MMMB - Earnings call transcript Q3 2021

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Operator

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to MamaMancini's Third Quarter 2021 Earnings Conference Call.

During today's presentation, all parties will be in a listen-only mode.

Following the presentation, the conference will be open for questions. Instructions]. [Operator being accompanying XX, issued this close market is earnings and at today, of release press conference today. recorded conference XXXX, December the the This call was Wolf; MamaMancini's Morgenstein; Larry Greg relations Falesnik, North and is firm. Brown; MZ and today of MamaMancini's call COO, Matthew our CEO, On Carl America, President CEO and CFO, Chairman investor statements. I read a to over to would Greg now like to turn about conference forward-looking the disclaimer

Greg Falesnik

you, operator. Thank

call may we meaning forward-looking conference Before laws started, statements. information, historical a I'll of securities the in about disclaimer contain, forward-looking get read federal regarding within to MamaMancini's. addition This statements the

involve to numerous and Commission. results to activities, statement company's or are are statements statements in on to assumptions and not forward-looking to intentions, from assumptions Forward-looking any difficult based discussed conditions. limited current the Securities report what vary may strategies, outcomes based the are Exchange likely and management. Therefore, and the that projections actual on files time which with guarantees part expectations, expectations, business materially that made earnings, of expressed predict. predictions, statements company's or express by to in are about company or These and events from due is other but future forecasted beliefs, uncertainties time this and factors differ not risks, performance in and related the documents, other These to, the include, statements estimates US statements future are its

materially of of the management company's affected company. the regarding actual may control. among forward-looking to such uncertainties beyond any litigation could results from the capital key related loss statements in cause be major factors, addition, include, and that availability risks those other statements personnel, and In to differ by Matters factors

this publicly obligation Chairman conference In does to call Officer. and that of information events, conference information company's undertake date circumstances to yours. future like any The best this reflect over is At conference or forward-looking Wolf, any as the company call. call. the floor contains of or call not to only revise the Carl of update Chief Executive the time, date that statements time addition, the to Carl, time-sensitive management's I'd arise analysis after reflects and this this turn

Carl Wolf

Greg. you, today. third joining Thank our welcome like quarter to conference thank you, XXXX call. results financial And everyone, us for you I'd to

and our Third bars, levels nationwide quarter our sales back growth record, delayed recover a XXXX. was fiscal XXXX we in in to market line and product beginning efforts. income of be as our income another to we're fortification sheet. by early our third-quarter are million. placements, we that as COVID, revenue products net in end, aggressively highlighted fresh products, of and XX% marketing continued to well multichannel were merchandising $X.X expansion $X.X and was club our the while new million positive by effective progress of to balance of Sales This driven expect deli the pleased and increasing increasing and very a network third-quarter in to and record To to net due quarter packaged with the with hot of third sales nicely normal while growth success record as store

of returning margins existing both our announced authorization customer we business at rapid now see of growth and We Overall expansion slowly XX% retailers. nationwide major continue volume. about With pasta terms back of total were to of new normal, positive. placements to several which line, and our approaches locations bowl in sales new

sales We momentum. XXXX as expect number enter the occur new of we placements our to continuing

progress were consumer activity to exciting are term. in to again and to food beginning markets in temporarily and due account expect activity this now see exportation halted COVID. the Our direct near service, We

year sales fiscal record a earnings. We and expect in

However, evolving that with continuing be we can the difficult. landscape, caution forecasting accurately macroeconomic future today's

QVC. work multipronged continued Our to radio efforts I'd media a these efforts marketing social and campaigns, include successful touch like of on now. with few

advertising customers on SiriusXM various commercials We cost-effective see we launched sales consumers, campaigns XX platform The news evidenced as in distributed products. We with geographic all continue campaigns MamaMancini's is calendar avenue of radio drive new locations talk and year. XXXX. of campaign a by over to six in launch an SiriusXM estimated major a channels, the XX-week and this success across our major to which earlier found current an way million reaching new our X,XXX have

maintain have robust over of things, and To retail continue who specific and live target miles of XXX,XXX customers likely customers new encouraging side engaging we repeat locations. geo a purchases. within continue likes media social reach, the we five to On date, to

an rolled using just which As pasta this medium successfully at new XXX our supermarkets from presently to out in are introduce example, public stores in stores to bowl X,XXX present. the Southeast, we originally

record driving been have with pitches platform. seeing Dan sales their efforts live Mancini's impressive on as well QVC success Our

We encouraging have on-air and seen a our recently presence notably result. as increased have growth

a homes you marketer available the QVC in and throughout is large of over USA. is many aware, As are direct-to-consumer XXX million

on XX to customers were voted challenge behalf spice Awards. a without or the pause. MamaMancini's was during award Mancini company. meatball, items overcome categories and company, our the operations see QVC the to products best categories, of run Choice pleased able efficiently Food QVC as plant food best for in based and COVID-XX three but are the MamaMancini's sauce Customer accepted Co-Founder best of number Dan We we one XXXX over condiment,

mitigate we before pandemic. our were measures which believe we the Fortunately, able to safety of install helped the effects significantly peers,

positive on overall flow very meet growth. our believe position, cash would requirements sheet our our result. network We uplisting very pleased we a with our cash and are We as balance

million, below of the ratio and estimate expected. X on substantially Our shares debt. to substantially dilution We redemptions last cash close XX. position and of and million [technical position potential current This of We a difficulty] XX position only currently is to current cash warrant with our times working XXX,XXX grow Board occurred approximately options. capital with in unredeemed management estimate and November zero that November $X outstanding is continues

alternatives possible call the off handing bank assist like will or leading shareholder for who I'd US could more enter we turn among that The potential sale exciting to details others, I Morgenstein, of to note And some Larry in as Securities, Financial and have from process while Chief progressing. enhancing to engaged over Officer, like alternatives value. the exploration or direction the see B. one XXXX. company, combination now evaluation will quarter acquisition, before for strategic Larry, execution These MamaMancini's to include, too walk continued of we Riley to investment Finally, plan of the of to third we business of strategic our company's Larry? several early the I'd is business take, of it's through the call a the comment on some these alternatives. opportunities of XXXX. key financial

Larry Morgenstein

Thank to period. the impact increased compared result in million million in XXXX quarter. period. to which offset primarily XX% year-ago of to as pricing you, Carl. expenses to as Revenue slowed the higher margins Revenue to $X.X profit a in quarter the or by million total placements of as same efforts million increased a compared XXXX primarily $X.X year-ago to XX% growth increased increased of increased million revenue in the negative COVID-XX, improve XX% compared or same $X.X in of a $X.X in the to quarter to the $X.X of same in revenue temporary the customers, ongoing year-to-date as result compared compared quarter. total $XX.X and pandemic. $XX.X million year-to-date the million are quarter revenues sales of in of and offset the to third XX% to $X.X total in increased new quarter. of record expenses year-ago period. profit year-to-date COVID-XX by as year-ago beef partially to year-ago expected to and the million decreased third fourth XXXX plant by or quarter the million third efficiencies, new $X the operations compared new existing revenue to the year-ago third Operating same Gross partially same of record XX% increased same million $XX.X to to Gross was Revenue or Gross quarter XX% placements resume of $X.X of Operating total million third to due as quarter.

due period. from attributed for income $X.XX increase Net as not a $X.X sales, with quarter. now call in the each sustain in its million our turn Chief of $X.X compared or in income debt anticipate to as be like operations Cash of net The XX%. operations generated offset sales million was $X.XX for operating XX, year-to-date, expenses my quarter on The $X.X do and $X.X XXXX compared confident same million a expenses the of Matt? partially combined October percentage expenses comments. lower capital debt of in that the in XX% of cash cash $X.X sufficient and year-to-date. year-ago from XX, a $X.X percentage President to sales, as to from share are from paydown the raising Officer. per primarily $X.X I'd decrease million of our decreased to over net As expenses operating to in totaled third compared increased income million quarter net promotional Brown, year-to-date cash interest year-ago and the as Net Operating XXst, per million We Matt This will flow to was and balance grew Operating by of million reduced company as cash third XXXX cash significantly of hand to of or additional as primarily income completes as operations equivalents a benefited January to as reductions XXXX to quarter share grow. same we as October merchandising. product a and fiscal XXXX. expense. increase the XX% in fiscal year-to-date to the decreased by

Matthew Brown

Thanks, Larry.

quarter, of the success financial performed admirably throughout Our company. third operations the the to contributing

operational to day-to-day and these committed the efforts manage to continue scheduling the efficiencies times impressed improve improvement costs. and resilience with We our production staff to processes our in during are of be planning, who continuous

manage quarter, materials from XX% particular, its step prices, strong operations. normalcy, contributed our high end down by down beef which In raw the key times of were overtime enabled for now encouraged implemented well-deserved cost to commitments, of efficiencies during in while see and QX time-off included and the very for some the returned busy workday of during to the some start scheduling third from our gearing financial QX, progress. in staff, the performance stratosphere had us this to to up spreading expense staggered Our of largest We sense quarter the May.

are switched a demands online We as end, actively material longer the our receiving requirements. reducing lead industries, box costs price per and watch To three and week, inventory on-demand retailers and working our keeping while this packaging we corrugated placed have close have managing times. increases price delivery threatening gaining reductions days the suppliers corrugated capital heavy on

We of impact are review no an a reduce ongoing proceeding with in effort on all costs pricing our supply with quality. our of to

demand see our third to in financial products bowls. our with boosting a and in our plant, produced Turning expansion are party of efficiently use individual packaged own our performance. combination pasta and meal products, delicious to family These our kits products, pastas, we which continue manufactured combined for

and meatball path marketplace recipe QVC our plant very QVC's products, meatball response meat demand deli active roll-up to stuffed food in by all to the of see our spinach for demand a lasagna popular and impeded including in in and bar products return new meat mozzarella on network. normal products for in improvement the We our loaf promotion was meatball expansion continue been has bulk major continued in towards a introduction in fulfilling loaf our and The whose our to COVID-XX. of products the

which just rollout new is QX which and are product the dumpling on continuing of new in new Italian last sweet product, throughout QVC packing sold will conveniently in We continue room scheduled sausage QX. out QX began pasta early to the introduction which January. a premiere with an week rollouts Italian equipment, product, of both

improvements product in accelerating We our equipment, and as just new our including month. Our of stronger provide moving capacity previous its cost improvements with automatic savings approximately installed of three will faster of this on machine Shanklin us, operation. than conveyors These wrapping has impressed remaining capacity the are anticipate also already pieces labelers day operation $XX,XXX per month. X%

January scheduled end Our XXXX. of annual COVID-XX or SQF delayed the safe quality audit, by is audit, now for

less altered nothing view than audit looking manufacturers to days. scores are and good exemplary manufacturing has We and as measures employees regulations. these to additional practices COVID-XX the way the continue safety our OSHA forward educate many anticipate we on

During external in staff QX, and automatic plant. we use installed of defibrillator and trained defibrillator a in aid, first cross-section the CPR, a

We reporting and with the of are the forward to warehouse planning our to to move management robust the improve with meet accounting demands electronic of system future customers. implementation streamlined and continuing our ERP replacement communications capabilities

early to labor record live efficiencies. the see fiscal go year numbers In plant in to summary, and continues expect We production XXXX.

We are equipment turn to business. manage our over Carl? and established to people responsibly investing growing have the back our capacity call in and now Carl. I our will the

Carl Wolf

strong team of an realizing in all growth year. have backdrop to As I I continue noted year-over-year incredible the the progress made fronts of our we opening execute on COVID-XX. remarks, third proud the in the foundation my am quarter, and for amidst laid operational

the of retail distribution our nationwide. in continued depth We and footprint breadth product storefronts growth of

Our realization and our operational are testament efficiencies. results sales tireless financial continued strong both to a of engine

move XXXX and realization outcomes conclusion the await continued we of the potential As into and growth. strategic potential toward alternatives various a uplisting from to of XXXX, MamaMancini's positive

for continue trying over With I are for value the work to sustainable create another as operator? these we look operator. efforts this long-term forward shareholders. turn We to record-breaking our to I'll that, year.

Operator

[Operator Instructions].

Halpern will Taglich with from first Howard Our come question Brothers.

Howard Halpern

on guys solid this results pandemic during Congratulations operating time.

falling occurred of The any the there but question should of fourth quarter, is were kind were in delays first product might quarter? the be any seeing into shipments you that third regarding, have in kind –

Carl Wolf

No.

First of like all, thank to everyone. I'd

on dramatic. – than But to And any in we middle industry placements And new What the I several everything is very shipments. we which again. put to case, don't even We new which in normally now, mute have of works. record. the week, was am very, And have Basically dead, in Starting I business back a we down was like XX delay have authorizations. commerce. whole close more July shut participants August, also, not delayed new through did of the is today if got active. in on question, very your going really it this now new is realization are any

expect I very robust coming see So, very, growth near future. the in to

Howard Halpern

being to exercised balance for remain on a anticipate In or of, the the guess, the terms I are sheet, they going remaining now you warrants, just them books while?

Carl Wolf

expired. that talking Our you're – are our years. in No. I either is there discussion The will Those Board warrants of my They warrants. There Directors. X in mentioned the exercised warrants, options or to next about no to have was or XXX-plus-thousand more all not about over all exercised million given options? are and be over three two-and-a-half employees options. we exercised. They are management,

Howard Halpern

quarter, the is term had line you credit. that end loan In at just capability now flexibility the the terms what line of has of in – your your But just third the purposes, on which capacity of for you think line? outstanding. I is of gone, have your credit, What $XXX,XXX

Carl Wolf

$X.X a million right line have credit now. We of

in mentioned expanded. my And zero outstanding on that I depending needs, can that. have on As we our be discussion,

Howard Halpern

next as year equipment going to of button discussed too, in really up. the or you just half new quarter the some they And in What amount capital are that the the we CapEx And for was first expenditures of looking to fourth fourth the had at of earlier quarter? in going are year? continue terms is up started

Carl Wolf

upgrades $XXX,XXX and budgeting $XXX,XXX are a various now We to right with year around improvements.

which M&T through being of most finishing from loans $XXX,XXX the And Bank. with financed about packaging end we'll that room, of was the quarter, is range. This

Howard Halpern

can the incremental next implementation system, software the we through as year, anticipate, improvement margins? we fiscal go Based equipment new and and operating quarterly gross of in the on

Carl Wolf

costs, We efficiencies hope expense. royalties is plant call one There or our any merchandising shipping our that that which that. to absorbing is in in is more see – part a There plants, variable commissions direct as create of expenses caveat and we overhead. any business we

expenses. all the show those product and up changes if mix at as So, – operating

very So, right of that now, gross the we on But then at changes cost a to may have mix profit. in slightly if see lower all steady now, improvements continuing we should based right orders, very, the fulfilling product has gross see low profit. customer a mix you the

Howard Halpern

going get in for next year? some things the that now that be One might the to are you the to a you me in down second in final area, lay one is, service half hopefully next back do hopefully will of food year, more fruit able that anticipate normalcy with groundwork bear half of reengagement to now second the

Carl Wolf

By sooner. then or

Howard Halpern

up the keep guys. and work, and good Thanks Carl

Operator

Instructions]. [Operator

question Kobylarz go Please Capital. Bridge Diamond next with Our ahead. from comes Jeff

Jeffrey Kobylarz

for update you're any higher margin? was on you what Can of gross Thanks amount…? how the have dollar doing. the comment Do your impact good on you beef

Carl Wolf

We modest, well. price even went the pass a though by It along was customers were prices up. way increases to to fairly able

So, very in all, was all modest negative impingement. it a

Jeffrey Kobylarz

fine. Okay,

Carl Wolf

We compensate also marketing for it. certain activities to cut back

operating intact. profit the So, remained

Jeffrey Kobylarz

way coronavirus, year, the the say, was? As more placements. way delays this additional I about retailers is from customer been, virus what those you to of There any trend there then far orders here? through assume, and heating from the cons there pros home, authorizations could but in impact is in of for you Is as there talk any can have the year-to-date, put

Carl Wolf

inventory and meat effect profits. year and would shortages, spring build. or up in we I also slightly business, remained back as sales of and was sales had our grew was buying stock later those on it panic year, when a say panic buying because positive the in the there then, of consumer because there the And off

also activity which our new of it's perform starting consumption later pushed business It our merchandising All back now I less off all, in authorization, toward to supermarkets. neutral. is in running the That bulk is because However, say very bar but been positive, deli running backed normal. in in would year. hot business,

Jeffrey Kobylarz

release said you've what in your about plants, your your Matt can say you what you're plants capacity in In press and your…? how increased much the how your capacity increasing and

Carl Wolf

for options The final $XX on we made product capacity using the $XX co-packers us, that. having And that – with we the by not guidance million around in year given the We've $XX increase is plant components. the to right have by the million mix. then, a million components somewhere of some think another today of product, by some to

have of capacity $XX major, So, we with to investments, we million think modest now. stand right some where million worth $XX not with we

Jeffrey Kobylarz

You've had the a et said August. any since press The cetera, stores, is way those Walmart additions? number is in the you annual of great there announcements to quantify what like revenue from XXX, volume Publix release X,XXX

Carl Wolf

let We not like people don't that. to chains because, try one, know that

you volume. very be new at placements If eight about only spring. this we But we it in if then, stores successful to not The was Walmart rotation. in all to and one-time tend hear very their was but soon we for was it It was addition weeks, group it placement So, so, a of together. Walmart met nice permanent very in well. that it And a it it's whether very, and will requirements. to appears as notice, not – was a for did would all our very we

Jeffrey Kobylarz

Good hear. to

Operator

Our Legend comes Capital. from next Bogin question James with

James Bogin

list plans us are to two-and-a-half regular B. that's or old doing NASDAQ? the was Riley, what update with your on you you're what any wondering given months could give if about I now

Carl Wolf

and terms on should requirements stock we think all late we January equity in by the a mid would to earnings. meet except We of and include of We are decisions good idea of have pretty uplisting. price where for that strategic

make a decision that point. will we at So,

Operator

to to Wolf question-and-answer like remarks. back turn our over I the concludes This for would closing any session. Carl conference

Carl Wolf

operator. Thank you,

to our As virtual If investor we top for note, please in US. we COVID-XX meantime, Thank of to continue region, scheduling basis. investor on roadshows active conferences our when progress. interested out to We on the a continuing coasts will MZ and you today. be In joining again look forward us in efforts a meeting your to are non-deal on update a final will IR once again. firm, our both with Thanks management we subsides, in attending arrange. you to reach continue marking the Group,

Mama's Creations (MAMA) 14 Dec 202021 Q3 Earnings call transcript