ILLINOIS
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000-17363
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36-3442829
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(State or other jurisdiction of
incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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6431 West Oakton St. Morton Grove, IL
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60053
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(Address of principal executive offices)
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(Zip code)
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Item 2.02
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Results of Operations and Financial Condition.
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Item 9.01
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Financial Statements and Exhibits.
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99.1
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Press release dated May 12, 2014.
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LIFEWAY FOODS, INC.
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Dated: May 12, 2014
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By:
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/s/ Edward Smolyansky
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Edward Smolyansky
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Chief Financial and Accounting Officer, Secretary and Treasurer
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Exhibit No.
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Description
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99.1
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Press release dated May 12, 2014.
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Lifeway Foods, Inc.
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Phone: 877.281.3874
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Email: info@Lifeway.net
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Investor Relations:
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ICR
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Katie Turner
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John Mills
646.277.1228
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March 31,
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December 31,
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|||||||||||
2014
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2013
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2013
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||||||||||
ASSETS
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Current assets
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||||||||||||
Cash and cash equivalents
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$ | 2,474,708 | $ | 2,739,957 | $ | 3,306,608 | ||||||
Investments
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2,790,935 | 2,062,343 | 2,516,380 | |||||||||
Certificates of deposits in financial institutions
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— | 250,000 | 15,373 | |||||||||
Inventories
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7,355,884 | 7,080,899 | 6,899,008 | |||||||||
Accounts receivable, net of allowance for doubtful
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||||||||||||
accounts and discounts ($1,300,000 and $1,350,000 and $1,050,000)
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10,794,866 | 11,915,981 | 10,444,839 | |||||||||
Prepaid expenses and other current assets
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39,855 | 92,827 | 128,323 | |||||||||
Other receivables
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91,628 | 5,165 | 103,272 | |||||||||
Deferred income taxes
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360,110 | 295,701 | 322,071 | |||||||||
Refundable income taxes
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2,580,323 | 84,828 | 1,014,947 | |||||||||
Total current assets
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26,488,309 | 24,527,701 | 24,750,821 | |||||||||
Property and equipment, net
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21,248,982 | 14,917,260 | 20,824,448 | |||||||||
Intangible assets
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||||||||||||
Goodwill and other non amortizable brand assets
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14,068,091 | 14,068,091 | 14,068,091 | |||||||||
Other intangible assets, net of accumulated amortization of
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||||||||||||
$4,734,478, $4,020,598 and $4,555,559 at March 31, 2014
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and 2013 and at December 31, 2013, respectively
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3,571,522 | 4,285,403 | 3,750,441 | |||||||||
Total intangible assets
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17,639,613 | 18,353,494 | 17,818,532 | |||||||||
Other Assets
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Long-term accounts receivable net of current portion
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273,000 | 294,000 | 280,000 | |||||||||
Total assets
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$ | 65,649,904 | $ | 58,092,455 | $ | 63,673,801 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
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||||||||||||
Current liabilities
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||||||||||||
Current maturities of notes payable
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$ | 879,354 | $ | 543,591 | $ | 875,002 | ||||||
Accounts payable
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6,958,999 | 6,465,801 | 6,723,179 | |||||||||
Accrued expenses
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2,732,170 | 1,197,883 | 1,284,060 | |||||||||
Accrued income taxes
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— | 462,593 | — | |||||||||
Total current liabilities
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10,570,523 | 8,669,868 | 8,882,241 | |||||||||
Notes payable
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8,775,587 | 4,820,160 | 8,999,012 | |||||||||
Deferred income taxes
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2,689,167 | 2,909,134 | 2,843,426 | |||||||||
Total liabilities
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22,035,277 | 16,399,162 | 20,724,679 | |||||||||
Stockholders' equity
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Common stock, no par value; 40,000,000 shares authorized;
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17,273,776 shares issued; 16,346,017 shares outstanding
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at March 31, 2014; 17,273,776 shares issued; 16,346,017 shares outstanding at March 31, 2013 and 16,346,017 shares outstanding at December 31, 2013
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6,509,267 | 6,509,267 | 6,509,267 | |||||||||
Paid-in-capital
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2,032,516 | 2,032,516 | 2,032,516 | |||||||||
Treasury stock, at cost
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( 8,187,682 | ) | ( 8,187,682 | ) | ( 8,187,682 | ) | ||||||
Retained earnings
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43,247,392 | 41,270,416 | 42,587,214 | |||||||||
Accumulated other comprehensive income (loss), net of taxes
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13,134 | 68,776 | 7,807 | |||||||||
Total stockholders' equity
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43,614,627 | 41,693,293 | 42,949,122 | |||||||||
Total liabilities and stockholders' equity
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$ | 65,649,904 | $ | 58,092,455 | $ | 63,673,801 |
(Unaudited)
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Three Months Ended
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March 31,
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2014
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2013
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Sales
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$ | 32,061,147 | $ | 27,590,622 | ||||||||||||
Less: discounts and allowances
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( 2,929,436 | ) | ( 3,203,591 | ) | ||||||||||||
Net sales
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29,131,711 | 29,131,711 | 24,387,031 | 24,387,031 | ||||||||||||
Cost of goods sold
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21,681,910 | 15,402,875 | ||||||||||||||
Depreciation expense
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383,361 | 394,125 | ||||||||||||||
Total cost of goods sold
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22,065,271 | 15,797,000 | ||||||||||||||
Gross profit
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7,066,440 | 8,590,031 | ||||||||||||||
Selling expenses
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3,479,688 | 2,813,572 | ||||||||||||||
General and administrative
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2,380,631 | 1,868,100 | ||||||||||||||
Amortization expense
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178,919 | 177,842 | ||||||||||||||
Total operating expenses
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6,039,238 | 4,859,514 | ||||||||||||||
Income from operations
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1,027,202 | 3,730,517 | ||||||||||||||
Other income (expense):
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Interest and dividend income
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28,698 | 15,009 | ||||||||||||||
Rental income
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500 | 3,269 | ||||||||||||||
Interest expense
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( 65,569 | ) | ( 36,299 | ) | ||||||||||||
Gain (loss) on sale of investments, net
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reclassified from OCI
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4,808 | 64,335 | ||||||||||||||
Loss on disposition of assets
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— | — | ||||||||||||||
Other income (expense)
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— | — | ||||||||||||||
Total other income (expense)
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(31,563 | ) | 46,314 | |||||||||||||
Income before provision for
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income taxes
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995,639 | 3,776,831 | ||||||||||||||
Provision for income taxes
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335,461 | 1,411,192 | ||||||||||||||
Net income
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$ | 660,178 | $ | 2,365,639 | ||||||||||||
Basic and diluted earnings
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per common share
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0.04 | 0.14 | ||||||||||||||
Weighted average number of
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shares outstanding
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16,346,017 | 16,346,017 | ||||||||||||||
COMPREHENSIVE INCOME
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Net income
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$ | 660,178 | $ | 2,365,639 | ||||||||||||
Other comprehensive income
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(loss), net of tax:
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Unrealized gains (losses) on
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investments (net of tax)
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8,044 | 51,535 | ||||||||||||||
Less reclassification adjustment
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for (gains) losses included in
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net income (net of taxes)
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(2,717 | ) | ( 36,349 | ) | ||||||||||||
Comprehensive income
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$ | 665,505 | $ | 2,380,825 |
March 31,
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||||||||
2014
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2013
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Cash flows from operating activities:
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Net income
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$ | 660,178 | $ | 2,365,639 | ||||
Adjustments to reconcile net income to net
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cash flows from operating activities:
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Depreciation and amortization
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562,280 | 571,967 | ||||||
Loss (gain) on sale of investments, net
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(4,808 | ) | (64,335 | ) | ||||
Deferred income taxes
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(196,401 | ) | (192,090 | ) | ||||
Bad Debt Expense
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126,049 | 51,819 | ||||||
Loss (Gain) on sale of equipment
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— | — | ||||||
(Increase) decrease in operating assets:
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Accounts receivable
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(468,826 | ) | (3,244,063 | ) | ||||
Other receivables
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11,644 | 3,660 | ||||||
Inventories
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(456,876 | ) | (1,141,713 | ) | ||||
Refundable income taxes
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(1,565,376 | ) | — | |||||
Prepaid expenses and other current assets
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88,468 | 4,311 | ||||||
Increase (decrease) in operating liabilities:
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Accounts payable
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235,820 | 2,209,076 | ||||||
Accrued expenses
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1,448,110 | 42,206 | ||||||
Income taxes payable
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— | 208,282 | ||||||
Net cash provided by operating activities
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440,262 | 814,759 | ||||||
Cash flows from investing activities:
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Purchases of investments
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(814,804 | ) | (1,271,516 | ) | ||||
Proceeds from sale of investments
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554,609 | 1,170,271 | ||||||
Investments in certificates of deposits
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— | — | ||||||
Redemption of certificates of deposits
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15,000 | 200,000 | ||||||
Purchases of property and equipment
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(807,894 | ) | (324,608 | ) | ||||
Proceeds from sale of equipment
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— | — | ||||||
Net cash (used in) provided by investing activities
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(1,053,089 | ) | (225,853 | ) | ||||
Cash flows from financing activities:
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Repayment of notes payable
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(219,073 | ) | (135,175 | ) | ||||
Net cash provided (used in) financing activities
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(219,073 | ) | (135,175 | ) | ||||
Net (decrease) increase in cash and cash equivalents
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(831,900 | ) | 453,731 | |||||
Cash and cash equivalents at the beginning of the period
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3,306,608 | 2,286,226 | ||||||
Cash and cash equivalents at the end of the period
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$ | 2,474,708 | $ | 2,739,957 |