Company: BRID
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001493152-25-012266
Chunk: 38

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-08-22
Form: 10-Q
Item: Part I, Item 1
Chunk 38
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 tax rate. The effective income tax rate differed from the applicable mixed statutory rate of approximately 26.4% due to non-deductible
meals and entertainment, non-taxable gains and losses on life insurance policies and state income taxes.

Liquidity
and Capital Resources

The
principal source of operating cash flows is cash receipts from the sale of our products, net of costs to manufacture, store, market and
deliver such products. We evaluate cash and cash equivalents related to borrowing capacity and short-term and long-term investments.
We normally fund our operations from cash balances and cash flow generated from operations. Recent losses may necessitate short-term
or long-term borrowing to fund inventory purchases to meet customer orders. We are focused on restoring profitability to the Company
by driving top-line revenue growth and reducing costs. In line with this focus, the Company is in discussions with and has begun production
of customer products under private-label arrangements with the goal of increasing product sales volume. Market data indicates that due
to higher inflation and rising costs for basic needs, consumers are increasingly turning to private-label products to reduce their expenses.
The Company is also seeking bids for its production materials to drive increased competition among its vendors while maintaining quality
inputs at the best possible price.

On
July 23, 2025, we entered into an amended and restated credit agreement dated November 30, 2024, with Wells Fargo. This agreement
amends, restates and supersedes our existing credit agreement with Wells Fargo that was set to expire by its terms on November 30,
2025. Under the terms of this amended and restated credit agreement and the revolving line of credit note, we may borrow up to $7,500 from time to time until
July 31, 2026. Refer to Note 6 – Equipment Notes Payable and Financial Arrangements to the Condensed Consolidated Financial Statements included
within this Report for further information.

We
are in the process of implementing price increases on our products to help offset some of the higher costs for meat commodities and
are focused on reducing selling, general and administrative expenses. Certain factors including but not limited to increased
commodity costs, tariffs, the willingness of customers to accept price increases and inflation of input costs, to name a few, may
cause future outcomes to differ materially from those foreseen in forward-looking statements. As of July 11, 2025, we had $1,111 of
current debt on equipment loans, $52,832