Felix Lin; Chief Executive Officer, President; Hf Foods Group Inc
Cindy Yao; Chief Financial Officer; Hf Foods Group Inc
Hello, everyone. Welcome to HF Foods Group’s first-quarter 2025 earnings conference call. Joining me on today’s call are Felix Lin, the company’s President and Chief Executive Officer, and Cindy Yao, the company’s Chief Financial Officer.
By now, everyone should have access to the earnings release for the period ending March 31, 2025 that went out Monday, May 12, at approximately 4:05 PM Eastern Time. The press release is accessible on the company’s website at investors.hffoodsgroup.com.
Before we begin, let me remind everyone that today’s discussion contains forward-looking statements based on management’s current beliefs and expectations about future events, which are subject to several known and unknown risks and uncertainties. If you refer to HF Foods’ earnings release, as well as the company’s most recent SEC filings, you will see a discussion of factors that could cause the company’s actual results to differ materially from those expressed or implied by these forward-looking statements. The company undertakes no obligation to update or revise these forward-looking statements in the future.
In these remarks, the company will make several references to non-GAAP financial measures, including adjusted EBITDA. We believe that these measures provide investors with a useful perspective on the underlying growth trends of the business and have included in the earnings release a full reconciliation of non-GAAP financial measures to the most comparable GAAP measures.
Now, I will turn the call over to Felix.
Felix Lin
Hello, everyone. Welcome to HF Foods first-quarter earnings call. I will provide a business update, and Cindy will speak about our first quarter of 2025 financial results.
Following a strong finish to 2024, I am pleased to report that we have carried our momentum into the first quarter of 2025. Net revenue increased 0.9% year over year despite one fewer day of operations in the first quarter of 2025. Adjusted EBITDA increased 12.3% year over year to $9.8 million. It is also worth noting, like many others in the foodservice space, we saw a relatively slow February, driven mainly by macro uncertainty, which was then offset by a very strong March. So far, we have seen this momentum carry through into April, which gives us confidence in our 2025 performance.
Our results in the first quarter reflect continued disciplined execution against our strategic initiatives, even amid a dynamic and uncertain macroenvironment characterized by new tariffs, persistent inflationary pressures, and shifts in consumer spending behaviors. Delivering positive net revenue growth and significant adjusted EBITDA growth under these conditions demonstrates the resilience of our business model and the strength of our operational focus.
The industry continues to face macro headwinds, particularly the uncertainty as the result of new tariff policies and related supply chain disruption. In response to the evolving tariff landscape, we have been actively diversifying our supplier base and exploring alternative sourcing strategies to ensure continuity and cost-effectiveness in our supply chain.
We are encouraged by our performance in the first quarter and the solid foundation we’ve built. We remain extremely optimistic in our long-term plan, and we aim to continue the momentum we’ve built for the rest of the year.
Our digital transformation initiative reached a major milestone on May 1, when we successfully completed the implementation of a new ERP application across our entire network. All of our locations are now operating on a single, modern ERP platform. This unified system will help us to achieve breakthrough levels of efficiency, visibility, and control across our operations, unlocking the full potential of our centralized purchasing capabilities and enabling more data-driven decision-making throughout the organization.
In parallel with the ERP rollout, we launched our new e-commerce platform at our Utah, North Carolina and Florida DC’s. This new platform, which is designed specifically for foodservice customers and distributors, will enable restaurant employees and owners to directly purchase HF Foods’ authentic, high-quality specialty products using the same delivery infrastructure already serving their restaurants.
This model leverages HF Foods’ established global network of suppliers and robust distribution infrastructure to offer a cost-efficient, value-added channel in a seamless digital experience. Taken together, these initiatives represent a strategic leap forward. We are confident they will serve as powerful catalysts for margin expansion, improved service levels for our customers, and long-term operational excellence.
Our strategic facility enhancement initiatives continue to advance across multiple regions. We are on track to complete renovations at our Charlotte distribution center by the end of Q2 2025. We continue to make steady progress on our Atlanta state-of-the-art facility project, which we expect will create meaningful organic growth opportunities from a cross-selling perspective. These infrastructure investments reflect our ongoing commitment to optimizing our distribution network and creating a stronger foundation for sustainable growth.
HF Foods is the only scaled food service provider in the Asian specialty market in the United States, and we believe we are the strategic acquirer of choice within our space. M&A remains a core pillar of our growth strategy. We are focused on expanding our geographic footprint in high-potential markets, capturing operational synergies, broadening our customer base, and enhancing our product and service capabilities. We remain disciplined but optimistic about M&A opportunities in 2025 and beyond.
Now, over to you Cindy.
