Q4 2025 Buda Juice Inc Earnings Call

March 26, 2026

Speaker #2: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question at that time, simply press star, then the number one on your telephone keypad.

Operator 2: If you would like to ask a question at that time, simply press star, then the number one on your telephone keypad. If you'd like to withdraw your question, again, press star one. We will also be taking web questions. If you would like to ask a question via the web, please type your question in the question box and press Enter. Thank you. I would now like to turn the conference over to Brian Siegel, Investor Relations. Please go ahead.

Operator: If you would like to ask a question at that time, simply press star, then the number one on your telephone keypad. If you'd like to withdraw your question, again, press star one. We will also be taking web questions. If you would like to ask a question via the web, please type your question in the question box and press Enter. Thank you. I would now like to turn the conference over to Brian Siegel, Investor Relations. Please go ahead.

Speaker #2: And if you'd like to withdraw your question, again, press star one. We will also be taking web questions. If you would like to ask a question via the web, please type your question in the question box and press Enter.

Speaker #2: Thank you. I would now like to turn the conference over to Brian Siegel, Investor Relations. Please go ahead. Thank you, operator. During today's call, Horatio Lonzo Hands, BUDA JUICE's Chief Executive Officer, and Clint Bowers, BUDA's Chief Financial Officer, will discuss BUDA's financial and operational results that were reported this morning.

Brian Siegel: Thank you, operator. During today's call, Horacio Lanzagorta, Buda Juice's Chief Executive Officer, and Clint Bowers, Buda's Chief Financial Officer, will discuss Buda's financial and operational results that were reported this morning. Any forward-looking statements made during this conference call, during the prepared remarks, or in the Q&A session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results in the future to differ materially from those discussed on today's call. These risks and uncertainties include, but are not limited to, specific risks and uncertainties disclosed in Buda's periodic SEC filings. Buda assumes no obligation to update any forward-looking statements or to update the factors that may cause actual results to differ materially from those that they forecast.

Speaker #2: Any forward-looking statements made during this conference call, during the prepared remarks or in the Q&A session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results in the future to differ materially from those discussed on today's call.

Speaker #2: These risks and uncertainties include, but are not limited to, specific risks and uncertainties disclosed in BUDA's periodic SEC filings. BUDA assumes no obligation to update any forward-looking statements or to update the factors that may cause actual results to differ materially from those that they forecast.

Speaker #2: Please note that our earnings release is available on the Investor Relations page of the BUDA JUICE website and has been filed on Form 8K with the SEC.

Brian Siegel: Please note that our earnings release is available on the investor relations page of the Buda Juice website and has been filed on Form 8-K with the SEC. Finally, on this call, we will refer to non-GAAP measures, including free cash flow and adjusted EBITDA. Please see our earnings release for an explanation of our use of non-GAAP measures and reconciliations to the GAAP measures. Now I would like to turn the conference over to Horacio.

Speaker #2: Finally, on this call, we will refer to non-GAAP measures, including free cash flow and adjusted EBITDA. Please see our earnings release for an explanation of our use of non-GAAP measures and reconciliations to the GAAP measures.

Speaker #2: Now I would like to turn the conference over to Horatio.

Speaker #3: Thank you, Brian, and good morning, everyone. Thank you for joining us for Buda Juice's first earnings call as a public company. In January, we completed our IPO on the New York Stock Exchange American.

Horacio Lanzagorta: Thank you, Brian, and good morning, everyone, and thank you for joining us for Buda Juice's first earnings call as a public company. In January, we completed our IPO on the NYSE American. That was an important milestone, but more importantly, it positions us to scale what we believe is a new category in the fresh perimeter of the supermarket. At Buda Juice, we've created what we call the UltraFresh category. We produce, package, ship, and deliver our products entirely with our fresh certified cold chain. No pasteurization, no HPP, no UV, and no shortcuts. That allows us to deliver genuinely fresh products at scale into the produce departments, which we believe is fundamentally different from both the shelf-stable beverages and in-store juicing. Turning to our results. In 2025, it was another solid year for Buda Juice. Revenue grew approximately 12% year-over-year.

Horatio Lonsdale-Hands: Thank you, Brian, and good morning, everyone, and thank you for joining us for Buda Juice's first earnings call as a public company. In January, we completed our IPO on the NYSE American. That was an important milestone, but more importantly, it positions us to scale what we believe is a new category in the fresh perimeter of the supermarket. At Buda Juice, we've created what we call the UltraFresh category. We produce, package, ship, and deliver our products entirely with our fresh certified cold chain. No pasteurization, no HPP, no UV, and no shortcuts. That allows us to deliver genuinely fresh products at scale into the produce departments, which we believe is fundamentally different from both the shelf-stable beverages and in-store juicing. Turning to our results. In 2025, it was another solid year for Buda Juice. Revenue grew approximately 12% year-over-year.

Speaker #3: That was an important milestone, but more importantly, it positions us to scale what we believe is a new category in the fresh perimeter of the supermarket.

Speaker #3: At BUDA JUICE, we've created what we call the ultra-fresh category. We produce, package, ship, and deliver our products entirely with our fresh 35° cold chain.

Speaker #3: No pasteurization, no HPP, no UV, and no shortcuts. That allows us to deliver generally fresh products at scale into the produce departments which we believe is fundamentally different from both the shelf-stable beverages and in-store juicing.

Speaker #3: Turning to our results, in 2025 it was another solid year for BUDA JUICE. Revenue grew approximately 12% year over year, operating income was $3.45 million, and GAAP net income was $3.53 million.

Horacio Lanzagorta: Operating income was $3.45 million, and GAAP net income was $3.53 million. Importantly, we remain profitable and debt-free. At our size, that is not common, and we believe it positions Buda among a relatively small group of public micro-cap companies that are both growing and generating consistent earnings. We have also begun targeted capital investments at our Dallas facility to increase capacity and improve automation. These projects are underway and expected to support future growth and operating efficiency over time. As we move through 2026, our focus remains straightforward, expanding distribution within existing retail partners, adding new retail accounts, and continuing to build our UltraFresh category in the produce departments. This is not just a product story. It is a category creation and an infrastructure story.

Horatio Lonsdale-Hands: Operating income was $3.45 million, and GAAP net income was $3.53 million. Importantly, we remain profitable and debt-free. At our size, that is not common, and we believe it positions Buda among a relatively small group of public micro-cap companies that are both growing and generating consistent earnings. We have also begun targeted capital investments at our Dallas facility to increase capacity and improve automation. These projects are underway and expected to support future growth and operating efficiency over time. As we move through 2026, our focus remains straightforward, expanding distribution within existing retail partners, adding new retail accounts, and continuing to build our UltraFresh category in the produce departments. This is not just a product story. It is a category creation and an infrastructure story.

Speaker #3: Importantly, we remain profitable and debt-free. At our size, that is not common and we believe it positions BUDA among a relatively small group of public micro-cap companies that are both growing and generating consistent earnings.

Speaker #3: We've also begun targeted capital investments at our Dallas facility to increase capacity and improve automation. These projects are underway and are expected to support future growth and operating efficiency over time.

Speaker #3: As we move through 2026, our focus remains straightforward: expanding distribution within existing retail partners, adding new retail accounts, and continuing to build our ultra-fresh category in the produce departments.

Speaker #3: This is not just a product story; it is a category creation and an infrastructure story. We believe we are still in the early stages of building a meaningful new category, and we're doing so from a position of financial strength.

Horacio Lanzagorta: We believe we are still in the early stages of building a meaningful new category, and we're doing so from a position of financial strength. With that, I'll turn over the call to Clint Bowers, our Chief Financial Officer.

Horatio Lonsdale-Hands: We believe we are still in the early stages of building a meaningful new category, and we're doing so from a position of financial strength. With that, I'll turn over the call to Clint Bowers, our Chief Financial Officer.

Speaker #3: With that, I'll turn over the call to Clint Bowers, our Chief Financial Officer.

Speaker #2: Thank you. Good morning, everyone. Let me start with full year 2025. We delivered approximately 12% revenue growth while maintaining strong profitability. Gross margin was 44.6%, down modestly from 46.2% in 2024, primarily due to higher citrus costs in the second half of the year.

Clint Lee Bowers: Thank you. Good morning, everyone. Let me start with full year 2025. We delivered approximately 12% revenue growth while maintaining strong profitability. Gross margin was 44.6%, down modestly from 46.2% in 2024, primarily due to higher citrus costs in H2 of the year. Operating expenses were $2.2 million, up from $1.8 million. About half of that increase reflects the normalization of executive compensation as part of our transition to a public company, which we do not expect to repeat at the same level going forward. Operating income was $3.45 million, very consistent with the prior year. Net income was $3.5 million, compared to $3.6 million last year.

Clint Bowers: Thank you. Good morning, everyone. Let me start with full year 2025. We delivered approximately 12% revenue growth while maintaining strong profitability. Gross margin was 44.6%, down modestly from 46.2% in 2024, primarily due to higher citrus costs in H2 of the year. Operating expenses were $2.2 million, up from $1.8 million. About half of that increase reflects the normalization of executive compensation as part of our transition to a public company, which we do not expect to repeat at the same level going forward. Operating income was $3.45 million, very consistent with the prior year. Net income was $3.5 million, compared to $3.6 million last year.

Speaker #2: Operating expenses were $2.2 million, up from $1.8 million. About half of that increase reflects the normalization of executive compensation as part of our transition to a public company.

Speaker #2: Which we do not expect to repeat at the same level going forward. Operating income was $3.45 million, very consistent with the prior year. Net income was $3.5 million, compared to $3.6 million last year.

Speaker #2: Adjusting for the benefit for the receipt of insurance proceeds in 2024, net income would have increased by approximately 4% year over year. Adjusted EBITDA was $3.8 million, and free cash flow was $3 million.

Clint Lee Bowers: Adjusting for the benefit from the receipt of insurance proceeds in 2024, net income would have increased by approximately 4% year-over-year. Adjusted EBITDA was $3.8 million, and free cash flow was $3 million, with the modest decline driven by IPO-related expenses. Turning to Q4. Revenue was $2.9 million, up 4.4% year-over-year. As expected, we saw typical seasonal softness in same-store sales in Q4. Gross margin was 42%, reflecting higher citrus costs and a small inventory write-off.

Clint Bowers: Adjusting for the benefit from the receipt of insurance proceeds in 2024, net income would have increased by approximately 4% year-over-year. Adjusted EBITDA was $3.8 million, and free cash flow was $3 million, with the modest decline driven by IPO-related expenses. Turning to Q4. Revenue was $2.9 million, up 4.4% year-over-year. As expected, we saw typical seasonal softness in same-store sales in Q4. Gross margin was 42%, reflecting higher citrus costs and a small inventory write-off.

Speaker #2: With the modest decline driven by IPO-related expenses. Turning to the fourth quarter, revenue was $2.9 million, up 4.4% year over year. As expected, we saw typical seasonal softness in same-store sales in the fourth quarter. Gross margin was 42%, reflecting higher citrus costs and a small inventory write-off.

Speaker #2: Operating expenses were approximately $550,000, up from $400,000, driven by executive compensation normalization, additional facility lease expense, and public company costs. Operating income was $660,000, and GAAP net income was $676,000.

Horacio Lanzagorta: Operating expenses were approximately $550 thousand, up from $400 thousand, driven by the executive compensation normalization, additional facility lease expense, and public company costs. Operating income was $660 thousand, and GAAP net income was $676 thousand. This was down from prior year as a result of the earlier mentioned gross margin factors, and higher operating expenses. Adjusted EBITDA was $719 thousand, and free cash flow was approximately $500 thousand. We ended the year with approximately $2 million in cash and no debt. Then in January, we added roughly $18 million net from our IPO proceeds, providing a very strong balance sheet of approximately $20 million in cash and no debt to support our continued growth.

Horatio Lonsdale-Hands: Operating expenses were approximately $550 thousand, up from $400 thousand, driven by the executive compensation normalization, additional facility lease expense, and public company costs. Operating income was $660 thousand, and GAAP net income was $676 thousand. This was down from prior year as a result of the earlier mentioned gross margin factors, and higher operating expenses. Adjusted EBITDA was $719 thousand, and free cash flow was approximately $500 thousand. We ended the year with approximately $2 million in cash and no debt. Then in January, we added roughly $18 million net from our IPO proceeds, providing a very strong balance sheet of approximately $20 million in cash and no debt to support our continued growth.

Speaker #2: This was down from the prior year as a result of the earlier-mentioned gross margin factors and higher operating expenses. Adjusted EBITDA was $719,000, and free cash flow was approximately $500,000.

Speaker #2: We ended the year with approximately $2 million in cash and no debt. And then, in January, we added roughly $18 million net from our IPO proceeds, providing a very strong balance sheet of approximately $20 million in cash and no debt to support our continued growth.

Speaker #2: Looking at 2026, while we generally do not plan on issuing guidance going forward, I'm going to provide some assistance for modeling purposes since this is our first earnings report.

Horacio Lanzagorta: Looking at 2026, while we generally do not plan on issuing guidance going forward, I'm gonna provide some assistance for modeling purposes since this is our first earnings report. We have a handful of days left in Q1, and I'm excited to say our revenue growth rate for the quarter will accelerate to the mid-teens versus last year, which at this stage is all from existing customers. Additionally, when modeling our full year 2026 compared to 2025, there are a few items to note. As a C corporation, we will begin to reflect federal income taxes on the income statement, as well as stock-based compensation, and approximately $1 million in annual public company costs. Thank you. We'll now open up the call for questions.

Horatio Lonsdale-Hands: Looking at 2026, while we generally do not plan on issuing guidance going forward, I'm gonna provide some assistance for modeling purposes since this is our first earnings report. We have a handful of days left in Q1, and I'm excited to say our revenue growth rate for the quarter will accelerate to the mid-teens versus last year, which at this stage is all from existing customers. Additionally, when modeling our full year 2026 compared to 2025, there are a few items to note. As a C corporation, we will begin to reflect federal income taxes on the income statement, as well as stock-based compensation, and approximately $1 million in annual public company costs. Thank you. We'll now open up the call for questions.

Speaker #2: We have a handful of days left in the first quarter and I'm excited to say our revenue growth rate for the quarter will accelerate to the mid-teens versus last year.

Speaker #2: Which, at this stage, is all from existing customers. Additionally, when modeling our full year 2026 compared to 2025, there are a few items to note.

Speaker #2: As a C corporation, we will begin to reflect federal income taxes on the income statement, as well as stock-based compensation and approximately $1 million in annual public company costs.

Speaker #2: Thank you. We'll now open up the call for questions.

Speaker #4: Thank you. If you would like to ask a question, via the phone, please press star 1 on your telephone keypad. To withdraw that question, again, press star 1.

Operator 2: Thank you. If you would like to ask a question via the phone, please press star one on your telephone keypad. To withdraw that question, again, press star one. If you would like to ask a question via the web, please type your question in the question box and press enter to submit. Your first question comes from Eric Des Lauriers with Craig-Hallum. Please go ahead.

Operator: Thank you. If you would like to ask a question via the phone, please press star one on your telephone keypad. To withdraw that question, again, press star one. If you would like to ask a question via the web, please type your question in the question box and press enter to submit. Your first question comes from Eric Des Lauriers with Craig-Hallum. Please go ahead.

Speaker #4: If you would like to ask a question via the web, please type your question in the question box and press enter to submit. Your first question comes from Eric Deloreaz with Craig Hallam.

Speaker #4: Please go ahead.

Speaker #5: Great. Thank you for taking my question. first one, just, just curious how the conversations with new grocers beyond your primary customer are going, what are some of the, you know, biggest sort of hurdles or, or, or pushback that you're encountering?

Eric Des Lauriers: Great. Thank you for taking my questions. First one, just curious how conversations with new grocers beyond your primary customer are going. What are some of the, you know, biggest sort of hurdles or pushback that you're encountering? What are some of the strongest selling points or sort of, you know, favorable aspects of your business that are helping you sort of get a foot in the door here?

Speaker #5: And then what are some of the strongest, selling points or sort of, you know, favorable, aspects of your, business that are helping you sort of get, get a foot in the door here?

Speaker #3: I'm, I'm sorry. good morning, Eric. so, the question, just to be clear, from existing customers, what are the challenges? Is, is that what the question is?

Horacio Lanzagorta: I'm sorry. Good morning, Eric. The question, just to be clear, from existing customers, what are the challenges? Is that what the question is?

Horatio Lonsdale-Hands: I'm sorry. Good morning, Eric. The question, just to be clear, from existing customers, what are the challenges? Is that what the question is?

Eric Des Lauriers: No, no. Sorry. I guess I wasn't super clear. I'm just kind of wondering how overall conversations with new grocers are going. You know, what's any potential pushback or hurdles that you're encountering, and, you know, what else about your business or products are really helping you in those conversations or, you know, get the foot in the door? Just kinda wondering how these new conversations are progressing.

Speaker #5: no, no, sorry. I guess I wasn't, super clear. I'm, I'm just kind of wondering how overall conversations with new grocers are going, you know, where, what's, what's any potential, pushback or hurdles that you're encountering and, you know, what, what else, about your business or products are, you know, really helping you, in those conversations or, you know, get, get the foot in the door?

Speaker #5: Just kind of wondering how these new conversations are progressing.

Speaker #3: Well, that's a harder question than the previous one. Okay. Well, everything is proceeding according to plan. We've been working with, you know, existing customers, and with new customers coming on board. There is, you know, a time lag, but we've been—it's taken us—we've been working with a couple of them for years, and we're getting close. Very close.

Horacio Lanzagorta: Well, that's a harder question than the previous one. Okay. Well, everything is proceeding according to plan. We've been working with new customers coming on board. You know, there's a time lag, but it's taken us, we've been working with a couple of them for years, and we're getting close, very close. With that in mind, we've been building more capacity here and more automation. We look forward to having one or two new customers on board soon.

Horatio Lonsdale-Hands: Well, that's a harder question than the previous one. Okay. Well, everything is proceeding according to plan. We've been working with new customers coming on board. You know, there's a time lag, but it's taken us, we've been working with a couple of them for years, and we're getting close, very close. With that in mind, we've been building more capacity here and more automation. We look forward to having one or two new customers on board soon.

Speaker #3: With that in mind, we've been building more capacity here and more optimization, and we look forward to having one or two new customers on board soon.

Speaker #5: All right. Great. and is this, is, is this new category that you're creating, is, is this something that you think would be kind of subject to the typical shelf resets, or is this something that, you know, perhaps you could sort of start to, layer in and a bit, a bit more smoothly, just kind of wondering how, how we should expect new customers to ramp?

Eric Des Lauriers: All right, great. Is this new category that you're creating, is this something that you think would be kind of subject to the typical shelf resets, or is this something that, you know, perhaps you could sort of start to layer in a bit more smoothly? I'm just kinda wondering how we should expect new customers to ramp.

Horacio Lanzagorta: Well, I think that most new customers will probably not just put in 4 SKUs to begin with. They'll probably start a little slower like we did with H-E-B. Over time they start increasing and giving us more shelf space. As you may know, we really fit into the fresh-cut fruit, you know, that perimeter that's really expanding in the fresh and the UltraFresh category, not so much in the juice set with all the other, you know, more shelf-stable and HPP products. Yes, I mean, I think, you know, this is incremental sales for the produce department, so it's really exciting for them because it brings a whole new category to them.

Horatio Lonsdale-Hands: Well, I think that most new customers will probably not just put in 4 SKUs to begin with. They'll probably start a little slower like we did with H-E-B. Over time they start increasing and giving us more shelf space. As you may know, we really fit into the fresh-cut fruit, you know, that perimeter that's really expanding in the fresh and the UltraFresh category, not so much in the juice set with all the other, you know, more shelf-stable and HPP products. Yes, I mean, I think, you know, this is incremental sales for the produce department, so it's really exciting for them because it brings a whole new category to them.

Speaker #3: well, I, I, I think that most new customers will probably, not just put in four SKUs to begin with, they'll probably start a little slower like we did with, with HEB.

Speaker #3: and over time, they, they start increasing and giving us more shelf space. a-as you may know, we, we really fit into the, the freshly cut fruit, you know, that perimeter that's really expanding in the fresh and the ultra-fresh category, not in so much in the juice set, with all the other, you know, more shelf-stable and, and HPP products.

Speaker #3: So, yes, I mean, I, I, I think, you know, once—okay, once this is incremental sales for the produce demand. So it's really exciting for them, because it brings a whole new category to them, a whole new—you know, the customers are looking for, you know, for fresh.

Horacio Lanzagorta: You know, the customers are looking for, you know, for fresh. I mean, you don't go to the grocery store to pick up, toilet paper or any paper towels or cleaning. You get that on Amazon. It's delivered to your door. You know, the grocery challenge right now in the grocery business is how do you get customers back in the stores two or three times a week? The solution is fresh. They're all expanding the perimeter of the store with fresh. That's where we fit beautifully into that because we are UltraFresh, and we have all these wonderful products from shots to fresh lemonades to citrus and so on, that really add a great value because incremental sales to the produce department, and it's what the customers want.

Horatio Lonsdale-Hands: You know, the customers are looking for, you know, for fresh. I mean, you don't go to the grocery store to pick up, toilet paper or any paper towels or cleaning. You get that on Amazon. It's delivered to your door. You know, the grocery challenge right now in the grocery business is how do you get customers back in the stores two or three times a week? The solution is fresh. They're all expanding the perimeter of the store with fresh. That's where we fit beautifully into that because we are UltraFresh, and we have all these wonderful products from shots to fresh lemonades to citrus and so on, that really add a great value because incremental sales to the produce department, and it's what the customers want.

Speaker #3: I mean, you don't go to the grocery store to pick up loo paper, or any paper towels, or cleaning—you get that on Amazon, and it's delivered to your door.

Speaker #3: So, you know, the grocery—the challenge right now in the grocery business is, how do you get customers back in the stores two or three times a week? And the solution is fresh, so they're all expanding the perimeter of the store with fresh.

Speaker #3: And that's where we, beautifully, go into that, because we are ultra-fresh. And we have all these wonderful products, from shots to fresh lemonades to citrus and so on, that really add great value.

Speaker #3: Because incremental sales to the produce department. And it's what the customers want. But it hasn't really been available to most of the, the grocery stores, because it's very expensive to do i-in-house.

Horacio Lanzagorta: It hasn't really been available to most of the grocery stores because it's very expensive to do in-house and challenging, and it hasn't been available on a scalable basis until we've come along. Now we're able to, especially in this market, we're already here. As we expand in this market, we eventually will do the East Coast and the West Coast, and it will be available nationwide.

Horatio Lonsdale-Hands: It hasn't really been available to most of the grocery stores because it's very expensive to do in-house and challenging, and it hasn't been available on a scalable basis until we've come along. Now we're able to, especially in this market, we're already here. As we expand in this market, we eventually will do the East Coast and the West Coast, and it will be available nationwide.

Speaker #3: And challenging. And it hasn't been available on a scalable basis until we've come along. And now we're able to, especially in this market—since we're already here—but as we expand in this market, we eventually will do the East and the West Coasts.

Speaker #3: And it will be available nationwide.

Eric Des Lauriers: That's great to hear. I appreciate the color. Just last one from me on the competitive landscape. Can you kind of just give us an overview here? You know, what are the competitive dynamics with other, you know, I would say adjacent brands, you know, maybe some wellness shop brands. As it relates to your infrastructure and cold chain, you know, what are your sort of primary advantages compared to others here?

Speaker #5: That's great to hear. I appreciate the color. and then just last one from me on the, competitive landscape. Can you kind of just give us an overview here, you know, what are the competitive dynamics with other, you know, I would say, adjacent brands, you know, maybe some, some wellness shop brands, and then as it relates to your infrastructure, and cold chain, you know, what, what are your sort of primary, advantages, compared to others here?

Horacio Lanzagorta: Well, that's a great question. Basically, the market consists right now of shelf-stable, pasteurized HPP UV products. That's pretty much the entire juice set today. Where we're different is the short shelf life, the UltraFresh. The customers are really getting real juices, real lemonades. They not only taste great, but they're, you know, that they have a short shelf life, so you know they're fresh. That's the point of difference. The advantage here is it's hard when you're pasteurizing like all the hundreds of different brands out there in the juice set. They all are doing the same thing. Who has the most money to buy shelf space, to spend on marketing, branding companies, all this stuff because they're all selling the same product.

Horatio Lonsdale-Hands: Well, that's a great question. Basically, the market consists right now of shelf-stable, pasteurized HPP UV products. That's pretty much the entire juice set today. Where we're different is the short shelf life, the UltraFresh. The customers are really getting real juices, real lemonades. They not only taste great, but they're, you know, that they have a short shelf life, so you know they're fresh. That's the point of difference. The advantage here is it's hard when you're pasteurizing like all the hundreds of different brands out there in the juice set. They all are doing the same thing. Who has the most money to buy shelf space, to spend on marketing, branding companies, all this stuff because they're all selling the same product.

Speaker #3: well, that's, that's a great question. So, basically, the market consists right now of shelf-stable, pasteurized, HPP, UV products, that's pretty much the entire juice set today.

Speaker #3: where we difference is, the short shelf life. The, the ultra-fresh. so the customers are really getting real juices, real lemonades. They're not in taste great.

Speaker #3: but they're, you know, that they have a short shelf life, so you know they're fresh. And that's the point of difference. The, the advantage here is it's hard when you're pasteurizing, like all, all the hundreds of, of different brands out there in, in the, in the juice.

Speaker #3: set. They all are doing the same thing. So who has the most money to buy shelf space to spend on marketing, branding companies, all this stuff?

Speaker #3: Because they're all selling the same product—it's just a different brand. In our case, we actually have a new category, and we have products that taste great or are better for you, and they actually belong in the freshly cut fruit space with a shorter shelf life. The consumers look at them and say, 'Yeah, this is fresh.' But it has the price point of a pasteurized product, generally.

Horacio Lanzagorta: It's just a different brand. In our case, we actually have a new category, and we have products that taste great and are better for you. They actually belong in the freshly cut fruit space with a shorter shelf life. The consumers look at them and say, "Yeah, this is fresh." It has the price point of a pasteurized product generally. That's a huge competitive advantage. Now the moat that we have is this, over the last 12 years with the help of, you know, Bryan Herr and Doug Burris from Country Fresh, you know, this amazing cold chain we've put in place. From farm all the way through to the consumer, we keep it at 35 degrees. And this is including the water.

Horatio Lonsdale-Hands: It's just a different brand. In our case, we actually have a new category, and we have products that taste great and are better for you. They actually belong in the freshly cut fruit space with a shorter shelf life. The consumers look at them and say, "Yeah, this is fresh." It has the price point of a pasteurized product generally. That's a huge competitive advantage. Now the moat that we have is this, over the last 12 years with the help of, you know, Bryan Herr and Doug Burris from Country Fresh, you know, this amazing cold chain we've put in place. From farm all the way through to the consumer, we keep it at 35 degrees. And this is including the water.

Speaker #3: So, that's a huge competitive advantage. Now, the moat that we have is this: over the last 12 years, with the help of, you know, Brian Hur and Doug Boris from Country Fresh, you know, this amazing cold chain we put in place.

Speaker #3: So from farm all the way through to the, the consumer, we keep it at 35 degrees. And, and, and this is including the, the, the water, the water that we wash the fruit in and, and sanitize it.

Horacio Lanzagorta: The water that we wash the fruit in and then sanitize it. It includes the water that comes in and that we put through a water filtration system. It includes when it's shipped to us, when it arrives at 35 degrees, it goes through our whole cold chain at 35 degrees. Now just imagine everyone else doesn't have to worry about that because they're pasteurizing it, so basically they can do it at ambient temperature, be it 70, 80, 90 degrees, whatever, you know, the production facility is at. It's a huge change to take a pasteurized product and then produce it in a fresh facility. I mean, that's gonna take years and a lot of money and expertise to convert and do it that way.

Horatio Lonsdale-Hands: The water that we wash the fruit in and then sanitize it. It includes the water that comes in and that we put through a water filtration system. It includes when it's shipped to us, when it arrives at 35 degrees, it goes through our whole cold chain at 35 degrees. Now just imagine everyone else doesn't have to worry about that because they're pasteurizing it, so basically they can do it at ambient temperature, be it 70, 80, 90 degrees, whatever, you know, the production facility is at. It's a huge change to take a pasteurized product and then produce it in a fresh facility. I mean, that's gonna take years and a lot of money and expertise to convert and do it that way.

Speaker #3: It, it, it includes the, the water that comes in and that we, we put through a water filtration system. It, it includes when it's shipped to us, when it arrives at 35 degrees, it goes through a whole cold chain at 35 degrees.

Speaker #3: Now, just imagine everyone else doesn't have to worry about that, because they're pasteurizing it. So basically, they can do it at ambient temperature, be it 70, 80, 90 degrees, whatever the, you know, the, the, the production facility is at.

Speaker #3: So it's a huge, change to take, a pasteurized product and then produce it in a fresh facility. I mean, that's going to take years.

Speaker #3: And a lot of money and expertise to convert and do it that way. So we have really a, a first mover advantage here where we, we, we feel now being public, we have the ability to expand and grow, although let's, let's be clear here, we're going to grow and be profitable.

Horacio Lanzagorta: We have a really first-mover advantage here where we feel now being public, we have the ability to expand and grow. Although let's be clear here, we're gonna grow and be profitable. Our executive chairman. We just had a board meeting yesterday, and he was very clear that expansion is great, and we're gonna do it, and we're gonna plan it correctly, but we are gonna stay profitable. That is our model. We have no debt, we have growth, and we have profits. That's what we're gonna continue to see and do as we grow.

Horatio Lonsdale-Hands: We have a really first-mover advantage here where we feel now being public, we have the ability to expand and grow. Although let's be clear here, we're gonna grow and be profitable. Our executive chairman. We just had a board meeting yesterday, and he was very clear that expansion is great, and we're gonna do it, and we're gonna plan it correctly, but we are gonna stay profitable. That is our model. We have no debt, we have growth, and we have profits. That's what we're gonna continue to see and do as we grow.

Speaker #3: So, our executive chairman is, is we just had a board meeting yesterday, and he was very clear that, expansion is, is, is great, and we're going to do it, and we're going to plan it correctly, but we are going to stay profitable.

Speaker #3: And that is our model. We have no debt. We have growth, and we have profit. And that's, that's what we're going to continue to see and, and do as we grow.

Eric Des Lauriers: That's all very helpful and great to hear. Thank you for taking my questions, and congrats on the success so far.

Speaker #5: That's all very helpful. And, great to hear. Thank you for taking my questions and congrats on the success so far.

Horacio Lanzagorta: Thank you, Eric Des Lauriers.

Horatio Lonsdale-Hands: Thank you, Eric Des Lauriers.

Speaker #3: Thank you, Eric.

Operator 2: Again, if you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Brett Brenner with Personal Investor. Please go ahead.

Operator: Again, if you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Brett Brenner with Personal Investor. Please go ahead.

Speaker #6: Again, if you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Brett Brenner with, who is a personal investor?

Speaker #6: Please go ahead.

Brett Brenner: Hello, my name's Brett Brenner. I'm retired from Morgan Stanley money manager. Your company interested me quite a bit 'cause you had high gross margins and a new concept. I have a couple questions. First of all, what's your geographic footprint right now, and what do you plan to do over the next year?

Speaker #7: Hello. My name's Brett Brenner. I'm retired from Morgan Stanley. Money manager. And your company interested me quite a bit because you had high gross margins and a new concept.

Speaker #7: And I have a couple of questions. First of all, what's your geographic footprint right now? And what do you plan to do over the next year?

Horacio Lanzagorta: Good morning, Brett. Thank you for the question. Good question. So right now, we're in Texas. In the next few months, we're gonna expand into a couple other states, out of the Dallas plant, out of our facility here. Then later on in the year, as we grow with our existing customers, and new customers coming on board, we look to expand to the East Coast and build a facility duplicating this plant basically and putting it on the East Coast so we can service the eastern seaboard.

Horatio Lonsdale-Hands: Good morning, Brett. Thank you for the question. Good question. So right now, we're in Texas. In the next few months, we're gonna expand into a couple other states, out of the Dallas plant, out of our facility here. Then later on in the year, as we grow with our existing customers, and new customers coming on board, we look to expand to the East Coast and build a facility duplicating this plant basically and putting it on the East Coast so we can service the eastern seaboard.

Speaker #3: Good morning, Brett. Thank you for the question. good question. so right now, we're in Texas. in, in the next, the next, let's say the next few months, we're going to expand into a couple other states.

Speaker #3: Within, out of the Dallas plant, out of our facility here. And then later on in the year, as we grow with our existing customers and new customers coming on board, we look to expand to the East Coast and build a facility duplicating this plant, basically, and putting it on the East Coast.

Speaker #3: So we can service the eastern seaboard.

Brett Brenner: Fantastic. I think Florida would be a great market and so California, because you have a lot of health conscious people. My second question is, you were talking about recurring revenue. I know the distribution costs would be higher in, say, health food stores and health bars, where you'd have more recurring revenue, but higher distribution cost. Have you considered that option?

Speaker #5: Fantastic. I think Florida would be a great market, and so would California because you have a lot of health-conscious people. My second question is, you were talking about recurring revenue.

Speaker #5: I know the distribution costs would be higher in, say, health food stores and health, health bars. where you'd have more recurring revenue, but, higher distribution cost.

Speaker #5: Have you considered that option?

Horacio Lanzagorta: That's also an interesting question. One thing that we're going to do is, especially in this initial expansion, stay really focused on what we know works, which is in the grocery stores with supermarkets, and not try and do some other verticals like the health food stores, hotels, restaurants, clubs, bars. All of those could be down the road, you know, could be very good verticals for us to get into. Today, the market is massive for us already with the supermarket opportunity with, you know, like Country Fresh has 15,000 points of distribution throughout the country. They have 12 plants. You know, we basically have the very tip of the iceberg here. We have a first-mover advantage.

Horatio Lonsdale-Hands: That's also an interesting question. One thing that we're going to do is, especially in this initial expansion, stay really focused on what we know works, which is in the grocery stores with supermarkets, and not try and do some other verticals like the health food stores, hotels, restaurants, clubs, bars. All of those could be down the road, you know, could be very good verticals for us to get into. Today, the market is massive for us already with the supermarket opportunity with, you know, like Country Fresh has 15,000 points of distribution throughout the country. They have 12 plants. You know, we basically have the very tip of the iceberg here. We have a first-mover advantage.

Speaker #3: That, that's also an interesting question. So, one thing that we're going to do, especially in this initial expansion, is stay really focused on what we know works, which is in the grocery stores, the supermarkets.

Speaker #3: And not try and do some other verticals, like the health food stores, hotels, restaurants, clubs, bars—all of those could be down the road.

Speaker #3: You know, there could be very good verticals for us to get into, but today, the market is massive for us already with a supermarket opportunity, with, you know, like Country Fresh has 15,000 points of distribution throughout the country.

Speaker #3: There are 12 plants. So, you know, we basically have the very tip of an iceberg here. We have a first-mover advantage. We have a proprietary cold chain.

Horacio Lanzagorta: We have a proprietary cold chain, and we have customers, and we feel that a lot of the target customers down the road. I mean, we're bringing them something that they need because the consumers want these products. We feel that the supermarket opportunity is so vast right now. Let's stay focused on that and not get distracted by all these other opportunities. Plenty of opportunities out there. There's 100 everyday ideas, everyone coming through. Let's stay focused on what we know works and what we know is out there. Down the road, few years down the road, we can start to add in other areas of opportunity when we need more growth.

Horatio Lonsdale-Hands: We have a proprietary cold chain, and we have customers, and we feel that a lot of the target customers down the road. I mean, we're bringing them something that they need because the consumers want these products. We feel that the supermarket opportunity is so vast right now. Let's stay focused on that and not get distracted by all these other opportunities. Plenty of opportunities out there. There's 100 everyday ideas, everyone coming through. Let's stay focused on what we know works and what we know is out there. Down the road, few years down the road, we can start to add in other areas of opportunity when we need more growth.

Speaker #3: And we have customers and, and we feel that a lot of the target customers down the road, I mean, we're bringing them something that they need because the consumers want these products.

Speaker #3: So we feel that the supermarket opportunity is so vast right now, let's stay focused on that and not get distracted by all these other opportunities. There are plenty of opportunities out there.

Speaker #3: There's 100 everyday ideas, everyone coming through. But let's stay focused on what we know works and what we know is out there. And then down the road, a few years down the road, we can start to add in other areas of opportunity when we need more growth.

Brett Brenner: Okay. What's your current distribution? I see that's Costco and Kroger. What stores are you currently in, and do you have any ones on the line? I know that you can't say for sure, but do you have any other fish on the hook that you might land in the near future?

Speaker #5: Okay. And what's your current distribution? As far as I see, that's Costco and Kroger. What stores are you currently in? And do you have any ones on the line?

Speaker #5: And I know that you can't say for sure, but do you have any other fish on the hook that you might land in the near future?

Horacio Lanzagorta: Yeah. Right now, we're in approximately 350 to 400 stores with all our customers. As we have new customers coming on board, that will obviously grow nicely. All I can say is we are increasing our capacity of putting more production in, putting more cooler space in, more automation in, and we're not doing that just for our existing business and growth. That's about all I can say as far as, you know, what's going on in the future.

Horatio Lonsdale-Hands: Yeah. Right now, we're in approximately 350 to 400 stores with all our customers. As we have new customers coming on board, that will obviously grow nicely. All I can say is we are increasing our capacity of putting more production in, putting more cooler space in, more automation in, and we're not doing that just for our existing business and growth. That's about all I can say as far as, you know, what's going on in the future.

Speaker #3: Yeah, right now, we're in approximately 350 to 400 stores with all our customers. And, as we have new customers coming on board, that will obviously grow nicely.

Speaker #3: All I can say is we are increasing our capacity of putting more production in, putting more cooler space in, more optimization in. And we're not doing that just for our existing business and growth.

Speaker #3: So, that's about all I can say as far as, you know, what's going on in the future.

Brett Brenner: What customers specifically do you have right now? What grocery stores?

Speaker #5: Well, what customers specifically do you have right now? What grocery stores?

Horacio Lanzagorta: Well, our main 800-pound gorilla is H-E-B, which if you're familiar with Texas, they're, you know, right at the top of the grocery. With no disrespect to anyone else, H-E-B is an exceptional customer for us and a wonderful grocery store that a lot of grocery stores around the country look at what they're doing. Basically, you know, they're the ones who helped us build where we are today and get better and better all the time. We just started with Kroger here, and we look to grow that business, and we've got more coming online.

Horatio Lonsdale-Hands: Well, our main 800-pound gorilla is H-E-B, which if you're familiar with Texas, they're, you know, right at the top of the grocery. With no disrespect to anyone else, H-E-B is an exceptional customer for us and a wonderful grocery store that a lot of grocery stores around the country look at what they're doing. Basically, you know, they're the ones who helped us build where we are today and get better and better all the time. We just started with Kroger here, and we look to grow that business, and we've got more coming online.

Speaker #3: Well, our main 800-pound grower is H-E-B, which if you're familiar with Texas, they're, you know, right at the top of the grocery—with no disrespect to anyone else. H-E-B is an exceptional customer for us.

Speaker #3: And, a-and a wonderful grocery store that, that a lot of grocery stores around the country look at what they're doing. So, basically, you know, that, that, that'll—they're the ones who, who helped us build where we are today and get better and better all the time.

Speaker #3: So now we've got—so we just started with Kroger here. And so, we look to grow that business, and we've got more coming online.

Brett Brenner: Fantastic. In the future, are you looking to, you know, as you expand, to get production facilities since it's based on Buda Fresh closer to your major markets like Florida and California, where you do have citrus and a lot more customer base as far as people that are healthy and interested in the product?

Speaker #5: Fantastic. And, in the future, maybe production facilities—are you looking to, you know, as you expand, get production facilities, since it's based on being so fresh, closer to your major markets like Florida or California, where you do have citrus and a lot more customer base as far as people that are healthy and interested in the product?

Horacio Lanzagorta: Yes. Brett, that's correct. As they used to say, if you can make it work in New York, you can make it anywhere. Well, in the grocery stores, if you can make it in Texas, they say you can make it anywhere because this is truly the most competitive grocery store market in the country. We feel that yes, Florida, the East Coast, and the West Coast would love our products. When we're ready, we will build a facility on the East Coast first and service the Eastern Seaboard, and then probably the following year do a plant on the West Coast, service the Western Seaboard.

Horatio Lonsdale-Hands: Yes. Brett, that's correct. As they used to say, if you can make it work in New York, you can make it anywhere. Well, in the grocery stores, if you can make it in Texas, they say you can make it anywhere because this is truly the most competitive grocery store market in the country. We feel that yes, Florida, the East Coast, and the West Coast would love our products. When we're ready, we will build a facility on the East Coast first and service the Eastern Seaboard, and then probably the following year do a plant on the West Coast, service the Western Seaboard.

Speaker #3: Yes, Brett, that's correct. I used to say if you can make it work in New York, you can make it anywhere. Well, in the grocery stores, if you can make it in Texas, they say you can make it anywhere, because this is truly the most competitive grocery store market in the country.

Speaker #3: And we feel that, yes, Florida and the East Coast and the West Coast, we feel, would love our products. So when we're ready, we will build a facility on the East Coast first.

Speaker #3: And service the eastern seaboard. And then, do, probably the following year, a plant on the West Coast, service the western seaboard.

Brett Brenner: Fantastic. Well, thank you for answering my questions, and good luck in growth, and let's keep it double digit.

Speaker #5: Fantastic. Well, thank you for answering my questions, and good luck in growth. And, let's keep it double digit.

Horacio Lanzagorta: Thank you very much, Brett. I appreciate your questions.

Horatio Lonsdale-Hands: Thank you very much, Brett. I appreciate your questions.

Speaker #3: Thank you very much, Brett. I appreciate your questions.

Operator 2: Thank you. Brian, I would like to turn the conference back to you for web questions.

Operator: Thank you. Brian, I would like to turn the conference back to you for web questions.

Speaker #1: Thank you. Brian, I would like to turn the conference back to you for web questions.

Brian Siegel: Thank you. The first question, you answered a couple questions already, so I'm just gonna move to this one. Can you expand on your brand strategy for Buda Juice? How do you plan to familiarize consumers with the brand and deepen engagement with those consumers?

Speaker #3: Thank you. so the first question, you answered you answered a couple of questions already. so I'm just going to move to this one. So can you expand on your brand strategy for Buda Juice?

Speaker #3: how do you plan to familiarize consumers with the brand and deepen engagement with those consumers?

Horacio Lanzagorta: Yeah, that's a good one. Well, first of all, we are unique in the fact that we don't spend a lot of money on marketing because we don't buy shelf space. We haven't been advertising. Everything's really been because we don't forget the history. We started with our own retail stores, put millions of money building up the stores, marketing the product, and all that stuff. We pivoted. We went all the way from our own stores into wholesale under our brand and white label other people's brands. The advantage of doing that is you don't have to spend a lot of money because customers typically spend their own money promoting their brands, their white labels.

Horatio Lonsdale-Hands: Yeah, that's a good one. Well, first of all, we are unique in the fact that we don't spend a lot of money on marketing because we don't buy shelf space. We haven't been advertising. Everything's really been because we don't forget the history. We started with our own retail stores, put millions of money building up the stores, marketing the product, and all that stuff. We pivoted. We went all the way from our own stores into wholesale under our brand and white label other people's brands. The advantage of doing that is you don't have to spend a lot of money because customers typically spend their own money promoting their brands, their white labels.

Speaker #4: Yeah, that's a good one. Well, first of all, we are unique in the fact that we don't spend a lot of money on marketing because we don't buy shelf space.

Speaker #4: We haven't been advertising. Everything's really being, because we, we don't forget the history. We started with our own retail stores, put millions of money building up the stores, marketing the product, and all that stuff.

Speaker #4: And then we, we pivoted. We went all the way from our own stores into wholesale—under our brand and white label, other people's brands.

Speaker #4: And so, the advantage of doing that is you don't have to spend a lot of money, because customers typically spend their own money promoting their brands, their white labels.

Horacio Lanzagorta: Basically we have Buda Juice, which is the corporate identity. We have Buda Fresh, which is all our, you know, all our great fresh products that we make, lemonade line and fresh citrus. We have the white label line, which is other people's brands. The beauty of the model is we have high margins. We have distribution where we distribute to their DCs. They take care of the product, and then they own the product. There's no credit backs. There's no marketing or very limited amount. You know, our job is really to keep the cold chain, produce very fresh interesting products for our customers and for the end consumers and grow the business that way.

Speaker #4: So you know, basically, we have the, the, the Buddha, okay. We have Buddha Juice, which is the corporate identity, and then we have Buddha Fresh, which is all our, you know, all our great fresh products that we make—lemonade, lime, and, and fresh citrus.

Horatio Lonsdale-Hands: Basically we have Buda Juice, which is the corporate identity. We have Buda Fresh, which is all our, you know, all our great fresh products that we make, lemonade line and fresh citrus. We have the white label line, which is other people's brands. The beauty of the model is we have high margins. We have distribution where we distribute to their DCs. They take care of the product, and then they own the product. There's no credit backs. There's no marketing or very limited amount. You know, our job is really to keep the cold chain, produce very fresh interesting products for our customers and for the end consumers and grow the business that way.

Speaker #4: And then we have the white label line, which is other people's brands. So, the beauty of the model is we have high margins. We have distribution where we distribute to their DCs.

Speaker #4: They take care of the product, and then they own the product. So there's no credit backs. There's no marketing—well, a very limited amount.

Speaker #4: So, you know, our job is really to keep the cold chain, produce very fresh, interesting products for our customers and for the end consumers.

Speaker #4: And grow the business that way. It's a—it's a different model from what everyone else is doing today, where they're spending millions and millions and millions on branding and advertising, and buying shelf space, and doing deals where they buy back things that don't sell, and all this stuff.

Horacio Lanzagorta: It's a different model from what everyone else is doing today, where they're spending millions and millions and millions on branding and advertising and buying shelf space and doing deals where they buy back things that don't sell and all this stuff. This is not the model we have. We have truly a great moat around our business, which is the cold chain from farm all the way through to the end consumers with all these really tasty, fresh products.

Horatio Lonsdale-Hands: It's a different model from what everyone else is doing today, where they're spending millions and millions and millions on branding and advertising and buying shelf space and doing deals where they buy back things that don't sell and all this stuff. This is not the model we have. We have truly a great moat around our business, which is the cold chain from farm all the way through to the end consumers with all these really tasty, fresh products.

Speaker #4: This is not the model we have. We have truly a great moat around our business, which is the cold chain from farm all the way through to the end consumers, with all these really tasty, fresh products.

Brian Siegel: Thank you, Horatio. So last set of questions. What does the margin profile look like as you scale? Do you see room for operating margins to meaningfully accelerate once you're past the infrastructure build-outs? Then, in general, how should we be thinking about operating leverage with the business?

Speaker #5: Mm-hmm. Thank you, Rachel. So, last set of questions. What does the margin profile look like as you scale? Do you see room for operating margins to meaningfully accelerate?

Speaker #5: Once you're past the infrastructure buildouts, and then in general, how should we be thinking about operating leverage with the business?

Horacio Lanzagorta: Okay. Well, we're really happy with the margins right now. We believe as we scale, there could be a little compression in the margins. However, the added volume and efficiencies of the business will offset that, we believe. You know, I mean, I think, you know, one will offset the other, but I wouldn't say we're gonna go a lot higher than our margins because they're already very high by the industry standards. They're really up there. I think we're really happy with those margins, and we'll do everything we can to keep them. The more volume we put through means we can buy, you know, lower.

Horatio Lonsdale-Hands: Okay. Well, we're really happy with the margins right now. We believe as we scale, there could be a little compression in the margins. However, the added volume and efficiencies of the business will offset that, we believe. You know, I mean, I think, you know, one will offset the other, but I wouldn't say we're gonna go a lot higher than our margins because they're already very high by the industry standards. They're really up there. I think we're really happy with those margins, and we'll do everything we can to keep them. The more volume we put through means we can buy, you know, lower.

Speaker #4: Okay, well, we're really happy with the margins right now. We believe as we scale, there could be a little, little compression in the margins.

Speaker #4: However, the added volume and efficiencies of the business will offset that, we believe. So, you know, I mean, I think, you know, one will offset the other.

Speaker #4: But I—I wouldn't say we're going to go almost higher than our margins, because they're already very high by industry standards. They're really up there.

Speaker #4: So, I think we're really happy with those margins, and we'll do everything we can to keep them. And the more volume we put through means we can buy—you know, buy lower.

Horacio Lanzagorta: Of course, the efficiencies, you know, we used to incur under $0.10 an ounce, and now it's about $0.01 an ounce of labor. We are working on getting that even further down as we expand and put in automation here into the facility.

Horatio Lonsdale-Hands: Of course, the efficiencies, you know, we used to incur under $0.10 an ounce, and now it's about $0.01 an ounce of labor. We are working on getting that even further down as we expand and put in automation here into the facility.

Speaker #4: And of course, the efficiencies—you know, we're having, you know, we used to order under, it was about $0.10 an ounce. And now it's about $0.01 an ounce of labor.

Speaker #4: We are working on getting that even further down, as we expand and put in automization here into the facility.

Brian Siegel: maybe Clint can handle this part of it. As you do scale, how does operating expenses scale with that? Is there operating leverage in the model still? Or, you know, if you can put a little bit more detail into that'd be helpful.

Speaker #5: Yeah. And, and, and, and maybe Clint can handle this part of it. A-as you do scale, how, how does operating how do operating expenses scale with that?

Speaker #5: Is there operating leverage in the model still, or, you know, if you can put a little bit more detail into that, that'd be helpful.

Clint Lee Bowers: Yeah. Yeah, sure. Well, I think that's probably a couple things to touch on that. As far as operating leverage, some of the things that are being done in the actual facility from automation and continuing to lower our you know, our per pound costs, those are ongoing and will continue. Then also touching back on a previous question regarding you know, distribution. We have quite a bit of leverage as we scale in our distribution costs. You'll see that even you know, with the 12% increase in sales, our distribution cost was flat year over year, right?

Clint Bowers: Yeah. Yeah, sure. Well, I think that's probably a couple things to touch on that. As far as operating leverage, some of the things that are being done in the actual facility from automation and continuing to lower our you know, our per pound costs, those are ongoing and will continue. Then also touching back on a previous question regarding you know, distribution. We have quite a bit of leverage as we scale in our distribution costs. You'll see that even you know, with the 12% increase in sales, our distribution cost was flat year over year, right?

Speaker #6: Yeah. Yeah, sure. well, I think there's that's probably there's a couple things to touch on that. as far as operating leverage, some of the things that are being done in the in the actual facility, from automization, and continuing to lower our, our you know, our per pound cost, those are ongoing and will continue.

Speaker #6: and then also touching back on, on a previous question regarding, you know, distribution. we, we have quite a bit of, of leverage as we scale in, in the, in our distribution costs.

Speaker #6: You'll see that even you know, with the 12% increase in sales, our distribution cost was flat year over year, right? And so the, the model being going to di a distribution centers as, as additional product a-and we add SKUs to existing customer and new customers our distribution cost does not go up hardly at all, because we're just adding product to the same truck that's going to the distribution center.

Clint Lee Bowers: The model being going to distribution centers as additional product, and we add SKUs to existing customer and new customers, our distribution cost does not go up hardly at all, because we're just adding product to the same truck that's going to the distribution center. We gain quite a bit of operating leverage in there.

Clint Bowers: The model being going to distribution centers as additional product, and we add SKUs to existing customer and new customers, our distribution cost does not go up hardly at all, because we're just adding product to the same truck that's going to the distribution center. We gain quite a bit of operating leverage in there.

Speaker #6: So, we gained quite a bit of operating leverage in there.

Brian Siegel: Maybe that's G&A. How does that scale as the business grows?

Speaker #5: And what about SG&A? How does that scale as the business grows?

Clint Lee Bowers: Yeah, SG&A. I think, you know, in my last comment mentioning, you know, additional IPO costs, right? Just the overhead around being a public company. Those costs, they come in. I'm not gonna call them fixed. I don't believe that they are 100% fixed, because I do believe we can get leverage there. With that said, as you scale, the incremental cost from a G&A perspective is minimal, okay? This year, you know, right, like we were talking about, we have our expectations for our costs.

Clint Bowers: Yeah, SG&A. I think, you know, in my last comment mentioning, you know, additional IPO costs, right? Just the overhead around being a public company. Those costs, they come in. I'm not gonna call them fixed. I don't believe that they are 100% fixed, because I do believe we can get leverage there. With that said, as you scale, the incremental cost from a G&A perspective is minimal, okay? This year, you know, right, like we were talking about, we have our expectations for our costs.

Speaker #6: Yeah. SG&A, I think, you know, what, what I in my last comment mentioning you know, additional IPO costs, right, and just the overhead around being a public company, so those costs, they come in I'm not going to call them fixed.

Speaker #6: I don't believe that—that they are 100% fixed. And because I, I do believe we can get leverage—leverage there. But with that said, as you scale, the incremental cost from a G&A perspective is—is minimal, okay?

Speaker #6: So, so this year, you know, right, like—like we were talking about, we should have—we, we have our expectations for our cost.

Clint Lee Bowers: You know, we're able to get leverage on that, just that's not going to increase on a percentage basis the same as we scale.

Clint Bowers: You know, we're able to get leverage on that, just that's not going to increase on a percentage basis the same as we scale.

Speaker #6: you know, but, but we're able to get leverage on that a-as, as just that's not going to to, to increase on a percentage basis the, the same a-as we scale.

Horacio Lanzagorta: Yeah. Also just to add in, we do have a different model, and that is all the way through, and it starts at the top with our Executive Chairman, you know, Bryan Herr, who's built massively successful companies. It's just a different model from what a lot of people do. For us, you know, managing it very carefully and caring about, you know, every little detail of our operations so we don't spend money where we don't need to is critical to our success. That's the culture we have. As long as Bryan Herr is the Executive Chairman, that is not gonna change. You know, we're very excited about the opportunity because it took us.

Horatio Lonsdale-Hands: Yeah. Also just to add in, we do have a different model, and that is all the way through, and it starts at the top with our Executive Chairman, you know, Bryan Herr, who's built massively successful companies. It's just a different model from what a lot of people do. For us, you know, managing it very carefully and caring about, you know, every little detail of our operations so we don't spend money where we don't need to is critical to our success. That's the culture we have. As long as Bryan Herr is the Executive Chairman, that is not gonna change. You know, we're very excited about the opportunity because it took us.

Speaker #4: Yeah, and, and also, just to add in, we do have a different model, and—and that is all the way through. And it starts at the top with our Executive Chairman, you know, Brian Ho, who's built massively successful companies.

Speaker #4: i-it's just a different model from what a lot of people do. And so for us, you know, managing it, very carefully and, and, and caring about, you know, every little detail of our operations so we don't spend money where we don't need to, i-is critical to our success.

Speaker #4: And that's the culture we have. And, as long as Brian Ho is the Executive Chairman, that is not going to change. So, you know, w-we're, we're very excited about the opportunity because, it took us, you know, when we, we pivoted from, you know, a—a private company with all, all our ow-own retail stores and we, we used up our, our line of credit of $3 million in energy.

Horacio Lanzagorta: You know, when we pivoted from, you know, a private company with all our own retail stores, and we used up a line of credit of $3 million at Amegy, and we had our shareholders, founding shareholders put in more money, millions of dollars. When we pivoted, we paid back the $3 million and paid back the shareholders. It takes years to be profitable. Once you get it, you do not want to give it up. You know, it takes so long to find something that works. When it works and you're making money and you're growing, it is a formula that everyone wants, and we're lucky enough to have one, and Brian's a huge part of that.

Horatio Lonsdale-Hands: You know, when we pivoted from, you know, a private company with all our own retail stores, and we used up a line of credit of $3 million at Amegy, and we had our shareholders, founding shareholders put in more money, millions of dollars. When we pivoted, we paid back the $3 million and paid back the shareholders. It takes years to be profitable. Once you get it, you do not want to give it up. You know, it takes so long to find something that works. When it works and you're making money and you're growing, it is a formula that everyone wants, and we're lucky enough to have one, and Brian's a huge part of that.

Speaker #4: And we had our shareholders, founding shareholders, put in more money—millions of dollars. And then, when we pivoted, we paid back the $3 million and paid back the shareholders.

Speaker #4: And it, it, it takes years to be profitable. And once you get it, you do not want to give it up. It's, you know, it takes so long to find something that works.

Speaker #4: And when it works, and you're making money and you're growing, it is a formula that everyone wants. And we're lucky enough to have one.

Speaker #4: And Brian's a huge part of that. And so, going forward, you know, we are going to say where we are in profit.

Horacio Lanzagorta: Going forward, you know, we are going to stay where we are in profit.

Horatio Lonsdale-Hands: Going forward, you know, we are going to stay where we are in profit.

Brian Siegel: Maybe last question. Are you considering a D2C model by selling online?

Speaker #5: Thank you. Last question. are you considering a D2C model by selling online?

Horacio Lanzagorta: No, we're not. We have in our past life, we've done, you know, the e-shop. It was flavor of the day. It was so exciting. Make lots of money and all this stuff, and all we ended up doing was losing more money. You know, if you're not set up for online shopping, it's a very, very different endeavor, especially since, don't forget, we're fresh. Everything has to be packed carefully. It has to be refrigerated as it ships out. You know, a lot of people, they open their packages and, oh, what happened? The bottle's this or, you know, they got cracked or, you know, exploded or they're not cold. It's just we're focused on the grocery store. That is such a huge market for us nationwide.

Horatio Lonsdale-Hands: No, we're not. We have in our past life, we've done, you know, the e-shop. It was flavor of the day. It was so exciting. Make lots of money and all this stuff, and all we ended up doing was losing more money. You know, if you're not set up for online shopping, it's a very, very different endeavor, especially since, don't forget, we're fresh. Everything has to be packed carefully. It has to be refrigerated as it ships out. You know, a lot of people, they open their packages and, oh, what happened? The bottle's this or, you know, they got cracked or, you know, exploded or they're not cold. It's just we're focused on the grocery store. That is such a huge market for us nationwide.

Speaker #4: no, we're not. we have in our in our past life, we've done the, you know, the e-shop and the yeah, it was it was flavor of the day.

Speaker #4: It was so exciting to make lots of money and all this stuff. And all we ended up doing was losing more money. you know, if you're not set up for online shopping, it's a very, very different endeavor, especially since don't forget, we're fresh.

Speaker #4: So everything has to be packed carefully. It has to be refrigerated as it ships out. And, you know, a lot of people, they open their packages and, 'Oh, what happened?'

Speaker #4: The bottle's this, or, you know, they got cracked, or, you know, exploded, or they're not cold, or th-there's, there's, it's just we—we're focused on the grocery store.

Speaker #4: That is such a huge market for us nationwide. We do not need to get distracted spending millions of dollars building an online business today.

Horacio Lanzagorta: We do not need to get distracted spending millions of dollars building an online business today. Amazon are the experts of that, as are Walmart and everyone else. Let them do that, and we'll focus on servicing the customers that want fresh and go to the grocery store. That doesn't mean they don't place their orders ahead of time and let the retailers deliver, because that's a massive business. We're able to handle that, but not for us to provision and do all that.

Horatio Lonsdale-Hands: We do not need to get distracted spending millions of dollars building an online business today. Amazon are the experts of that, as are Walmart and everyone else. Let them do that, and we'll focus on servicing the customers that want fresh and go to the grocery store. That doesn't mean they don't place their orders ahead of time and let the retailers deliver, because that's a massive business. We're able to handle that, but not for us to provision and do all that.

Speaker #4: Amazon are the experts of that, as are Walmart and everyone else. So let them do that. And we'll focus on servicing, the, the customers that want fresh and go to the grocery store.

Speaker #4: That doesn't mean they don't place their orders ahead of time, and let the retailers deliver, because that's a massive business. We—we're able to handle that.

Speaker #4: But not for us to, to, to provision and do all that.

Operator 2: Ladies and gentlemen, that does conclude our question and answer session, and it also concludes our call for today. Thank you all for joining, and you may now disconnect.

Operator: Ladies and gentlemen, that does conclude our question and answer session, and it also concludes our call for today. Thank you all for joining, and you may now disconnect.

Speaker #1: Ladies and gentlemen, that does conclude our question and answer session. And it also concludes our call for today. Thank you all for joining. And you may now disconnect.

Q4 2025 Buda Juice Inc Earnings Call

Request a DemoDemo

BUDA

Buda Juice

Earnings