Where Food es From(US:WFCF)2020-05-14 17:07Financial Position - As of March 31, 2020, the company had cash and cash equivalents of approximately $3.2 million, an increase from $2.9 million at December 31, 2019[87]. - The company has a revolving line of credit providing $75,080 in working capital, with an effective interest rate of 4.75% as of March 31, 2020[93]. - On April 17, 2020, the company received a $1.0 million loan under the PPP with an annual interest rate of 1.00%[94]. Cash Flow - Net cash provided by operating activities for the three months ended March 31, 2020, was approximately $0.9 million, down from $1.3 million during the same period in 2019[88]. - Net cash used in investing activities for the three months ended March 31, 2020, was approximately $0.4 million, primarily due to the acquisition of Postelsia Holdings, Ltd for $0.3 million[89]. Revenue Performance - For the three months ended March 31, 2020, total revenues were approximately $3.9 million, a slight decrease from $3.95 million in the same period in 2019[96]. - Verification and certification service revenue decreased less than 0.4% compared to the same period in 2019[97]. - Product sales increased by approximately $0.1 million, or 13.1%, compared to the same period in 2019, driven by the requirement for source and age verification for cattle[98]. - Software license, maintenance, and support services revenue decreased approximately 32.3% compared to the same period in 2019, mainly due to a reduction in billable hours[101]. - Software-related consulting service revenue increased approximately 19.9% compared to the same period in 2019, reflecting fluctuations in customer demand[102]. - The company recorded a net loss attributable to shareholders of approximately $0.2 million for the three months ended March 31, 2020, compared to a net loss of approximately $0.1 million in the same period in 2019[109]. - The company received dividend income of $30,000 from Progressive Beef for the three months ended March 31, 2020, consistent with the previous year[107]. Operational Insights - The company supports over 15,000 farmers and food producers through third-party verification services, enhancing credibility for product claims[76]. - The company employs a SaaS revenue model, bundling software licenses with ongoing enhancements and professional services[77]. - The business is subject to seasonal fluctuations, with significant revenue typically realized from late May through early October[86]. - The company has evaluated customer receivables in light of the COVID-19 pandemic and does not currently feel any are impaired[88]. - Gross margin for the verification and certification segment decreased to 39.7% in Q1 2020 from 41.0% in Q1 2019, primarily due to competitive pricing[99]. - Gross margin for the software sales and related consulting segment declined to 46.6% in Q1 2020 from 49.7% in Q1 2019[103]. - Other operating expenses for the verification and certification segment increased approximately 1.7% compared to the same period in 2019[100]. Future Outlook - The company plans to continue growth through verification bundling opportunities and acquisitions in national and international markets[92].