Barfresh Food Group, Inc. Q4 FY2025 earnings call

• 2025 was a transformational year for Barfresh with record revenue. - Completed acquisition of Arps Dairy which changed how the company operates, providing control over manufacturing capabilities. - Secured $7.5 million senior convertible note financing and a $2.4 million government grant. - Fourth quarter and full year revenue growth driven by the acquired Arps Dairy. - Strong uptake across existing product portfolios and traction in school districts, including a significant win in the Nevada school district. - Focus on protecting base business and recovering lost customers, and now pursuing new district opportunities. - Manufacturing capacity issues resolved by year end with the acquisition and co-manufacturing partners.

For the fourth quarter of 2025, Barfresh achieved record revenue of $5.4 million, representing a 94% year-over-year revenue growth. For the full year of 2025, it achieved record revenue of $14.2 million, representing a 33% year-over-year growth. The growth was driven by the acquisition of Arps Dairy. In the fourth quarter, gross margin was 3% compared to 26% in the same period of 2024, and adjusted gross margin was 4% compared to 30% in the prior year period. For the full year of 2025, adjusted gross margin was 22% compared to 37% in the same period of 2024.

• Expect to achieve positive adjusted EBITDA in fiscal year 2026 as integrated manufacturing model benefits are realized. - Adjusted fiscal 2026 revenue guidance is in the range of 28 to 32 million. - First quarter of fiscal 2026 revenue expected in the range of 5 to 5.2 million and adjusted EBITDA breakeven. - Expect year-over-year quarterly improvement in revenue and profitability as facility enhancements are completed.

Q: As we're gaining additional clarity on supply chain ramp and reengaging with school districts lost due to supply chain disruptions, how have conversations gone?

A: Customers love the product, they're being reengaged, reaching out to those who took off the product due to no supply, in bidding process again, staying in close contact.

Q: Walk through underlying assumptions for revenue growth, especially back half?

A: Implied revenue includes bar fresh and ARPS business, ARPS business is counter-seasonal, second quarter has higher than expected products revenue, Q3 is biggest quarter with combination of businesses.

Q: Updates on channels outside education like food service and military?

A: There are opportunities in other channels, but haven't had supply to get there, now with manufacturing capacity, will get back into aggressive sales mode exploring various channels.

Q: Production capacity at the moment and scaling?

A: Existing facility is older but working, new facility later this year will have more flexibility, infrastructure and room for new lines.

Q: Guidance for base business, does it include signed up business and upside?

A: 2026 is stabilizing year for base business, includes existing customers and some growth, setting up for 2027.

Q: Pipeline and focus on larger school districts after Nevada deal?

A: Focus on getting out of old facility into new facility to go after larger accounts aggressively, couldn't do before due to supply constraints.

Q: Timeline for facility upgrade?

A: Before the end of 2026