Where Food Comes From, Inc. (NASDAQ:WFCF) Q3 2023 Earnings Call Transcript
Where Food Comes From, Inc. (NASDAQ:WFCF) Q3 2023 Earnings Call Transcript November 10, 2023
Operator: Greetings, and welcome to the Where Food Comes From Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder this conference is being recorded. At this time I would like to turn the call over to Jay Pfeiffer of Investor Relations. Thank you. You may begin.
Jay Pfeiffer: Good morning, and welcome to the Where Food Comes From 2023 third quarter earnings call. Joining me on the call today are CEO, John Saunders; President, Leann Saunders; and Chief Financial Officer, Dannette Henning. During this call, we'll make forward-looking statements based on current expectations, estimates and projections that are subject to risk. Statements about current and future financial performance, growth strategy, customers, business opportunities, market acceptance of our products and services and potential acquisitions are forward-looking statements. Listeners should not place undue reliance on these statements as there are many factors that could cause actual results to differ materially from our forward-looking statements.
We encourage you to review our publicly filed documents as well as our news releases and website for more information. Today we'll also discuss adjusted EBITDA, a non-GAAP financial measure provided as a complement to GAAP results. Please refer to today's earnings release for important disclosures regarding non-GAAP measures. I'll now turn the call over to John Saunders.
Aerial view of a large warehouse loaded with pallets and crates of food products.
John Saunders: Good morning, and thanks for joining the call today. As highlighted in our third quarter earnings release, this morning our core verification and certification revenue increased for both the third quarter and nine-month period, despite continuing headwinds primarily associated with smaller herd sizes related to the cyclical cattle trends. These increases were offset by lower hardware revenue, which resulted in a decline in total revenue for both periods. You might remember that on our last call in August, I mentioned that headwinds were likely to persist for a while so slightly lower overall revenue in Q3 was not a surprise. Nevertheless, we continue to generate a lot of cash and deliver solid profitability in the quarter and year-to-date period.
We also returned $855,000 in value to stockholders in the form of stock buybacks in the quarter with year-to-date buybacks, totaling nearly $3 million. So in the context of challenges we've been facing on multiple fronts in recent quarters we're pretty pleased with our overall performance and as evidenced by our continued stock buybacks confident in our future prospects. Getting back to our verification and certification business, which is by far our largest revenue segment, we achieved 4% growth in the quarter and 8% growth through the first nine months of 2023. Within this segment, beef verification is the largest single component of revenue. As herd sizes have shrunk over the past year or so due to a combination of drought impact and normal cattle cycles, our tag sales have declined as well.
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