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Mama’s Creations(MAMA) - 2024 Q1 - Earnings Call Transcript
MAMAMama’s Creations(MAMA)2023-06-13 22:59
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Financial Data and Key Metrics Changes - The first quarter of fiscal 2024 saw a revenue increase of 5.9% to 23.1millioncomparedto23.1 million compared to 21.8 million in the same quarter last year [29] - Gross profit increased by 65% to 6.4million,representing27.66.4 million, representing 27.6% of total revenues, up from 17.7% in the same year-ago quarter [30] - Net income for the quarter was 1.4 million or 0.04perdilutedshare,comparedto0.04 per diluted share, compared to 0.1 million or zero per diluted share in the same year-ago quarter, with net income totaling 6.1% of revenue [32] Business Line Data and Key Metrics Changes - The company launched Mama's Creations, a platform brand for international cuisine, which received positive reviews from retailers and consumers [15] - The in-a-Cup product line was expanded, addressing consumer demand for convenient meal solutions [23] - The company reported successful cross-selling efforts contributing to organic growth [29] Market Data and Key Metrics Changes - Consumers are increasingly opting for grocery store prepared foods due to macroeconomic headwinds, with a focus on high-quality, affordable meal solutions [17] - Retailers are facing significant supply chain and labor challenges, seeking efficient solutions for their deli and grab-and-go offerings [18] Company Strategy and Development Direction - The company aims to become a one-stop shop for deli prepared foods, addressing the 40billionfoodserviceandpreparedfoodsmarket[16]−AcorporatenamechangetoMama′sCreationsisplannedtobetterreflectthecompany′sidentityasanationaldelisolutionsprovider[26]−Thecompanyisfocusedoncontinuousfoundationalimprovementthroughits3Csstrategy:cost,controls,andculture[19]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedconfidenceinthecompany′sabilitytogrowprofitability,withexpectationsofnormalizedgrossmarginsreturningtotheupper2040 billion foodservice and prepared foods market [16] - A corporate name change to Mama's Creations is planned to better reflect the company's identity as a national deli solutions provider [26] - The company is focused on continuous foundational improvement through its 3Cs strategy: cost, controls, and culture [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow profitability, with expectations of normalized gross margins returning to the upper 20% range in the near term and potentially exceeding 30% in the long term [34] - The leadership team is optimistic about the upcoming launch of a new sales organization and the introduction of incremental products to capture market share [27] Other Important Information - Cash and cash equivalents increased to 5.3 million as of April 30, 2023, driven by 1.6millionincashflowfromoperations[33]−AdjustedEBITDAforthefirstquarterincreasedto1.6 million in cash flow from operations [33] - Adjusted EBITDA for the first quarter increased to 2.5 million compared to $0.7 million in the same year-ago quarter [44] Q&A Session Summary Question: Can you quantify the average items carried and cross-selling trends? - The average items carried increased to over six items on a weighted average basis, reflecting successful cross-selling efforts [51] Question: What are the growth expectations for the second half of the year? - Management is optimistic about growth due to the right products and a larger sales force, with positive feedback from recent product launches [53] Question: How have price increases been received by customers? - Price increases have been well received, with nearly all customers accepting the new pricing, which aligns with market expectations [68]