Happy Belly Food Group Announces 11th Consecutive Record Quarter, and First Fiscal Year of Positive Adjusted EBITDA

Toronto, Ontario--(Newsfile Corp. - April 30, 2025) - Happy Belly Food Group Inc. (CSE: HBFG) (OTCQB: HBFGF) ("Happy Belly" or the "Company"), a leader in acquiring and scaling emerging food brands across Canada, is pleased to announce its audited financial results and corporate update for the fiscal year ended December 31st, 2024.

"In 2024, Happy Belly Food Group delivered record growth and transformation, advancing our mission to become Canada's leader in acquiring and scaling emerging food brands while generating significant shareholder value. Through a combination of organic expansion and strategic acquisitions, we added 30 new restaurant locations, drove a 419% increase in system sales, and achieved a 72% rise in net income. We closed the year adjusted EBITDA-positive and strategically reinvested capital in securing additional capacity during Q4 to support our record setting 2025 rollout. Key hires and system enhancements during the year underpinned an expedited opening schedule, evidenced by 10 net new restaurant openings year-to-date in 2025, with many more still to come," said Sean Black, Chief Executive Officer. 

"As I reflect on 2024, I am proud of our sustained momentum across both top and bottom-line metrics, including an 11th consecutive record quarter. Equally important is the collaborative culture we have built at Happy Belly. Our management team and brand partners are working seamlessly to support franchisees and expand our national footprint. This dynamic teamwork is the foundation of our rapid execution and positions us for an even stronger performance in 2025. While 2024 was transformational, our best chapters are still ahead as we are very focused on delivering more growth throughout 2025. In a few short weeks we look forward to unveiling our Q1 2025 results, as we continue our push toward cash-flow positivity and positive earnings per share; our story is truly just beginning."

We are just getting started.

2024 Financial Highlights

• System wide sales across Quick Service Restaurants (QSR) totaled $30.30M in fiscal 2024, up 419% versus prior fiscal year (2023 - $5.84M). The increase is attributed to organic baseline restaurant growth, alongside increased restaurant count, which reached 43 operating restaurants in 2024 versus 13 in the prior fiscal year.

• Total operating revenues and other income totaled $9.38M in fiscal 2024, up 72% versus prior fiscal year (2023 - $5.45M). Year over year growth was driven by continued sales growth in both the QSR and Consumer Product Goods (CPG) segments, three (3) business acquisitions in 2024, combined with new franchised restaurant openings and royalties collected during 2024 (16 net new openings).

• Total product sales totaled $7.93M in fiscal 2024, up 56% versus prior fiscal year (2023 - $5.07M). Furthermore, royalties and franchise fee revenues reached $0.98M, up 400% from the prior fiscal year (2023 - $0.19M), which was driven by royalties collected from 16 new restaurant openings in 2024.

• Adjusted EBITDA(1) reached $0.26M or 2.7% in fiscal 2024, up 144% versus prior fiscal year (2023 - adjusted EBITDA loss of $0.58M or negative 10.6%).

• Net working capital remains healthy at $3.28M as at December 31, 2024 (2023 - $0.80M). Total cash and cash equivalents were $3.49M in 2024. Two separate non-brokered private placements were completed during fiscal 2024 for the sum of $3M total.

• Happy Belly Food Group Inc. made accretive cash and equity investments during fiscal 2024. First acquiring three (3) QSR brands: Via Cibo Franchising Inc., IQ Foods and Yolks Breakfast Inc. Secondly, to increase capacity for growth in 2025 investments were made in Q4 2024 to add headcount and infrastructure that will support the build and servicing of the significant net new restaurant pipeline in 2025. Subsequent to fiscal 2024, the company has already opened and is operating 10 additional restaurants and acquired Smile Tiger Coffee Roasters on January 27, 2025. Such investments are aligned and support the company's direction for strategic growth.

Q4 2024 Financial Highlights

• System wide sales across QSR brands increased 377% in Q4 2024 to $8.88M versus $1.86M in Q4 2023 and increased 4% versus $8.53M in the prior quarter. The increase is attributed to the organic growth with baseline restaurants and the increase in restaurant count from 13 in Q4 2023 to 43 opened as at Q4 2024.

• Total operating revenues and other income increased 62% in Q4 2024 to $2.56M versus $1.58M in Q4 2023. The significant growth was primarily driven by organic product sales growth in both the Quick Service Restaurants (QSR) and Consumer Product Goods (CPG) segments of the business, combined with new restaurant openings and franchise royalties and fees collected.

• Total product sales from both the QSR and CPG segments increased 116% to $2.66M in Q4 2024 versus the same quarter last year (2023 - $1.23M) Both segments continued to be profitable once again this quarter. QSR EBITDA reached $0.21M in 2024 and CPG EBITDA reached $0.15M.

• Despite seasonality, revenues increased 4% in Q4 2024 to $2.6M versus $2.5M in Q3 2024. Furthermore, quarter over quarter total system sales increased 4.7% in Q4 2024 to $8.9M versus $8.5M in Q3 2024.

• Q4 2024 adjusted EBITDA(1) was positive versus an adjusted EBITDA(1) loss of $0.10M or negative 6.4% in Q4 2023. It is now two (2) consecutive quarters whereby the Company has achieved positive adjusted EBITDA(1), which also led to positive adjusted EBITDA(1) for fiscal year ended 2024.

The Company continues to maintain a healthy net working capital position of $3.28M as at year ended December 31, 2024, as compared to $0.80M 2023. Total cash and cash equivalents were $3.49M in Q4 2024 driven by two non-brokered private placements completed in 2024 ($3M combined) through the issuance of convertible debentures. $1M of the total $3M convertible debentures was converted to shares at year end.

The closing of the private placements strengthens our balance sheet and provides us the ability to accelerate our growth strategy and execute material M&A opportunities with strong positive cash flow, when the opportunity presents itself.

Happy Belly had 7 net new restaurant openings during Q4 2024. The Heal Lifestyle brand opened three locations in Kitsilano BC, Edmonton AB, and the Greater Toronto Ontario region. Lettuce Love Cafe brand opened 1 location in Toronto. Both Rosie's Burgers and Pirho Grill brands each opened 1 location in Calgary Alberta. IQ Foods opened 1 location in Toronto.

Q4 2024 CORPORATE HIGHLIGHTS

December 20th, 2024 - Happy Belly's Smash Burger Brand Rosie's Burgers Secures Real-Estate Location in Toronto's Avenue & Lawrence Neighborhood

December 16th 2024 - Happy Belly Food Group Signs Order for 4th Consecutive Above-Market Financing

December 6th, 2024 - Happy Belly's HEAL Wellness QSR Secures Real-Estate Location for Its Multi-Unit Franchisee in the Kensington Area of the City of Calgary, Alberta

December 5th, 2024 - Happy Belly's Yolks Breakfast Announces the Signing of Its 13th Franchise to Open in the Greater Vancouver Area

December 4th, 2024 - Happy Belly Announces the Opening of its Newest Co-Branded Store with Lettuce Love Cafe and Heal Wellness QSRs in Toronto's Bloor West Village

December 3rd - Happy Belly's HEAL Wellness QSR Secures Real-Estate Location in Whitby's Taunton Gardens

November 29th, 2024 - Happy Belly's Smash Burger Brand Rosie's Burgers Announces the Opening of its Newest Location in Calgary, Alberta

November 26th, 2024 - Happy Belly Food Group Partners with Cadillac Fairview and Announces Secured Real-Estate for IQ Foods, Heal Wellness and Rosie's Burgers for CF Shops at Don Mills

November 25th, 2024 - Happy Belly's HEAL Wellness QSR Announces Signing of its 46th Franchise and Real-Estate Location in Bolton, Ontario

November 22th, 2024 - Happy Belly's HEAL Wellness QSR Announces the Opening of Its Newest Location in Edmonton's North Town Center

November 21th, 2024 - Happy Belly Food Group Announces 10th Consecutive Record Quarter

November 19th, 2024 - Happy Belly's HEAL Wellness QSR Announces the Signing of a Franchise Agreement for Kingston, Ontario

November 15th, 2024 - Happy Belly's HEAL Wellness QSR Announces Toronto Multi-Unit Franchisee Signs Third Location

November 14th, 2024 - Happy Belly's Via Cibo Announces it has secured a real estate location for Barrhaven, in the City of Ottawa, Ontario

November 12th, 2024 - Happy Belly's Rosie's Burgers Announces the Signing of a franchise agreement for Hamilton, Ontario

November 1st, 2024 - Happy Belly's announces the signing of a Definitive Agreement to acquire 50% of SALUS Fresh Foods

October 25th, 2024 - Happy Belly's Pirho Fresh Greek Grill Announces the opening of its newest location in the city of Calgary, Alberta

October 18th, 2024 - Happy Belly's IQ Foods Announces the Signing of a 25-Unit Area Development Agreement in Ontario

October 16th, 2024 - Happy Belly's Heal Wellness secures 5,th Calgary based real-estate location at Aspen Landing Shopping Center

October 15th, 2024 - Happy Belly's Via Cibo Announces the Signing of a franchise agreement for Barrhaven, in the City of Ottawa, Ontario

October 10th, 2024 - Happy Belly's Via Cibo Announces the Signing of a franchise agreement for the Niagara Falls region of Ontario

October 7th, 2024 - Happy Belly Announces the appointment of Randall Papineau as Brand President of IQ Foods

October 4th, 2024 - Happy Belly's Heal Wellness Announces the opening of its newest location in the Kitsilano neighborhood of Vancouver, BC

October 3rd, 2024 - Happy Belly Announces the appointment of John Delutis as Vice President of Restaurant Operations

SUBSEQUENT EVENTS

April 25th, 2025 - Happy Belly's Heal Wellness QSR Announces Opening in Downtown Calgary's Historic Alberta Block

April 24th, 2025 - Happy Belly's Yolks Breakfast Signs 10 Unit Area Development Agreement in Atlantic Canada

April 23rd, 2025 - Happy Belly's Yolks Breakfast Announces Entry to Quebec Market with Signing of First Real-Estate Location

April 17th, 2025 - Happy Belly's Via Cibo Italian Restaurant Opens Its Newest Location Located in Barrhaven, in the City of Ottawa, Ontario

April 16th, 2025 - Happy Belly Promotes Randall Papineau to President of Emerging Brands

April 14th, 2025 - Happy Belly's Yolks Breakfast Signs Franchise Agreement and Real-Estate Location in the City of Tsawwassen, British Columbia

April 11th, 2025 - Happy Belly's Smash Burger Brand Rosie's Burgers Announces the Opening of its Newest Location in Toronto, Ontario

April 8th, 2025 - Happy Belly's Yolks Breakfast Signs Franchise Agreement for the City of Richmond Hill, Ontario

April 7th, 2025 - Happy Belly Promotes John Delutis to Chief Restaurant Officer

April 4th, 2025 - Happy Belly Selects TOAST to Power Growing Restaurant Portfolio

March 28th, 2025 - Happy Belly's Rosie's Burgers Announces the Signing of a Franchise Agreement for the City of Mississauga, Ontario

March 27th, 2025 - Happy Belly's Rosie's Burgers Announces the Signing of a Multi Unit Franchise Agreement for 5 Stores in the Province of British Columbia

March 21st, 2025 - Happy Belly Opens 50th Restaurant in Hamilton's Westdale Village Featuring Lettuce Love & Heal Wellness

March 18th, 2025 - Happy Belly Expands CPG Availability with Lumber Heads Popcorn Now Available in 193 Loblaws Retail Locations

March 17th, 2025 - Happy Belly's Heal Wellness QSR Announces Multi-Unit Franchisee is Now Open in Calgary's Aspen Landing, Alberta, Canada

March 14th, 2025 - Happy Belly's Heal Wellness QSR Announces Multi-Unit Franchisee Opens Third Location in Toronto, Ontario

March 13th, 2025 - Happy Belly's Heal Wellness QSR Announces Securing a Real-Estate Location for Windermere, in the City of Edmonton, Alberta

March 12th, 2025 - Happy Belly's Heal Wellness Announces the Signing of their 49th Franchise Agreement to be Located in Brampton, Ontario

March 10th, 2025 - Happy Belly's Smash Burger Brand Rosie's Burgers Announces the Signing of a Real Estate Location and Franchisee for University of Alberta in Edmonton

March 6th, 2025 - Happy Belly Food Group's Heal Wellness QSR Signs 20 Unit Area Development Agreement in Atlantic Canada

March 4th, 2025 - Happy Belly Food Group's Smash Burger Brand Rosie's Burgers Signs 10 Unit Area Development Agreement in Manitoba, Canada

February 28th, 2025 - Happy Belly Food Group's Smash Burger Brand Rosie's Burgers Signs 15 Unit Area Development Agreement in Atlantic Canada

February 27th, 2025 - Happy Belly's Heal Wellness Announces the Signing of a Franchise Agreement for Grand Bend, Ontario

February 26th, 2025 - Happy Belly Food Group's iQ Food Co. QSR Signs 20-Unit Area Development Agreement in British Columbia

February 24th, 2025 - Happy Belly's HEAL Wellness QSR Brand Enters 4th Province in Canada with Signing of a 10-Unit Area Development Agreement in The Province of Saskatchewan

February 21st, 2025 - Happy Belly's Yolk's Breakfast Announces the Opening of Its Newest Location in Canada's Capital, Ottawa, Ontario

February 24th, 2025 - Happy Belly's Smile Tiger Coffee Roasters Signs 25-Unit Area Development Agreement in British Columbia

February 11th, 2025 - Happy Belly Appoints David LeBlanc as Director of Design and Construction

February 7th, 2025 - Happy Belly's HEAL Wellness QSR Announces the Opening of its Newest Location in the City of Calgary, Alberta

February 6th, 2025 - Happy Belly's HEAL Wellness QSR Announces Securing a Franchisee and Real-Estate Location for Aurora, Ontario

January 27th, 2025 - Happy Belly Closes 100% Acquisition of Smile Tiger Coffee Roasters Inc

January 23rd, 2025 - Happy Belly's HEAL Wellness QSR Secures Real-Estate Location for Kingston, Ontario

January 22nd, 2025 - Happy Belly's HEAL Wellness QSR Announces Toronto Multi-Unit Franchisee Signs Fourth Agreement

January 17th, 2025 - Happy Belly Food Group Signs National Distributional Agreement with Sysco

January 10th, 2025 - Happy Belly's HEAL Wellness QSR Announces the Grand Opening of its Newest Location at the University of Alberta

January 9th, 2025 - Happy Belly Closes 6th Consecutive Above-Market Non-Brokered Financing

January 8th, 2025 - Happy Belly Signs Definitive Agreement to Acquire 100% of Smile Tiger Coffee Roasters Inc

January 7th, 2025 - Happy Belly Appoints Former Fat Burger Vice President John Grieve as Regional Vice President of Operations, Western Canada

FOOTNOTES:

1. Adjusted EBITDA Is a non-IFRS financial measure which does not have a standardised meaning prescribed by IFRS. Adjusted EBITDA and Adjusted EBITDA Margin are used by management as supplemental measures to review and assess operating performance and to provide a more complete understanding of factors and trends impacting the Company's business. Management believes Adjusted EBITDA are useful measures of operating performance and the Company's ability to generate cash-based earnings, as they provide a more relevant position of operating results by excluding the effects of financing and investing activities, which removes the effects of interest, depreciation and amortization expenses as well as other expenses, as described, that are not reflective of the Company's underlying business. This non-IFRS measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
   
   Adjusted EBITDA is defined as net comprehensive income or (loss), excluding interest, taxes, depreciation and amortization (EBITDA), adjusted for share-based compensation, gain (loss) on equity investments and sublease, expected credit loss and non-recurring expenses.

About Happy Belly Food Group
Happy Belly Food Group Inc. (CSE: HBFG) (OTCQB: HBFGF) ("Happy Belly" or the "Company") is a leader in acquiring and scaling emerging food brands across Canada.

Happy Belly Food Group

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Sean Black
Chief Executive Officer

Shawn Moniz
Chief Operating Officer

Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this press release, which has been prepared by management.

Cautionary Note Regarding Forward-Looking Statements

All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to the Company within the meaning of applicable securities laws. Forward-Looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur and include the future performance of Happy Belly and her subsidiaries. Forward-Looking statements are based on the opinions and estimates at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements. There are uncertainties inherent in forward-looking information, including factors beyond the Company's control. There are no assurances that the business plans for Happy Belly described in this news release will come into effect on the terms or time frame described herein. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. For a description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's Management's Discussion and Analysis and other disclosure filings with Canadian securities regulators, which are posted on www.sedarplus.ca.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/250280