MMMB MamaMancinis Holdings Inc

MamaMancini's Holdings, Inc. (NASDAQ: MMMB), a leading national marketer and manufacturer of fresh Deli prepared foods, has reported its financial results for the fiscal first quarter ended April 30, 2023.

Financial Summary:

		Three Months Ended April 30,
$ in millions		2023				2022				% Increase
Revenues		$	23.1			$	21.8				6	%
Gross Profit		$	6.4			$	3.9				65	%
Operating Expenses		$	4.4			$	3.6				23	%
Net Income (Loss)		$	1.4			$	0.1				1,251	%
Earnings per Share (Diluted)		$	0.04			$	0.00				-
Adj. EBITDA (non-GAAP)		$	2.5			$	0.7				278	%

Key First Quarter Fiscal 2024 & Subsequent Operational Highlights:

• Appointed former Mondelēz marketing executive Lauren Sella as Chief Marketing Officer, leveraging 16-years of experience across the Mondelēz family of brands.
• Attended IDDBA 2023, a premier industry tradeshow with over 10,000 attendees hosted by the International Dairy Deli Bakery Association, where the Company:
  • Launched Mama’s Creations, a new international deli foods platform brand offering Asian, Tex-Mex, Indian and other incremental international cuisine opportunities.
  • Introduced an expanded line of highly incremental on-the-go snacking products – building upon the initial success of Meatballs In a Cup tests in convenience stores – with enhanced packaging that expanded shelf life from 5 days to 21 days.
  • Announced the expansion of the Company’s branded sleeve product line, offering a lunch & dinner entrée in convenient grab-and-go packaging easy for retailers to stock, with initial orders already secured from two large national grocery chains.
• Expanded upon initial cross-selling success with a major Club chain, growing items carried from one as of last summer to ten today, while concurrently growing another Club chain from one to three regions nationally with the largest orders in the Company’s history.
• Invited to present at leading investor conferences nationally, including the 35th Annual ROTH Conference, the 13th Annual LD Micro Invitational, the Diamond Equity Research Emerging Growth Invitational, the Planet MicroCap Showcase 2023 and the 19th Annual Taglich Brothers Investment Conference.

Management Commentary

“The first quarter of fiscal 2024 reflects the sustainability of our margin profile, a strong base which we expect to build upon as we continue to strengthen our business throughout the year,” said Adam L. Michaels, Chairman and CEO of MamaMancini's. “Our success in enhancing profitability has been enabled through our laser focus on being brilliant at the basics and executing upon our '3Cs' strategy – Cost, Controls, and Culture. Despite the progress we have seen to-date, there is still room for further improvement in time, and I firmly believe that gross margins could reach the 30% range in the long-term.

“Today’s consumers are facing significant macro-economic pressures, with many eating out less and turning to prepared foods in the deli sections of their local grocery store. We remain on the forefront of this trend, acting as a one-stop-shop by enabling our grocer customers to offer consumers an incredibly wide variety of Grandma-quality, affordable and easy-to-prepare meal solutions. To that end, our successful introduction of several new highly incremental products at the IDDBA 2023 conference will allow us to capture new dining occasions – including on-the-go snacking with a new line of ‘in a cup’ products and incremental entrée opportunities with Mama’s Creations to capture a greater portion of consumer tastes.

“Looking ahead, we see tremendous growth potential in our new brand extensions under the Mama’s Creations banner, and we are eager to leverage more 'feet on the street' through the impending build-out of our sales force – most recently with our hire of a Director of West Coast Sales – to notably grow the average number of SKUs per customer. In the spirit of this continued corporate evolution into a national one-stop-shop deli solutions provider, this summer we will seek to transition our corporate name to Mama’s Creations with a new stock ticker ‘MAMA’. In summary, we are well-positioned for continued growth, and I am confident that our ongoing initiatives will allow us to take significant market share in-time and deliver sustainable value to my fellow shareholders,” concluded Michaels.

First Quarter Fiscal 2024 Financial Results

Revenue for the first quarter of fiscal 2024 increased 5.9% to $23.1 million, as compared to $21.8 million in the same year-ago quarter. The increase was largely attributable to strong organic growth, driven by successful cross selling efforts.

Gross profit increased 65% to $6.4 million, or 27.6% of total revenues, in the first quarter of fiscal 2024, as compared to $3.9 million, or 17.7% of total revenues, in the same year-ago quarter. The increase in gross margin was primarily attributable to the normalization of commodity costs, successful pricing actions and improvements in operational efficiencies across the organization. The Company continues to identify procurement and logistics efficiencies and cost savings through stronger buying power created through the acquisitions of T&L and Olive Branch.

Operating expenses totaled $4.4 million in the first quarter of fiscal 2024, as compared to $3.6 million in the same year-ago quarter. As a percentage of sales, operating expenses increased in the first quarter of fiscal 2024 to 19.2% from 16.5%. Operating expenses, as a percentage of sales, increased due to the addition of several new key hires, who brought new and differentiated capabilities to the organization.

Net income for the first quarter of fiscal 2024 was $1.4 million, or $0.04 per diluted share, as compared to $0.1 million, or $0.00 per diluted share, in the same year-ago quarter. This quarter’s net income totaled 6.1% of revenue, in line with our expectations in the mid-single-digit range.

Adjusted EBITDA, a non-GAAP term, increased to $2.5 million for the first quarter of fiscal 2024, as compared to an adjusted EBITDA of $0.7 million in the same year-ago quarter.

Cash and cash equivalents as of April 30, 2023 were $5.3 million, as compared to $4.4 million as of January 31, 2023. The increase in cash and cash equivalents was driven by $1.6 million in cash flow from operations in the first quarter of fiscal 2024, $0.5 million of which was used to pay down the Company’s debt, which now stands at just $8.8 million.

Conference Call

Management will host an investor conference call at 4:30 p.m. Eastern time today to discuss the Company’s first quarter fiscal 2024 financial results, provide a corporate update, and conclude with Q&A from participants. To participate, please use the following information:

Q1 FY2024 Earnings Conference CallDate: Tuesday, June 13, 2023 Time: 4:30 p.m. Eastern time U.S. Dial-in: 1-877-451-6152International Dial-in: 1-201-389-0879Conference ID: 13738817Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1615887&tp_key=c51d5f5f90

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 Thursday, July 13, 2023. 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 13738817. A webcast replay will also be available using the webcast link above.

About MamaMancini’s Holdings, Inc.

MamaMancini's Holdings, Inc. (NASDAQ: MMMB) is a leading marketer and manufacturer of prepared foods with over 45,000 product placements in grocery, mass, club and convenience stores nationally. The Company’s broad product portfolio, born from a 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 www.mamamancinis.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. 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. For a definition and reconciliation of EBITDA to net income, its corresponding GAAP measure, please see the reconciliation table shown in this press release below.

US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION

(Unaudited)

		THREE MONTHS ENDED
		April 30,
		2023				2022
Net Income (Loss)		$	1,400,926			$	103,697
Depreciation			248,413				208,829
Amortization of Debt Discount			5,530				3,640
Amortization of Right of Use Assets			5,794				69,344
Amortization of Intangibles			101,896				113,170
Taxes			524,692				29,385
Interest			177,394				124,251
Adjusted EBITDA (Non-GAAP)		$	2,464,645			$	652,316

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. ZimmermanDirectorMZ Group - MZ North America(949) 259-4987MMMB@mzgroup.us www.mzgroup.us

MamaMancini’s Holdings, Inc.Condensed Consolidated Balance Sheets

		April 30, 2023				January 31, 2023
		(Unaudited)
Assets:
Current Assets:
Cash		$	5,259,448			$	4,378,383
Accounts receivable, net			8,389,108				6,832,046
Inventories, net			2,535,831				3,635,881
Prepaid expenses and other current assets			1,127,631				828,391
Total current assets			17,312,018				15,674,701
Property and equipment, net			3,319,698				3,423,096
Intangibles, net			1,400,614				1,502,510
Goodwill			8,633,334				8,633,334
Operating lease right of use assets, net			3,230,896				3,236,690
Deferred tax asset			372,361				717,559
Equity method investment			1,489,244				1,343,486
Deposits			57,060				53,819
Total Assets		$	35,815,225			$	34,585,195
Liabilities and Stockholders’ Equity:
Liabilities:
Current Liabilities:
Accounts payable and accrued expenses		$	9,451,772			$	9,063,256
Term loan, net of debt discount of $54,552 and $60,082, respectively			1,497,172				1,491,642
Operating lease liability			408,965				391,802
Finance leases payable			180,685				182,391
Promissory note – related party			750,000				750,000
Total current liabilities			12,288,594				11,879,091
Line of credit			750,000				890,000
Operating lease liability – net of current			2,845,326				2,897,205
Finance leases payable – net of current			200,467				248,640
Promissory note – related party, net of current			1,500,000				1,500,000
Term loan – net of current			4,267,250				4,655,181
Total long-term liabilities			9,563,043				10,191,026
Total Liabilities			21,851,637				22,070,117
Commitments and contingencies (Notes 9 and 10)
Stockholders’ Equity:
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of April 30, 2023 and January 31, 2023, respectively, 0 shares outstanding as of April 30, 2023 and January 31, 2023, respectively			-				-
Series B Preferred stock, $0.00001 par value; 200,000 shares authorized; 54,600 issued and outstanding as of April 30, 2023 and January 31, 2023 respectively			-				-
Preferred stock, $0.00001 par value; 19,680,000 shares authorized; no shares issued and outstanding			-				-
Common stock, $0.00001 par value; 250,000,000 shares authorized; 36,484,777 and 36,317,857 shares issued and outstanding as of January 31, 2023 and January 31, 2022			366				364
Additional paid in capital			22,799,322				22,724,440
Accumulated deficit			(8,686,600	)			(10,060,226	)
Less: Treasury stock, 230,000 shares at cost			(149,500	)			(149,500	)
Total Stockholders’ Equity			13,963,588				12,515,078
Total Liabilities and Stockholders’ Equity		$	35,815,225			$	34,585,195

MamaMancini’s Holdings, Inc.Condensed Consolidated Statements of Operations(Unaudited)

		For the Three Months EndedApril 30,
		2023				2022
Sales-net of slotting fees and discounts		$	23,120,816			$	21,830,580
Costs of sales			16,749,816				17,970,317
Gross profit			6,371,000				3,860,263
Operating expenses:
Research and development			71,185				26,535
General and administrative			4,357,031				3,572,755
Total operating expenses			4,428,216				3,599,290
Income from operations			1,942,784				260,973
Other income (expenses)
Interest			(177,394	)			(124,251	)
Amortization of debt discount			(5,530	)			(3,640	)
Other income			20,000				-
Total other income (expenses)			(162,924	)			(127,891	)
Net income before income tax provision and income from equity method investment			1,779,860				133,082
Income from equity method investment			145,758				-
Income tax provision			(524,692	)			(29,385	)
Net income			1,400,926				103,697
Less: series B preferred dividends			(27,300	)			-
Net income available to common stockholders			1,373,626			$	103,697
Net income per common share
– basic		$	0.04			$	0.00
– diluted		$	0.04			$	0.00
Weighted average common shares outstanding
– basic			36,394,033				35,759,244
– diluted			37,625,518				36,148,920

MamaMancini’s Holdings, Inc.Condensed Consolidated Statements of Cash Flows(Unaudited)

		For the Three Months Ended April 30,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	1,400,926			$	103,697
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			248,413				208,829
Amortization of debt discount			5,530				3,640
Amortization of right of use assets			5,794				69,344
Amortization of intangible assets			101,896				113,170
Stock based compensation			55,384				-
Change in deferred tax asset			345,198				29,385
Income from equity method investment			(145,758	)			-
Changes in operating assets and liabilities:
Accounts receivable			(1,557,062	)			(1,370,867	)
Inventories			1,100,050				(1,277,898	)
Prepaid expenses			(607,018	)			(299,864	)
Security deposits			(3,241	)			-
Accounts payable and accrued expenses			696,294				1,095,439
Operating lease liability			(34,716	)			(87,888	)
Net cash provided by (used in) operating activities			1,611,690				(1,343,013	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for fixed assets			(145,015	)			(174,007	)
Net cash used in investing activities			(145,015	)			(174,007	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of term loan			(387,931	)			(129,310	)
(Repayment) borrowings of line of credit, net			(140,000	)			1,775,000
Repayment of finance lease obligations			(49,879	)			(58,008	)
Payment of Series B Preferred dividends			(27,300	)			-
Proceeds from exercise of options			19,500				-
Net cash (used in) provided by financing activities			(585,610	)			1,587,682
Net increase (decrease) in cash			881,065				70,662
Cash - beginning of period			4,378,383				850,598
Cash - end of period		$	5,259,448			$	921,260
SUPPLEMENTARY CASH FLOW INFORMATION:
Cash Paid During the Period for:
Income taxes		$	-			$	-
Interest		$	152,468			$	133,291
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Non-cash deposits on prepaid additions		$	307,778			$	-