Goodfood Reports Third Quarter Results Including $39 million of Net Sales, $0.3 million of Net Income, $4 million of Cash Flows From Operations and $4 million of Adjusted EBITDA¹

Goodfood Market Corp. (“Goodfood” or “the Company”) (TSX: FOOD), a leading Canadian online meal solutions company, today announced financial results for the third quarter of Fiscal 2024, ended June 1, 2024.

“The third quarter of Fiscal 2024 proved operationally strong again as we generated net income and consistent Adjusted EBITDA1 and Adjusted Free Cash Flow1 growth. For the last twelve months, our cash flows provided by operations reached $7 million and our Adjusted EBITDA1 and Adjusted Free Cash Flow1 reached $9 million and $8 million, respectively, a testament to our teams’ focus on growing profitability and cash flows. With Adjusted EBITDA1 positive for the sixth consecutive quarter and Adjusted Free Cash Flow1 positive for a third quarter in a row, we continue to optimize our capital structure and further de-leverage, with net leverage3 now at a manageable 2.1X, positioning us to consider various capital allocation options as we strive to generate growth and enhance shareholder value,” said Jonathan Ferrari, Chief Executive Officer of Goodfood.

“We are energized by the consistent strengthening of our profitability, cash flows and overall financial position. With our strengthened financial position, we enter the fourth quarter, which is typically marked by a seasonal slowdown in business activity as customers spend more time outside of their homes, with the opportunity to build additional momentum on the implementation of our intrinsic and external growth plan. We are indeed equally as energized by the launch of new value meals which provide our raving fans with more delicious options at various price points, and by the launch of Camp Goodfood, a set of recipes that introduce the joys of cooking to everyone in the family. Combined with more partnerships and Canadian flavor on the menu like the recent collaboration with celebrity chef Laurent Dagenais, our current and future customer-centric initiatives are beginning to show promising results as we enter the home stretch before Fiscal 2025,” concluded Jonathan Ferrari.

RESULTS OF OPERATIONS – THIRD QUARTER OF FISCAL 2024 AND 2023

The following table sets forth the components of the Company’s interim condensed consolidated statement of income and comprehensive income:

(In thousands of Canadian dollars, except per share and percentage information)

For the 13 weeks periods ended	June 1, 2024			June 3, 2023			($		)	(%	)
Net sales	$	38,561		$	42,139		$	(3,578	)	(8	)%
Cost of goods sold		21,612			24,853			(3,241	)	(13	)%
Gross profit	$	16,949		$	17,286		$	(337	)	(2	)%
Gross margin		44.0	%		41.0	%		N/A		3.0 p.p.
Selling, general and administrative expenses		13,700			14,545			(845	)	(6	)%
Depreciation and amortization		1,729			2,206			(477	)	(22	)%
Reorganization and other related costs		–			370			(370	)	N/A
Net finance costs		1,213			1,329			(116	)	(9	)%
Net income (loss), being comprehensive income (loss)	$	307		$	(1,164	)	$	1,471		N/A
Basic and diluted income per share	$	–		$	(0.02	)	$	0.02		N/A

VARIANCE ANALYSIS FOR THE THIRD QUARTER OF 2024 COMPARED TO THIRD QUARTER OF 2023

• The decrease in net sales is primarily driven by the decrease in the number of active customers, as we focus on customers providing stronger unit economics, partially offset by an increase in average order value as a result of price optimizations, increased variety in the meal-kit offering and a focus on meal-kit offerings with ready-to-eat meal solutions and grocery products as add-ons.
• The decrease in gross profit primarily resulted from a decrease in net sales as well as higher credit and incentives as a percentage of sales mostly offset by lower production and fulfilment costs driven by improved inventory management reducing waste, lower production labour cost and last-mile shipping costs as well as price optimizations. Gross margin increased mainly due to operational efficiencies driving lower production and fulfilment costs as a percentage of net sales, as well as pricing optimization, partially offset by an increase in credits and incentives as a percentage of net sales.
• The decrease in selling, general and administrative expenses is primarily due to lower wages and salaries primarily resulting from the Company’s costs saving initiatives. Selling, general and administrative expenses as a percentage of net sales increased from 34.5% to 35.5% mainly due to one-time favorable lease and other contract adjustments that occurred in the third quarter of Fiscal 2023, and lower net sales.
• The decrease in depreciation and amortization expense is mainly due to the the derecognition of a right-of-use asset and fixed assets pursuant to a sublease agreement.
• The improvement in net income is mainly the result of lower wages and salaries in cost of goods sold and in selling, general and administrative expenses as well as operational efficiencies reducing production and fulfilment costs. This improvement can also be explained by lower depreciation and amortization expense partially offset by a lower net sales base.

RESULTS OF OPERATIONS – YEAR-TO-DATE FISCAL 2024 AND 2023

The following table sets forth the components of the Company’s interim condensed consolidated statement of loss and comprehensive loss:

(In thousands of Canadian dollars, except per share and percentage information)

For the 39 weeks periods ended	June 1, 2024			June 3, 2023			($		)	(%	)
Net sales	$	118,775		$	131,330		$	(12,555	)	(10	)%
Cost of goods sold		68,788			80,171			(11,383	)	(14	)%
Gross profit	$	49,987		$	51,159		$	(1,172	)	(2	)%
Gross margin		42.1	%		39.0	%		N/A		3.1 p.p.
Selling, general and administrative expenses		42,081			52,074			(9,993	)	(19	)%
Depreciation and amortization		5,502			8,831			(3,329	)	(38	)%
Reorganization and other related gains		(1,361	)		(1,280	)		(81	)	6	%
Net finance costs		4,038			4,369			(331	)	(8	)%
Loss before income taxes	$	(273	)	$	(12,835	)	$	12,562		98	%
Deferred income tax recovery		–			(61	)		61		N/A
Net loss, being comprehensive loss	$	(273	)	$	(12,774	)	$	12,501		98	%
Basic and diluted loss per share	$	–		$	(0.17	)	$	0.17		N/A

VARIANCE ANALYSIS FOR THE YEAR-TO-DATE 2024 COMPARED TO SAME PERIOD OF 2023

• The decrease in net sales is primarily driven by a decrease in the number of active customers partially offset by an increase in average order value as a result of price optimizations, increased variety in the meal-kit offering and a focus on meal-kit offerings with ready-to-eat meal solutions and grocery products as add-ons. This net sales decrease can also be explained by the Company’s decision to discontinue its on-demand offering in Fiscal 2023. The decrease in active customers is mainly driven by the Company’s focus on attracting and retaining customers that provide higher gross margins and by changing customer behaviours.
• The decrease in gross profit primarily resulted from a decrease in net sales as well as higher credit and incentives as a percentage of sales partially offset by lower food, production and fulfilment costs as a percentage of net sales driven by improved inventory management reducing waste, lower production labour cost and lower packaging and shipping costs. Gross margin increased mainly due to operational efficiencies driving lower food, production and fulfilment costs, as well as pricing optimization, partially offset by an increase in credits and incentives as a percentage of net sales.      
• The decrease in selling, general and administrative expenses is primarily due to lower wages and salaries, marketing spend, software expenses, utilities and maintenance expenses driven primarily by the Company’s costs saving initiatives. Selling, general and administrative expenses as a percentage of net sales decreased from 39.7% to 35.4%.
• The decrease in depreciation and amortization expense is mainly due to the reduction in right-of-use assets following exiting facilities as part of the Company’s costs reduction initiatives as well as the derecognition of a right-of-use asset and fixed assets pursuant to a sublease agreement and amortization.
• The decrease in net finance costs is mainly due to lower interest expense on lease obligations in relation to the Company’s costs saving, lower interest on debt as a result of a lower debt balance as well as lower debt renewal fees in Fiscal 2024 partially offset with higher interest expense on debentures in relation to the Company’s $30 million convertible debentures issued in February 2023.
• The decrease in net loss is mainly due to lower wages and salaries in cost of goods sold and in selling, general and administrative expenses as well as lower depreciation and amortization expense, lower food costs, lower marketing spend, and utilities and maintenance expenses partially offset by a lower sales base.

METRICS AND NON-IFRS FINANCIAL MEASURES – RECONCILIATION

ADJUSTED GROSS PROFIT1 AND ADJUSTED GROSS MARGIN1

The reconciliation of gross profit to adjusted gross profit1 and adjusted gross margin1 is as follows:

(In thousands of Canadian dollars, except percentage information)

	For the 13 weeks ended						For the 39 weeks ended
	June 1, 2024			June 3, 2023			June 1, 2024			June 3, 2023
Gross profit	$	16,949		$	17,286		$	49,987		$	51,159
Discontinuance of products related to on-demand offering		–			(1	)		–			1,273
Adjusted gross profit	$	16,949		$	17,285		$	49,987		$	52,432
Net sales	$	38,561		$	42,139		$	118,775		$	131,330
Gross margin		44.0	%		41.0	%		42.1	%		39.0	%
Adjusted gross margin (%)		44.0	%		41.0	%		42.1	%		39.9	%

For the 13 weeks ended June 1, 2024, adjusted gross profit decreased by $0.3 million while adjusted gross margin increased by 3.0 percentage points compared to the same quarter last year. This adjusted gross margin improvement can mainly be explained by operational efficiencies driving lower production costs and fulfilment costs as a percentage of net sales resulting from lower production labour cost and last-mile shipping costs as well as pricing optimization. This improvement was partially offset by an increase in credits and incentives as a percentage of net sales.

For the 39 weeks ended June 1, 2024, the adjusted gross profit decreased by $2.4 million primarily due to a decrease in net sales partially offset by lower costs of goods sold mainly in food, production and fulfilment costs. The increase in adjusted gross margin of 2.2 percentage points can be explained by lower food costs, production and fulfilment costs as a percentage of net sales driven by improved inventory management to reduce waste, lower production labour cost and lower last-mile shipping costs, as well as pricing optimization. This improvement was partially offset by an increase in credits and incentives as a percentage of net sales.

EBITDA1, ADJUSTED EBITDA1 AND ADJUSTED EBITDA MARGIN1

The reconciliation of net income (loss) to EBITDA1, adjusted EBITDA1 and adjusted EBITDA margin1 is as follows:

(In thousands of Canadian dollars, except percentage information)

	For the 13 weeks ended						For the 39 weeks ended
	June 1, 2024			June 3, 2023			June 1, 2024			June 3, 2023
Net income (loss)	$	307		$	(1,164	)	$	(273	)	$	(12,774	)
Net finance costs		1,213			1,329			4,038			4,369
Depreciation and amortization		1,729			2,206			5,502			8,831
Deferred income tax recovery		–			–			–			(61	)
EBITDA	$	3,249		$	2,371		$	9,267		$	365
Share-based payments expense		310			544			648			3,631
Discontinuance of products related to on-demand offering		–			(1	)		–			1,273
Reorganization and other related costs (gains)		–			370			(1,361	)		(1,280	)
Adjusted EBITDA	$	3,559		$	3,284		$	8,554		$	3,989
Net sales	$	38,561		$	42,139		$	118,775		$	131,330
Adjusted EBITDA margin (%)		9.2	%		7.8	%		7.2	%		3.0	%

For the 13 weeks ended June 1, 2024, adjusted EBITDA margin improved by 1.4 percentage points compared to the same quarter last year mainly driven by stronger adjusted gross margin while selling, general and administrative expenses as a percentage of net sales were slightly higher compared to the same quarter last year mostly as a result of one-time favorable lease and other contract adjustments that occurred in the third quarter of Fiscal 2023. The improved adjusted EBITDA margin was partly offset by a lower net sales base. Overall, Adjusted EBITDA increased by $0.3 million this quarter compared to the same quarter of last fiscal year.

For the 39 weeks ended June 1, 2024, adjusted EBITDA margin improved by 4.2 percentage points compared to the corresponding period in 2023 mainly driven by stronger adjusted gross margin and lower selling, general and administrative expenses mostly as a result of the Company’s cost savings measures which reduced wages and salaries, utilities and maintenance and software expenses. The improved adjusted EBITDA margin was partly offset by a lower net sales base. Overall, Adjusted EBITDA increased by $4.6 million for the 39 weeks ended June 1, 2024 compared to the same period of Fiscal 2023.

FREE CASH FLOW1 AND ADJUSTED FREE CASH FLOW1

The reconciliation of net cash flows from operating activities to free cash flow1 and adjusted free cash flow1 is as follows:

(In thousands of Canadian dollars)

	For the 13 weeks ended						For the 39 weeks ended
	June 1, 2024			June 3, 2023			June 1, 2024			June 3, 2023
Net cash provided by (used in) operating activities	$	4,499		$	3,100		$	8,426		$	(7,392	)
Additions to fixed assets		(12	)		(9	)		(44	)		(698	)
Additions to intangible assets		(167	)		(202	)		(413	)		(822	)
Free cash flow	$	4,320		$	2,889		$	7,969		$	(8,912	)
Payments related to discontinuance of products related to on-demand offering		–			184			–			312
Payments made to reorganization and other related costs		47			1,058			736			5,752
Adjusted free cash flow	$	4,367		$	4,131		$	8,705		$	(2,848	)

For the 13 weeks ended June 1, 2024, adjusted free cash flow improved by $0.3 million compared to the same period last year mainly driven by higher net income after non-cash items resulting mainly from lower selling, general and administrative expenses. The improvement to the adjusted free cash flow was partially offset by a lower favorable change in non-cash operating working capital due to a lower reduction in inventories in the third quarter of 2024 resulting from increased stability in inventory management.

For the 39 weeks ended June 1, 2024, adjusted free cash flow was $8.7 million compared to negative $2.9 million in the same period last year. This is an improvement of $11.6 million compared to the corresponding period in 2023 mainly driven by improved profitability as the lower net loss resulted from stronger adjusted gross margin and lower selling, general and administrative expenses. The improvement to the adjusted free cash flow can also be explained by a favorable change in non-cash operating working capital due to a positive change in accounts payable and accrued liabilities resulting from timing of supplier payments as well as lower spend on fixed assets and intangible assets projects in Fiscal 2024.

TOTAL NET DEBT TO ADJUSTED EBITDA

The reconciliation of total net debt to adjusted EBITDA (net leverage) is as follows:

(In thousands of Canadian dollars, except the ratio)

As at		June 1,2024			June 3,2023
Debt		$	1,450		$	4,322
Convertible debentures, liability component			44,384			40,920
Total debt		$	45,834		$	45,242
Cash and cash equivalents			(26,201	)		(28,368	)
Total net debt (1)		$	19,633		$	16,874
Adjusted EBITDA (trailing 12 months) (2)		$	9,260		$	2,062
Total net debt to adjusted EBITDA (1)			2.1			8.2

(1)	Total net debt and total net debt to adjusted EBITDA are a non-IFRS measure. An explanation of their composition, usefulness to investors and purposes for which management has included these measures in this press release is detailed below.
(2)	Please refer to the “Selected Quarterly Financial Information” section of the Management’s Discussion and Analysis for the 12 months Adjusted EBITDA.

Total net debt to adjusted EBITDA is calculated as total net debt divided by the last twelve months adjusted EBITDA. Total net debt consists of debt and the liability component of the convertible debentures less cash and cash equivalents.

In the first quarter of Fiscal 2024, we ceased the review of its total net debt non-IFRS measures, as we believed such measure are not longer the best measures to assess our financial leverage on a recurring basis considering that our debt balance was significantly reduced in the last year due to its amended credit facilities.  

With stronger results in the last four quarters and adjusted EBITDA now surpassing $9 million over the last twelve months, we reduced our total net debt to adjusted EBITDA nearly 70% from 8X one year ago to approximately 2X now. Although this is not a non-IFRS metric that we consider important to understand our performance on a recurring basis, we included this metric in the second quarter of Fiscal 2024 Press Release as there was a significant improvement over the last 9 months that was important to note. We included the metric again in this Press release to show that we expect this ratio to remain fairly stable in the future, rendering the metric less critical for ongoing performance assessment. We do not expect to present this metric in the future as we do not anticipate total net debt to adjusted EBITDA ratio to fluctuate at the same level as it has in the last year.

FINANCIAL OUTLOOK

Goodfood’s core purpose is to create experiences that spark joy and help our community live longer on a healthier planet. As a food brand with a strong following from Canadians coast to coast, we are focused on growing the Goodfood brand through our meal solutions including meal kits and prepared meals, with a range of exciting Goodfood branded add-ons to complete a unique food experience for customers.

We believe there is runway for additional penetration of meal kits into Canadian households, as evidenced by 2023 and 2024 industry research estimating the Canadian meal kit market to grow at a CAGR in the mid-teen percentage points through 2028 (See Goodfood’s Annual Information Form for the 52 weeks ended September 2, 2023, available on SEDAR+ at www.sedarplus.ca for additional information and details).

Before scaling our efforts to endeavour to capture an outsized share of the Canadian meal solutions market, our focus has been and continues to be on further improving and growing cash flows. We are pleased to have now reported six consecutive quarters of positive adjusted EBITDA1, which on a last twelve months basis surpasses $9 million. The substantial rise in adjusted EBITDA1 has led to significant adjusted free cash flow1 improvement which has now been positive in four of our last five quarters. These results help position Goodfood to grow its top-line and to fund this growth with internally generated cash flows.

To grow our customer base, we aimed to build customer acquisition cost efficiencies through a review and consistent improvement in our investments. We have also made and continue to make investments in our digital product to elevate the customer experience by reducing friction and enhancing ease of use. Combined with reactivations of previous Goodfood members, these initiatives have driven a double-digit percentage reduction of our customer acquisition costs since the fourth quarter of Fiscal 2023 and improved the profitability and unit economics of customers.

A key driver that can enhance order frequency is product variety. In addition to launching our VIP program, which rewards high-frequency customers, we have increased the diversity of our recipe and ingredient offering to provide additional choices to enhance order rate. With a focus on Better-for-You products like organic chicken breasts, organic lean ground beef, bison, sustainably raised steelhead trout and paleo and keto meals, combined with exciting partnerships with first-rate restaurants and chefs, we plan on offering a growing and mouth-watering selection to customers to drive consistently increasing order frequency.

The dollar-value of the baskets our customers are building is also increasing and we are building a differentiated set of meal kits, ready-to-eat meals and grocery add-ons to provide Canadians with an exciting online meal solutions option and increasingly capture a larger share of their food wallet. In addition, we have provided and continue to provide more choice of proteins to our customers, with the launch of upsells and upcoming launch of customization within our meal-kit recipes allowing customers to swap or double the proteins included in their chosen recipes. With these initiatives, we aim to provide customers with an array of options to easily make their meals better and their baskets bigger. With that said, to capture customers increasingly looking for value, we have launched a new set of Value Meals starting at $10.99 a portion and are testing various plan adjustments to enable a broader set of customers to enjoy our delicious meals.

We are also continuously looking to enhance our sustainability initiatives by prioritizing planet-friendly options. Not only do we offer perfectly portioned ingredients that save from food waste, we also constantly look to simplify our supply chain by removing middlemen from farm to kitchen table. This year, we are also offsetting carbon emissions on deliveries and introducing packaging innovations that have helped us to remove the equivalent of 2.4 million plastic bags annually from our deliveries. Our goal is clear, build a business that helps our customers live healthier lives on a healthier planet.

In addition to focusing on these key pillars of top-line growth, we will consider and evaluate various other growth avenues, including acquisitions.

Our strategic execution to drive profitability and cash flows continues to position us for growth and profitability, underpinned by consistent improvement in adjusted EBITDA1 and cash flows. Coupled with our unrelenting focus on nurturing our customer relationships, profitable growth remains our top priority. The Goodfood team is fully focused on building and growing Canada’s most loved millennial food brand.

TRENDS AND SEASONALITY

The Company’s net sales and expenses are impacted by seasonality. During the winter holiday season and the summer season, the Company anticipates net sales to be lower as a higher proportion of customers elect to skip their delivery. The Company generally anticipates the number of active customers to be lower during these periods. During periods with significantly colder or warmer weather, the Company anticipates packaging costs to be higher due to the additional packaging required to maintain food freshness and quality.

CONFERENCE CALL

Goodfood will hold a conference call to discuss these results on July 16, 2024, at 8:00AM Eastern Time. Interested parties can join the call by dialing 1 289 514 5100 (Toronto or overseas) or 1 800 717 1738 (elsewhere in North America). To access the webcast and view the presentation, click on this link: https://www2.makegoodfood.ca/en/investisseurs/evenements

Parties unable to call in at this time may access a recording by calling 1 888 660 6264 and entering the playback passcode 37912#. This recording will be available until July 23, 2024.

A full version of the Company’s Management’s Discussion and Analysis (MD&A) and Consolidated Financial Statements for the third quarters ended June 1, 2024, and June 4, 2023, will be posted on http://www.sedarplus.ca later today.

NON-IFRS FINANCIAL MEASURES

Certain non-IFRS financial measures included in this press release do not have standardized definitions prescribed by IFRS and, therefore, may not be comparable to similar measures presented by other companies. They are provided as additional information to complement IFRS measures and to provide a further understanding of the Company’s results of operations from our perspective. For a more complete description of these measures and a reconciliation of Goodfood's non-IFRS financial measures to financial results, please see Goodfood's Management's Discussion and Analysis for the Fiscal year 2023.

Goodfood's definition of the non-IFRS financial measures are as follows:

• Adjusted gross profit is defined as gross profit excluding the impact of the discontinuance of products related to Goodfood On-Demand offering pursuant to the Company’s costs saving initiatives. Adjusted gross margin is defined as the percentage of adjusted gross profit to net sales. The Company uses adjusted gross profit and adjusted gross margin to measure its performance from one period to the next excluding the variation caused by the items described above. Adjusted gross profit and adjusted gross margin are non-IFRS financial measures. We believe that these metrics are useful measures of financial performance to assess how efficiently the Company uses its resources to service its customers as well as to assess underlying trends in our ongoing operations without the variations caused by the impacts of strategic initiatives such as the items described above and facilitate the comparison across reporting periods.
• EBITDA is defined as net income or loss before net finance costs, depreciation and amortization and income taxes. Adjusted EBITDA is defined as EBITDA excluding share-based payments expense, the impact of the inventories write-downs due to the discontinuance of products related to Goodfood On-Demand offering, impairment and reversal of impairment of non-financial assets and reorganization and other related (gains) costs pursuant to the Company’s costs saving initiatives. Adjusted EBITDA margin is defined as the percentage of adjusted EBITDA to net sales. EBITDA, adjusted EBITDA, and adjusted EBITDA margin are non-IFRS financial measures. We believe that EBITDA, adjusted EBITDA, and adjusted EBITDA margin are useful measures of financial performance to assess the Company’s ability to seize growth opportunities in a cost-effective manner, to finance its ongoing operations and to service its debt. They also allow comparisons between companies with different capital structures. We also believe that these metrics are useful measures of financial performance to assess underlying trends in our ongoing operations without the variations caused by the impacts of the items described above and facilitates the comparison across reporting periods.
• Free cash flow is defined as net cash used in or provided by operating activities less additions to fixed assets and additions to intangible assets. This measure allows the Company to assess its financial strength and liquidity as well as to assess how much cash is generated and available to invest in growth opportunities, to finance its ongoing operations and to service its debt. It also allows comparisons between companies with different capital structures. Adjusted free cash flow is defined as free cash flow excluding cash payments made to costs related to reorganization activities. We believe that adjusted free cash flow is a useful measure when comparing between companies with different capital structures by removing variations caused by the impacts of the items described above. We also believe that this metric is a useful measure of financial and liquidity performance to assess underlying trends in our ongoing operations without the variations caused by the impacts of the items described above and facilitates the comparison across reporting periods.
• Please refer to the “Metrics and non-IFRS financial measures – reconciliation” and the “Liquidity and capital resources” sections of the MD&A for a reconciliation of these non-IFRS financial measures to the most comparable IFRS financial measures.

ACTIVE CUSTOMERS

An active customer is a customer that has placed an order within the last three months. For greater certainty, an active customer is only accounted for once, although different products and multiple orders might have been purchased within a quarter. While the active customers metric is not an IFRS or non-IFRS financial measure, and, therefore, does not appear in, and cannot be reconciled to a specific line item in the Company’s consolidated financial statements, we believe that the active customers metric is a useful metric for investors because it is indicative of potential future net sales. The Company reports the number of active customers at the beginning and end of the period, rounded to the nearest thousand.

ABOUT GOODFOOD

Goodfood (TSX: FOOD) is a leading digitally native meal solutions brand in Canada, delivering fresh meals and add-ons that make it easy for customers from across Canada to enjoy delicious meals at home every day. The Goodfood team is building Canada’s most loved millennial food brand, with the mission to create experiences that spark joy and help our community live longer on a healthier planet. Goodfood customers have access to uniquely fresh and delicious products, as well as exclusive pricing, made possible by its world-class culinary team and direct-to-consumer infrastructures and technology. Goodfood is passionate about connecting its partner farms and suppliers to its customers’ kitchens while eliminating food waste and costly retail overhead. The Company’s administrative offices are based in Montreal, Québec, with production facilities located in the provinces of Quebec and Alberta.

Except where otherwise indicated, all amounts in this press release are expressed in Canadian dollars.

For further information: Investors and Media
Roslane Aouameur Chief Financial Officer(855) [e-mail]	Jennifer StahlkeExecutive Vice President, Marketing(855) [e-mail]

FORWARD-LOOKING INFORMATION

This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Such forward-looking information includes, but is not limited to, information with respect to our objectives and the strategies to achieve these objectives, as well as information with respect to our beliefs, plans, expectations, anticipations, assumptions, estimates and intentions, including, without limitation, statements in the “Financial Outlook” section of the MD&A. This forward-looking information is identified by the use of terms and phrases such as “may”, “would”, “should”, “could”, “expect”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe”, and “continue”, as well as the negative of these terms and similar terminology, including references to assumptions, although not all forward-looking information contains these terms and phrases. Forward-looking information is provided for the purposes of assisting the reader in understanding the Company and its business, operations, prospects and risks at a point in time in the context of historical trends, current condition and possible future developments and therefore the reader is cautioned that such information may not be appropriate for other purposes.

Forward-looking information is based upon a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those that are disclosed in, or implied by, such forward-looking information. These risks and uncertainties include, but are not limited to, the following risk factors which are discussed in greater detail under “Risk Factors” in the Company’s Annual Information Form for the 52 weeks ended September 2, 2023 available on SEDAR+ at www.sedarplus.ca: limited operating history, negative operating cash flows and net losses, going concern risk, food industry including current industry inflation levels, indebtedness and impact upon financial condition, future capital requirements, quality control and health concerns, regulatory compliance, regulation of the industry, public safety issues, product recalls, damage to Goodfood’s reputation, transportation disruptions, storage and delivery of perishable foods, product liability, unionization activities, consolidation trends, ownership and protection of intellectual property, evolving industry, reliance on management, fulfillment centers and logistics channels, factors which may prevent realization of growth targets, competition, availability and quality of raw materials, environmental and employee health and safety regulations, online security breaches and disruptions, reliance on data centers, open source license compliance, operating risk and insurance coverage, management of growth, limited number and scope of products, conflicts of interest, litigation, food costs and availabilities, catastrophic events, risks associated with payments from customers and third parties, being accused of infringing intellectual property rights of others and, climate change and environmental risks, as well as an inability to maintain high social responsibility standards could lead to reputational damage and adversely affect our business. This is not an exhaustive list of risks that may affect the Company’s forward-looking statements. Other risks not presently known to the Company or that the Company believes are not significant could also cause actual results to differ materially from those expressed in its forward-looking statements. Although the forward-looking information contained herein is based upon what we believe are reasonable assumptions, readers are cautioned against placing undue reliance on this information since actual results may vary from the forward-looking information. Certain assumptions were made in preparing the forward-looking information concerning the availability of capital resources, business performance, market conditions, as well as customer demand.

In addition, net sales and operating results could be impacted by changes in the overall economic condition in Canada and by the continuing inflationary pressures and by the impact these conditions could have on consumer discretionary spending. Fears of a looming recession, increases in interest rates, continuing supply chain disruptions and increased input costs are expected to have a continuing significant impact on our economic condition that could materially affect our financial condition, results of operations and cash flows.

Consequently, all of the forward-looking information contained herein is qualified by the foregoing cautionary statements, and there can be no guarantee that the results or developments that we anticipate will be realized or, even if substantially realized, that they will have the expected consequences or effects on our business, financial condition or results of operation. Unless otherwise noted or the context otherwise indicates, the forward-looking information contained herein is provided as of the date hereof, and we do not undertake to update or amend such forward-looking information whether as a result of new information, future events or otherwise, except as may be required by applicable law.

1 Please refer to the “Non-IFRS Financial Measures” section of this press release for corresponding definitions.

2 For variances against same period last year, refer to “Results of Operations – Third Quarter of Fiscal 2024 and 2023” and “Metrics and Non-IFRS Financial Measures - Reconciliation” sections of this press release.

3 Please refer to the “Metrics and Non-IFRS Financial Measures” section of this MD&A for corresponding definitions.