Mama’s Creations Reports Fourth Quarter and Fiscal Year 2024 Financial Results
- Mama's Creations reported an impressive 17% revenue growth in Q4 2024, reaching $26.7 million.
- The company generated $6.7 million in cash flow from operations during the same quarter, showcasing strong financial performance.
- Gross profit increased by 22% to $7.8 million in Q4 2024, with a significant improvement in gross margin profile to 29.3% of total revenues.
- Adjusted EBITDA rose by 22% to $2.9 million in Q4 2024, reflecting the company's operational efficiency and financial strength.
- Mama's Creations successfully launched retail products for nationwide delivery through direct-to-consumer e-commerce and Amazon.com, expanding its market reach.
- The company appointed a seasoned finance leader to the Board of Directors, enhancing its financial oversight and strategic planning capabilities.
- Despite an increase in operating expenses and a decline in net income for Q4 2024, Mama's Creations remains confident in its growth trajectory and market positioning.
- Management emphasized long-term growth strategies, including investments in marketing, trade promotions, and potential M&A opportunities to drive revenue growth and market consolidation.
- Net income declined by 24% in Q4 2024 compared to the same period last year, reaching $1.4 million.
- Operating expenses increased by 29% in Q4 2024, impacting the company's overall financial performance.
- Despite a substantial increase in gross profit, the company experienced a decrease in earnings per share (Diluted) by 33% in Q4 2024.
- The company's net income for fiscal year 2024 decreased by 24% compared to the previous year, raising concerns about profitability.
- Mama's Creations' operating expenses as a percentage of sales increased in fiscal year 2024, indicating a potential strain on operational efficiency.
Insights
“Catapult” in 4 Cs Strategy Drives
EAST RUTHERFORD, NJ, April 24, 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 fourth quarter and fiscal year ended January 31, 2024.
Financial Summary:
| Three Months Ended Jan. 31, | Fiscal Year Ended Jan. 31, | |||||||||||||||||||||||
| $ in millions | 2024 | 2023 | % Increase | 2024 | 2023 | % Increase | ||||||||||||||||||
| Revenues | $ | 26.7 | $ | 22.8 | 17 | % | $ | 103.3 | $ | 93.2 | 11 | % | ||||||||||||
| Gross Profit | $ | 7.8 | $ | 6.4 | 22 | % | $ | 30.3 | $ | 19.4 | 56 | % | ||||||||||||
| Operating Expenses | $ | 5.9 | $ | 4.5 | 29 | % | $ | 21.4 | $ | 16.6 | 29 | % | ||||||||||||
| Net Income* | $ | 1.4 | $ | 1.8 | (24 | %) | $ | 6.5 | $ | 2.3 | 184 | % | ||||||||||||
| Earnings per Share (Diluted) | $ | 0.04 | $ | 0.06 | (33 | %) | $ | 0.17 | $ | 0.06 | 183 | % | ||||||||||||
| Adj. EBITDA (non-GAAP) | $ | 2.9 | $ | 2.4 | 22 | % | $ | 11.7 | $ | 4.5 | 161 | % | ||||||||||||
*Fourth quarter FY2023 (prior year) was impacted by a one-time book-to-tax adjustment that improved net income by approx.
Key Fourth Quarter Fiscal 2024 & Subsequent Operational Highlights:
- Participated and exhibited at leading industry trade shows including the 2024 UNFI Natural and Conventional Spring and Summer Shows in San Diego and Orlando, NATSO Connect 2024, and DOT Innovations 2024 – in addition to hosting the first-ever Broker Summit at the Company’s headquarters.
- Launched popular MamaMancini’s retail products for delivery throughout the continental United States through the Company’s first direct-to-consumer e-commerce platform as well as on Amazon.com.
- Appointed veteran finance leader Lynn L. Blake to Board of Directors and as Chair of the Audit Committee, bringing over 30 years of financial leadership and public market experience.
- Invited to present at leading investor conferences nationally, including the 36th Annual ROTH Conference, LD Micro Invitational, 14th Annual Craig-Hallum Alpha Select Conference, and 12th Annual ROTH Deer Valley Conference – in addition to hosting a 2nd annual investor day at the Company’s headquarters.
- Cash and cash equivalents as of January 31, 2024 increased to
$11.0 million , as compared to$4.4 million as of January 31, 2023. The increase was driven by$11.6 million in cash flow from operations in fiscal 2024,$6.7 million of which was generated in the fourth quarter, and$3.3 million of which was used to pay down the Company’s debt.
Management Commentary
“Fiscal 2024 was a transformational year, culminating in double-digit revenue growth and year-over-year expansion of our gross margin profile by 850 basis points to
“The improvement in our gross margin profile was driven by operational efficiency improvements across the organization, made possible by getting the small things right, with long-term opportunities to unlock a several hundred basis point improvement through strategic CapEx investments. These investments will position us to invest surplus gross margin, beyond our goal in the high
“On the marketing front, we are enhancing our industry presence with record attendance at six of the leading, highest impact trade shows in the industry. Our investments in high-impact marketing activities, such as our recent programming with Z100 radio, social media “Year of Meatballs” National Meatball Day promotion, as well as multiple marketing programs with key strategic customers including Sam’s Club and BJs, have the potential to drive meaningful change in brand awareness both at the industry and consumer level.
“Looking ahead, there is a compelling and growing opportunity in the deli space as consumer preferences shift toward fresh, deli-prepared foods. We have several levers available to drive growth – from new SKUs in existing customers, to new tier-1 customers and continued investments in marketing & trade promotion to increase velocities of existing in-store items. These tailwinds, when paired with a robust landscape of attractively priced M&A opportunities, gives us confidence that MAMA has the potential to serve as a consolidator in the fragmented prepared foods market and emerge as a leading one-stop-shop deli solution nationally.”
Fourth Quarter Fiscal 2024 Financial Results
Revenue for the fourth quarter of fiscal 2024 increased
Gross profit increased
Operating expenses totaled
Net income for the fourth quarter of fiscal 2024 totaled
Adjusted EBITDA, a non-GAAP measure, increased
Cash and cash equivalents as of January 31, 2024 increased to
Conference Call
Management will host an investor conference call at 4:30 p.m. Eastern time on Wednesday, April 24, 2024 to discuss the Company’s fourth quarter and fiscal year 2024 financial results, provide a corporate update, and conclude with Q&A from telephone participants. To participate, please use the following information:
Q4 FY2024 Earnings Conference Call
Date: Wednesday, April 24, 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: 13745400
Webcast: MAMA Q4 FY2024 Earnings Conference Call
Please join at least five minutes before the start of the call to ensure timely participation.
A playback of the call will be available through Friday, May 24, 2024. To listen, please call 1-844-512-2921 within the United States and Canada or 1-412-317-6671 when calling internationally, using replay pin number 13745400. A webcast replay will also be available using the webcast link above.
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. 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 | Fiscal Year Ended | |||||||||||||||
| January 31, | January 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net income available to common stockholders | $ | 1,408 | $ | 1,823 | $ | 6,512 | $ | 2,270 | ||||||||
| Depreciation | 276 | 242 | 1,043 | 920 | ||||||||||||
| Amortization of debt discount | 5 | 12 | 22 | 22 | ||||||||||||
| Amortization of right of use assets | 24 | 5 | 8 | 17 | ||||||||||||
| Amortization of intangibles | 388 | 115 | 1,080 | 482 | ||||||||||||
| Taxes | 486 | -97 | 2,008 | 9 | ||||||||||||
| Interest, net | 66 | 187 | 549 | 634 | ||||||||||||
| Stock-based compensation | 216 | 74 | 436 | 110 | ||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 2,869 | $ | 2,361 | $ | 11,658 | $ | 4,464 | ||||||||
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, and other risks identified in the Company's 10-K for the fiscal year ended January 31, 2023 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
Mama’s Creations, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
| January 31, 2024 | January 31, 2023 | |||||||
| Assets: | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 11,022 | $ | 4,378 | ||||
| Accounts receivable, net | 7,859 | 6,832 | ||||||
| Inventories, net | 3,310 | 3,636 | ||||||
| Prepaid expenses and other current assets | 1,375 | 828 | ||||||
| Total current assets | 23,566 | 15,674 | ||||||
| Property, plant, and equipment, net | 4,436 | 3,423 | ||||||
| Intangibles, net | 4,979 | 1,503 | ||||||
| Goodwill | 8,633 | 8,633 | ||||||
| Operating lease right of use assets, net | 2,889 | 3,237 | ||||||
| Deferred tax asset | 503 | 718 | ||||||
| Equity method investment | — | 1,343 | ||||||
| Security Deposits | 95 | 54 | ||||||
| Total Assets | $ | 45,101 | $ | 34,585 | ||||
| Liabilities and Stockholders’ Equity: | ||||||||
| Liabilities: | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 12,425 | $ | 9,063 | ||||
| Term loan, net of debt discount of | 1,514 | 1,492 | ||||||
| Operating leases liability | 434 | 392 | ||||||
| Finance leases payable | 367 | 182 | ||||||
| Promissory notes – related parties | 1,950 | 750 | ||||||
| Total current liabilities | 16,690 | $ | 11,879 | |||||
| Line of credit | — | $ | 890 | |||||
| Operating leases liability – net of current | 2,515 | 2,897 | ||||||
| Finance leases payable – net of current | 1,062 | 249 | ||||||
| Promissory notes – related parties, net of current | 2,250 | 1,500 | ||||||
| Term loan – net of current | 3,003 | 4,655 | ||||||
| Total long-term liabilities | 8,830 | 10,191 | ||||||
| Total Liabilities | 25,520 | 22,070 | ||||||
| Commitments and contingencies (Note 9) | ||||||||
| Stockholders’ Equity: | ||||||||
| Series A Preferred stock, | - | - | ||||||
| Series B Preferred stock, | - | - | ||||||
| Preferred stock, | - | - | ||||||
| Common stock, | — | — | ||||||
| Additional paid in capital | 23,278 | 22,724 | ||||||
| Accumulated deficit | (3,547 | ) | (10,059 | ) | ||||
| Less: Treasury stock, 230,000 shares at cost | (150 | ) | (150 | ) | ||||
| Total Stockholders’ Equity | 19,581 | 12,515 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 45,101 | $ | 34,585 | ||||
Mama’s Creations, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
| For the Years Ended | For the three months ended | |||||||||||||||
| January 31, | January 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Sales-net of slotting fees and discounts | $ | 103,284 | $ | 93,188 | $ | 26,725 | $ | 22,817 | ||||||||
| Costs of sales | 72,951 | 73,770 | 18,904 | 16,385 | ||||||||||||
| Gross profit | 30,333 | 19,418 | 7,821 | 6,432 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 414 | 135 | 124 | 42 | ||||||||||||
| Selling, general and administrative | 21,029 | 16,460 | 5,732 | 4,496 | ||||||||||||
| Total operating expenses | 21,443 | 16,595 | 5,856 | 4,538 | ||||||||||||
| Income from operations | 8,890 | 2,823 | 1,965 | 1,894 | ||||||||||||
| Other income (expenses) | ||||||||||||||||
| Interest | (549 | ) | (634 | ) | (66 | ) | (187 | ) | ||||||||
| Amortization of debt discount | (22 | ) | (22 | ) | (5 | ) | (12 | ) | ||||||||
| Other income | 27 | 3 | 0 | 0 | ||||||||||||
| Total other expenses | (544 | ) | (653 | ) | (71 | ) | (199 | ) | ||||||||
| Net income before income tax provision and income from equity method investment | 8,346 | 2,170 | 1,894 | 1,695 | ||||||||||||
| Income from equity method investment | 223 | 143 | 0 | 53 | ||||||||||||
| Income tax provision | (2,008 | ) | (9 | ) | (486 | ) | 97 | |||||||||
| Net income | 6,561 | 2,304 | 1,408 | 1,845 | ||||||||||||
| Less: series B preferred dividends | (49 | ) | (34 | ) | 0 | (22 | ) | |||||||||
| Net income available to common stockholders | 6,512 | 2,270 | 1,408 | 1,823 | ||||||||||||
Mama’s Creations, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
| For the Years Ended January 31, | ||||||||
| 2024 | 2023 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income | $ | 6,561 | $ | 2,304 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation | 1,043 | 920 | ||||||
| Provision for credit losses | (140 | ) | 233 | |||||
| Amortization of debt discount | 22 | 22 | ||||||
| Amortization of right of use assets | 348 | 360 | ||||||
| Amortization of intangibles | 1,080 | 482 | ||||||
| Stock-based compensation | 436 | 110 | ||||||
| Allowance for obsolete inventory | 63 | — | ||||||
| Change in deferred tax asset | 215 | (269 | ) | |||||
| Income from equity method investment | (223 | ) | (143 | ) | ||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 2,392 | 563 | ||||||
| Inventories | 263 | (745 | ) | |||||
| Prepaid expenses | (540 | ) | (174 | ) | ||||
| Security deposits | (35 | ) | (2 | ) | ||||
| Accounts payable and accrued expenses | 476 | 2,191 | ||||||
| Operating lease liability | (340 | ) | (343 | ) | ||||
| Net Cash Provided by Operating Activities | 11,621 | 5,509 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash paid for fixed assets | (786 | ) | (593 | ) | ||||
| Cash paid for acquisition/investment in Chef Inspirational Foods, LLC, net | (646 | ) | (500 | ) | ||||
| Net Cash (Used in) Investing Activities | (1,432 | ) | (1,093 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from series b preferred stock offering | — | 1,365 | ||||||
| Payment of stock offering costs | — | (66 | ) | |||||
| Cash paid for financing fees | — | (27 | ) | |||||
| Repayment of term loan | (1,652 | ) | (1,293 | ) | ||||
| (Repayment) borrowings of line of credit, net | (890 | ) | 125 | |||||
| Repayment of term loan - related party | (750 | ) | (750 | ) | ||||
| Repayment of finance lease obligations | (272 | ) | (235 | ) | ||||
| Payment of Series B Preferred dividends | (49 | ) | (34 | ) | ||||
| Proceeds from exercise of options | 68 | 26 | ||||||
| Net Cash (Used in) Financing Activities | (3,545 | ) | (889 | ) | ||||
| Net Increase in Cash | 6,644 | 3,527 | ||||||
| Cash and cash equivalents - Beginning of Period | 4,378 | 851 | ||||||
| Cash and cash equivalents - End of Period | $ | 11,022 | $ | 4,378 | ||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | ||||||||
| Cash Paid During the Period for: | ||||||||
| Income taxes | $ | 1,620 | $ | 32 | ||||
| Interest | $ | 654 | $ | 634 | ||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Finance lease asset additions | $ | 1,270 | $ | 72 | ||||
| Related party loan to finance acquisition | $ | 2,700 | $ | — | ||||
| Non-cash consideration paid in common stock for equity method investment | $ | — | $ | 700 | ||||
| Non-cash deposits on prepaid additions | $ | — | $ | 385 | ||||
| Settlement of liability in common stock | $ | 50 | $ | - | ||||
See accompanying notes to the condensed consolidated financial statements.
FAQ
What was Mama's Creations' revenue growth percentage in Q4 2024?
How much cash flow from operations did Mama's Creations generate in Q4 2024?
What was the gross profit increase percentage in Q4 2024 for Mama's Creations?
Who was appointed to the Board of Directors of Mama's Creations recently?
How did Mama's Creations' net income compare in Q4 2024 to the same period last year?
What strategies did Mama's Creations emphasize for future growth?
What was the percentage increase in adjusted EBITDA for Mama's Creations in Q4 2024?
How did Mama's Creations' operating expenses impact their financial performance in Q4 2024?
What was the net income for Mama's Creations in fiscal year 2024?
What was the change in gross margin profile for Mama's Creations in fiscal year 2024?
