BRFH - Earnings call 4 2021 | Barfresh Food Group, Inc.

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Operator

Good afternoon, everyone, and thank you for participating on today's fourth quarter and full year corporate update call for Barfresh Food Group.

Joining us today is Barfresh Food Group's Founder and CEO, Riccardo Delle Coste; and Barfresh Food Group CFO, Lisa Roger.

Following prepared remarks, we will open the call for your questions.

The discussion today will include forward-looking statements, except for historical information herein, matters set forth in this call are forward-looking within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995, including statements about the company's commercial progress, successful strategic relationships and projections of future financial performance.

These forward-looking statements are identified by use of words such as grow, expand, estimate, believe, expect, plan, should, hypothetical, potential, forecast and predict, continue, could, may, predict and will and variations of such words and similar expressions are intended to identify such forward-looking statements.

future the developments historical or that or in than activities, that anticipates, other may or statements. events the the statements statements fact of address will All forward-looking are company believes statements future and are expected appropriate based on company circumstances. the that developments certain made other assumptions These based are experience, under the factors believes on

one these the Such such many of uncertainties, or statements risks control the or assumptions assumptions, of and should are of anticipated materially subject results prove of to those or company. materialize uncertainties incorrect, by Should are indicated statements. or risks may a beyond more from number underlying forward-looking which vary actual

of place XX-Q reliance XX-K Form on the quarterly and with reports made. not investors includes are forward-looking annual call the The cautioned risk warnings, contents contained Accordingly, filings of as be report cautious recent on Form with current date undue Exchange conjunction are considered in Commission this factors statements Securities they therein. statements, to and the the these including any should company's only and Form which report and on X-K, speak on

of intention a events, company any the disclaims forward-looking whether assumptions or update in result changes call, current expressly any publicly statements of Furthermore, new future this as to information, otherwise.

reconciled is In to order are measures. to table business presenting a certain also business company most measures, aid the non-GAAP adjusted the the of GAAP update an which in understanding in performance, comparable including EBITDA, company's earlier the

believes directly performance of gain sale investors stock services or information EBITDA are stock items including business. company's or of that of issue reflective on because provides adjusted and nonoperational core the usual reconciling loss period-to-period The the to the the the compensation, derivatives. Management costs, for noncash

go call over of sir. Delle Mr. Group Riccardo the Barfresh Coste. turn CEO the Food ahead, to Please I'll Now

Riccardo Delle Coste

company accomplishments our year and third growth we Thank sequential with pleased first throughout highest the fourth with increasing year-over-year. sequentially our XXX% you, quarter history. quarter in and everyone. revenue afternoon, good in results fourth the XXXX. quarter and time our business And the to and full quarter, fourth Revenue revenue XX% the from was I'm very had quarterly

and the a products up and throughout revenue, ended servicing of XXX% million COVID-XX Go year some year fiscal gradual a customer revenue up sales school the return single-serve bulk sales preventing us to the the These were subset fiscal and districts other $X.X base compared larger the our XXXX results affected our supply our record & The and prior to ability our from We year introduce face channels. the with servicing of increase XX% periods. our from in year in to was education product year in from XXXX. due channel Twist of challenges, an across in increased in of only achieved

made a the quarter to due to scale challenges negative orders We customers our prevent impact those of supply to canceled some school temporarily larger back servicing strategic and to relationships. last decision

is channel massive. only schools surface school the the XX,XXX total of We've over in market education XX,XXX States. addressable scratched the districts the United just Additionally, in the and

we through supply our challenges new aggressive to existing in with continue see both reengage ease to will fiscal XXXX. partnerships more of our be year We able beginning our our are school team sales pursuit be of we customers, to through will and and slightly in so customers distribution

year million prior XXXX of the achieved significantly for top compared to Additionally, year. fiscal we X% XX% we chain declining COVID, G&A in year. and bulk the year reduced sales This XXXX, half higher and fiscal products to prior expenses core reduction from due total higher-margin on despite second our year, by single-serve $X of supply is in costs the minimal the to over the with operating

shipping into first the elevated costs the XXXX. half of continue and anticipate will We storage

volume in higher partially as efficient increase and these planned costs. offset our more per arrangements sales taking load However, distribution volume will advantage well of as

raw supplier in are we to at cost look help more a advance, where taking increases buying and passing of all relationships mitigate price closer increases. materials Additionally, on industry-wide possible, our

base We have have double addition of year with XXXX-'XX entered into in XX continued new school of momentum that great year districts heading to prior the we locations last sales XXXX add in the months. and school school number the from to as the customer X the

Army We Service also served Force the XX a Twist contract students awarded X announced this to Go X-year from December, been across overseas. & in be Exchange military-based had for Air we countries and schools that past to

average an for with meals the XX,XXX largest a most serves independently more G&J million than total school day arrangement year. per announced of schools XX And and we The of bottler, XXXX-'XX in meals the recently, franchise be operated to Pepsi retail X across well-known distribution through customers the and distributes of sold distributed same like account Kevita now that network Pepsi-Cola products Tropicana, Juice. Naked United schools. States, Pepsi including practically brands Bottlers. Twist will type every G&J's & the are Go in owned

can has especially We for the we independent the serve XX as bottlers similar programs as arrangement incredible of start outside begin to school channel. hope believe Barfresh. Go We & this additional a with value, expand this Twist to partnership blueprint

a long-standing it the in than relationships district order in company or school has through beverage distributor with those go specific must The for rather cases. most distributors school access and to the channel accounts, education

repeat and high breakfast a the education have products significantly rate success in solid our channel with been have have We rates. they increase as to consumption of participation shown

and working significant relationship it And becomes business distributor with begin once barriers a with sticky entry. to a we therefore,

made focus distributors such of as Pepsi, our forward. strategy therefore, a with sales going partnering have, G&J We

successful expenses Market. to into our this followed and tailwind for Capital common uplisting our improving Another NASDAQ the top financial year of the strengthening line new ourselves milestone. achievement of business work, ready our balance our our sheet, increasing for was dramatically stock hard company the This heading years fiscal to

broader solidifies garner serious investors in and it as a now player will access the place to industry. beverage our We

the the talent, Roger of in extensive as had aspects has also CFO. right seen position numerous company of managed the this as Lisa Lisa us hiring growing helped manufacturing Our with companies, announcement the public for finance within successfully experience all Fox industry earlier attract year and has including Factory.

team has and our the will Lisa next our an of elevated part growth. level financial of to company's chapter integral next be

turn to Now CFO, it with over that, Lisa Lisa? Roger. I'll our

Lisa Roger

and excited to them the part made improvements business this with Thank all forward at working to an innovative to Barfresh company team and expansion. years time you, past the their exciting company incredible of I'm have Riccardo. and over his the recognize like be in Riccardo look few

$X.X compared Now quarter in XXXX the XXXX. to more detail. for to Revenue the last the million $XXX,XXX of million discuss period same in our year for of $X.X up third XXX% results to XX% and to increased quarter compared fourth

this seasonally from mentioned, time highest the in was into fourth light Riccardo third the and quarter As our company first sequential revenue the history revenue quarterly quarter. growth we had

in of orders XXXX. the single-serve our $X.X full channel year of as for school quarter gradual XXXX XXX% million is of products. product the well of & increased and as year return for bulk and compared result $X.X full revenue full Revenue increased the year increase the our Twist in Go to the record on fourth to sales for The a million

WHIRLZ the period XXXX launching Juice of quarter for fourth the Concentrates to in XXX% for same margins negative X% the year. gross and period The were XX% margins to expenses & the was Go compared COVID-related company product Twist realizing to last well prior as start-up Gross as write-downs. due negative related

product of XXXX Go of for were higher WHIRLZ XX% the and and Twist the & XXXX. Gross was The XX% volume year XXX% to margins the increase compared Juice year for our Concentrates. of full full to due sales mix

we, throughout that expect the experiencing along entire industry, explained, Riccardo inflationary are fiscal As persist year with to we headwinds XXXX.

offset with our the earlier, serve with we have along headwinds. And products, the return to in single the XXs. of of Go sales place higher-margin expect fiscal & outlined full and However, plans to and we gross XXXX help in WHIRLZ in profit for increase margins products, expected our year Twist the as stay bulk these

Our the forgiveness $X.X a same of loss net in the XXXX $X.X to XXXX. fourth Net of income of income flat $XXX,XXX net for year. expenses as loan. PPP quarter in of the quarter XXXX of improved of $XXX,XXX benefited from to at fourth quarter quarter fourth XXXX the fourth for million period the were compared compared last to G&A million

year fiscal increases significant million shipping R&D a we storage and labor increase the While loss experienced partially as costs. costs such the million fiscal $X.X by to net lower year to market were XXXX unprecedented in additional for of shortages loss improved Net and quarter, a costs personnel in offset from $X.X compared and in XXXX.

fiscal for by XXXX prior X% decreased with expenses the G&A compared year year.

continue and shipping elevated the of into first to the half expect XXXX. We costs storage

our higher costs. expected volume as distribution offset help volume as partially us taking these However, will efficient increase advantage of sales arrangements more and load in per well

of $XX,XXX loss million, the and a For million of and compared for of a period quarter as same $X.X full year. year and $X last improved the our to loss fourth XXXX, EBITDA adjusted $X.X to XXXX respectively, approximately million

on sheet. to balance moving our Now

private had to $XXX,XXX we inventory XX, $XXX,XXX of approximately placement announced of On completion common December on balance $X XX, million of and compared our of $X.X of X, coverage. we XXXX. cash of inventory of no of approximately As stock a cash of million the warrant as XXXX, December and $X million June XXXX, with sheet

all of the retirement debt and eliminated transaction $XXX,XXX also and of addition, prior interest. interest. $XXX,XXX approximately conversion negotiated related This convertible debt In existing and approximately we of

PPP the for XXXX. we loan second had quarter $XXX,XXX in Additionally, of our forgiven fourth

turn closing Now to for Riccardo call back the I will remarks.

Riccardo Delle Coste

you, Lisa. Thank

of the and our years, survived for rearview And difficult truly I'm finally, making of is in the closed excited door the XXXX, made future. proud lots struggles team of the our COVID-XX last we've that the X mirror. stronger. decisions on company Now

up balance We to uplisted NASDAQ. sheet. company. We have rightsized We cleaned our our

debt. We have no

need strong raise We don't to have a balance new and any cash capital.

are expect such strategic We be and breakeven partnerships J&J added We've profitable. Pepsi. to as distribution approaching

products now COVID come starting to are back Our going that away. existing is

our reengaging. accounts are national in Our back and pipeline

have Go just & record to surface. quarter, record off Twist fourth a can and expect more a quarters the record come. products and scratching and we're We achieved year Our taken you

Operator? let's that, your take with questions. Now

Operator

from first [Operator Maxim comes Vendetti Anthony Instructions] from question The Group.

Anthony Vendetti

Twist about agreement independent & bottler you conversations you product. your PepsiCo So think, with that Go having Can significant with whether bottlers? and talk you're owned distribution announced, could any what for Riccardo, mean independently retail I other a

Riccardo Delle Coste

G&J. are other obviously. with started, going having bottlers. only just It's with independent we Yes, well conversations We've

Twist options this be it that education to piece for serve to. education we'll will able additional a the for range be just think Go channel, because it the channel I the broader gives of us well. be is It us as an & of important customers won't outside

through a right? to And you a can going is between is to give for system customer. difference it distributor, broadline distributors And example I delivery end also are a broadline the maybe get the distributor, the really the product

that and selling So sell. Part the a products. and broadline relationship arrangement G&J part equation not their place of great of deal go our of they we team, out with selling takes distributors. end is is where customers. own by That there's left us the that Pepsi the also to the of attraction the They're

they do. So over team part own assist the more than could to our selling and of able are increases obviously what transaction, with take our potential which that sales

Anthony Vendetti

of course. No, Yes.

on gaining So mostly revenues the in from traction where could that start store should when right? this side, year, this we material of type potentially convenience relationship. terms assume I see of it's some

Riccardo Delle Coste

No, or school be the much Frito-Lay Pepsi it beverages They're well. education will as it's pretty the the the products in single juices. or in country. the whether products, every side

pretty the much also And you're education will already. be see starting it now it it you're going channel. to So and see to

obviously slower We to to continue. had increase typically -- us. going what's significant That's in are quarter for we a going a

the the despite and I every think with much headway. that on the continuing take on positive in And had see will from cost issues in out. marketplace you'll and is we've challenges issues really else, else going chain make we're no labor business start different turned very supply the So to has anybody corner. issues than everything to quarter and it that here -- And pretty that

Anthony Vendetti

to look an like I'm is -- know on sure opportunities, said, that's new the having it's No, just But the in Certainly, the convenience Pepsi help you store area terms XXXX a to of helps. someone do for of what since great. in the schools. and in terms But that and you you Yes. -- to going going though, What the I that's store delivery a opportunity obviously, side for as independent that distributor. you? like, new convenience

Riccardo Delle Coste

Yes. look outside we're as to of We're the to going be the going education expanding cafeterias new is product places like to it going environments, -- have will different the I & of at mean areas, to convenience channel likes. Anthony, Twist option. and a couple also office one such Go

business the we the our in and plan So That's supermarkets. that to regards be in that to in locations, dip water also looking will our grocery channel. and for this industry type with year toe -- retail, at start our that's process

what asking going are same specific category. we look So do the numbers It's tell. too that think like to for early to

We are It process. has This literally this relationship. just is brand-new starting started. a

types outlets have we're best working revenue but percolate, that's of to we the of So early different different way And kind the ways it I in through think to channels. do days. and very beginning merchandise these is products also our

partner to great with, us the helping to that along they're a got really we've -- do and going they're way. So

really to we're relationship. looking that growing forward So

Anthony Vendetti

Sure.

Okay.

on the through hopefully, -- went COVID but been dealt for is you now, industries those. said companies issues and you've supply with all many and the and you Riccardo, -- you've with at have that as other correct chain mirror rearview you're Just least in dealt

out to that that guess if -- of concerns are are do be at would Do this either that for you question. where categorize any a there? elevated issues are point cost leveled necessary, able able whatever out going increases? considered supply that abate, some the happened with feel were whatever pressures chain that or the have or combating take I price are And there starting while. is those, price? And disruptions you those to to you to you you costs of for if have now some And or

Riccardo Delle Coste

We're question. going everything. else, great anybody literally up no for Great, different right? than Prices are

So going up proportions. different different are things in

measures whatever mitigate we try increases. We the taking to are and can

and where in contracting, name increases. can more whether how you buying So that's mitigate we're seeing buying we advance, at control and more, looking it, -- it the

in on passed on wherever doing have pretty passed received We're we some first and actually. that quarter, the increases increase We recent already. We actually was possible. that well a

our tells elasticity there that that out price good there's us customers. So with

increases. And despite price the real for there's product demand the a

reassuring. getting availability we're labor that's remains ingredients be other So it's There to an everybody. lead But still managing certain whether and managed, for of need that shortages, challenges, we're through. times or issue

job had the in done I think managed keep bumps but over to get has to we've We've So the team amazing an everything them. our moving. road,

in could that no doubt There's been that actually -- the numbers even in couldn't have despite weren't that have higher. orders fill could There higher. actually it increases the been Despite had revenue, -- we time. significant were we've

on handle been out to move like So going the it reasonable feel things going constantly the and has issues we team prices. on what's definitely are keep a have in on I ways But by on that really good affected and at got working are there. mitigate

really customers been good. the have And also

dialogue been we've as material the have prices lot growing significantly kind also territories. of our a been has markets and the pieces costs, very It's costs. costs product. the increasing fortunate of through the not particular been significantly. raw of volume also the making in It's going to little cost just set and roof, increasing we've that bit And fluid. also We concentration with sales the of delivery So great customers, been right? the been it's freight while have is a the a There's

into higher higher the area. ability increases a So part volume afforded on freight concentrated the mitigate from that's of some us to based the a going having price

we helping thoughtful That's us. going continue sales. growing be to we're how about again, also So about our

I tell and to is around great in spot. incredibly and think great do we we're are we where about of higher a us. can have doing the you for what's reality prices. team job a hopefully, The deal corner the Yes, with But excited really we're

Anthony Vendetti

to guess just Is it categorize XX% lastly, back? XX% starting is more. say in you I little serve bit that prepared this back? Lisa I just the maybe back. if could sounds channel think that it mentioned recovered? it's bulk like How -- it also And would a you has But Is her fast remarks. come

Riccardo Delle Coste

good kind Yes. products has in bulk customers are, channel short feeding, piece which communal to therefore, the proximity, been come to That's another service of time, education customers. close -affected designed like last which of itself, kind definition, COVID back play period in of is in puzzle the the of a right? they're within Even really from question, by a high the are, of volume

reason congregating cetera. because the that grab-and-go low-touch And for there's a for big et is been areas, push items,

in year, coming slowest traditionally back. quarter I normally mind come and but even quarter in the our has -- that of it year, It's back. the lowest still keeping this early, beginning QX our is definitely year. most of saw mean, the is of QX we So second

And have to and we've bulk our back to products. service reengaging started in QX, actually customers coming with regards

theme a affected. larger you were of or typically on smoothies the have attraction that. locations, Niagara by Some parks, seasonality or with Liberty that those these And affected of and Parks the and like of a Statue that tourism when well, our were the where lot really centers, and COVID bulk seasonal summer locations accounts of moving types really they lens through places and have are products people as the

and summer definitely what's establishments, are at coming They seen great were those that which selling more back within a locations is existing really affected adding All last for locations the and by points for well. turn looking start to come and as around. adding their We've year. to accounts touch sign

Operator

The question from Global. Gregozeski Greenridge from comes Instructions] William next [Operator

William Gregozeski

channel. military I was update just give wondering an could if the on you

Riccardo Delle Coste

Bill. sure, Yes,

That back. within we for channel that contract channel, & we different the the customers military have products. X-year Go. also the signed within demonstrated military with the Twist recently definitely that expanding is types It's a of So was going coming We're well.

That's military in schools number overseas. going to be of bases quite on a

our They I similar So earlier, products. they to was what military we're definitely also just are with use fostering close relationships with our bulk Anthony customers. describing service

seeing as to well. So business up we pick are starting that

have So more been we do opened. have feeding that areas communal

have bases new opened. We that being are

So that improving. definitely is

William Gregozeski

supply Okay. this able is might accounts seeing some Great. to you too early Or have anything to guys And just to into then supply get volume where -- that? be mean, I point it at chain, year? national enough with the you to tell are

Riccardo Delle Coste

tell we will conversations. that you just you it's than reengaged. I tell will having I have more that

with there's we it timing definitely bit. accounts, this progress made. kind go, it. of obviously be little was there and still things sure the definitely this progressed the may year, is scale, year. So there are year. national something last a the It's touch year exact Not Last of from progressing but whether of will but big this and being difference go conversations, definitely And that's a year. were touch be

Operator

Capital. question next Marc The Shay Nuccitelli from comes from

Marc Nuccitelli

me? hear you Okay. Can quarter. Great Congrats. Riccardo?

As of long-time you lot investor years, know, I've some the headwinds been and pivots. and a over terrific done had a you've you've

mind, So time long Go. me I few a questions at on single-serve Twist & just just you've gone to if because extremely for and from you as you've been indulge this don't thought, bulk-pour, to

You've brought Pepsi, Cisco. Unibel, great to relationships in some

upon it's the Anthony think rest I think I So started it. me, investor base important probably the to and and touch for of

you bit and more some these I a verticals. So certainly pipeline, term long to of want in midterm kind on your just your of short-term little your press

few many how that. give be lot a kind And schools districts, last but projection, term kind of you students around some added you target does range. a your can't school could you that I intermediate the and there many must Can put a on with brackets how that of you've cover? of know recap over years. if based just So just

thinking could besides in to of to enter? next try you math based some can schools go level you're where the that give kind have, get short You of the this to just on the term, could us you schools potentially

Riccardo Delle Coste

All right. sure. Yes,

this little So let's a break bit. down

our believe schools that at think what's Twist now, So that's QX. the a of We & it numbers in that about XX,XXX where as of would deceiving bit right, rate in right? right? that schools, kind now, because -- really X.X% to what's not right? probably a to are rate little as penetration accounts, run the is and about now, of Go school the So we're right we run X% But seen we that's that's forefront have relates you rough a

more out believe extrapolate as in So locations what number, than to of customers for more had will QX what annualized QX. we right? larger that an we be than it QX, because So start you number the got is in and kind we've

Marc Nuccitelli

do students expect that? a how to them many schools, And how many times XX,XXX you be week served? is

Riccardo Delle Coste

by ranges schools. It Yes.

variables Some are depends a of them of are some them once really once week, And a week, them month. It of twice the a there's some school. a lot obviously are that the by based How demographic huge is. that how obviously the at students school. difference. where go a -- many are many each of -- makes into on school That the of

already -- And additional So year expect we have some that. we visibility X.X% that an of we got. think in not enormous That's as the on market there's get linear and come it's we next we're we've and as into with penetration believe to why we seeing particularly runway, about well. that really X% numbers like board the school ahead and customers it, to we we're

a time, couldn't period reason doing be over out why believe channel $XX to is of It channel huge really this So is $XX There's we a very for no this million very... of us. million alone. we certain

Marc Nuccitelli

it that your million in new to be the say of I -- of some just assume if at so Xx QX it's seasonality, to rate, from type kind schools and a and larger because the know short-term going top there's extrapolate was I of just you're run you're quarter what that's X -- know to Okay, addition if I I line? easily could let's $XX saying fourth you're but plus

Riccardo Delle Coste

the a challenges to do given there's also -- medium So a in be term, short we the build be current measured the the way where measured have. marketplace, we're in margin of of the we're based backdrop given we that's different time after how so -- debatable, inflationary costs, capacity, maintain that mix. in It that we offering and on need of we pricing the There's how pressures right? this there's architecture Well, pricing go really how through going, to the to going, right? parts want customers, the perspective we that we from term, doing lead country, also we're going

that to to think that that, an honest, is just I $XX we would very million And over of that achievable a So I think we of believe the million be $XX have. it's time opportunity. a do enormous be market relatively given period -- are where what what I and short we size

The other back. have to products that starting are other we come the thing is

we've for -- about got was we XXXX planned it time, had long that talked at and for right. you're Unfortunately, a You rollout it been shelved.

back with So in couldn't of pipeline. now cetera. have preparation, the back and help COVID come after in have We that that things that years testing and was we et do and

been hasn't that wasted perspective. So all it from

We've we've just we of that will done to business the be the we is historically it rest opportunity.... that going. So get of think the as work taken all incremental

Marc Nuccitelli

had $XX I mean -- mandates getting was I If to business expected generate with of had summer million I mass remember sorry, Liberty. of teetering months. out dropping. that vaccine you like and bulk-pour you I -- And I of recall I million. and I theme into all -- Statue or parks here things you yes, start the -- mean, them assume starting and so all Are opening recall I'm back of $X they're the to COVID expect some to. come to kind all that we're you see single-serve

Riccardo Delle Coste

cetera. that just I of $X products, of looking channel -- bulk like the million it's volumes and either business a single-serve expecting customers. as the to $XX same customers adding parks, the the across are lot weren't et We increase definitely to the Yes. that earlier. mentioned business million the or coming from existing theme more their back. of But got We've locations

wanted of back. national some to think I definitely also messages the in lost customer historical be new. hurt Not the yes, business. think and make haven't mean a And to right? balance, our I that addition or on is be we They great of was But ahead also of customers, heard think incrementality I haven't I the other to The will business the on be they X the going sure with we accounts. that add that's the by ahead to really old we're end coming we've going away. the equal some be to base, be we won't pandemic customers those right? year, But we expect we're gone going -- on parts this the of including we moving is, happening and stuff lost products of part But that new the lot the forward. got what of

years, nice and lot finally of being done the So be to when it's happens. there -- and because going work that's what's really us over a is exciting for that

Marc Nuccitelli

certainly me, you for that been shed if for guess could at I more a Yes. the texture at think this opportunity national years. for because around X just I least you've bit little accounts

is So X a, the a still category comes category -- of menu? to the part I is critical question me, smoothie their the factors: down their to -- guess offering,

lot of some on to you, with on And B, if capacity thing. to can had work the add a from the a otherwise, most X obviously, needs meet it they're taste these of the you spend I the customers, obviously, then going three, and important time reviews know your is then of to maybe you just tenets? the texture wasn't going work. making those And you sure lot national accounts, of product

Riccardo Delle Coste

do at needs into consideration, it charge. and be Yes. we have and we depending to change all who's something always I change, taken ensure also ideas capacity is need teams that preferences marketing mean, change, in taste that on the times. to Times

now. So what that we're right with is some dealing of

work flavors. some around it that have do and is we So development doing, we're

And are now. we're of the we It's as accounts guess they I need, make and are we saddle able to to that national it our real. got context sure working and all in with -- we adjustments. I working large for back we're them. So and on mentioned, very got color We've cater what finally, to we're we've make those continue

Marc Nuccitelli

want precise, again, in? So that be they category category to a be desirable to just is the still

Riccardo Delle Coste

XXX%. In actual fact, the category of growing. smoothie is actually

Marc Nuccitelli

Okay. We'll check that.

Okay.

So their able number tastes to you modify needs? changed, but you've recipe meet said have two, been

Riccardo Delle Coste

the not of It's a testing a process making and have needs. of and them balance. sure recipe It's developing bit really flavors you right

Marc Nuccitelli

you And you think same three, to national Okay. from worked COVID capacity light of different you I some accounts? position the to the the of big be I do able in green be assume then you setting still the country. in you'll parts know if prior relationships, have get up those

Riccardo Delle Coste

Yes.

have that same currently. capacity set We up

So front, increasing the the but demand have other no products. do increasing have sorry, on on we change there's we capacity do -- capacity

So ways we're more efficient. always to be looking for

Marc Nuccitelli

remember different, If or know over Twist had Okay. is correctly, it's that I of XXX capacity. still units whether million the & single bulk-pour case? Go, you I serve,

Riccardo Delle Coste

Yes. Correct.

Okay.

Marc Nuccitelli

Okay, okay.

again, on and on Anthony's they they be opportunity So all about yes, what partnership point they unless I the wouldn't to boxes mean, be ], (sic) -- this that just must here, you taking about like. J&G could product look checked touch with your G&J [ excited

their volume you opportunity? given could from mean you have excited Could the how they're -- shed this must what can look you think a they on color retail unit I they like. some sense So of perspective big about

Riccardo Delle Coste

have other and they're literally are truck products the with and the mean on like the in take the they they by products brands to being -- that enough Naked have we're put side and side, Juice. board I other Kevita, it excited Tropicana, on

trucks. those strong So they is days. it's alongside I early feel guess proposition to put products their enough very like a It on us

Marc Nuccitelli

over they believe these I'm saying think product dollar the I'm products a to you million opportunity, they No, of today. on opportunity it's on $XXX be correct? $XX in don't amount. They category for not be confident. I unless not tens I could they mean they're But going taking million millions. got could to be don't I think to a there pretty just take be sideshow understand

Riccardo Delle Coste

that's comment. fair Yes, a

Marc Nuccitelli

Okay.

prior you What looking were hope to Lisa I to in What maybe, XX% get you -- 'XX, I far what your finally, XX% your time. a at the COVID. gross least, of mentioned mid-XXs about about, out know long-term Just to only to as range apologize to for gross as and do back margin. lot target guess, I is margins? expecting occupying is

Lisa Roger

that. I is can Lisa. This address

in some in the good is bit inflationary as that first in industry. success, a although the the earlier, having well say just some as as some there variations. said, year whole is are And product seasonality business as seasonal with that of had expect to mentioned full as lag to of we've a And We I quarter there's the mid-XXs, mix. some for to we customers, XXXX, far pressures be Riccardo with on the passing would

Marc Nuccitelli

looking in But back hope XXs future the you chain? between that would into the to out and Okay. get prices supply

Riccardo Delle Coste

up probably it it XXs, it the I given was. -- into maybe back mix, product the say into would could would higher creep the where XXs

in we're given on initiatives the backdrop gap. close working also that But little to are a that to bit be We some right now. we conservative want

Marc Nuccitelli

to pricing in sorry, understood. very sensitive completely just I'm No, I understand. of so, this something. We're I environment thought all

and Can talk tried superb and for or or that the how helped with Twist just we've the about came That accelerate with & penetration. those over here. a that's because that it's maybe you obviously on the to it of you opportunities penetration USDA, really product, Your you a criteria? other whether heels all that and helped again you're meeting moment that is schools military leading Go

Riccardo Delle Coste

it's right? sugar, the we requirements, I there's protein mean from So it's product, fruit, we've fact USDA no -- mean, healthy the made the products yogurt, live yogurt. added make cultured that the real

product great. is the profile So

everywhere. been it very received COVID. When product, it's well started the was we So during

of distribution on it product in had them. one out a customers. being able we're us honest, challenges the were in to get to that's biggest be get we that to to out And to that some customers. really isn't to end there restrictions And able ton at year, of getting of like and and the that being last still challenges have have customers the was get even we So get only product that we the

That And -- shortage labor. gaps right? where are, of happen. the broadline They're look of distributors. They've product get They've a there's pressures, kind when got at you we own cost and a the to full. doesn't have into just their the price requirements can it's the the able volume, minimum the chicken they'll delivery to there's get market and yet. been kind have situation, needs right? So if a the turn or of egg How haven't product, you before and take and the on have into you product

operating to difference. new you'll we're really numbers more and side more penetration. as our And a really see And back. from to going what it's we and because increase. arm to volume one think start start exciting been distribution making that's is to We're are see to tied open get huge pieces, these incredibly starting to the starting we've what's So behind with start I like see that our distributors up,

And there's in even still country we have a there's don't any areas penetration the of around still -- of yet. tons lot that

various after big country, we the really opportunity is a us. as areas ahead So strategically go for of

Marc Nuccitelli

that strategic can't ago. topic, Europe. years -- expanding I any states, issues great. in lot Is the a they're know in of to taking But helping I with from how about the supply know anything Unibel Maybe on there Europe? investment on That's you potentially there just anything or these here you you're far received many I some as chain is talk into as with imagine dealing

Riccardo Delle Coste

with to that into partner They We're thankful. many mean we're or with, et have and retail, I whether them very helpful, great introduction continue on helping They've it's us with been been cetera. table, and a a it's supply great very to proud manufacturing, things, they've partner and be whether our us a them at the closely working helping partner. or they're to different great have. chain they're incredibly

Operator

in no are concludes queue, more conference and today's There call. Instructions] this [Operator questions the

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Barfresh Food (BRFH) 10 Mar 222021 Q4 Earnings call transcript