Innovative Food Holdings Inc. (OTC:IVFH) Stock Falls 10%: Here is Why

In light of the developments from last Friday, Innovative Food Holdings Inc. (OTC:IVFH) stock may well be one to watch out for. The company, which is a national-level gourmet food seller to professional chefs, was in the news cycle on January 12 after it made a key announcement. Innovative Food Holdings announced that, following unanimous approval from its board of directors, it had decided to restructure its Home Gourmet e-commerce business unit.

However, that was not all. The company also announced that it had completed the sales of two of its entities, Organic Food Brokers LLC and Oasis Sales Corp. The sales of those entities had been previously announced by Innovative Food Holdings. Another key announcement from the company was with regards to the sale of Haley Food Groups Inc., an entity it controlled. The company also reiterated what it had discussed at the 2023 third fiscal earnings call. Innovative Food Holdings was in a stabilization phase and was working on cutting down its focus on unprofitable and non-core businesses. The aim was to drive fresh growth in the Professional Chefs business, a profitable business.

The restructuring process related to the Home Gourmet business would involve the reduction of the workforce, which is comprised of around 20 employees. There would also be no more paid marketing associated with the business, and the assortment would also be reduced by half.

Innovative Food Holdings noted that the measures would result in a reduction in annual revenues of around $6 million. However, there would be a rise in annual profits of approximately $650,000. The restructuring would also involve a one-time cost in the $100,000–$200,000 range. The company also revealed that the sale of the Grow Brand Management business would lead to a reduction in annualized revenues to the tune of $1 million, but there would be no impact on profits.