Healthy Choice Wellness Corp. Reports Revenue Growth, Net Loss in Latest Quarter

Healthy Choice Wellness Corp. (HCWC) reported significant financial developments in its 10-Q filing for the period ending September 30, 2024. The company, which focuses on providing healthier nutrition and lifestyle alternatives, experienced a notable increase in revenue, with net sales for the three months reaching $18.2 million, up from $12.7 million in the same period of 2023. For the nine months, net sales totaled $49.7 million, compared to $39.8 million in the prior year. This growth was primarily driven by acquisitions, including Ellwood Thompson’s and GreenAcres Market, which contributed to a $5.8 million increase in grocery sales despite a slight decline in same-store sales.

Gross profit for the three months ended September 30, 2024, was $7.0 million, an increase from $4.6 million in 2023, reflecting improved gross margins. However, the company reported a loss from operations of $(372,423) for the quarter, a significant improvement from a loss of $(1,255,135) in the same period last year. Despite this operational improvement, HCWC recorded a net loss of $(2.7 million) for the quarter, compared to $(919,673) in 2023, largely due to increased other expenses, including a $1.9 million loss on warrant settlement.

For the nine-month period, HCWC's net loss was $(3.96 million), up from $(2.44 million) in the previous year. The company also reported a negative working capital of $1.3 million as of September 30, 2024, and total liabilities increased significantly to $30.3 million from $19.4 million at the end of 2023, primarily due to new debt incurred from acquisitions and a $7.5 million loan agreement established in July 2024.

In terms of strategic developments, HCWC completed its spin-off from HCMC on September 14, 2024, becoming an independent publicly traded company on the NYSEAM under the symbol "HCWC." The spin-off involved the issuance of approximately 9.2 million shares of common stock. The company also secured $13.25 million in equity financing from investors associated with HCMC, which is expected to support its operations and capital requirements for the next twelve months.

As of September 30, 2024, HCWC had cash and cash equivalents of approximately $1.8 million, an increase from $941,803 a year earlier. The company continues to face challenges, including material weaknesses in internal controls, which management is addressing through planned remediation actions.