Revenues Increase 28% to Second Quarter Record of $10.4 Million; Net Income Grew 107% to
$0.7 Million
Fortified Balance Sheet, Growing Cash Position by $1.3 Million and Eliminating $1.4 Million in Debt Year-to-Date
EAST RUTHERFORD, NJ, Sept. 14, 2020 (GLOBE NEWSWIRE) -- MamaMancini's Holdings, Inc. (OTCQB: MMMB), a marketer of specialty pre-prepared, frozen and refrigerated food products, has reported its financial results for the second quarter ended July 31, 2020.
Financial Summary:
| Three Months Ended July 31, | Year-over-Year | |||||||||||
| 2020 | 2019 | % Change | ||||||||||
| Revenues | $ | 10.4 million | $ | 8.1 million | 28 | % | ||||||
| Gross Profit | $ | 3.2 million | $ | 2.7 million | 19 | % | ||||||
| Operating Expenses | $ | 2.4 million | $ | 2.2 million | 7 | % | ||||||
| Net Income | $ | 0.740 million | $ | 0.358 million | 107 | % | ||||||
| Earnings per Share | $ | 0.02 | $ | 0.01 | 100 | % | ||||||
| As of | As of | |||||||||||
| July 31, 2020 | January 31, 2020 | |||||||||||
| Cash & Equivalents | $ | 1.7 million | $ | 0.4 million | 331 | % | ||||||
| Working Capital | $ | 3.4 million | $ | 1.4 million | 142 | % | ||||||
| Debt | $ | 2.7 million | $ | 4.1 million | (35 | )% | ||||||
| Stockholder’s Equity | $ | 3.6 million | $ | 0.4 million | 791 | % | ||||||
Recent Highlights:
- Announced new customer authorizations, both in terms of new locations and expansion of existing placements, at several major nationwide retailers in September 2020 including an expansion of locations at 1,250 Publix Super Markets in the Southeast and select Sam’s Club locations nationwide. New product placements included 167 Tops Friendly Markets in the Northeast, 175 Gordon Food Service Marketplace locations across the Midwest and to Lipari Foods, a major distributor in Michigan servicing over 5,000 accounts.
- Launched an 11 week national marketing campaign on Sirius XM Radio to promote MamaMancini’s new Plant-Based Meatballs and Sauce, made with Beyond Beef®, a plant-based ground meat made by Beyond Meat®.
- Attended multiple virtual investor conferences including the LD 500 Virtual Investor Conference on September 2nd, Proactive's One2One Virtual Investor Forum on July 28th, the Virtual Investor Summit on June 10th, and Little Grapevine’s G1 Microcap Virtual Conference May 27th . The company has also committed to present at the MicroCap Club Leadership Summit on September 25th.
Management Commentary
“We continued our pace of operational execution in the second quarter of 2021, further expanding our footprint both in terms of breadth and depth of product distribution at retail storefronts nationwide,” said Carl Wolf, Chairman and Chief Executive Officer of MamaMancini’s. “This success was reflected in our robust revenue and net income growth in what has been a record breaking year. During this time, we have worked to improve firm-wide operational and manufacturing plant efficiencies through a comprehensive effort which is nearing completion. These improvements are increasing throughput while driving gross margin expansion as we scale, particularly as beef prices begin to return to normal.
“Increase in demand in 2020 is being driven by a host of changes in the consumer market, which we are leveraging through marketing and advertising programs designed to engage purchasers adjusting to more meals at home. Many consumers have continued to obtain the majority of their food purchases from grocery stores, even as stay-at-home orders have lifted. We believe this trend will continue in the near term, and our goal is to continue to convert these enthusiastic first-time customers into repeat purchasers, creating a recurring revenue stream. Looking ahead, we plan to transition our momentum into the food service segment as that market slowly returns to normal as COVID subsides over time.
“Despite a challenging year of uncertainty for our country, I am incredibly proud of the dedication and hard work of our team. Despite stay-at-home orders and a pandemic, we were able to continue operations uninterrupted, improve plant efficiency, conduct marketing campaigns, connect with our shareholders through virtual events and improve our growth. We look forward to continued growth in the second half of the year, creating sustainable value for our shareholders over the long-term,” concluded Wolf.
Second Quarter 2021 Financial Results
Revenue in the second quarter of 2021 increased 28% to a second quarter record of $10.4 million, compared to $8.1 million in the same year-ago quarter. Revenue for the first half FY2021 increased 39% to $21.5 million, compared to $15.5 million in the same year-ago period. Revenue growth was primarily a result of increased sales through placements with both new and existing customers.
Gross profit increased to $3.2 million in the second quarter of 2021, or 31% of total revenues, compared to $2.7 million, or 33% of total revenues, in the same year-ago quarter. Gross profit increased to $6.9 million in the first half FY2021, or 32% of total revenues, compared to $5.1 million, or 33% of total revenues, in the same year-ago period. Gross margin decreased due to temporarily higher beef prices, partially offset by improved plant operating efficiencies.
Operating expenses totaled $2.4 million in the second quarter of 2021, compared to $2.2 million in the same year-ago quarter. Operating expenses in the first half of FY2021 increased by 25% to $5.2 million as compared to the same year-ago period. As a percentage of sales, operating expenses in the second quarter of 2021 decreased from 27% to 24%. Operating expenses increased primarily due to increases in freight and commissions directly related to higher sales.
Net income for the second quarter of 2021 grew significantly to $0.740 million, or $0.02 per share, as compared to a net income of $0.358 million, or $0.01 per share, in the same year-ago quarter. Net income in the first half FY2021 totaled $1.6 million, as compared to $0.7 million in the same year-ago period. The increase in net income was primarily attributable to an increase in sales, reduction of operating expenses as a percentage of sales and a decrease in interest expense.
Cash and cash equivalents as of July 31, 2020 was $1.7 million, as compared to $0.4 million at January 31, 2020. The increased cash balance as of July 31, 2020 benefitted from $1.5 million of proceeds from the exercise of warrants and $1.5 million in cash flow from operations, partially offset by a paydown of debt, as the Company reduced its debt by $1.4 million fiscal year-to-date.
Conference Call
Management will host an investor conference call at 8:30 a.m. Eastern time on Tuesday, September 15, 2020 to discuss the Company’s second quarter 2021 financial results, provide a corporate update, and conclude with a Q&A from participants. To participate, please use the following information:
Q2 2021 Earnings Conference Call
Date: Tuesday, September 15, 2020
Time: 8:30 a.m. Eastern time
U.S. Dial-in: 1-844-889-4326
International Dial-in: 1-412-317-9264
Conference ID: 10147782
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 22, 2020. 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 10147782.
About MamaMancini’s Holdings, Inc.
MamaMancini's Holdings, Inc. (OTCQB: 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 Sams 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, 2019 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
MMMB@mzgroup.us
www.mzgroup.us
MamaMancini’s Holdings, Inc.
Condensed Consolidated Balance Sheets
| July 31, 2020 | January 31, 2020 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 1,698,586 | $ | 393,683 | ||||
| Accounts receivable, net | 2,793,527 | 3,727,887 | ||||||
| Inventories | 1,758,761 | 1,246,417 | ||||||
| Prepaid expenses | 256,634 | 252,268 | ||||||
| Total current assets | 6,507,508 | 5,620,255 | ||||||
| Property and equipment, net | 3,077,439 | 2,805,843 | ||||||
| Operating lease right of use assets, net | 1,422,687 | 1,490,794 | ||||||
| Deposits | 20,177 | 20,177 | ||||||
| Total Assets | $ | 11,027,811 | $ | 9,937,069 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Liabilities: | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 2,570,473 | $ | 3,552,790 | ||||
| Term loan | 184,497 | 423,799 | ||||||
| Operating lease liability | 136,976 | 126,516 | ||||||
| Finance leases payable | 184,570 | 105,126 | ||||||
| Total current liabilities | 3,076,516 | 4,208,231 | ||||||
| Line of credit – net | 2,497,348 | 2,997,348 | ||||||
| Operating lease liability – net | 1,298,625 | 1,372,349 | ||||||
| Finance leases payable – net | 573,012 | 315,234 | ||||||
| Notes payable - related party | - | 641,844 | ||||||
| Total long-term liabilities | 4,368,985 | 5,326,775 | ||||||
| Total Liabilities | 7,445,501 | 9,535,006 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ Equity: | ||||||||
| Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of July 31, 2020 and January 31, 2020, 0 and 0 shares outstanding as of July 31, 2020 and January 31, 2020 | - | - | ||||||
| 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; 33,517,101 and 31,991,241 shares issued and outstanding as of July 31, 2020 and January 31, 2020 | 336 | 321 | ||||||
| Additional paid in capital | 18,229,615 | 16,695,352 | ||||||
| Accumulated deficit | (14,498,141 | ) | (16,144,110 | ) | ||||
| Less: Treasury stock, 230,000 shares at cost, respectively | (149,500 | ) | (149,500 | ) | ||||
| Total Stockholders’ Equity | 3,582,310 | 402,063 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 11,027,811 | $ | 9,937,069 | ||||
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Operations
(unaudited)
| For the Three Months Ended July 31, | For the Six Months Ended July 31, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Sales-net of slotting fees and discounts | $ | 10,384,484 | $ | 8,099,445 | $ | 21,485,403 | $ | 15,464,269 | ||||||||
| Costs of sales | 7,170,403 | 5,408,049 | 14,543,722 | 10,401,819 | ||||||||||||
| Gross profit | 3,214,081 | 2,691,396 | 6,941,681 | 5,062,450 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 25,857 | 24,509 | 55,338 | 49,835 | ||||||||||||
| General and administrative | 2,381,459 | 2,215,945 | 5,103,624 | 4,082,107 | ||||||||||||
| Total operating expenses | 2,407,316 | 2,240,454 | 5,158,962 | 4,131,942 | ||||||||||||
| Income from operations | 806,765 | 450,942 | 1,782,719 | 930,508 | ||||||||||||
| Other expenses | ||||||||||||||||
| Interest | (61,648 | ) | (87,284 | ) | (126,050 | ) | (203,896 | ) | ||||||||
| Amortization of debt discount | (5,350 | ) | (5,350 | ) | (10,700 | ) | (12,638 | ) | ||||||||
| Total other expenses | (66,998 | ) | (92,634 | ) | (136,750 | ) | (216,534 | ) | ||||||||
| Net income before income tax provision | 739,767 | 358,308 | 1,645,969 | 713,974 | ||||||||||||
| Income tax provision | - | - | - | - | ||||||||||||
| Net income | $ | 739,767 | $ | 358,308 | $ | 1,645,969 | $ | 713,974 | ||||||||
| Net income per common share | ||||||||||||||||
| – basic | $ | 0.02 | $ | 0.01 | $ | 0.05 | $ | 0.02 | ||||||||
| – diluted | $ | 0.02 | $ | 0.01 | $ | 0.05 | $ | 0.02 | ||||||||
| Weighted average common shares outstanding | ||||||||||||||||
| – basic | 32,262,375 | 31,947,763 | 32,128,298 | 31,907,676 | ||||||||||||
| – diluted | 33,543,565 | 31,981,806 | 33,409,488 | 34,941,719 | ||||||||||||
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
| For the Six Months Ended | ||||||||
| July 31, 2020 | July 31, 2019 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income | $ | 1,645,969 | $ | 713,974 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation | 319,078 | 370,052 | ||||||
| Amortization of debt discount | 10,700 | 12,638 | ||||||
| Share-based compensation | 49,975 | 29,943 | ||||||
| Amortization of right of use assets | 68,107 | 42,958 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 934,360 | (12,770 | ) | |||||
| Inventories | (512,344 | ) | (68,524 | ) | ||||
| Prepaid expenses | (4,366 | ) | (159,239 | ) | ||||
| Accounts payable and accrued expenses | (982,317 | ) | 3,503 | |||||
| Operating lease liability | (63,264 | ) | (42,958 | ) | ||||
| Net Cash Provided by Operating Activities | 1,465,898 | 889,577 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash paid for fixed assets | (189,287 | ) | (89,525 | ) | ||||
| Net Cash Used in Investing Activities | (189,287 | ) | (89,525 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Repayment of term loan | (250,002 | ) | (808,335 | ) | ||||
| Repayments of related party notes payable | (641,844 | ) | - | |||||
| Proceeds from promissory note | 330,505 | - | ||||||
| Repayment of promissory note | (330,505 | ) | - | |||||
| Borrowings (repayments) of line of credit, net | (500,000 | ) | 65,314 | |||||
| Repayment of capital lease obligations | (64,165 | ) | (31,213 | ) | ||||
| Proceeds from exercise of options | 7,200 | - | ||||||
| Proceeds from exercise of warrants | 1,477,103 | - | ||||||
| Net Cash Provided by (Used in) Financing Activities | 28,292 | (774,234 | ) | |||||
| Net Increase in Cash | 1,304,903 | 25,818 | ||||||
| Cash - Beginning of Period | 393,683 | 609,409 | ||||||
| Cash - End of Period | $ | 1,698,586 | $ | 635,227 | ||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | ||||||||
| Cash Paid During the Period for: | ||||||||
| Income taxes | $ | - | $ | - | ||||
| Interest | $ | 128,913 | $ | 253,763 | ||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Operating lease liability | $ | - | $ | 1,599,830 | ||||
| Finance lease asset additions | $ | 401,387 | $ | 254,166 | ||||
| Common stock issued for services to be rendered | $ | - | $ | 71,875 | ||||