- Net sales were $31 million in the second quarter of 2025, with gross margin2 reaching 42.6% for a gross profit of $13 million
- Net loss of $2 million, adjusted EBITDA margin1 of 4.5% and adjusted EBITDA1 of $1 million for the quarter
- Cash flows used in operating activities of $1 million and adjusted free cash flow1 was negative $1 million for the second quarter of 2025
- Cash balance and marketable securities at $19 million, with balance sheet further de-risked with repayment of 2025 Debentures on March 31, 2025
- Attained B Corp certification, joining global community of forward-thinking companies using business as a force for good
- Genuine Tea, Goodfood's first acquisition, performing well and benefitting from "Buy in Canada” movement, as we look to further build pipeline of deals and complete more acquisitions to expand our platform
Goodfood Market Corp. ("Goodfood”, "the Company”, "us”, "we” or "our”) (TSX: FOOD), a leading Canadian online meal solutions company, today announced financial results for the 13 weeks and 26 weeks ended March 8, 2025.
"I am pleased to report that Goodfood delivered positive Adjusted EBITDA1 for a ninth consecutive quarter, as our solid operational foundations and the flexibility of our cost structure enabled successfully navigating a persistently challenging consumer demand environment across Canada,” said Jonathan Ferrari, Chief Executive Officer of Goodfood Market Corp. "Despite macroeconomic headwinds impacting consumer behavior and driving more cautious spending, our focus on product innovation, operational discipline, and cost efficiency drove continued profitability on an Adjusted EBITDA1 basis,” added Mr. Ferrari.
"We also reached a record basket size this quarter, as customers continued to upgrade recipes and add more meals to their baskets. The success of our new Value Plan, which has served as a great entry point for new customers, combined with our ongoing investments in digital enhancements that are reducing friction and improving ease-of-use of new features like protein customization helped drive these record order values. In addition to our focus on driving more value for our customers in these challenging times, we are also finding new ways to bring delicious and healthy convenience to their homes. In recent weeks, we launched our new line of Heat & Eat meals which were made available in select geographies and are off to a strong start with Goodfood members rating our meals with a score of 4.6 out of 5. Heat & Eat meals provide Goodfood with a new growth avenue and expand our target addressable market as we work to expand their availability across the country,” continued Mr. Ferrari.
"Looking ahead, our priorities remain clear: to generate sustainable cash flows, de-risk our balance sheet as we did with the repayment in shares of our convertible debentures, maintain strong cost discipline, and scale our digital food platform with differentiated offerings, developed internally or through acquisitions as previously done with Genuine Tea, that meet the evolving needs of our customers. We are encouraged by the progress we have made and confident in our teams' ability to create long-term value,” concluded Mr. Ferrari.
RESULTS OF OPERATIONS - SECOND QUARTER OF FISCAL 2025 AND 2024
The following table sets forth the components of the Company's interim condensed consolidated statement of (loss) income and comprehensive (loss) income:
(In thousands of Canadian dollars, except per share and percentage information)
For the 13 weeks periods ended | March 8,
2025 | March 2,
2024 | ($)
|
(%) | ||||||||
Net sales | $ | 30,500 | $ | 39,755 | $ | (9,255 | ) | (23)% | ||||
Cost of goods sold | 17,502 | 22,646 | (5,144 | ) | (23)% | |||||||
Gross profit | $ | 12,998 | $ | 17,109 | $ | (4,111 | ) | (24)% | ||||
Gross margin | 42.6% | 43.0% | N/A | (0.4) p.p | ||||||||
Selling, general and administrative expenses | 11,860 | 13,893 | (2,033 | ) | (15)% | |||||||
Depreciation and amortization | 1,670 | 1,818 | (148 | ) | (8)% | |||||||
Reorganization and other related gains | - | (1,364 | ) | 1,364 | (100%) | |||||||
Net finance costs | 1,856 | 1,369 | 487 | 36% | ||||||||
Net (loss) income, being comprehensive (loss) income | $ | (2,388 | ) | $ | 1,393 | $ | (3,781 | ) | N/A | |||
Basic and diluted (loss) income per share | $ | (0.03 | ) | $ | 0.02 | $ | (0.04 | ) | N/A | |||
- The decrease in net sales is driven by the decrease in active customer driving lower orders partially offset by an increase in average order value. The decrease in active customers can be explained mainly by uncertainties regarding the future economic outlook related to tariffs driving customers towards spending more carefully in the months post the winter holiday as well as a more pronounced holiday seasonality in Fiscal 2025. The decrease in net sales was also partially offset by Genuine Tea's net sales in the second quarter of Fiscal 2025.
- The decrease in gross profit is driven mainly by a decrease in net sales as well as an increase in credits and incentives as a percentage of net sales compared to the same quarter last year. This decrease was partially offset by lower labour and packaging costs. Gross margin decreased slightly by 0.4 percentage points.
- The decrease in selling, general and administrative expenses is primarily due to lower marketing spend and wages and salaries. Selling, general and administrative expenses as a result of percentage of net sales increased by 4 percentage points to 38.9% compared to 34.9% in the same quarter last year primarily driven by lower net sales.
- The decrease in reorganization and other related gains is mainly due to net gains in Fiscal 2024 on reversal of impairment resulting from a sublease agreement concluded in the second quarter of Fiscal 2024.
- The increase in net finance costs is mainly explained by the revaluation of the Company's marketable securities to its fair value as at March 8, 2025.
- The increase in net loss is primarily driven by lower profitability as a result of lower net sales partially offset by lower selling, general and administrative expenses as well as reorganization activities in Fiscal 2024 which resulted in a gain due to a sublease agreement.
The following table sets forth the components of the Company's interim condensed consolidated statement of loss and comprehensive loss:
(In thousands of Canadian dollars, except per share and percentage information)
For the 26 weeks periods ended | March 8,
2025 | March 2, 2024 | ($) | (%) | ||||||||
Net sales | $ | 65,162 | $ | 80,214 | $ | (15,052 | ) | (19)% | ||||
Cost of goods sold | 38,443 | 47,176 | (8,733 | ) | (19)% | |||||||
Gross profit | $ | 26,719 | $ | 33,038 | $ | (6,319 | ) | (19)% | ||||
Gross margin | 41.0% | 41.2% | N/A | (0.2) p.p | ||||||||
Selling, general and administrative expenses | 24,256 | 28,381 | (4,125 | ) | (15)% | |||||||
Depreciation and amortization | 3,251 | 3,773 | (522 | ) | (14)% | |||||||
Reorganization and other related gains | - | (1,361 | ) | 1,361 | (100)% | |||||||
Net finance costs | 3,287 | 2,825 | 462 | 16% | ||||||||
Net loss, being comprehensive loss | $ | (4,075 | ) | $ | (580 | ) | $ | (3,495 | ) | 603% | ||
Basic and diluted loss per share | $ | (0.05 | ) | $ | (0.01 | ) | $ | (0.04 | ) | (400)% | ||
- The decrease in net sales is driven by the decrease in active customer driving lower orders partially offset by an increase in average order value. The decrease in active customers can be explained mainly by uncertainties regarding the future economic outlook related to tariffs driving customers towards spending more carefully as well as a more pronounced holiday seasonality in Fiscal 2025. The decrease in net sales was partially offset by Genuine Tea's net sales in Fiscal 2025.
- The decrease in gross profit is driven by lower net sales compared to the same period last year. This decrease was partially offset by lower labour and packaging costs. Gross margin remained relatively stable.
- The decrease in selling, general and administrative expenses is primarily due to lower marketing spend and wages and salaries. Selling, general and administrative expenses as a percentage of net sales increased by 1.8 percentage points from 35.4% to 37.2% primarily driven by lower net sales.
- The decrease in reorganization and other related gains is mainly due to net gains in Fiscal 2024 on reversal of impairment resulting from a sublease agreement concluded in the second quarter of Fiscal 2024.
- The increase in net finance costs is mainly explained by the revaluation of the Company's marketable securities to its fair value as at March 8, 2025.
- The increase in net loss is primarily driven by lower profitability as a result of lower net sales partially offset by lower selling, general and administrative expenses as well as conclusion of our restructuring activities in Fiscal 2024 which resulted in a gain due to a sublease agreement.
EBITDA1, ADJUSTED EBITDA1 AND ADJUSTED EBITDA MARGIN1
The reconciliation of net (loss) income to EBITDA, adjusted EBITDA and adjusted EBITDA margin is as follows:
(In thousands of Canadian dollars, except percentage information)
For the 13 weeks ended
|
For the 26 weeks ended | |||||||||||
March 8, 2025 | March 2,
2024 |
March 8, 2025 | March 2, 2024 | |||||||||
Net (loss) income | $ | (2,388 | ) | $ | 1,393 | $ | (4,075 | ) | $ | (580 | ) | |
Net finance costs | 1,856 | 1,369 | 3,287 | 2,825 | ||||||||
Depreciation and amortization | 1,670 | 1,818 | 3,251 | 3,773 | ||||||||
EBITDA | $ | 1,138 | $ | 4,580 | $ | 2,463 | $ | 6,018 | ||||
Share-based payments expense | 222 | 325 | 441 | 338 | ||||||||
Reorganization and other related gains | - | (1,364 | ) | - | (1,361 | ) | ||||||
Acquisition costs | - | - | 99 | - | ||||||||
Adjusted EBITDA | $ | 1,360 | $ | 3,541 | $ | 3,003 | $ | 4,995 | ||||
Net sales | $ | 30,500 | $ | 39,755 | $ | 65,162 | $ | 80,214 | ||||
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