Q1 2021 Revenues Increase 51% to a Record $11.1 Million; Net Income Grows 155% to a Record
$0.9 Million; Grew Cash Balance by over $1 Million; Operating Cash Flow of $1.2 Million
EAST RUTHERFORD, NJ, June 15, 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 first quarter ended April 30, 2020.
Financial Summary:
| Three Months Ended April 30, | Year-over-Year % | |||||
| 2020 | 2019 | Change | ||||
| Revenues | $11.1 million | $7.4 million | 51% | |||
| Gross Profit | $3.7 million | $2.4 million | 57% | |||
| Operating Expenses | $2.8 million | $1.9 million | 45% | |||
| Net Income (Loss) | $0.906 million | $0.356 million | 154% | |||
| Earnings per Share | $0.03 | $0.01 | 200% | |||
Recent Highlights:
- 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®.
- Announced operational improvement initiatives in conjunction with a leading renowned industry consulting agency, 15/16 Group, to streamline and accelerate manufacturing operations in anticipation of future growth. As part of this initiative, the Company is creating a dashboard of Key Performance Indicators and installing the NetSuite application to improve operational controls and visibility of plant floor performance, which it expects to be ready starting fall 2020.
- Record sales Activity with QVC in April, selling over $1 million of MamaMancini’s products to QVC customers.
- Attended the June 2020 Virtual Investor Summit, a virtual investor conference taking place June 9-12, 2020.
Management Commentary
“The first quarter of 2021 was highlighted by our robust revenue and net income growth which lays the foundation for an incredible fiscal year,” said Carl Wolf, Chairman and Chief Executive Officer of MamaMancini’s. “We continue to see robust demand, which we are servicing more efficiently than ever given the numerous operational improvements being implemented at our facility. We expect these improvements to increase throughput while driving gross margin expansion as we scale, particularly as beef prices begin to return to normal.
“We believe the increase in demand is partially driven by a spike in first time customers, as consumers continue to obtain the majority of their food purchases from grocery stores in the first quarter. Our goal is to continue engaging and converting these first-time customers into repeat purchasers, as we have typically seen with our products. As stay-at-home orders are lifted and businesses reopen, we plan to transition our strong first quarter momentum into the food service segment.”
“I am proud of the progress we have made in the first quarter and would like to thank our dedicated employees for their hard work and flexibility, which have allowed us to sustain our growth in a changing world. We look forward to continued revenue growth and margin expansion throughout the year, creating sustainable value for our shareholders over the long-term,” concluded Wolf.
First Quarter 2021 Financial Results
Revenue for the first quarter of 2021 increased 51% to a record $11.1 million, compared to $7.4 million in the same year-ago quarter. During the three months ended April 30, 2020, the Company was able to increase its sales through increased purchases at retail food stores and direct to consumer due to COVID-19.
Gross profit increased significantly to $3.7 million, or 34% of total revenues, in the first quarter of 2021, compared to $2.4 million, or 32% of total revenues, in the same year-ago quarter. Gross margin increased due to higher plant operations and efficiency and a change in product mix.
Operating expenses totaled $2.8 million in the first quarter of 2021, compared to $1.9 million in the same year-ago quarter. As a percentage of sales, operating expenses decreased in the first quarter of 2021 from 26% to 25%. Operating expenses increased primarily due to increases in freight, commissions related mainly to higher sales and professional fees related to increased investor relations initiatives.
Net income for the first quarter of 2021 grew significantly to $0.9 million, or $0.03 per share, as compared to a net income of $0.4 million, or $0.01 per share, in the same year-ago quarter. The increase in net income was primarily attributable to an increase in sales of 51%, increase in gross margins from 32% to 34%, lowering of operating expenses as a percentage of sales to 25% from 26%, and in addition to a decrease in interest expense.
Cash and cash equivalents as of April 30, 2020 was $1.8 million, as compared to $0.4 million at January 31, 2020. The cash balance as of April 30, 2020 includes $330 thousand of proceeds from a Paycheck Protection Program term note, the proceeds of which were returned to the lender on May 6, 2020.
Conference Call
Management will host an investor conference call at 5:00 p.m. Eastern time today to discuss the Company’s first quarter 2021 financial results, provide a corporate update, and conclude with a Q&A from participants. To participate, please use the following information:
Q1 2021 Earnings Conference Call
Date: Monday, June 15, 2020
Time: 5:00 p.m. Eastern time
U.S. Dial-in: 1-844-889-4326
International Dial-in: 1-412-317-9264
Conference ID: 10144790
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 June 19, 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 10144790.
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 has a major presence on QVC, the largest direct to consumer marketer in the world. 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:
Luke 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
| April 30, 2020 | January 31, 2020 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 1,814,028 | $ | 393,683 | ||||
| Accounts receivable, net | 3,967,266 | 3,727,887 | ||||||
| Inventories | 1,180,653 | 1,246,417 | ||||||
| Prepaid expenses | 262,034 | 252,268 | ||||||
| Total current assets | 7,223,981 | 5,620,255 | ||||||
| Property and equipment, net | 2,975,261 | 2,805,843 | ||||||
| Operating lease right of use assets, net | 1,456,998 | 1,490,794 | ||||||
| Deposits | 20,177 | 20,177 | ||||||
| Total Assets | $ | 11,676,417 | $ | 9,937,069 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Liabilities: | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 3,830,965 | $ | 3,552,790 | ||||
| Term loan | 304,148 | 423,799 | ||||||
| Operating lease liability | 131,752 | 126,516 | ||||||
| Finance leases payable | 148,779 | 105,126 | ||||||
| Promissory note | 330,505 | - | ||||||
| Total current liabilities | 4,746,149 | 4,208,231 | ||||||
| Line of credit – net | 3,147,348 | 2,997,348 | ||||||
| Operating lease liability – net | 1,335,738 | 1,372,349 | ||||||
| Finance leases payable – net | 469,968 | 315,234 | ||||||
| Notes payable - related party | 641,844 | 641,844 | ||||||
| Total long-term liabilities | 5,594,898 | 5,326,775 | ||||||
| Total Liabilities | 10,341,047 | 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 April 30, 2020 and January 31, 2020, 0 and 0 shares outstanding as of April 30, 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; 31,991,241 and 31,866,241 shares issued and outstanding as of April 30, 2020 and January 31, 2020 | 321 | 321 | ||||||
| Additional paid in capital | 16,722,457 | 16,695,352 | ||||||
| Accumulated deficit | (15,237,908 | ) | (16,144,110 | ) | ||||
| Less: Treasury stock, 230,000 shares at cost, respectively | (149,500 | ) | (149,500 | ) | ||||
| Total Stockholders’ Equity | 1,335,370 | 402,063 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 11,676,417 | $ | 9,937,069 | ||||
See accompanying notes to the condensed consolidated financial statements
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Operations
(unaudited)
| For the Three Months Ended | ||||||||
| April 30, 2020 | April 30, 2019 | |||||||
| Sales-net of slotting fees and discounts | $ | 11,100,919 | $ | 7,364,824 | ||||
| Cost of sales | 7,373,319 | 4,933,770 | ||||||
| Gross profit | 3,727,600 | 2,371,054 | ||||||
| Operating expenses: | ||||||||
| Research and development | 29,481 | 25,326 | ||||||
| General and administrative | 2,722,165 | 1,866,162 | ||||||
| Total operating expenses | 2,751,646 | 1,891,488 | ||||||
| Income from operations | 975,954 | 479,566 | ||||||
| Other expenses | ||||||||
| Interest | (64,402 | ) | (116,612 | ) | ||||
| Amortization of debt discount | (5,350 | ) | (7,288 | ) | ||||
| Total other expenses | (69,752 | ) | (123,900 | ) | ||||
| Net income before income tax provision | 906,202 | 355,666 | ||||||
| Income tax provision | - | - | ||||||
| Net income | 906,202 | 355,666 | ||||||
| Net income per common share | ||||||||
| – basic | $ | 0.03 | $ | 0.01 | ||||
| – diluted | $ | 0.03 | $ | 0.01 | ||||
| Weighted average common shares outstanding | ||||||||
| – basic | 31,991,241 | 31,866,240 | ||||||
| – diluted | 33,946,276 | 32,098,426 | ||||||
See accompanying notes to the condensed consolidated financial statements
MamaMancini’s Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
| For the Three Months Ended | ||||||||
| April 30, 2020 | April 30, 2019 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income | $ | 906,202 | $ | 355,666 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation | 159,793 | 180,485 | ||||||
| Amortization of debt discount | 5,350 | 7,288 | ||||||
| Share-based compensation | 27,105 | 17,257 | ||||||
| Amortization of right of use assets | 33,796 | 10,658 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (239,379 | ) | 363,046 | |||||
| Inventories | 65,764 | (63,584 | ) | |||||
| Prepaid expenses | (9,766 | ) | (98,651 | ) | ||||
| Accounts payable and accrued expenses | 278,175 | (87,411 | ) | |||||
| Operating lease liability | (31,375 | ) | (9,851 | ) | ||||
| Net Cash Provided by Operating Activities | 1,195,665 | 674,903 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash paid for fixed assets | (105,616 | ) | (242,820 | ) | ||||
| Net Cash Used in Investing Activities | (105,616 | ) | (242,820 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Repayment of term loan | (125,001 | ) | (325,001 | ) | ||||
| Proceeds from promissory note | 330,505 | - | ||||||
| Borrowings (repayments) of line of credit, net | 150,000 | (15,865 | ) | |||||
| Repayment of capital lease obligations | (25,208 | ) | (14,121 | ) | ||||
| Net Cash Provided by (Used in) Financing Activities | 330,296 | (354,987 | ) | |||||
| Net Increase in Cash | 1,420,345 | 77,096 | ||||||
| Cash - Beginning of Period | 393,683 | 609,409 | ||||||
| Cash - End of Period | $ | 1,814,028 | $ | 686,505 | ||||
| - | ||||||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | ||||||||
| Cash Paid During the Period for: | ||||||||
| Income taxes | $ | - | $ | - | ||||
| Interest | $ | 67,265 | $ | 151,968 | ||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Operating lease liability | $ | - | $ | 1,599,830 | ||||
| Finance lease asset additions | $ | 223,598 | $ | 54,163 | ||||
See accompanying notes to the condensed consolidated financial statements