COFFEE HOLDING CO INC
For the period ended Jan 31, 2025. Filed Mar 21, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jan 31, 2025 · Filed Mar 21, 2025
JVA$4.86+0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-07-31; filed 2024-09-13.
0001493152-24-036225
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-01-31; filed 2025-03-21.
0001493152-25-011093
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 46 previous paragraphs and 38 current paragraphs.
22 unchanged; 14 reworded; 2 added; 8 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (2)
Current report
On November 6, 2024, Second Empire, a wholly owned subsidiary of the Company, entered into a Secured Creditor Sale Agreement with Bridge Business Credit, LLC (“Seller”). The sale was a Uniform Commercial Code (“UCC”) Chapter 9 sale to purchase equipment, accounts receivable and inventory of Empire Coffee Company, Inc. (“Empire Coffee Company”).
Current report
Critical Accounting Policies and Estimates
Removed paragraphs (8)
Previous report
On September 29, 2022, Coffee Holding Co., Inc, a Nevada corporation (“JVA”), entered into a Merger and Share Exchange Agreement (the “Merger Agreement”), by and among JVA, Delta Corp Holdings Limited, a Cayman Islands exempted company (“Pubco”), Delta Corp Holdings Limited, a company incorporated in England and Wales (“Delta”), CHC Merger Sub Inc., a Nevada corporation and wholly owned subsidiary of Pubco (“Merger Sub”), and each of the holders of ordinary shares of Delta as named therein. Upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub would merge with and into JVA, with JVA surviving as a direct, wholly-owned subsidiary of Pubco (the “Merger”). In April 2024, the Company held a special meeting of stockholders at which approval of the Merger Agreement and the Merger did not receive the requisite votes. On June 21, 2024, JVA terminated the Merger Agreement. No early termination penalties were payable by JVA upon termination of the Merger Agreement.
Previous report
Critical Accounting Estimates
Previous report
Nine Months Ended July 31, 2024 Compared to the Nine Months Ended July 31, 2023
Previous report
Net Sales. Net sales totaled $57,349,477 for the nine months ended July 31, 2024, an increase of $7,938,294, or 16%, from $49,411,183 for the nine months ended July 31, 2023. The increase in net sales was due to increased sales to new private label customers.
Previous report
Cost of Sales. Cost of sales for the nine months ended July 31, 2024 was $46,239,134, or 80.6% of net sales, as compared to $41,810,204, or 84.6% of net sales, for the nine months ended July 31, 2023. Cost of sales consists primarily of the cost of green coffee and packaging materials and realized and unrealized gains or losses on hedging activity. This increase in gross margin was due to price increases for our roasted coffee customers as well as a favorable inventory position which resulted in higher gross margins related to our wholesale green coffee customers.
Previous report
Operating Expenses. Total operating expenses increased by $650,515 to $9,840,219 for the nine months ended July 31, 2024 from $9,189,704 for the nine months ended July 31, 2023. Selling and administrative expenses increased by $643,080 and officers’ salaries increased by $7,435. Operating expenses increased due to higher payroll costs, professional fees, and insurance expense, partially offset by decreases in medical expenses. automobile costs, and advertising costs. for the nine months ended July 31, 2024 compared to the nine months ended July 31, 2023.
Previous report
Other Income (Expense). Other income for the nine months ended July 31, 2024 was $9,809, a decrease of $219,592 from other income of $229,401 for the nine months ended July 31, 2023. The decrease was attributable to a decrease in other income of $634,181 related to an insurance claim, partially offset by an increase of gain on extinguishment of lease of $210,567, decrease in interest expense of $158,163, an increase in interest income of $31,549, and a decrease in loss from equity method investments.
Previous report
Net Income (Loss). We had net income of $955,979, or $0.17 per share basic and diluted, for the nine months ended July 31, 2024 compared to a net loss of $1,003,824, or $0.18 per share basic and diluted, for the nine months ended July 31, 2023. The increase in net income was due primarily to the reasons described above.
Reworded paragraphs (14)
Previous wording
Some of the matters discussed under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” “Risk Factors” and elsewhere in this quarterly report include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements upon information available to management as of the date of this Form 10-Q and management’s expectations and projections about future events, including, among other things:
Current wording
Some of the matters discussed under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Risk Factors” and elsewhere in this quarterly report include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements upon information available to management as of the date of this Form 10-Q and management’s expectations and projections about future events, including, among other things:
Previous wording
There have been no changes to our critical accounting policies during the three and nine months ended July 31, 2024. Critical accounting policies and the significant estimates in accordance with such policies are regularly discussed with our Audit Committee. Those policies are discussed under “Critical Accounting Policies” in “Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as in our consolidated financial statements and notes thereto, each included in our annual report on Form 10-K filed with the SEC on February 9, 2024 for the fiscal year ended October 31, 2023.
Current wording
There have been no changes to our critical accounting policies during the three months ended January 31, 2025. Critical accounting policies and the significant estimates in accordance with such policies are regularly discussed with our Audit Committee. Those policies are discussed under “Critical Accounting Policies and Estimates” in “Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as in our consolidated financial statements and notes thereto, each in our 2024 10-K.
Previous wording
Net Sales. Net sales totaled $18,813,162 for the three months ended July 31, 2024, an increase of $3,048,797, or 19%, from $15,764,365 for the three months ended July 31, 2023. The increase in net sales was due to increased sales to new private label customers.
Current wording
Net Sales. Net sales totaled $21,305,285 for the three months ended January 31, 2025, an increase of $1,764,883, or 9%, from $19,540,402 for the three months ended January 31, 2024. The increase in net sales was due to increased sales of private label and our brands to our wholesale and retail customers.
Previous wording
Cost of Sales. Cost of sales for the three months ended July 31, 2024 was $14,887,098, or 79.1% of net sales, as compared to $13,315,602, or 84.5% of net sales, for the three months ended July 31, 2023, an increase of $1,571,496. Cost of sales consists primarily of the cost of green coffee and packaging materials and realized and unrealized gains or losses on hedging activity. This increase in gross margin was due to price increases that were initiated during the three months ended July 31, 2024 for our roasted coffee customers as well as a favorable inventory position which resulted in higher gross margins related to our wholesale green coffee customers.
Current wording
Cost of Sales. Cost of sales for the three months ended January 31, 2025 was $15,573,359, or 73.1% of net sales, as compared to $16,060,103, or 82.2% of net sales, for the three months ended January 31, 2024, a decrease of $486,744. Cost of sales consists primarily of the cost of green coffee and packaging materials. This increase in gross margin was due to favorable green coffee prices that were initiated during the three months ended January 31, 2025 for our roasted coffee customers and the cost of goods sold was favorably impacted by an improved inventory situation, along with increased prices to both our wholesale and retail customers, reflecting higher market conditions. Additionally, net sales increased due to higher sales of our private label and branded products to both wholesale and retail customers.
Previous wording
Gross Profit. Gross profit for the three months ended July 31, 2024 amounted to $3,926,064 or 20.9% of net sales, as compared to $2,448,763 or 15.5% of net sales, for the three months ended July 31, 2023. The increase in gross profits on a percentage and dollar basis was attributable to the factors listed above.
Current wording
Gross Profit. Gross profit for the three months ended January 31, 2025 amounted to $5,731,926 or 26.9% of net sales, as compared to $3,480,299 or 17.8% of net sales, for the three months ended January 31, 2024. The increase in gross profits on a percentage and dollar basis was attributable to the factors listed above.
Previous wording
Operating Expenses. Total operating expenses increased by $354,191 to $3,206,201 for the three months ended July 31, 2024 from $2,852,010 for the three months ended July 31, 2023. Selling and administrative expenses increased by $336,373 and officers’ salaries increased by $17,818. The increase in selling and administrative expenses was due to higher payroll costs, professional fees, and insurance expense, partially offset by decreases in medical expenses. automobile costs, and advertising costs.
Current wording
Operating Expenses. Total operating expenses increased by $1,277,507 to $4,140,895 for the three months ended January 31, 2025 from $2,863,388 for the three months ended January 31, 2024. Selling and administrative expenses increased by $1,239,551 and officers’ salaries increased by $37,956. The increase in selling and administrative expenses was due to higher payroll costs, professional fees, and the acquisition of Empire Coffee Company.
Previous wording
Other Income (Expense). Other income for the three months ended July 31, 2024 was $166,182, a decrease of $84,934 from other income of $251,116 for the three months ended July 31, 2023. The change was attributable to a decrease in interest expense of $99,383, an increase in interest income of $249, a decrease in loss from our equity method investments of $5,007, and a gain on extinguishment of lease of $210,567, partially offset by a decrease in other income of $400,140 related to an insurance claim.
Current wording
Other Income (Expense). Other income for the three months ended January 31, 2025 was $31,683, a decrease of $91,867 from other income of $123,550 for the three months ended January 31, 2024. The change was attributable to a decrease in interest expense of $85,863.
Previous wording
Income Taxes. Our expense for income taxes for the three months ended July 31, 2024 totaled $259,249 compared to a benefit of $40,250 for the three months ended July 31, 2023. The change was primarily attributable to the difference in the income for the three months ended July 31, 2024 versus the loss for the three months ended July 31, 2023.
Current wording
Income Taxes. Our expense for income taxes for the three months ended January 31, 2025 totaled $406,092 compared to an expense of $142,337 for the three months ended January 31, 2024. The change was primarily attributable to the difference in the income for the quarter ended January 31, 2025 versus the income in the quarter ended January 31, 2024.
Previous wording
Net Income (Loss). We had net income of $626,796, or $0.11 per share basic and diluted, for the three months ended July 31, 2024 compared to a net loss of $111,881, or $0.02 per share basic and diluted, for the three months ended July 31, 2023.
Current wording
Net Income (Loss). We had net income of $1,153,256, or $0.20 per share basic and diluted, for the three months ended January 31, 2025 compared to a net loss of $351,024, or $0.06 per share basic and diluted, for the three months ended January 31, 2024.
Previous wording
As of July 31, 2024, we had working capital of $19,494,786, which represented a $894,524 increase from our working capital of $18,600,262 as of October 31, 2023. Our working capital increased primarily due to the decrease of the outstanding balance on our line of credit to $1,900,000 from $9,620,000 as of July 31, 2024 and October 31, 2023, respectively, along with a decrease of $670,966 in accounts payable and accrued expenses, a $917,843 increase in due from broker, a $364,181 increase in cash and cash equivalents, and a $17,131 decrease in due to broker. This was partially offset by $533,485 decrease in accounts receivable, a $4,480,524 decrease in inventories, a $3,150,000 decrease in receivable from sale of investment, a $200,309 decrease in prepaid expenses and other current assets, and an increase of $380,909 in lease liabilities - current portion.
Current wording
As of January 31, 2025, we had working capital of $22,386,733, which represented a $859,750 increase from our working capital of $ 21,526,983 as of October 31, 2024. Our working capital increased primarily due to the $495,767 increase in due from broker, a $980,195 increase in cash and cash equivalents, and a $2,398,168 increase in accounts receivable offset by a $2,200,000 increase on the line of credit.
Previous wording
Each of the A&R Loan Facility and A&R Loan Agreement contains covenants, subject to certain exceptions, that place annual restrictions on the Borrowers’ operations, including covenants relating to debt restrictions, capital expenditures, indebtedness, minimum deposit restrictions, tangible net worth, net profit, leverage, employee loan restrictions, dividend and repurchase restrictions (common stock and preferred stock), and restrictions on intercompany transactions. The outstanding balance on our line of credit was $1,900,000 and $9,620,000 as of July 31, 2024 and October 31, 2023, respectively.
Current wording
Each of the A&R Loan Facility and A&R Loan Agreement contains covenants, subject to certain exceptions, that place annual restrictions on the Borrowers’ operations, including covenants relating to debt restrictions, capital expenditures, indebtedness, minimum deposit restrictions, tangible net worth, net profit, leverage, employee loan restrictions, dividend and repurchase restrictions (common stock and preferred stock), and restrictions on intercompany transactions. The outstanding balance on our line of credit was $2,200,000 and $9,620,000 as of January 31, 2025 and October 31, 2024, respectively.
Previous wording
For the nine months ended July 31, 2024, our operating activities provided net cash of $5,209,235 as compared to the nine months ended July 31, 2023 when operating activities provided net cash of $799,162. The increase in cash flow from operations was partially due to net income of $955,979 for the nine months ended July 31, 2024, compared to a net loss of $1,003,824 for the nine months ended July 31, 2023. Non-cash charges, including depreciation and amortization, unrealized gain on commodities, loss on equity method investments, amortization of right-of-use assets, gain on extinguishment of lease liability, and deferred income taxes, resulted in cash used of $159,890 for the nine months ended July 31, 2024 and cash used of $440,538 for the nine months ended July 31, 2023. The aggregate change in operating assets and liabilities provided $4,413,146 and $2,243,524 in operating cash flow for the nine months ended July 31, 2024 and 2023, respectively.
Current wording
For the three months ended January 31, 2025, our operating activities used cash of $401,898 as compared to the three months ended January 31, 2024 when operating activities provided net cash of $4,594,849. The decrease in cash flow from operations was primarily due to the increase in accounts receivable from October 31, 2024 to January 31, 2025, compared to a decrease in accounts receivable of $2,524,747 from October 31, 2023 to January 31, 2024. Non-cash charges, including depreciation and amortization, unrealized gain on commodities, loss on equity method investments, amortization of right-of-use assets, and deferred income taxes, resulted in cash used of $393,042 for the three months ended January 31, 2025 compared to non-cash charges provided of $513,003 for the three months ended January 31, 2024.
Previous wording
For the nine months ended July 31, 2024, our investing activities provided net cash of $2,879,320 as compared to the nine months ended July 31, 2023 when net cash used in investing activities was $721,696. The increase in our cash provided by investing activities was due to proceeds from the sale of an investment and decreased purchases of machinery and equipment during the nine months ended July 31, 2024.
Current wording
For the three months ended January 31, 2025, our investing activities provided used cash of $817,906 as compared to the three months ended January 31, 2024 when net cash used in investing activities was $0. The decrease in our cash provided by investing activities was due to purchases of machinery and equipment during the three months ended January 31, 2025.
Previous wording
For the nine months ended July 31, 2024, our financing activities used net cash of $7,724,374 compared to net cash used in financing activities of $174,789 for the nine months ended July 31, 2023. The change in cash flow from financing activities for the nine months ended July 31, 2024 was primarily due to our credit line activity.
Current wording
For the three months ended January 31, 2025, our financing activities used net cash of $2,200,000 compared to net cash used in financing activities of $4,920,963 for the three months ended January 31, 2024. The change in cash flow from financing activities for the three months ended January 31, 2025 was primarily due to our credit line activity.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Gross Profit. Gross profit for the nine months ended July 31, 2024 amounted to $11,110,343 or 19.4% of net sales, as compared to $7,600,979 or 15.4% of net sales, for the nine months ended July 31, 2023. The increase in gross profits on a percentage basis was attributable to the factors listed above.
Previous report — wording carried elsewhere
Income Taxes. Our expense for income taxes for the nine months ended July 31, 2024 totaled $323,954 compared to a benefit of $355,500 for the nine months ended July 31,2023. The change was primarily attributable to the difference in the income for the nine months ended July 31, 2024 versus the loss for the nine months ended July 31, 2023.