Owners Pocket $6.3 Million As Lifeway Foods Posts Loss: Report

MORTON GROVE, IL — Lifeway Foods stock is at its lowest point in more than 20 years, the company has gone from turning a $3.5 million profit in 2016 to losing $345,000 last year and sales fell 4 percent, Crain's Chicago Business reported. The publicly traded manufacturer of the fermented dairy drink kefir was founded in 1986 by the Smolyansky family, which is now in its second generation of leadership.

As profit turned to loss last year, three members of the family received a combined $6.3 million in compensation. That equates to more than 5 percent of the company's total sales. According to the co-founder of the executive compensation firm Board Advisory, the company is "being run like a personal piggy bank," Crain's reported.

"This is the kind of pay practice that give executive compensation a black eye," Managing Director Paul McConnell told Crain's, noting leaders of similarly sized companies tend to make about a third of the $2.4 million that CEO Julie Smolyansky and her brother, COO Edward Smolyansky, each receive.

Lifeway did not immediately respond to a request for comment, but Julie Smolyansky, who became the youngest woman to lead a publicly traded company in 2002 when her father died of a heart attack, promised to Crain's it was just a matter of time before the company reached $500 million in sales.

“We’re incredibly proud of the strength of our brand, which is evident in the loyalty of our customers despite pressures on the dairy category," Smolyansky said earlier this month in a release announcing a 15 percent drop in sales last quarter.

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