Barfresh Food Group Inc.

Good afternoon, and thank you for participating on today's first quarter 2021 corporate update call for Barfresh Group. Joining us today is Barfresh Group's founder and CEO, Riccardo Delle Coste. 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 on this call are forward-looking within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements about the company's commercial progress, success of its strategic relationships, and projections of future financial performance. These forward-looking statements are identified by the use of words such as grow, expand, anticipate, intend, estimate, believe, expect, plan, should, hypothetical, potential, forecast, and project, continue, could, may, predict, and will, and variations of such words and similar expressions include are intended to identify such forward-looking statements. All statements other than the statements of historical fact that address activities, events or developments that the company believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made based on experience, expected future developments and other factors that the company believes are appropriate under the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the company. should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, investors are questioned not to place undue reliance on these forward-looking statements, which speak only as a date they are made. The contents of this call should be considered in conjunction with the company's recent filings with the Securities and Exchange Commission, including its annual report on Form 10-K and the quarterly reports on Form 10-Q and current reports on Form 8-K. including any warnings, risk factors, and cautionary statements contained therein. Furthermore, the company expressly disclaims any current intention to update publicly any forward-looking statements after this call, whether as a result of due information, future events, changes in assumptions, or otherwise. In order to aid in the understanding of the company's business performance, the company is also presenting certain non-GAAP measures, including adjusted EBITDA, which are reconciled in a table in the business update release to the most comparable GAAP measures. Management believes that the adjusted EBITDA provides useful information to the investor because it is directly reflective of the cash flow of the company. The primary factors in reconciling these items are non-cash costs, including stock compensation, stock issued for services, and gain or loss of the sale of derivatives. Now, I'll turn the call over to the CEO of Bar Fresh Food Group, Mr. Riccardo Delle Coste. Please go ahead, sir.

Thank you, and good afternoon, everyone. On the call today, I will review our first quarter 2021 results and accomplishments. Since our last earnings call was less than a month ago, I am going to provide a high level review for accomplishments and spend more time on how we are performing in the second quarter. Now to discuss our first quarter 2021, starting with our financials. Revenue for the first quarter of 2021 increased 38% to $1 million compared to $733,000 for the same period last year and a meaningful improvement compared to $835,000 for the first quarter of 2019. The increase in revenue is the result of increased orders for our Twist and Go products in the school channel. as well as the gradual return in sales of our bulk and single serve products. Gross margins for the first quarter of 2021 were 34% compared to 54% for the first quarter of 2020. The decline in gross margins was due to product mix as the company's lower margin Twist and Go products made up a larger percent of sales in the first quarter of 2021 compared to the prior year period. The company expects gross profit margins for the remainder of 2021 will increase to approximately 40% due to higher concentration of sales from these products, strengthened by a gradual return of the higher margin bulk and single serve products. The net loss for the first quarter of 2021 improved to 600,000 as compared to a loss of 700,000 in the first quarter of 2020. The company continued to significantly reduce core operating expenses reducing total G&A expenses in the first quarter of 2021 by 39% compared with the prior year period. During the first quarter of 2021, net cash used in operating activities improved to 394,000 compared to 973,000 in the prior fiscal period. As of March 31, 2021, we had approximately 2.1 million of cash compared to 1.9 million as of December 31st, 2020. In addition, we had approximately 0.76 million of inventory as of March 31st, compared to 0.87 million as of December 31st, 2020. The increased cash position highlights the improved expense management and the receipt of 568,000 PPP loan during the first quarter of 2021.

for the first quarter of 2021.