MMMB - Earnings call transcript Q1 2023

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Operator

Good morning ladies and gentlemen. Thank you for standing by. Welcome to MamaMancini’s first quarter fiscal 2023 earnings conference call.

During today’s presentation, all participants will be in a listen-only mode.

Following the presentation, the conference will be open for questions.

question, your the touchtone a the followed have on one phone. you please star press by If

If you would press the like to withdraw followed the your by two. star question, please

before and is being recorded On earlier President June speaker Carl lift Matthew equipment, release If earnings and this MamaMancini’s our today, and CFO CEO, selection. call accompanying Wolf; you’re is the morning. this XX, using conference handset Chairman Brown; conference and This making Morgenstein. COO, the please today press XXXX, call your issued was Larry

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

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

loss company’s under availability differ the affected measure also to EBITDA, results forward-looking actual GAAP Matters This capital, performance be company’s control. include, in factors, could GAAP by the as to risks this performance. to items and this to that as those non-GAAP not from of of has which is a the the information corresponding together provides the income financial statements costs cause measures and personnel, and key not the beyond includes useful operations; considered be trends other regarding all not major that other related adjusted results limitations such among litigation considered it as may non-GAAP an statements call measure of materially with regarding GAAP the financial management and associated management of any with relating in net and factors addition, operation measure uncertainties however, with determined GAAP. reflect In company significant following alternative should of accordance company. company’s investors The in the the of measure business measure: to and the believes business does a when financial

comparable are not to and the as differently GAAP. may measures company’s should therefore be other measures performance a calculated measures addition, and or therefore for companies, In similar with accordance financial to in measures addition investors not to superior of substitute non-GAAP by consider non-GAAP in

the in please and shown open definition corresponding at market press income, earnings reconciliation its For of a net that the reconciliation wire GAAP to measure, see the release crossed EBITDA table today.

reflect does revise conference any and to the that or this date conference statements circumstances time management’s future the date arise of addition, as only obligation information In conference of The call. contains update or that best after publicly events, time-sensitive information this analysis call company this undertake of reflects forward-looking call. not to any

the Executive time, phone. require At is zero on assistance, to Chairman this your floor call please Carl to star yours. the touchtone Officer. If you press company’s over turn Chief like I’d the then Wolf, Carl, operator and

Carl Wolf

a few call. for and quarter conference XXXX comments Since you welcome call we to ago, limiting our to today. joining Operator, us financial weeks you was you are like results Thank thank today. first everyone our our I’d last

The first by bringing run to our and significantly for revenues recent quarter our reinforced closer by quarter year of end. saw acquisitions sales first million us rate annualized MamaMancini’s record goal XXXX fiscal of $XXX

this cup as showing. our our ever in new such shared To original call focusing a supermarket in its better which have store, multifaceted out the first meet segment. a to in earnings quickly initiatives, ago, exciting customers’ fourth convenience we efficiently support potential and QVC food prepared fiscal service feedback, weeks service quarter meatballs needs, fresh strong, product growing opportunities. in product creating customer the few based innovation we these a To has our the sold promising university XXXX As product on foods are preference favorites on

cost perspective, increases. we serve new to fortify financial is the enhance to ourselves to this phenomenon unique From industry and largely is commodity to future to acquisition-related the along inflationary of passing beginning profitability and front, margin our us, with expenses to margins are customers. but environment in return an behind profile increases going non-recurring On regardless rapidly price find by forward, our we

In through of term down, defense addition, enhance our as and our margins the to long costs price input recent commodity come further expect costs normalize we increases.

efforts, a Our products campaigns of innovative on of know continued XXX,XXX-plus our growing quality and high likes and and our a have to work efforts. that few included now effective as million media several like with campaigns, already touch social social marketing I’d new we you radio views. sales our often result historically and have some QVC. hit these These on media multi-pronged are

have XXXX. from were of immediately see a which Larry? quarter that to Financial last national key vision time summary, building Larry walk company now product Looking we months several accretive Morgenstein, call for acquisition to our our platform the and multiples the for over as MamaMancini’s emerge. year to additional candidates complementary financial are turn Chief the ahead ahead foundation national space to the like of in a through for this from network. continue Officer that I’d In will to products details first distribution our some continue evaluate will food the good and momentum, attractive opportunities are

Larry Morgenstein

XX, Carl. in quarter. million first for costs balance inflation Salads you LLC quarter the and compared record packaging Branch XXXX T&L primarily million increased lower as of Management revenue quarter. increased in totaled of was overhead and partially and business offset Operating of for to as price LLC. year-ago to the material raw quarter, Salads Gross in increase XXXX Creative Inc. or quarter $X.X increases the Olive quarter the compared acquisition the compared T&L caused revenue December materials, XX.X% first normalize $XX.X to between the by will $X.X margins the a first of million result The second Olive the from year-ago expenses the by in in and quarter. returning the Thank lines, as gross well same was million believes of Branch to of margin quarter the a XXX.X% in profits of or inflated of fiscal in same first million raw company’s historical the compression $XX.X businesses. range. Revenue freight its $X.X profits lower the to acquired XXXX total XXXX year-ago the the fiscal Creative in costs, revenues as quarter to as The XX.X% $X.X same million total fiscal

year-ago increased of to a would to XXXX. $X.X as expenses year-ago XX.X% $X.XX of diluted in Cash Brown, acquisition-related rate XX.X% due compared million quarter Operating quarter. percentage of the over like quarter cash XX, quarter in expenses Matt January my fuel same fiscal per compared increases, of non-GAAP operating compared year-ago first million income to surcharges update. to $X.X quarter. XX, of net President $X.X completes for compared to share operations a and the XXXX Operating or our same April $X.X or equivalents sales, expenses. Chief This term quarter. $X.X as was totaled first call as the Officer million I and first the million Matt? to $X.X share mainly Net per first for of in million Adjusted XXXX same totaled XXXX the transportation the As income as million turn at quarter $X.XX as an the a totaled the EBITDA, for in in and to XXXX comments. fiscal

Matthew Brown

Larry. Thanks

side of recertifications new about XXXX was business. fiscal operations and business, the On QX the

their control Good all who on more are manufacturing the safety. Both to with to of team. flow in-ops meet speed acquisition major numerous and passed I safely of we required all ease on points, regards the audits and between XX% ever of business safe produce pre-ops on Branch XX%. and food which traceability operations documentation product-specific to in to or the address helpful was can system the heavily call, SQF food both or an particular, both professionally our detailed allergen scrutinized the X production say the has program, focus ongoing and started record should scores this our the to food of SQF. need control facilities identify XX-K proud can being trips lot the and needs. Level and ability do of extremely These demonstrate heavily facilities mentioned these Olive with and ERP shared year primary practices, traceability post-ops. T&L to that learn to with am arise. QX new are facilities quality our manufacturers production facilities scores across plants nationally. to are lot their facilities are focus As audits, past with at and programs, that we from HACCP more requiring shifted to annual facilities with was customers how issues the critical the in Where In help inclined involved emphasis

sharing buying to price MamaMancini minimum. the inflationary and where at to suppliers enabled other front, work both material least common power T&L operations volume together keep raw items On our production on protein increases for us and to continued a

beef in T&L working was hard check. While MamaMancini prices, chicken to keep prices battled

market can at period. taken MamaMancini’s, can costs this be While continue take advantage heading, have signs control no commodity to hope implementation employees overtime. that is to reducing have hours with during our turn we our technology reduced have of start We might the in tighter and see area. steps to of labor to the and predict through some just of this we where better record seen we the better further softening in prices one certainty softening At margins

to authorizations Our take continue new One line. new on as we pick for hold our Meals projects up

line recently had agents, the same buzz in show product four microwaveable Association or needs quick a Meals Dairy, commissaries. XX-ounce in for and weeks. The of to meals one of to QX, our took retail is and its than show. partners were time new As joint post-pandemic customers important MFO this The tray. as option XX-ounce to quality us char new a their attended available a MamaMancini’s we of calls One and chicken shortages was in the grew to quick less or one offerings, ready-made received to fettuccini raw partners tremendous Meals and existing created in attended spaghetti products. a sausage the at our commitment International purchasing include to with develop who grilled as Products meatballs made appearance our supermarket in IDDBA. labor participation In reminds show Deli, our mainstay The first joint place were onions. buyers, introducing have access we by our out some able Atlanta of and well and potential and parm, chicken and meatballs, brokers internally are Alfredo, the refresher, in chicken for One, it T&L customers. peppers our the conference, while our well for the cup as around With chain and to work at version. and suppliers, All an R&D to turn by asked packaging due Bakery

pick order disappoint. that Meals years. now Speaking part of meatballs of us for aside show line. Meals already our One it is due business of shows penne to an Overall, for five coming a addition was in hiatus up did attended along COVID two-year One one this with we available best to the the the in the the production in show new have past for to XX-ounce restrictions, offerings, a We in from la hope of and not setting brand-new cup, the and item this out brought and as a new vodka

for efforts Q&A. now before our final new months over to We call for notes the expect orders. and from see rewards concludes some few the with Carl? authorizations wrapping up back next turn update. call over That my I the the Carl to new will

Carl Wolf

Thank the SKUs concurrently national front, our driving we store. you continue Larry and Matt. product In on to per while more summary, grow innovating footprint

continue national the is Our fit. attractive of an providing exciting and opportunities clear company platform product positioning as pipeline we we in see see multiples space M&A a as companies food for to potential

We to the operating positioned Operator? term execution are to Operator ahead. turn our I incredibly With my Q&A long a for it forward to create fellow look session. and cadence begin value that, quarters well of I’ll in to sustainable over the shareholders, strong

Operator

[Operator first Howard instructions] Halpern ahead. Please The from comes Brothers. with question Taglich go

Howard Halpern

Congratulations, to great quarter. your first kick-off

In do get terms the area of back XX% you you’re year? in that be gross second to the going half margin, that anticipate into able to of

Carl Wolf

acquisition EBITDA, is which Right running our now, expenses, a Well, adjusted $XX,XXX yes. X.X% of of sales. was for around adjustment minor

X% from margins, X% that as should so sales our will of be see is so come in and increase norm as expenses margin, things XX% down, normalize. gross Our should we should most X.X%, grow, to significantly above around come we so gross our

Howard Halpern

the that in costs, variable the you to should pretty million really ramp everything $XX revenue? Okay, you else and quarterly along be vein expenses, operating only going with up even and freight as transportation is huge the sustainable that forward see

Carl Wolf

Yes.

think a freight be a sales; good go of so relatively--go freight just direct some be Freight we support, as possibility we as that without admin up. that logistics SG&A down percentage should sales a go there’s Our sales. added variable down will should however, of

Howard Halpern

your have national and in any real you and that acquisitions are you Okay, network, front? of yet? occurred into and Olive What possibility has of distribution of terms seeing on any your seen Branch, T&L

Carl Wolf

seen very begun T&L of into We’ve products distribution already substantial--we’ve network. substantial MamaMancini’s

first MamaMancini’s occurrence, of products. coming this expansion see this some sales see coming substantial we opportunities and We that for are T&L commitments T&L MamaMancini’s and we well which have other will likely summer so we additional authorized actually occur of ships month, already have have then as been from very and several expansion

Howard Halpern

the on Okay, cup. a do going just When convenience brief the and you stores launch a anticipate the update meatballs in within forward?

Carl Wolf

microwaveability. to QVC defrosted, frozen shipped The technology, needed Our we product frozen. a will stores July, packaging--we first for sell special orders and is and so we shipped coming technology convenience then products was have that so different in needed mid be out. early in we that are The mid-July, shipping

what some now, indicated other of interest we we have so and have have see reaction Right think is additional happens QVC, We business. the hopefully a commitments lot than soon, will substantial I tremendous. but three we’ll

Howard Halpern

Okay.

up guys, Okay just keep the great work. Thanks.

Carl Wolf

Thank you.

Operator

question have Still a next press one. from please Again with if question, Please you star then Capital. Martin The ahead. Lake Bruce comes go

Bruce Martin

I follow-up a last two the other on good Hi, morning. and question, questions. quick have then

Carl Wolf

Sure.

Bruce Martin

you at you running it’s now When are the adjusted you in say normal-- that’s X.X%, quarter, is EBITDA what running now say when and second saying

Carl Wolf

quarter. First

Bruce Martin

quarter? the first In

Carl Wolf

right. quarter, First

Bruce Martin

fourth as that? you so anticipate than is cadence-- in sooner And or What’s the you year when slowly than rate you’d which or quarter, incrementally is hit the plan that that that the say on get later increase to your to goes and that normal, does run X.X%, do

Carl Wolf

to should the to I the could sales million it and and be in that’s running $XXX the fourth be at $X.X so more, EBITDA. close definitely fourth By would quarter, or substantially quarter. in quarter be million third hope by more, we say

Bruce Martin

do look or we’re beyond quote-unquote for while percent at-- that as, as longer that that is that a just you you term normal note, growing And that normal, staying on X.X% I see

Carl Wolf

Long term efficiencies take is X% our to XX% we in as overheads.

Bruce Martin

first and plays think then have through my a as here? or cash and working liquidity, burn do been you in about the there in obviously how was question liquidity other we How and comfortable on year second Mm-hmm, as the quarter. investing is inventory capital, guys

Carl Wolf

the which had, $X.X sales Sure. in bank should some was That increase accounts reduction anticipate we up capital working substantial forward. of very and is the line, going going receivables. paying $XX the of modest in first we and safety be working increases We’ll million that. months, payable few next and needs our equity we quarter, debt have a because inventory million, some There start our heavy in increases, in an we cash some capital now flow positive in of good. down a as quarter seeing We may assets as of and million is stabilizing think just long $X.X at term look first our valve. supporting around and are very to of We increase

Bruce Martin

change more Right, an bit--it so--and question, as board or--? third at a the is that about about you’ve require been equity made to debt, you’ve talking been--this my is opposed going that it is been you’ve recently, which talking you safe you’ve would fair like think level, M&A forward, feels to so when raise assume a M&A

Carl Wolf

different you by--the is three equity and on four it: and have numbers, the the outside can there’s three debt get get equity look at depending it’s one, ways seller; capital; three, the you is thing the can a flow Well, seller each can and you markets, from two, so decision. from handle make to we cash debt the with from and

acquisition significantly However, share. should be each to earnings accretive per

Bruce Martin

And you expect acquisition or see two or year, this to should fiscal this not say would investors necessarily? all another year,

Carl Wolf

for We has are then this margin on more I one at come there then that, be should and available, the would year back and want market the augurs investment, we to acquisitions. some that making I we’ll so want compression do think say and absorb fact growing well seen have later we’ll to--we this fast, opportunities year. least

Bruce Martin

Is it products And additional additional or distribution? is there targeting anything you’re specifically?

Carl Wolf

because fresh prepared that more products eat network, than but so the a has in will also home, center That’s much habits store to has of years focused not now. normal, or done foods, better, at we have--right a been COVID, that key to upon and growing but of yes, to as last back the growing category, ready-to-eat so--anyway, up over products time It’s the foods and into focus well, two some as we come distribution national to is distribution although our and move have the area. be now,

seen us number because their inventory have so segment. take-home the old fits today’s patterns, the business the moved just for of goods, core consumers part their a to It things overstocked prepared of of in been--have foods you’ve in very retailers As segments certain many dry rapidly many, have is lifestyle. back

Bruce Martin

Right, okay. you very Thank much.

Carl Wolf

You’re welcome.

Operator

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

Carl Wolf

Thank Operator. you

reach to top investor we meeting active are the across in in As please will a with we If conferences continue in a attending region, final States. be interested note, scheduling management United your when out to you. to today. us Thank to Group, update to joining for arrange. Lucas Zimmerman our We forward Thank on firm again from our look MZ IR progress. you continuing you

Operator

conference you presentation. now has concluded. attending for Thank The today’s

now You may disconnect.

Mama's Creations (MAMA) 15 Jun 222023 Q1 Earnings call transcript