CASTLE ROCK, CO--(Marketwired - May 1, 2013) - Where Food Comes From, Inc. (d.b.a. IMI Global, Inc.) (
Revenue in the first quarter was $1,025,500, down slightly as compared with revenue of $1,029,300 in the same quarter last year. The decline was due to reduced source and age verification activity associated with Japan recently having eased its beef important regulations. Lower source and age verification revenue was more than offset by increased revenue from other WFCF service offerings, including Non-Hormone Treated Cattle (NHTC) and Verified Natural Beef (VNB) programs. Total verification services revenue increased slightly to $853,600 in the first quarter from $845,800 in the same quarter last year. Hardware revenue consisting of cattle ear tags declined to $129,000 from $157,000 year over year, again a reflection of reduced source and age verification activity. Other revenue, primarily comprised of fees from the Where Food Comes From labeling program, grew 62% year-over-year to $42,900 from $26,500.
Selling, general and administrative expense in the first quarter increased 28% year over year to $625,500 from $488,100. This increase reflected expenses associated with the Company's 60% ownership interest in International Certification Services (ICS), which was acquired on February 29, 2012. Net loss attributable to Where Food Comes From, Inc. in the first quarter was $58,400, or less than one cent per share, versus net income of $362,100, or $0.02 per share, in same quarter last year.
"As anticipated, Japan's decision to ease import regulations affected our source and age verification activity in the first quarter and this, in turn, impacted revenue and profitability," said John Saunders, Chairman and CEO. "On the positive side, the majority of our source and age customers continue to subscribe to our verification services in order to differentiate their cattle and respond to ever increasing consumer demands for more information on the food they eat. We're also gratified that overall verification revenue increased year-over-year as demand for other services such as Non-Hormone Treated Cattle and Verified Natural Beef continued to grow. We have the industry's most diverse portfolio of services, which enables us to weather a short-term downturn in a particular service offering, and we continue to look for ways to further enhance that portfolio, both through internally developed programs and M&A activity. Meanwhile, our flagship Where Food Comes From consumer labeling program continues to show year-over-year revenue gains and holds tremendous potential for long-term growth as consumers demand more transparency into the food chain continuum. We remain confident about our long term prospects for profitable growth and look forward to another year of solid performance in 2013."
Conference Call The Company will conduct a conference call today at 2:15 p.m. Mountain Time.
The call-in numbers for the conference call: Domestic Toll Free: 1-877-941-1466 International: 1-480-629-9867 Conference Code: 4616473
Phone replay: A telephone replay of the conference call will be available through May 15, 2013, as follows: Domestic Toll Free: 1-800-406-7325 International: 1-303-590-3030 Conference Code: 4616473
About Where Food Comes From, Inc. Where Food Comes From, Inc. (d.b.a. IMI Global) is America's leading provider of third-party identification, verification and traceability solutions for the livestock and agricultural industries. The Company supports more than 6,000 ranchers, farmers, feed yards, meatpackers, food retailers and restaurants with a wide range of solutions, including its USVerified™ brand -- the industry standard for USDA Process Verified (PVP) programs -- which annually verifies marketing claims for approximately one half of all U.S. beef exports; Where Food Comes From®, a unique retail and restaurant labeling program that connects consumers directly to the source of the food they purchase; and various organic and gluten free certification solutions through its International Certification Services (ICS) subsidiary. Go to www.IMIGlobal.com and www.wherefoodcomesfrom.com for additional information.
CAUTIONARY STATEMENT This news release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, based on current expectations, estimates and projections that are subject to risk. Forward-looking statements are inherently uncertain, and actual events could differ materially from the Company's predictions. Important factors that could cause actual events to vary from predictions include those discussed in our SEC filings. Specifically, statements in this news release about expectations to grow organically and through M&A; industry leadership; potential for exponential growth of the Where Food Comes From program; ability to weather short-term downturns in a revenue segment; and the demand for, and impact and efficacy of, the Company's and its subsidiaries' products and services on the marketplace are forward-looking statements that are subject to a variety of factors, including availability of capital, personnel and other resources; competition; governmental regulation of the agricultural industry; the market for beef and other commodities; and other factors. Financial results for the first quarter are not necessarily indicative of future results. Readers should not place undue reliance on these forward-looking statements. The Company assumes no obligation to update its forward-looking statements to reflect new information or developments. For a more extensive discussion of the Company's business, please refer to the Company's SEC filings at www.sec.gov .
| Where Food Comes From, Inc. | ||||||||||
| Statements of Income | ||||||||||
| Three Months Ended | ||||||||||
| March 31, | ||||||||||
| 2013 | 2012 | |||||||||
| Revenues | ||||||||||
| Service revenues | $ | 853,606 | $ | 845,827 | ||||||
| Product sales | 129,009 | 156,954 | ||||||||
| Other revenues | 42,888 | 26,503 | ||||||||
| Total revenues | 1,025,503 | 1,029,284 | ||||||||
| Costs of revenues | ||||||||||
| Labor and other costs of services | 405,792 | 355,453 | ||||||||
| Costs of products | 85,889 | 102,872 | ||||||||
| Total costs of revenue | 491,681 | 458,325 | ||||||||
| Gross profit | 533,822 | 570,959 | ||||||||
| Selling, general and administrative expenses | 625,515 | 488,137 | ||||||||
| Income (loss) from operations | (91,693 | ) | 82,822 | |||||||
| Other expense (income): | ||||||||||
| Interest expense | 6,779 | 7,872 | ||||||||
| Other income, net | (447 | ) | (2,662 | ) | ||||||
| Income (loss) before income taxes | (98,025 | ) | 77,612 | |||||||
| Income tax benefit | (34,288 | ) | (282,090 | ) | ||||||
| Net income (loss) | (63,737 | ) | 359,702 | |||||||
| Net loss attributable tonon-controlling interest | 5,354 | 2,431 | ||||||||
| Net income (loss) attributable to Where FoodComes From, Inc. | $ | (58,383 | ) | $ | 362,133 | |||||
| Net income (loss) per share: | ||||||||||
| Basic | $ | - | $ | 0.02 | ||||||
| Diluted | $ | - | $ | 0.02 | ||||||
| Weighted average number of commonshares outstanding: | ||||||||||
| Basic | 21,439,355 | 20,609,639 | ||||||||
| Diluted | 21,439,355 | 21,105,614 | ||||||||
| Where Food Comes From, Inc. | ||||||||||
| Balance Sheets | ||||||||||
| March 31, | December 31, | |||||||||
| 2013 | 2012 | |||||||||
| ASSETS | ||||||||||
| Current Assets: | ||||||||||
| Cash and cash equivalents | $ | 1,505,638 | $ | 1,403,489 | ||||||
| Accounts receivable, net | 329,850 | 377,072 | ||||||||
| Prepaid expenses and other current assets | 52,217 | 80,189 | ||||||||
| Deferred tax assets | 277,232 | 242,944 | ||||||||
| Total current assets | 2,164,937 | 2,103,694 | ||||||||
| Property and equipment, net | 139,602 | 146,563 | ||||||||
| Intangible and other assets, net | 293,776 | 303,810 | ||||||||
| Goodwill | 532,997 | 532,997 | ||||||||
| Long-term deferred tax assets | 277,177 | 277,177 | ||||||||
| Total assets | $ | 3,408,489 | $ | 3,364,241 | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 149,907 | $ | 134,913 | ||||||
| Accrued expenses and other current liabilities | 42,918 | 58,808 | ||||||||
| Customer deposits | 30,969 | 27,478 | ||||||||
| Deferred revenue | 207,990 | 139,022 | ||||||||
| Short-term debt and current portion of notes payable | 23,745 | 22,873 | ||||||||
| Current portion of capital lease obligations | 4,012 | 5,506 | ||||||||
| Total current liabilities | 459,541 | 388,600 | ||||||||
| Capital lease obligations, net of current portion | 13,958 | 14,981 | ||||||||
| Notes payable and other long-term debt, net of current portion | 184,465 | 191,106 | ||||||||
| Notes payable, related party | 200,000 | 200,000 | ||||||||
| Total liabilities | 857,964 | 794,687 | ||||||||
| Stockholders' equity: | ||||||||||
| Common stock | 21,977 | 21,837 | ||||||||
| Additional paid-in capital | 3,713,124 | 3,668,556 | ||||||||
| Treasury stock | (121,294 | ) | (121,294 | ) | ||||||
| Accumulated deficit | (1,345,923 | ) | (1,287,540 | ) | ||||||
| Total Where Food Comes From, Inc. equity | 2,267,884 | 2,281,559 | ||||||||
| Non-controlling interest | 282,641 | 287,995 | ||||||||
| Total equity | 2,550,525 | 2,569,554 | ||||||||
| Total liabilities and stockholders' equity | $ | 3,408,489 | $ | 3,364,241 | ||||||
Company Contacts: John Saunders Chief Executive Officer 303-895-3002 Jay Pfeiffer Pfeiffer High Investor Relations, Inc. 303-393-7044
