Mama’s Creations Reports First Quarter Fiscal 2025 Financial Results
Mama’s Creations (NASDAQ: MAMA) reported a 29% increase in first-quarter fiscal 2025 revenues, reaching $29.8 million. Gross profit rose 17% to $7.5 million, but net income fell by 61% to $0.6 million, translating to $0.01 per diluted share. This decline was partly due to a one-time $0.9 million charge for stock compensation.
Key highlights include participation in a ‘Costco Roadshow’ and attendance at major industry trade shows. The company introduced new products, such as Breakfast Wraps and Meatball Entertaining Sleeves. Cash flow from operations generated $3.6 million, increasing cash equivalents to $13 million by April 30, 2024. Operating expenses rose 51% to $6.7 million.
CEO Adam L. Michaels emphasized automation and efficiency improvements to mitigate commodity cost increases. Adjusted EBITDA remained flat at $2.5 million. The company's focus is on profitable growth and strategic marketing initiatives.
- Revenue increased by 29% to $29.8 million.
- Gross profit rose by 17% to $7.5 million.
- Cash equivalents increased to $13 million, driven by $3.6 million in cash flow from operations.
- Selected for Costco Roadshow, potentially expanding product placement.
- Participation in major industry trade shows enhances market presence.
- Introduction of new products like Breakfast Wraps and Meatball Entertaining Sleeves.
- Focus on operational efficiencies and automation to offset commodity cost increases.
- Net income decreased by 61% to $0.6 million.
- Earnings per share fell 75% to $0.01.
- Operating expenses increased by 51% to $6.7 million.
- Gross margin decreased from 27.6% to 25%.
Insights
Mama’s Creations has reported a significant 29% increase in revenues for Q1 fiscal 2025, totaling
The participation of Mama’s Creations in the ‘Costco Roadshow’ is a strategic move with potential long-term benefits. Costco’s large-scale operations provide a significant opportunity for the company, potentially leading to permanent placement in Costco clubs regionally and nationally. This exposure can drive substantial volume increases and revenue growth. Additionally, their proactive engagement in renowned industry trade shows and investor conferences enhances brand visibility and can attract new customer segments. The launch of new products like Breakfast Wraps and Gourmet Paninis at the IDDBA 2024 underscores the company’s commitment to innovation and expanding its product line, which could further strengthen its market position and attract more consumers. These strategic marketing and operational initiatives, paired with a strong relationship with Costco, position the company well for sustained growth.
Mama’s Creations has demonstrated a clear focus on improving operational efficiency through automation and strategic CapEx investments. Addressing commodity price increases by enhancing chicken processing capabilities and implementing automation to reduce labor costs reflects a forward-thinking approach. These strategic investments are important for maintaining and potentially improving gross margins despite rising input costs. The company’s emphasis on integrating new technologies to optimize the value chain could result in significant cost savings and improved operational efficiency in the long term. Ensuring these initiatives translate into tangible operational improvements will be essential for maintaining competitiveness in the increasingly dynamic prepared foods market.
First Quarter Revenues Increase
EAST RUTHERFORD, NJ, June 11, 2024 (GLOBE NEWSWIRE) -- Mama’s Creations, Inc. (NASDAQ: MAMA), a leading national marketer and manufacturer of fresh deli prepared foods, has reported its financial results for the first quarter ended April 30, 2024.
Financial Summary:
| Three Months Ended April 30, | ||||||
| $ in millions | 2024 | 2023 | % Increase | |||
| Revenues | $ | 29.8 | $ | 23.1 | 29 | % |
| Gross Profit | $ | 7.5 | $ | 6.4 | 17 | % |
| Operating Expenses* | $ | 6.7 | $ | 4.4 | 51 | % |
| Net Income* | $ | 0.6 | $ | 1.4 | (61 | )% |
| Earnings per Share (Diluted) | $ | 0.01 | $ | 0.04 | (75 | )% |
| Adj. EBITDA (non-GAAP) | $ | 2.5 | $ | 2.5 | - | |
* Net income was impacted by a
Key First Quarter Fiscal 2025 & Subsequent Operational Highlights:
- Selected by Costco Wholesale Corporation (“Costco”) to participate in a ‘Costco Roadshow’ in the Northeast Region, allowing members to sample the Company’s products as part of an evaluation for a more permanent placement in Costco clubs both in the region as well as nationally.
- Participated and exhibited at leading industry trade shows including the UNFI Spring and Summer Shows in San Diego and Orlando, NATSO Connect, DOT Innovations 2024, the National Restaurant Association Show 2024, and the International Dairy Deli Bakery Association (IDDBA) 2024 Show.
- Introduced multiple incremental products and flavors at IDDBA 2024 – the industry’s most significant event – including Breakfast Wraps, Grilled Chicken Breast in Vacuum Packs, Meatball Entertaining Sleeves and Gourmet Paninis.
- Invited to present at leading investor conferences nationally, including the 36th Annual ROTH Conference, LD Micro Invitational, Planet MicroCap Showcase, Craig Hallum Midwest Institutional Investor Conference, and BMO Global Farm to Market Conference.
- Cash and cash equivalents as of April 30, 2024 increased to
$13.0 million , as compared to$11.0 million as of January 31, 2024. The increase was driven by$3.6 million in cash flow from operations in the first quarter of fiscal 2025.
Management Commentary
“Our continued focus on purposeful and profitable growth drove a
“We have been proactive in addressing recent commodity price increases, successfully partnering with our customers to adjust price while concurrently focusing on implementing automation and operational efficiency improvements across the organization. We are accelerating CapEx investments to improve our value chain, which will allow us to avoid third-party upcharges and reduce labor costs. These price increases, when paired with our efficiency gains through recent CapEx investments to improve chicken processing capabilities, are expected to offset much of the impact on our gross margin profile in the second quarter. We believe these investments will position us to invest surplus gross margin, beyond our goal in the high
“Building upon our previous successful product rotations in Costco, we were recently selected to participate in a ‘Costco Roadshow’ in the Northeast Region, allowing members to sample our products as part of an evaluation for a more permanent placement in Costco. A successful roadshow would provide us with the potential to add new and existing products with Costco, both in the Northeast region as well as nationally across other regions. We continue to expand our partnership with Costco, with our products having seen rotations in 5 of 8 regions over the past twelve months. Costco’s high-volume footprint continues to be an ideal venue for our products.
“In addition to strategic marketing activations, such as our radio features and our in-store advertising, we have enhanced our industry presence with a record attendance by MAMA at high-ROI industry conferences to put our products in front of buyers. Most recently we attended the International Dairy Deli Bakery Association (IDDBA) 2024 Show, one of the most important trade shows in the industry. There we took the opportunity to launch incremental pillars that will prove instrumental to our one-stop-shop deli strategy – providing sampling of our all-new breakfast wraps, sliced chicken breast in vacuum packs, meatball entertaining sleeve, and gourmet paninis. Our ongoing investments in high-impact marketing programs have the potential to drive meaningful change in brand awareness both at the industry and consumer level.
“As we progress through 2024, the growth in the deli space is accelerating with consumers increasingly choosing fresh, clean and easy to prepare meals. The goal of our fourth C, Catapult, is to drive additional growth from new SKUs in existing customers, new tier-1 customers, and from continued investments in marketing & trade promotion to increase velocities of existing in-store items. We also believe that, supported by our strong balance sheet, attractively priced M&A opportunities in the industry could enable us to become a consolidator in the fragmented prepared foods market and emerge as a leading one-stop-shop deli solution on a national level.”
First Quarter Fiscal 2025 Financial Results
Revenue for the first quarter of fiscal 2025 increased
Gross profit increased
Operating expenses totaled
Net income for the first quarter of fiscal 2025 totaled
First quarter net income totaled
Adjusted EBITDA, a non-GAAP measure, remained consistent year-over-year at
Cash and cash equivalents as of April 30, 2024 increased to
Conference Call
Management will host an investor conference call at 4:30 p.m. Eastern time today, Tuesday, June 11, 2024 to discuss the Company’s first quarter fiscal 2025 financial results, provide a corporate update, and conclude with Q&A from telephone participants. To participate, please use the following information:
Q1 FY2025 Earnings Conference Call
Date: Tuesday, June 11, 2024
Time: 4:30 p.m. Eastern time
U.S. Dial-in: 1-877-451-6152
International Dial-in: 1-201-389-0879
Conference ID: 13746633
Webcast: MAMA Q1 FY2025 Earnings Conference Call
Please join at least five minutes before the start of the call to ensure timely participation.
About Mama’s Creations, Inc.
Mama’s Creations, Inc. (NASDAQ: MAMA) is a leading marketer and manufacturer of fresh deli prepared foods, found in over 8,000 grocery, mass, club and convenience stores nationally. The Company’s broad product portfolio, born from MamaMancini’s rich history in Italian foods, now consists of a variety of high quality, fresh, clean and easy to prepare foods to address the needs of both our consumers and retailers. Our vision is to become a one-stop-shop deli solutions platform, leveraging vertical integration and a diverse family of brands to offer a wide array of prepared foods to meet the changing demands of the modern consumer. For more information, please visit https://mamascreations.com.
Use of Non-GAAP Financial Measures
This press release includes the following non-GAAP measure – adjusted EBITDA, which is not a measure of financial performance under GAAP and should not be considered as an alternative to net income as a measure of financial performance. Adjusted EBITDA represents net income (loss) before interest, taxes, depreciation and amortization adjusted for stock-based compensation and one-time costs associated with a legal settlement. The company believes this non-GAAP measure, when considered together with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to the company’s results of operations. However, this non-GAAP measure has significant limitations in that it does not reflect all the costs and other items associated with the operation of the company’s business as determined in accordance with GAAP. In addition, the company’s non-GAAP measures may be calculated differently and are therefore not comparable to similar measures by other companies. Therefore, investors should consider non-GAAP measures in addition to, and not as a substitute for, or superior to, measures of financial performance in accordance with GAAP. A reconciliation of Adjusted EBITDA to net income, its corresponding GAAP measure, is shown below.
US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION
(Unaudited)
(in thousands)
| THREE MONTHS ENDED | |||||
| 30-Apr-24 | |||||
| 2024 | 2023 | ||||
| Net Income (Loss) | $ | 553 | $ | 1,401 | |
| Depreciation | 292 | 248 | |||
| Amortization | 369 | 113 | |||
| Taxes | 179 | 525 | |||
| Interest, net | 35 | 177 | |||
| Share Based Compensation | 205 | 55 | |||
| Stock & Cash Settlement Agreement | 900 | 0 | |||
| Adjusted EBITDA (Non-GAAP) | $ | 2,533 | $ | 2,519 | |
Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may,” “future,” “plan” or “planned,” “will” or “should,” “expected,” “anticipates,” “draft,” “eventually” or “projected.” You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, including the impacts of public health emergencies, such as the COVID-19 pandemic, on our business, financial condition and results of operations, and our inability to mitigate such impacts; the adequacy of our liquidity to pursue our business objectives; reliance on a limited number of customers; loss or retirement of key executives, including prior to identifying a successor; adverse economic conditions or intense competition; pricing pressures in the market and lack of control over the pricing of raw materials and freight; entry of new competitors and products; adverse federal, state and local government regulation (including, but not limited to, the Food and Drug Administration); liability related to the consumption of our products ability to secure placement of our products in key retail locations; wage and price inflation; maintenance of quality control; and issues related to the enforcement of our intellectual property rights, and other risks identified in the Company’s 10-K for the fiscal year ended January 31, 2024 and other filings made by the Company with the Securities and Exchange Commission.
Investor Relations Contact:
Lucas A. Zimmerman
Managing Director
MZ Group – MZ North America
(949) 259-4987
MAMA@mzgroup.us
www.mzgroup.us
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