifeway Foods, Inc. and all its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Use of estimates	Use of estimates The preparation of consolidated financial statements in conformity with U.S. 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 reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made in preparing the consolidated financial statements include the reserve for promotional allowances, the valuation of goodwill and intangible assets, stock-based and incentive compensation, and deferred income taxes.
Cash and cash equivalents	Cash and cash equivalents Lifeway considers cash and all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents are stated at cost, which approximates or equals fair value due to their short-term nature. Lifeway from time to time may have bank deposits in excess of insurance limits of the Federal Deposit Insurance Corporation. The Company places its cash and cash equivalents with high credit quality financial institutions. Lifeway has not experienced any losses in such accounts and believes the financial risks associated with these financial instruments are minimal.
Advertising and promotional costs	Advertising and promotional costs Advertising costs are expensed as incurred and reported in Selling expense in the Company’s consolidated statement of operations. Total advertising expense was $ 4,131 2,884 1,599 878
Segments	Segments The Company is managed as a single reportable segment. The Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), reviews financial information on an aggregate basis for purposes of allocating resources and assessing financial performance, as well as for making strategic operational decisions and managing the organization. Substantially all of Lifeway’s consolidated revenues relate to the sale of cultured dairy products that it produces using the same processes and materials and are sold to consumers through a common network of distributors and retailers in the United States.
Recent accounting pronouncements	Recent accounting pronouncements Issued but not yet effective In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07: Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The new standard requires entities to report incremental information about significant segment expenses included in a segment’s profit or loss measure as well as the name and title of the chief operating decision maker. The new standard also requires interim disclosures related to reportable segment profit or loss and assets that had previously only been disclosed annually. The new standard is effective for our annual period ending December 31, 2024 and our interim periods during the fiscal year ending December 31, 2025. The new standard does not affect recognition or measurement in the Company’s consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09: Income Taxes (Topic 740): Improvements to Income Tax Disclosures that requires entities to disclose additional information about federal, state, and foreign income taxes primarily related to the income tax rate reconciliation and income taxes paid. The new standard also eliminates certain existing disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities. The new standard is effective for our fiscal year ending December 31, 2025. The guidance does not affect recognition or measurement in the Company’s consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Topic 220): Disaggregation of Income Statement Expenses. The new standard requires additional disclosure of certain amounts included in the expense captions presented on the Statement of Operations as well as disclosures about selling expenses. The new standard is effective on a prospective basis, with the option for retrospective application, for our annual period ending December 31, 2027 and our interim periods during the fiscal year ending December 31, 2028. The new standard does not affect recognition or measurement in the Company’s consolidated financial statements.

Inventories, net (Tables)

Inventories, net (Tables)	9 Months Ended
	Sep. 30, 2024
Inventory Disclosure [Abstract]
Schedule of inventories	Schedule of inventories September 30, December 31, Ingredients $ 2,360 $ 2,929 Packaging 2,532 3,014 Finished goods 3,549 3,161 Total inventories, net $ 8,441 $ 9,104

Property, Plant and Equipment_2

Property, Plant and Equipment, net (Tables)	9 Months Ended
	Sep. 30, 2024
Property, Plant and Equipment [Abstract]
Schedule of property, plant and equipment	Schedule of property, plant and equipment September 30, December 31, Land $ 1,565 $ 1,565 Buildings and improvements 22,667 21,661 Machinery and equipment 36,222 33,573 Vehicles 626 705 Office equipment 1,072 1,072 Construction in process 3,843 2,154 65,995 60,730 Less accumulated depreciation (39,685 ) (37,966 ) Total property, plant and equipment, net $ 26,310 $ 22,764

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of goodwill	Schedule of goodwill Total Balance at December 31, 2023 Goodwill $ 12,948 Accumulated impairment losses (1,244 ) $ 11,704 Balance at September 30, 2024 Goodwill $ 12,948 Accumulated impairment losses (1,244 ) $ 11,704
Schedule of other intangible assets, net	Schedule of other intangible assets, net September 30, 2024 December 31, 2023 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Recipes $ 44 $ (44 ) $ – $ 44 $ (44 ) $ – Customer lists and other customer related intangibles 4,529 (4,529 ) – 4,529 (4,529 ) – Customer relationships 3,385 (1,492 ) 1,893 3,385 (1,372 ) 2,013 Brand names 7,948 (3,348 ) 4,600 7,948 (3,063 ) 4,885 Formula 438 (438 ) – 438 (438 ) – Total intangible assets, net $ 16,344 $ (9,851 ) $ 6,493 $ 16,344 $ (9,446 ) $ 6,898
Schedule of estimated amortization expense on intangible assets	Schedule of estimated amortization expense on intangible assets Year Amortization Three months ended December 31, 2024 $ 135 2025 $ 540 2026 $ 540 2027 $ 540 2028 $ 540

Accrued Expenses (Tables)

Accrued Expenses (Tables)	9 Months Ended
	Sep. 30, 2024
Payables and Accruals [Abstract]
Schedule of accrued expense	Schedule of accrued expense September 30, December 31, 2023 Payroll and incentive compensation $ 4,747 $ 3,853 Real estate taxes 410 442 Utilities 209 241 Current portion of operating lease liabilities 57 74 Other 166 306 Total accrued expenses $ 5,589 $ 4,916

Debt (Tables)

Debt (Tables)	9 Months Ended
	Sep. 30, 2024
Debt Disclosure [Abstract]
Schedule of note payable	Schedule of note payable September 30, 2024 December 31, 2023 Term loan due August 18, 2026. Interest payable monthly. $ – $ 2,750 Unamortized deferred financing costs – (17 ) Total note payable – 2,733 Less current portion – (1,250 ) Total long-term portion $ – $ 1,483

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2024
Leases
Schedule of future maturities of lease liabilities	Schedule of future maturities of lease liabilities Year Operating Leases Three months ended December 31, 2024 $ 21 2025 55 2026 31 2027 21 2028 17 Thereafter 10 Total lease payments 155 Less: Interest (19 ) Present value of lease liabilities $ 136

Stock-based and Other Compens_2

Stock-based and Other Compensation (Tables)	9 Months Ended
	Sep. 30, 2024
Share-Based Payment Arrangement [Abstract]
Schedule of stock option activity	Schedule of stock option activity Options Weighted Weighted contractual life Aggregate (In thousands) Outstanding at December 31, 2023 41 $ 10.42 2.21 $ 121 Granted – – – – Exercised (11 ) 10.41 – – Forfeited – – – – Outstanding at September 30, 2024 30 $ 10.42 1.46 $ 460 Exercisable at September 30, 2024 30 $ 10.42 1.46 $ 460
Schedule of RSUs activity	Schedule of RSUs activity Restricted Stock Units Weighted Average Grant Date Fair Value (In thousands) Outstanding at December 31, 2023 207 $ 6.89 Granted 57 13.12 Shares issued upon vesting (35 ) 7.27 Forfeited – – Outstanding at September 30, 2024 229 $ 8.38 Vested and deferred at September 30, 2024 109 $ 7.02

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Sep. 30, 2024
Net earnings per common share:
Schedule of weighted average number of shares outstanding	Schedule of weighted average number of shares outstanding Three Months Ended Nine months Ended September 30, September 30, 2024 2023 2024 2023 (In thousands) Weighted average common shares outstanding 14,801 14,677 14,740 14,659 Assumed exercise/vesting of equity awards 464 424 454 404 Weighted average diluted common shares outstanding 15,265 15,101 15,194 15,063

Disaggregation of Revenue and_2

Disaggregation of Revenue and Significant Customers (Tables)	9 Months Ended
	Sep. 30, 2024
Segment Reporting [Abstract]
Schedule of net sales of products by category	Schedule of net sales of products by category 2024 2023 In thousands $ % $ % Drinkable Kefir other than ProBugs 115,280 82 94,174 80 Cheese 10,476 8 10,074 9 Cream and other 6,202 4 5,362 4 Drinkable Yogurt 4,419 3 4,760 4 ProBugs Kefir 2,494 2 2,490 2 Other dairy 1,015 1 1,170 1 Net Sales 139,886 100 118,030 100 Net sales of products by category were as follows for the three months ended September 30: 2024 2023 In thousands $ % $ % Drinkable Kefir other than ProBugs 37,737 82 33,035 81 Cheese 3,584 8 3,353 8 Cream and other 2,215 5 1,811 4 Drinkable Yogurt 1,501 3 1,485 4 ProBugs Kefir 744 1 820 2 Other dairy 314 1 392 1 Net Sales 46,095 100 40,896 100

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Accounting Policies [Abstract]
Advertising expense	$ 1,599	$ 878	$ 4,131	$ 2,884

Inventories, net (Details)

Inventories, net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Ingredients	$ 2,360	$ 2,929
Packaging	2,532	3,014
Finished goods	3,549	3,161
Total inventories, net	$ 8,441	$ 9,104

Property, Plant and Equipment_3

Property, Plant and Equipment, net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 65,995	$ 60,730
Less accumulated depreciation	(39,685)	(37,966)
Total property, plant and equipment, net	26,310	22,764
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,565	1,565
Building and Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	22,667	21,661
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	36,222	33,573
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	626	705
Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,072	1,072
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 3,843	$ 2,154

Goodwill and Intangible Asset_2

Goodwill and Intangible Assets (Details - Goodwill) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill before impairment	$ 12,948	$ 12,948
Accumulated impairment losses	(1,244)	(1,244)
Goodwill	$ 11,704	$ 11,704

Goodwill and Intangible Asset_3

Goodwill and Intangible Assets (Details - Other intangible assets, net) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 16,344	$ 16,344
Accumulated Amortization	(9,851)	(9,446)
Net Carrying Amount	6,493	6,898
Recipes [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	44	44
Accumulated Amortization	(44)	(44)
Net Carrying Amount	0	0
Customer Lists and Other Customer Related Intangibles [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	4,529	4,529
Accumulated Amortization	(4,529)	(4,529)
Net Carrying Amount	0	0
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	3,385	3,385
Accumulated Amortization	(1,492)	(1,372)
Net Carrying Amount	1,893	2,013
Brand Names [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	7,948	7,948
Accumulated Amortization	(3,348)	(3,063)
Net Carrying Amount	4,600	4,885
Formula [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	438	438
Accumulated Amortization	(438)	(438)
Net Carrying Amount	$ 0	$ 0

Goodwill and Intangible Asset_4

Goodwill and Intangible Assets (Details - Amortization expense on intangible assets) $ in Thousands	Sep. 30, 2024 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Three months ended December 31, 2024	$ 135
2025	540
2026	540
2027	540
2028	$ 540

Goodwill and Intangible Asset_5

Goodwill and Intangible Assets (Details Narrative)	9 Months Ended
	Sep. 30, 2024
Finite-Lived Intangible Assets [Line Items]
Weighted-average remaining amortization expense period	12 years
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted-average remaining amortization expense period	11 years 9 months 18 days
Brand Names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted-average remaining amortization expense period	12 years 1 month 6 days

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Payroll and incentive compensation	$ 4,747	$ 3,853
Real estate taxes	410	442
Utilities	209	241
Current portion of operating lease liabilities	57	74
Other	166	306
Total accrued expenses	$ 5,589	$ 4,916

Debt (Details)

Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Debt Disclosure [Abstract]
Term loan due August 18, 2026. Interest payable monthly.	$ 0	$ 2,750
Unamortized deferred financing costs	0	(17)
Total note payable	0	2,733
Less current portion	0	(1,250)
Total long-term portion	$ 0	$ 1,483

Debt (Details Narrative)

Debt (Details Narrative) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Jun. 30, 2024
Short-Term Debt [Line Items]
Paid outstanding term loan		$ 2,250
Unused revolving line of credit fee	0.20%
Letter of credit fee percentage	0.20%
Revolving Credit Facility [Member]
Short-Term Debt [Line Items]
Line of credit	$ 5,000
Termination date	Jun. 30, 2025
Revolving credit facility amount outstanding	$ 0
Future borrowings	5,000
Incremental Facility [Member]
Short-Term Debt [Line Items]
Line of credit	5,000
Credit Agreement Term Loan [Member]
Short-Term Debt [Line Items]
Termination loans	$ 5,000
Termination date	Aug. 18, 2026
Credit Agreement [Member]
Short-Term Debt [Line Items]
Description of debt instrument, interest rate terms	Secured Overnight Financing Rate (“SOFR”), plus 2.07%. Interest is payable monthly in arrears.

Leases (Details)

Leases (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Leases
Three months ended December 31, 2024	$ 21
2025	55
2026	31
2027	21
2028	17
Thereafter	10
Total lease payments	155
Less: Interest	(19)
Present value of lease liabilities	$ 136

Leases (Details Narrative)

Leases (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Leases
Total lease expense	$ 33	$ 41	$ 110	$ 102
Weighted average remaining lease term	3 years 4 months 24 days		3 years 4 months 24 days
Weighted average discount rate	8.94%		8.94%
Operating lease liabilities	$ 22	$ 24	$ 68	$ 70

Income taxes (Details Narrative

Income taxes (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Effective income tax rate reconciliation, percent	31.20%	30.80%	30.40%	32.50%
Unrecognized tax benefits	$ 0	$ 0	$ 0	$ 0

Stock-based and Other Compens_3

Stock-based and Other Compensation (Details - Option activity) - Equity Option [Member] - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options outstanding, beginning balance	41
Weighted average exercise price outstanding, beginning balance	$ 10.42
Weighted average remaining contractual life	1 year 5 months 15 days	2 years 2 months 15 days
Aggregate intrinsic value, outstanding beginning balance	$ 121
Options, granted	0
Weighted average exercise price, granted	$ 0
Options, exercised	(11)
Weighted average exercise price, exercised	$ 10.41
Options, forfeited	0
Weighted average exercise price, forfeited	$ 0
Options outstanding, ending balance	30	41
Weighted average exercise price outstanding, ending balance	$ 10.42	$ 10.42
Aggregate intrinsic value, outstanding ending balance	$ 460	$ 121
Options, exercisable	30
Weighted average exercise price, exercisable	$ 10.42
Weighted average remaining contractual life, exercisable	1 year 5 months 15 days
Aggregate intrinsic value, exercisable	$ 460

Stock-based and Other Compens_4

Stock-based and Other Compensation (Details - Restricted stock units) - Restricted Stock Units (RSUs) [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock units outstanding, beginning | shares	207
Weighted average grant date fair value outstanding, beginning | $ / shares	$ 6.89
Restricted stock units, granted | shares	57
Weighted average grant date fair value, granted | $ / shares	$ 13.12
Restricted stock units, shares issued upon vesting | shares	(35)
Weighted average grant date fair value, shares issued upon vesting | $ / shares	$ 7.27
Restricted stock units, forfeited | shares	0
Weighted average grant date fair value, forfeited | $ / shares	$ 0
Restricted stock units outstanding, ending | shares	229
Weighted average grant date fair value outstanding, ending | $ / shares	$ 8.38
Restricted stock units, vested and deferred | shares	109
Weighted average grant date fair value, vested and deferred | $ / shares	$ 7.02

Stock-based and Other Compens_5

Stock-based and Other Compensation (Details Narrative) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2020	Sep. 30, 2024	Sep. 30, 2023	Aug. 31, 2022	Dec. 31, 2015
Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	$ 235	$ 154		$ 703	$ 356
Tax related benefits	66	43		197	100
Future compensation expense related to restricted stock units	793			$ 793
Weighted average basis term				1 year 3 months
CEO 2020 Award [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	0	18		$ 24	87
Long-term equity-based incentive			$ 750
Plan 2021 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	0	33		40	161
Long-term equity-based incentive				1,069
Plan 2022 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	132	116		420	356
Plan 2023 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	122	102		377	118
Plan 2024 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	$ 113	0		$ 334	0
Omnibus 2015 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares authorized for issuance							3,500
Omnibus 2022 Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares authorized for issuance						3,250
Shares available for grant	2,640			2,640
Director 2022 Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for grant	394			394
Defined Contribution Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Employer contribution expense	$ 133	$ 106		$ 495	$ 364

Earnings Per Share (Details)

Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Net earnings per common share:
Weighted average common shares outstanding	14,801	14,677	14,740	14,659
Assumed exercise/vesting of equity awards	464	424	454	404
Weighted average diluted common shares outstanding	15,265	15,101	15,194	15,063

Disaggregation of Revenue and_3

Disaggregation of Revenue and Significant Customers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue, Major Customer [Line Items]
Net sales	$ 46,095	$ 40,896	$ 139,886	$ 118,030
Drinkable Kefir Other Than ProBugs [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 37,737	$ 33,035	$ 115,280	$ 94,174
Drinkable Kefir Other Than ProBugs [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	82%	81%	82%	80%
Cheese [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 3,584	$ 3,353	$ 10,476	$ 10,074
Cheese [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	8%	8%	8%	9%
Cream And Other [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 2,215	$ 1,811	$ 6,202	$ 5,362
Cream And Other [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	5%	4%	4%	4%
Drinkable Yogurt [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 1,501	$ 1,485	$ 4,419	$ 4,760
Drinkable Yogurt [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	3%	4%	3%	4%
ProBugs Kefir [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 744	$ 820	$ 2,494	$ 2,490
ProBugs Kefir [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	1%	2%	2%	2%
Other Dairy [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 314	$ 392	$ 1,015	$ 1,170
Other Dairy [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	1%	1%	1%	1%
Net Sales [Member]
Revenue, Major Customer [Line Items]
Net sales	$ 46,095	$ 40,896	$ 139,886	$ 118,030
Net Sales [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Net sales percentage	100%	100%	100%	100%

Disaggregation of Revenue and_4

Disaggregation of Revenue and Significant Customers (Details Narrative)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue Benchmark [Member] | Two Customers [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Concentration risk, percentage	24%	24%	25%	23%