EX-99.1 2 ea026965801ex99-1_functional.htm PRESS RELEASE DATED DECEMBER 15, 2025

Exhibit 99.1

 

 

 

Functional Brands Announces Third Quarter 2025 Financial Results

 

Lake Oswego, OR – (December 15, 2025) – Functional Brands Inc. (NASDAQ: MEHA), a leading innovator in wellness and performance products, today announced financial results for the third quarter ended September 30, 2025.

 

Third Quarter 2025 highlights:

 

●Revenue of $1.7 million increased 21.4% compared to the third quarter of 2024, primarily due to growth in direct-to-consumer sales
   
●Gross profit increased 28.1% compared to the prior year period and gross profit margin improved 310 basis points to 57.8% reflecting higher revenue, improved cost control and better terms with vendors
   
●Net income of $0.3 million or $0.04 per diluted share compared to a net loss of $0.3 million and $(0.04) per diluted share in the prior year period

 

“We are pleased with our third quarter results as we delivered strong growth on the top and bottom line, reflecting early progress on our key initiatives,” said Eric Gripentrog, CEO of Functional Brands Inc. “The past few months have been transformational for Functional Brands, marked by several milestone achievements that position us strongly for accelerated growth. Most notably, we successfully completed our direct listing on the Nasdaq Capital Market under the symbol MEHA, representing a pivotal moment that validates our business model and provides the capital foundation to execute our ambitious expansion plans.

 

“We also achieved significant strategic breakthroughs that differentiate us in the marketplace. Our P2i by Kirkman prenatal supplement has become the world’s first to fully align with FIGO’s transparency standards and the first to comply with California’s new SB 646 QR-code disclosure law—well ahead of the January 2027 implementation date. Additionally, we forged a high-impact commercial partnership with Market Performance Group to supercharge the growth of our flagship Kirkman brand across eCommerce and digital channels, unlocking new opportunities to reach millions of consumers with our science-based wellness solutions. These accomplishments demonstrate that we are executing on our mission of ‘Making Everyone Healthy Again’ while building a foundation for sustainable, profitable growth.”

 

About Functional Brands Inc.

 

Functional Brands Inc. is a health and wellness company focused on acquiring and growing science-based consumer brands. With a portfolio that includes trusted names like Kirkman®, P2i by Kirkman®, Hemptown Naturals, Healthy Assist by Kirkman; Functional Brands is committed to providing high-quality, effective solutions that support healthier lives.

 

For more information, visit www.functionalbrandsinc.com and www.kirkmangroup.com.

 

 

 

 

Investor Relations Contact:

 

FunctionalBrands@icrinc.com

 

Cautionary Note Regarding Forward Looking Statements

 

This news release and statements of Functional Brands’ management in connection with this news release or related events contain or may contain “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements mean statements (including statements related to the closing, and the anticipated benefits to the Company, of the private placement described herein) related to future events, which may impact our expected future business and financial performance, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “potential,” “will,” “should,” “could,” “would,” “optimistic” or “may” and other words of similar meaning. These forward-looking statements are based on information available to us as of the date of this news release and represent management’s current views and assumptions. Forward-looking statements are not guarantees of future performance, events or results and involve significant known and unknown risks, uncertainties and other factors which may be beyond our control.

 

Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this news release. Potential investors should review Functional Brands’ Registration Statement for more complete information, including the risk factors that may affect future results, which are available for review at www.sec.gov. Accordingly, forward-looking statements should not be relied upon as a predictor of actual results. We do not undertake to update our forward-looking statements to reflect events or circumstances that may arise after the date of this news release, except as required by law.

 

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FUNCTIONAL BRANDS INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In U.S. dollars, except share data or otherwise noted)

 

   September 30,
2025		   December 31,
2024		 
Assets        
Current assets:        
Cash  $1,005,324   $211,642 
Accounts receivable, net   89,213    303,471 
Inventories, net   1,690,733    1,709,458 
Prepaid expenses and other current assets   169,070    45,112 
Deferred offering costs   1,256,451    588,641 
Total current assets   4,210,791    2,858,324 
Noncurrent assets:          
Property and equipment, net   42,086    49,564 
Right-of-use assets, net   1,753,581    2,000,092 
Intangible assets, net   1,408,944    1,443,541 
Goodwill   818,139    818,139 
Total non-current assets   4,022,750    4,311,336 
Total assets  $8,233,541   $7,169,660 
           
Liabilities and stockholders’ equity / (deficit)          
Current liabilities:          

Accounts payable and accrued liabilities

  $2,425,006   $1,956,165 
Line of credit   21,286    32,235 
SBA loan, current   3,547    3,436 
Lease liabilities, current   364,505    291,213 
Other current liabilities   34,425    35,332 
Payable for acquisition, current   2,227,366    2,342,366 
Loans payable (related party), current   58,886    370,703 
Loans payable   567,497    171,500 
Total current liabilities   5,702,518    5,202,950 
Non-current liabilities:          
Lease liabilities, net of current   1,527,586    1,844,819 
SBA loan, net of current   137,780    140,468 
Loan payable (related party), net of current   260,992    - 
Convertible debenture   -    100,000 
Total non-current liabilities   1,926,358    2,085,287 
Total liabilities   7,628,876    7,288,237 
           
Stockholders’ equity / (deficit)          
Series A Preferred stock, par value $0.001, 100,000 shares authorized; 0 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively   -    - 
Series B Preferred stock, par value $0.001, 80,000 shares authorized; 0 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively   -    - 
Common stock, par value $0.00001, 220,000,000 shares authorized; 7,084,769 and 6,694,880 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively   71    67 
Additional paid-in capital   8,359,361    7,542,286 
Accumulated deficit   (7,754,767)   (7,660,930)
Total stockholders’ equity / (deficit)   604,665    (118,577)
Total liabilities and stockholders’ equity / (deficit)  $8,233,541   $7,169,660 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

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FUNCTIONAL BRANDS INC.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In U.S. dollars, except share data or otherwise noted)

 

   Three Months Ended
September 30,		   Nine Months Ended
September 30,		 
   2025   2024   2025   2024 
Revenue, net of returns  $1,694,174   $1,395,913   $5,116,963   $4,886,359 
Cost of goods sold   715,824    632,194    2,303,752    2,268,986 
Gross profit   978,350    763,719    2,813,211    2,617,373 
Operating expenses                    
Sales and marketing   118,876    156,497    462,545    454,714 
General and administrative expenses   937,762    825,993    2,616,489    2,256,004 
Total operating expenses   1,056,638    982,490    3,079,034    2,710,718 
Operating income / (loss)   (78,288)   (218,771)   (265,823)   (93,345)
Interest expense   (155,310)   (69,638)   (321,417)   (189,552)
Other income – ERTC refund   491,801    -    491,801    - 
Other income   -    -    112    - 
Interest income   798    328    1,490    1,291 
Total other income / (expenses)   337,289    (69,310)   171,986    (188,261)
Net income / (loss)  $259,001   $(288,081)  $(93,837)  $(281,606)
Net income (loss) per share of common stock attributable to common stockholders                    
Basic  $0.04   $(0.04)  $(0.01)  $(0.04)
Diluted  $0.04   $(0.04)  $(0.01)  $(0.04)
Weighted average shares used in computing net loss per share of common stock                    
Basic   7,039,144    6,694,493    6,953,265    6,694,493 
Diluted   7,197,605    6,694,493    6,953,265    6,694,493 

  

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

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FUNCTIONAL BRANDS INC.

CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)

(In U.S. dollars, except share data or otherwise noted)

 

   Nine Months Ended
September 30,		 
   2025   2024 
         
Cash flows from operating activities:        
Net loss  $(93,837)  $(281,606)
Reconcile net loss to cash provided by operating activities          
Allowance for doubtful accounts receivable   (3,796)   - 
Allowance for inventory obsolescence   12,895    - 
Depreciation of property and equipment   15,990    40,576 
Amortization of right-of-use assets   246,511    227,912 
Amortization of intangible assets   34,597    34,597 
Financing expense on warrant issuance   45,263    - 
Stock-based compensation   598,856    - 
Issuance of shares for financing expense   50,630    - 
Changes in operating assets and liabilities:          
Accounts receivable   218,054    (103,316)
Inventories   5,830    (59,921)
Prepaid expenses and other current assets   1,042    1,429 
Accounts payable and accrued liabilities   591,172    331,409 
Other current liabilities   (908)   (31,515)
Lease liabilities   (243,941)   (213,743)
Net cash provided by (used in) operating activities   1,478,358    (54,178)
           
Cash flows from investing activities:          
Purchase of property and equipment   (8,512)   (1,881)
Net cash used in investing activities:   (8,512)   (1,881)
           
Cash flows from financing activities:          
Deferred offering costs   (667,810)   (95,625)
Proceeds from loans   195,277    280,000 
Payments for payable for acquisition   (115,000)   (200,001)
Proceeds from debt facilities   99,735    86,662 
Repayment of loans   (75,106)   (4,492)
Line of credit repayment   (110,683)   (132,329)
SBA loan repayment   (2,577)   (2,421)
Net cash used in financing activities   (676,164)   (68,206)
           
Increase (decrease) in cash   793,682    (124,265)
Cash beginning of period   211,642    374,435 
Cash, end of period  $1,005,324   $250,170 
           
Supplemental disclosures of cash flow information          
Cash paid for interest  $241,662   $187,031 
           
Non-cash investing and financing activities          
Common stock issued for convertible note payable and accrued interest  $122,331   $- 
Loan payable, related party  $225,000   $- 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

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