Barfresh Food Group Inc.

Good afternoon, everyone, and thank you for participating on today's fourth quarter and full year 2025 earnings conference call and webcast for Barfresh Food Groups. Joining us today is Barfresh Food Groups founder and CEO, Ricardo de la Costa, and Barfresh Food Groups CFO, Lisa Rogers. 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 Security 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 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 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 by such forward-looking statements. Accordingly, investors are cautioned 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 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 new information, future events, changes in assumptions, or otherwise. In order to aid an understanding of the company's business performance, the company is also presenting certain non-GAAP measures, including adjusted gross profit, EBITDA, adjusted EBITDA, which are reconciled in the tables in business update release to the most comparable gap measures and certain calculations based on its results, including gross margin and adjusted gross margin. The reconciling items are non-operational or non-cash cost. including stock compensation and other non-recurring costs, such as those associated with the product withdrawal, the related dispute, certain manufacturing relocation costs, and acquisition-related expenses. Management believes that the adjusted gross profit EBITDA and adjusted EBITDA provide useful information to the investor because they are directly reflective of the performance of the company. Now, with that, I will turn the call over to the CEO of Barfresh Food Group, Mr. Ricardo De La Casse.

Please, sir, go ahead.

Good afternoon, everyone, and thank you for joining us for our fourth quarter and full year 2025 earnings call. I'm very excited to report that 2025 has been a transformational year for Barfresh, one that has fundamentally repositioned our company for sustainable growth and profitability. The fourth quarter capped off an exciting year in which we achieved record revenue of $14.2 million, completed a strategic acquisition that gives us control of our own manufacturing capabilities, and secured financing that positions us to unlock over $200 million in revenue capacity. Before I discuss our quarterly and full-year results, let me provide context on the strategic milestones that have reshaped our business models. In early October, we completed the acquisition of Arps Dairy, which has fundamentally changed how we operate. This acquisition brought us an operational 15,000 square foot processing facility where we immediately commenced production, along with a 44,000 square foot state-of-the-art manufacturing facility in Defiance, Ohio. We're already realizing immediate benefits from enhanced supply chain control and operational efficiency with approximately 90% of our revenue mix now manufactured in-house, giving us the ability to deliver orders that we previously would not have been able to deliver without the acquisition. After years of being constrained by third party manufacturers, which created operational challenges, revenue limitations, and increased operating costs, we now have control over the majority of our production. Our updated timeline for the remaining construction and equipment installation at our larger facility is extended to the fourth quarter of 2026 due to the timing of financing. In March of 2026, we secured a $7.5 million senior convertible note financing that delivers transformative benefits. These proceeds enable us to pay off the existing mortgage on the larger Defiance facility. meaning we now own our manufacturing plant free and clear. The financing also accelerates construction completion, enabling us to move into the enhanced facility before the end of 2026. Additionally, as previously announced, we will approve for a $2.4 million government grant to install specialized equipment necessary for full-scale production operations. For the fourth quarter of 2025, we achieved record revenue of $5.4 million, representing a 94% year-over-year revenue growth. For the full year of 2025, we achieved record revenue of $14.2 million, representing a 33% year-over-year growth. The fourth quarter and full year revenue growth was driven by the inclusion of the newly acquired Arps Dairy. Growth in our base business for 2025 was limited by the supply constraints of our co-manufacturing model, underscoring the strategic necessity of acquiring ARPS dairy. With the limited manufacturing supply, we have been focused on maintaining results and working on recovering lost customers, but now as we move into 2026 with enhanced capacity coming online, we are also focused on acquiring new ones. We've seen strong uptake across our existing Twist and Go portfolio and our Pop and Go 100% juice freeze pops have gained meaningful traction with several large school districts. I'm particularly excited to highlight a significant win we announced recently that demonstrates our continued momentum and competitive strength in the education channel. We successfully secured a seven year bid award with the largest school district in Nevada. representing the fifth largest school district in the entire United States. This district serves over 300,000 students across the region, making it one of the most substantial wins in the K-12 channel. This win is especially meaningful for several reasons. First, it validates our ability to compete successfully for and secure placements with the largest school districts in the country. And second, With our enhanced manufacturing capabilities through the ARPS dairy acquisition and our expanded product lineup, we are well positioned to support this district's needs reliably and consistently. This represents a major milestone in our expansion within the K-12 education channel and strengthens our position as we continue pursuing similar large-scale opportunities nationwide. Despite wins like this fifth largest district in the nation, we remain at only approximately 5% market penetration in the education channel overall, which represents substantial runway for growth. And we have tremendous growth opportunities within the districts we currently serve. A key priority throughout the fourth quarter and into fiscal 2026 has been protecting our base business and rebuilding relationships with customers who are impacted by the supply constraints we experienced earlier in the year. We successfully brought back customers who had temporarily removed our products due to our earlier supply shortfalls, with many reintroductions occurring in the fourth quarter. Our approach has been straightforward and relationship focused. We've stayed in close contact with these school districts through our broader broker network and our own sales team, communicating transparently about our manufacturing progress and our transition to owned facilities. Because these customers are already familiar with our products and have seen the positive response from students, the reintroduction process is more streamlined. This focused effort to win back displaced customers while simultaneously pursuing new district opportunities positions us well for sustained growth, as we're both recovering lost ground and expanding our market presence. The manufacturing capacity issues that constrained our first half performance were mostly resolved by year end with the acquisition of ARPS Dairy's processing plant and the contribution from our smoothie bottle co-manufacturing partners, which provided additional production capacity, giving both existing and prospective customers confidence in our ability to deliver reliably. The combination of record fiscal 2025 revenue Successful school district penetration, including major wins like the fifth largest school district in the nation and our expanding manufacturing capabilities positions us well as we execute on our fiscal 2026 plan. We've built significant operational momentum and with our own facility providing enhanced control and capacity, we're ready to capitalize on the substantial market opportunities ahead. With that overview of our strategic progress and market momentum, I'll now turn it over to Lisa to walk through the detailed financial results for the fourth quarter and full year.