Shipments into New Tier-1 Placements Drives
Strong
17
%
Year-over-Year
Sales Growth
Elevated Commodity/Shipping Costs
Compress Margins
Through Year-End; One-Time Uplisting Expenses Reflected in Second Quarter Expenses
EAST RUTHERFORD, NJ, Sept. 09, 2021 (GLOBE NEWSWIRE) —
MamaMancini’s Holdings, Inc. (NASDAQ: MMMB), a marketer of specialty pre-prepared, frozen and refrigerated food products, has reported its financial results for the fiscal second quarter ended July 31, 2021.
Financial
Summary
:
| Three Months Ended July 31, | Year-over-Year | |||||||||||
| 2021 | 2020 | % Change | ||||||||||
| Revenues | $ | 12.1 million | $ | 10.3 million | 17.7 | % | ||||||
| Gross Profit | $ | 3.4 million | $ | 3.1 million | 9.5 | % | ||||||
| Operating Expenses | $ | 2.8 million | $ | 2.3 million | 22.6 | % | ||||||
| Pre-Tax Net Income | $ | 0.6 million | $ | 0.7 million | (22.0 | %) | ||||||
| Net Income | $ | 0.4 million | $ | 0.7 million | 41.6 | % | ||||||
| Earnings per Share | $ | 0.01 | $ | 0.02 | (50 | %) | ||||||
| Cash | $ | 4.3 million | $ | 1.7 million | 150 | % | ||||||
Second
Quarter 2022 & Subsequent Operational
Highlights
:
- Completed uplisting to the Nasdaq Capital Market on July 15, 2021, under the symbol “MMMB” to help elevate the Company’s public profile, expand its potential shareholder base, improve liquidity and enhance shareholder value.
- Advanced the Company’s active acquisition program targeting complementary food product firms with sales in the $12 to $20 million per year range, generating positive EBITDA with a product that is symbiotic to MamaMancini’s existing retail, club store and food service distribution network.
- Secured new product placements for second and third quarter at tier-1 retailers including pasta bowls at Publix and Albertsons Safeway; stuffed peppers at BJ’s; MamaMancini’s branded retail sleeves including plant-based products as part of Amazon Fresh; and several additional big box retailer placements pending final authorization.
- Developed MamaMancini’s Branded Meatball in a Cup for Convenience Stores, with initial trial placements in the second half of 2021.
- Secured credit line from M&T Bank for potential acquisitions, with a total available credit line of up to $12.5 million, in addition to a $4.3 million cash balance.
- Received the coveted Food Product of the Month at QVC for the month of September.
- Registered to attend upcoming investor conferences nationwide including the Taglich Brothers Investment Conference on September 13th and the LD Micro Main Event on October 12th.
Management Commentary
“The second quarter of fiscal 2022 was highlighted by our rapid pace of growth, realizing a robust 17% revenue increase as compared to the same year-ago quarter,” said Carl Wolf, Chairman and Chief Executive Officer of MamaMancini’s. “These sales figures were driven by our previously announced product placements, many of which began to ship in the second quarter. Profits were temporarily offset by elevated commodity and shipping costs as well as one-time extraordinary expenses related to our Nasdaq listing fee and additional shareholder meeting requirements. Our go-forward sales forecasts continue to increase given our planned price increases and I would expect to see margin improvement by year-end.
“On July 15, 2021 we completed our uplisting to the Nasdaq Capital Market – a milestone for all MamaMancini’s stakeholders that has been several years in the making. We expect that this will help elevate our public profile, expand our potential shareholder base and improve liquidity. I could not be prouder of our incredibly hard-working team, many of whom were featured when we rang the Nasdaq closing bell just a few short weeks ago.
“With our active acquisition efforts well underway, I firmly believe we are still in the early innings of MamaMancini’s growth and increasing prominence as a public company. We will continue to scale operations and have only begun our capital markets journey. We are poised for success on all fronts and look forward to seeing what the future holds for our brand,” concluded Wolf.
Second
Quarter
Fiscal
202
2
Financial
Results
Revenue for the second quarter of fiscal 2022 totaled $12.1 million, as compared to $10.3 million in the same year-ago quarter. The increase in revenue for the second quarter was a result of initial shipments as part of the Company’s previously announced new placement wins with tier-1 retailers nationwide.
Gross profit totaled $3.4 million, or 27.9% of total revenues, in the second quarter of fiscal 2022, as compared to $3.1 million, or 30.0% of total revenues, in the same year-ago quarter. The lower gross profit margin in the second quarter was due to higher inbound shipping and commodity costs which were passed on to existing customers on a time lag basis for the first two months of the quarter, and fixed pricing for a short introductory period on new placements. The Company expects profit margins will improve by year-end as commodity prices normalize and higher production volumes will result in higher plant operating efficiencies, as well as the expiration of introductory pricing with several customers.
Operating expenses totaled $2.8 million in the second quarter of fiscal 2022, as compared to $2.3 million in the same year-ago quarter. As a percentage of sales, operating expenses totaled 23.1% in the second quarter of fiscal 2022, as compared to 22.2% in the same year-ago quarter. Operating expenses in the second quarter were affected by significant one-time expenses such as the Company’s Nasdaq uplisting and additional shareholder meeting requirements, increased shipping costs and higher director fees.
Pre-Tax Income for the second quarter of fiscal 2022 totaled $0.6 million, as compared to $0.7 million in the same year-ago quarter.
Net income for the second quarter of fiscal 2022 totaled $0.4 million, or $0.01 per diluted share, as compared to a net income of $0.7 million, or $0.02 per diluted share, in the same year-ago quarter. The decrease in net income was significantly attributable to an income tax provision of $145,439 recorded during the three months ended July 31, 2021, compared to $0 during the three months ended July 31, 2020.
Cash and cash equivalents as of July 31, 2021 were $4.3 million, as compared to $1.7 million in the same year-ago quarter and $3.2 million as of January 31, 2021. The increased cash balance benefitted from $0.2 million in cash flow from operations in the second quarter of fiscal 2022 and a total of $1.6 million fiscal year-to-date.
Conference Call
Management will host an investor conference call at 4:30 p.m. Eastern time on Thursday, September 9, 2021 to discuss the Company’s second quarter 2022 financial results, provide a corporate update, and conclude with a Q&A from participants. To participate, please use the following information:
Q
2
2022 Earnings Conference Call
Date: Thursday, September 9, 2021
Time: 4:30 p.m. Eastern time
U.S. Dial-in: 1-844-889-4326
International Dial-in: 1-412-317-9264
Conference ID: 10159841
Webcast: https://services.choruscall.com/mediaframe/webcast.html?webcastid=rxhejL49
Please dial in at least five minutes before the start of the call to ensure timely participation.
A playback of the call will be available through September 16, 2021. To listen, call 1-877-344-7529 within the United States or 1-412-317-0088 when calling internationally. Please use the replay pin number 10159841.
About MamaMancini’s Holdings, Inc.
MamaMancini’s Holdings, Inc. (NASDAQ: MMMB) is a marketer and distributor of specialty prepared, refrigerated and frozen all-natural Italian foods. MamaMancini’s product portfolio consists of over 20 products including meatballs, meat loaf, chicken parmesan, sausages and pasta bowl kits, with beef, turkey, chicken and pork varieties. The Company’s products are sold in over 45,000 locations nationwide, including at well-known retailers such as Sam’s Club, Whole Foods, Publix, Costco and Albertsons, as well as through national distributors such as Sysco and United Natural Foods. The Company also regularly maintains a direct-to-consumer presence through presentations on QVC. For more information, please visit www.mamamancinis.com.
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, 2021 and other filings made by the Company with the Securities and Exchange Commission.
Investor Relations Contact:
Lucas A. Zimmerman
Senior Vice President
MZ Group – MZ North America
(949) 259-4987
[email protected]
www.mzgroup.us
MamaMancini’s Holdings, Inc.
Condensed Consolidated Balance Sheets
| July 31, 2021 | January 31, 2021 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 4,252,881 | $ | 3,190,560 | ||||
| Accounts receivable, net | 4,702,713 | 3,973,793 | ||||||
| Other receivable | 107,896 | – | ||||||
| Inventories | 1,407,614 | 1,195,211 | ||||||
| Prepaid expenses | 447,894 | 519,887 | ||||||
| Total current assets | 10,918,998 | 8,879,451 | ||||||
| Property and equipment, net | 3,063,165 | 2,963,602 | ||||||
| Intangibles | 87,639 | 87,639 | ||||||
| Operating lease right of use assets, net | 1,585,538 | 1,352,483 | ||||||
| Deferred tax asset, net | 353,794 | 744,973 | ||||||
| Deposits | 23,156 | 20,177 | ||||||
| Total Assets | $ | 16,032,290 | $ | 14,048,325 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Liabilities: | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 4,456,933 | $ | 3,707,111 | ||||
| Operating lease liability | 181,573 | 147,684 | ||||||
| Finance leases payable | 214,946 | 190,554 | ||||||
| Total current liabilities | 4,853,452 | 4,045,349 | ||||||
| Operating lease liability – net | 1,429,500 | 1,218,487 | ||||||
| Finance leases payable – net | 356,277 | 474,743 | ||||||
| Total long-term liabilities | 1,785,777 | 1,693,230 | ||||||
| Total Liabilities | 6,639,229 | 5,738,579 | ||||||
| Commitments and contingencies (See Note 10) | ||||||||
| Stockholders’ Equity: | ||||||||
| Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of July 31, 2021 and January 31, 2021, 0 and 0 shares outstanding as of July 31, 2021 and January 31, 2021 | – | – | ||||||
| Preferred stock, $0.00001 par value; 19,880,000 shares authorized; no shares issued and outstanding | – | – | ||||||
| Common stock, $0.00001 par value; 250,000,000 shares authorized; 35,725,041 and 35,603,731 shares issued and outstanding as of July 31, 2021 and January 31, 2021 | 359 | 357 | ||||||
| Additional paid in capital | 20,555,657 | 20,535,793 | ||||||
| Accumulated deficit | (11,013,455 | ) | (12,076,904 | ) | ||||
| Less: Treasury stock, 230,000 shares at cost, respectively | (149,500 | ) | (149,500 | ) | ||||
| Total Stockholders’ Equity | 9,393,061 | 8,309,746 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 16,032,290 | $ | 14,048,325 | ||||
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Income
(unaudited)
|
For the Three Months Ended July 31, |
For the Six Months Ended July 31, |
|||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Sales-net of slotting fees and discounts | $ | 12,064,584 | $ | 10,247,564 | $ | 22,377,984 | $ | 21,082,505 | ||||||||
| Costs of sales | 8,695,300 | 7,170,403 | 15,664,347 | 14,543,722 | ||||||||||||
| Gross profit | 3,369,284 | 3,077,161 | 6,713,637 | 6,538,783 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 30,541 | 25,857 | 53,977 | 55,338 | ||||||||||||
| General and administrative | 2,753,830 | 2,244,539 | 5,222,548 | 4,700,726 | ||||||||||||
| Total operating expenses | 2,784,371 | 2,270,396 | 5,276,525 | 4,756,064 | ||||||||||||
| Income from operations | 584,913 | 806,765 | 1,437,112 | 1,782,719 | ||||||||||||
| Other income (expenses) | ||||||||||||||||
| Interest | (7,549 | ) | (61,648 | ) | (17,979 | ) | (126,050 | ) | ||||||||
| Amortization of debt discount | – | (5,350 | ) | – | (10,700 | ) | ||||||||||
| Other income | – | – | 37,704 | – | ||||||||||||
| Total other income (expenses) | (7,549 | ) | (66,998 | ) | 19,725 | (136,750 | ) | |||||||||
| Net income before income tax provision | 577,364 | 739,767 | 1,456,837 | 1,645,969 | ||||||||||||
| Income tax provision | 145,439 | – | 393,388 | – | ||||||||||||
| Net income | $ | 431,925 | $ | 739,767 | $ | 1,063,449 | $ | 1,645,969 | ||||||||
| Net income per common share | ||||||||||||||||
| – basic | $ | 0.01 | $ | 0.02 | $ | 0.03 | $ | 0.05 | ||||||||
| – diluted | $ | 0.01 | $ | 0.02 | $ | 0.03 | $ | 0.05 | ||||||||
| Weighted average common shares outstanding | ||||||||||||||||
| – basic | 35,697,568 | 32,262,375 | 35,660,440 | 32,128,298 | ||||||||||||
| – diluted | 36,223,674 | 33,543,565 | 36,181,353 | 33,409,488 | ||||||||||||
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
| For the Six Months Ended | ||||||||
| July 31, 2021 | July 31, 2020 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income | $ | 1,063,449 | $ | 1,645,969 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation | 381,732 | 319,078 | ||||||
| Amortization of debt discount | – | 10,700 | ||||||
| Share-based compensation | 786 | 49,975 | ||||||
| Amortization of right of use assets | 91,660 | 68,107 | ||||||
| Change in deferred tax asset | 391,179 | – | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (728,920 | ) | 934,360 | |||||
| Other receivable | (107,896 | ) | ||||||
| Inventories | (212,403 | ) | (512,344 | ) | ||||
| Prepaid expenses | 71,993 | (4,366 | ) | |||||
| Security deposits | (2,979 | ) | – | |||||
| Accounts payable and accrued expenses | 749,822 | (982,317 | ) | |||||
| Operating lease liability | (79,813 | ) | (63,264 | ) | ||||
| Net Cash Provided by Operating Activities | 1,618,610 | 1,465,898 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash paid for fixed assets | (481,295 | ) | (189,287 | ) | ||||
| Net Cash Used in Investing Activities | (481,295 | ) | (189,287 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Repayments of term loan | – | (250,002 | ) | |||||
| Repayments of related party notes payable | – | (641,844 | ) | |||||
| Proceeds from promissory note | – | 330,505 | ||||||
| Repayment of promissory note | – | (330,505 | ) | |||||
| Borrowings of line of credit, net | – | (500,000 | ) | |||||
| Repayment of finance lease obligations | (94,074 | ) | (64,165 | ) | ||||
| Proceeds from exercise of options | 19,080 | 7,200 | ||||||
| Proceeds from exercise of warrants | – | 1,477,103 | ||||||
| Net Cash Provided by (Used) in Financing Activities | (74,994 | ) | 28,292 | |||||
| Net Increase in Cash | 1,062,321 | 1,304,903 | ||||||
| Cash – Beginning of Period | 3,190,560 | 393,683 | ||||||
| Cash – End of Period | $ | 4,252,881 | $ | 1,698,586 | ||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | ||||||||
| Cash Paid During the Period for: | ||||||||
| Income taxes | $ | – | $ | – | ||||
| Interest | $ | 17,979 | $ | 128,913 | ||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Finance lease asset additions | $ | – | $ | 401,387 | ||||
| Operating lease asset additions | $ | 347,585 | $ | – | ||||
