Mr. Bill Besenhofer reports

THE FRESH FACTORY REPORTS STRONG Q3 2023 RESULTS, WITH RECORD YTD BILLED REVENUE OF $17.2M

The Fresh Factory B.C. Ltd. has released its quarterly and year-to-date financial results for the period ending Sept. 30, 2023.

Bill Besenhofer, Chief Executive Officer and co-founder of The Fresh Factory, commented: "We are thrilled to announce our continued growth, with billed revenue totaling $5.8 million ($7.7M CAD) for the quarter. In addition, the team worked hard to achieve our first quarter of positive adjusted EBITDA results. We feel we have set the table for continued success by implementing a more disciplined, metric-driven approach to managing our day-to-day operations. As we continue to grow, we want to do so profitably and allow companies to turn to us as a trusted partner, relying on our expertise in everything from product formulation to product fulfillment. Furthermore, we recently began trading on the TSX Venture Exchange, opening up new opportunities to share our story with a broader investor audience."

Financial Highlights: YTD 2023 vs. YTD 2022Record billed revenue of $17.2M ($22.9M CAD) YTD 2023, vs. $14.4M ($19.2M CAD) YTD 2022, an increase of 19.4%, was driven by the onboarding of new customers, worth approximately $1.4M ($1.9M CAD) and increased demand from existing customers, representing approximately 14% organic growth.Adjusted EBITDA of $(0.7)M ($(0.9)M CAD) YTD 2023, an improvement of approximately ~$0.6M compared to YTD 2022, was driven by increased sales and efficiencies across the supply chain.Adjusted gross margin of $4.9M ($6.5M CAD) in YTD 2023, vs. $3.9 ($5.2M CAD) in YTD 2022, represents a 56.7% increase.

Financial and Operational Highlights: Q3 2023 vs Q2 2023Total billed revenue was $5.8M ($7.7M CAD) in Q3 2023 vs. $5.9M ($7.8M CAD) for Q2 2023.Adjusted EBITDA was +$0.1M (+$0.1M CAD) in Q3 2023 vs. $(0.1)M ($(0.1)M CAD) in Q2 2023, an increase of $0.2M despite slightly lower sales.Adjusted gross margin was $1.8M ($2.4M CAD) in Q3 2023 vs. $1.7M ($2.3M CAD) in Q2 2023.On October 5, 2023, the Company began trading on the TSX Venture Exchange ("TSXV") and in conjunction was delisted from the Canadian Securities Exchange ("CSE").

Strategic Areas of Focus

The Fresh Factory is building a platform to serve emerging food and beverage brands in the fresh-food sector with an emphasis on better-for-you products. The Company has established three key areas of focus on which it will report on a quarterly basis moving forward.

Execution: Focus on safety, high-quality operations, and strong margins.Adjusted gross margins, on a percentage basis, increased by 0.7% from 29.5% in Q2 2023 to 30.2% in Q3 2023.Operating profits increased 1.3% to $1.0M ($1.3M CAD) in Q3 2023 from $0.9M ($1.2M CAD) in Q2 2023.Operating profit, on a percentage basis, increased from 16.6% in Q2 2023 to 16.9% in Q3 2023 due to operational efficiencies.

Growth: Invest in and grow with the right brands across diversified channels.The Company onboarded four new customers, expanding its product portfolio.The increase in revenue through 2022 and into 2023 was due to both the addition of new customers and increased sales to existing customers, and the company expects that trend to continue.The Company produced 3.2M total units in Q3 2023, a 23% increase from Q3 2022.

Sustainability: Become a market leader in sustainability.The Company continues to use solar energy to help offset its electrical usage.The Company continues to compost 100% of its food waste and donate 100% of produce extras.The Company improved its FOG (fats, oils, grease) mitigation system, enabling better collection and recycling of the oils used in production and improving the quality of wastewater expelled from the facility.The Company launched a project to determine the Scope 1 and Scope 2 carbon-emissions output from each of its production facilities and vehicles.

The earnings news release should be read in conjunction with the Company's interim financial statements for the quarterly and year-to-date financial results for the period ending September 30, 2023, which can be found on The Fresh Factory's issuer profile on SEDAR+ at www.sedarplus.ca.

For conversion purposes, this release used $0.75 as the conversion rate from CAD to USD.

All figures in this press release are in US dollars unless otherwise stated.

About The Fresh Factory B.C. Ltd.

The Fresh Factory is a vertically integrated company focused on accelerating the growth of the fresh, clean-label, plant-based food and beverage brands of tomorrow. The Fresh Factory owns or partners with emerging brands in the plant-based space to develop, manufacture, and sell products made from fresh produce and recognizable ingredients. It operates from its centrally located manufacturing facility near Chicago, serving customers across the United States. As a public benefits corporation, The Fresh Factory is ESG-focused, driven to make a lighter, greener impact on the environment and a stronger, positive impact on local communities and the food system as a whole. Learn more about The Fresh Factory at www.thefreshfactory.co and find The Fresh Factory on social media at Instagram, Twitter, and LinkedIn. To receive news and updates about The Fresh Factory, visit their website at www.thefreshfactory.co.

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