Core Insights - Lifeway Foods, Inc. has achieved net sales of $37.6 million for the first two months of Q2 2025, marking a 10.7% increase year-over-year [1] - Year-to-date net sales reached $83.7 million as of May 31, 2025, with expectations for Q2 net sales to be between $52 million and $56 million [1] - The company is expanding distribution of its products in response to rising consumer interest in probiotic and functional foods [2] Sales Performance - The company reported a 10.7% increase in net sales for the first two months of Q2 2025 compared to the same period last year [1] - Year-to-date net sales as of May 31, 2025, totaled $83.7 million [1] - Lifeway anticipates Q2 net sales to fall between $52 million and $56 million [1] Product Expansion - Lifeway is expanding its distribution across major retailers, including Amazon Fresh, BJ's Wholesale Club, CVS, HEB, and others [3] - New product launches include Lifeway Organic, Lactose Free Flavor Fusions and Lifeway Organic Kefir Shots in various retail locations [3] - The company is seeing a 63% unit increase in Lifeway Farmer Cheese year-to-date, indicating strong demand [2] Market Trends - There is a growing consumer interest in functional foods that support gut health and overall wellness, driven by social media trends [2] - Lifeway's products are made with live and active cultures, aimed at supporting immunity, digestion, and long-term health [2]

Core Viewpoint - The Smolyanskys, who own approximately 27% of Lifeway Foods, express serious concerns regarding the company's Q1 2025 performance and the Board's governance issues, emphasizing a need for immediate changes to restore operational discipline and shareholder alignment [1][3]. Financial Performance - Lifeway reported a 44% year-over-year increase in GAAP earnings per share, attributed entirely to a one-time $3.4 million gain from an investment sale, rather than improvements in the core kefir business [2]. - Income from operations declined nearly 55% year-over-year, with the operating margin falling to approximately 3.4%, down from 7.9% in Q1 2024 [5]. - Net sales increased only 3.3% year-over-year but declined 1.8% sequentially from Q4 2024 [5]. - Revenue from the 2021 acquisition of Glen Oaks has declined approximately 50% to date [5]. - Selling expenses rose sharply by 27% year-over-year and 35% from Q4 2024, without a corresponding increase in sales [5]. - Gross margin contracted by 180 basis points to 24.0%, while SG&A expenses climbed to 20.2% of sales [5]. Governance Concerns - The Smolyanskys criticized the Board's governance, particularly regarding the handling of the Danone offer and the subsequent attempt to nullify the Company's 1999 Stockholder Agreement with Danone [2][5]. - Concerns were raised about the $8.5 million in cash and shares awarded to CEO/Chair Julie Smolyansky shortly after these events, which were seen as misaligned with shareholder interests [2][5]. - The combined CEO/Chair role held by Julie Smolyansky has been identified as a significant governance failure, leading to a lack of independent oversight [5]. Shareholder Actions - The Smolyanskys are pursuing a consent path to achieve their goals, believing there is broad support from the investment community for swift changes [3]. - They have filed a preliminary consent statement and a preliminary proxy statement, nominating a slate of independent directors to restore operational discipline and long-term value creation [3][7].

Lifeway Foods (LWAY) Q1 2025 Earnings Call May 13, 2025 09:00 AM ET Company Participants Julie Smolyansky - CEO, President, Secretary & Chairperson of the Board Operator Good morning. Welcome to LifeWay Foods Fourth Quarter and Full Year twenty twenty four Conference Call. On the call with me today is Julie Smolansky, President and Chief Executive Officer. By now, everyone should have access to the press release that went out this morning. If you have not received the release, it is available on the Investo ...

Lifeway Foods (LWAY) Q1 2025 Earnings Call May 13, 2025 09:00 AM ET Speaker0 Good morning. Welcome to LifeWay Foods Fourth Quarter and Full Year twenty twenty four Conference Call. On the call with me today is Julie Smolansky, President and Chief Executive Officer. By now, everyone should have access to the press release that went out this morning. If you have not received the release, it is available on the Investor Relations portion of LifeWay's website at www.lifewayfoods.com. A recording of this call wi ...

Financial Performance - Net sales for the three-month period ended March 31, 2025, were $46,091, an increase of $1,457 or 3.3% compared to the same period in 2024[83]. - Gross profit as a percentage of net sales decreased to 24.0% in Q1 2025 from 25.8% in Q1 2024, primarily due to unfavorable milk pricing and increased trade promotions[84]. - Net income for the three months ended March 31, 2025, was $3,540, compared to $2,426 in the same period in 2024, reflecting a net income margin increase from 5.4% to 7.8%[82]. Expenses - Selling expenses increased by $998 to $4,698 in Q1 2025, representing 10.2% of net sales, up from 8.3% in Q1 2024, driven by marketing investments[85]. - General and administrative expenses rose by $492 to $4,628 in Q1 2025, influenced by professional fees related to stockholder actions and an unsolicited purchase proposal[86]. Cash Flow - Net cash used in operating activities was $150 in Q1 2025, a decrease from $1,546 provided in Q1 2024, primarily due to lower cash earnings[93]. - Net cash provided by investing activities was $2,933 in Q1 2025, compared to net cash used of $2,469 in Q1 2024, reflecting proceeds from the sale of an investment[94]. Taxation - The effective tax rate for Q1 2025 was 28.7%, down from 30.8% in Q1 2024, mainly due to changes in non-deductible compensation[87]. Future Outlook - The Company expects the accelerating consumer focus on health and wellness to drive increased demand for its products[80]. Credit Facilities - The Company had $0 outstanding under the Revolving Credit Facility as of March 31, 2025, with $25,000 available for future borrowings[96]. Market Risk - Not applicable for quantitative and qualitative disclosures about market risk[101].

CHICAGO, May 2, 2025 /PRNewswire/ -- Edward Smolyansky, who together with Ludmila Smolyansky, beneficially own approximately 27% of outstanding shares of Lifeway Foods common stock, today issued the following statement in response to Lifeway's amended 2024 Annual Report and its latest disclosures on executive and director compensation.Apparent Delay of 2025 Annual Meeting of Shareholders On March 13, Edward Smolyansky submitted a full slate of Board nominees for Lifeway's 2025 Annual Meeting. To date, Lifew ...

Company to Report First Quarter 2025 Results on May 13, 2025 MORTON GROVE, Ill., April 29, 2025 /PRNewswire/ -- Lifeway Foods, Inc. (Nasdaq: LWAY) ("Lifeway" or "the Company"), a leading U.S. supplier of kefir and fermented probiotic products to support the microbiome, today announced a milestone achievement of surpassing $5 million in gross sales for the week ending April 27th, 2025, representing a 35% increase from the prior year. Forward-Looking Statements This press release contains "forward-looking sta ...

Core Insights - The termination of Amy Feldman, a key executive at Lifeway Foods, is viewed as a significant misstep that undermines the company's strategic vision and employee morale [1][2][3] - Edward Smolyansky and Ludmila Smolyansky, who own approximately 28% of Lifeway's outstanding shares, are advocating for immediate changes in leadership and governance following Feldman's dismissal [1][3] Company Actions and Reactions - Lifeway Foods dismissed Amy Feldman on February 28, 2025, despite her pivotal role in developing the company's sales strategy, which has raised concerns among employees and shareholders [1][2] - The Board recently awarded CEO Julie Smolyansky a substantial cash bonus and stock options, which has sparked controversy, especially as it represents over 94% of the company's net income for 2024 [2][3] - The Smolyanskys have submitted a full slate of Board nominees for the 2025 Annual Meeting, emphasizing the need for leadership change and improved governance [3][4] Demands for Change - The Smolyanskys are calling for a transparent explanation regarding Feldman's termination and whether the Board was involved in the decision [5] - They demand the rescission of the recent share award to CEO Julie Smolyansky, proposing that the equity be redistributed to Lifeway's employees through an incentive plan [5] - There is a call for an end to the current corporate culture perceived as anti-shareholder and anti-employee, which is believed to be detrimental to Lifeway's foundational values [5] - The immediate release of Lifeway's preliminary Q1 2025 financial reports is requested to restore investor confidence and transparency [5]

Lifeway notes that Edward Smolyansky was previously terminated for cause as an officer of the companyMORTON GROVE, Ill., March 24, 2025 /PRNewswire/ -- Lifeway Foods, Inc. (NASDAQ: LWAY) ("Lifeway" or the "Company"), a leading U.S. supplier of Kefir and fermented probiotic products to support the microbiome, which recently reported record full-year earnings for 2024 and delivered its 22nd consecutive quarter of growth, has issued the following statement regarding Edward Smolyansky's nomination notice with r ...

CHICAGO, March 17, 2025 /PRNewswire/ -- Edward Smolyansky, who, together with Ludmila Smolyansky, beneficially owns 4,163,141 shares of common stock, today launched a formal campaign to stop the further eroding of value taking place at Lifeway Foods, Inc (NASDAQ: LWAY) by submitting and filing a Notice regarding Planned Nominees for election at the upcoming 2025 Annual Meeting.Lifeway Foods has reached an inflection point. The Board's continued deference to the CEO has raised serious governance concerns, an ...