Mama`s Creations Inc (MAMA, Financial) released its 8-K filing on December 12, 2023, detailing a strong financial performance for the third quarter of fiscal year 2024. The company, a leading national marketer and manufacturer of fresh deli prepared foods, demonstrated significant growth in revenue and net income, driven by effective cross-selling, new customer acquisitions, and successful pricing actions.
Financial Performance Overview
For the three months ended October 31, 2023, Mama`s Creations Inc reported an 11.5% increase in revenue, reaching $28.7 million, up from $25.7 million in the same period last year. Gross profit saw a substantial rise of 31.6%, amounting to $8.6 million, or 30.1% of total revenues, compared to $6.6 million in the prior year's quarter. This improvement in gross margin was primarily due to successful pricing strategies, the normalization of commodity costs, and enhanced efficiencies in procurement, manufacturing, and logistics.
Operating expenses rose to $5.9 million, a 17.0% increase from the previous year, largely due to strategic new hires that brought differentiated capabilities to the organization. Despite this, net income for the quarter surged by 83.0% to $2.0 million, or $0.05 per diluted share, compared to $1.1 million, or $0.03 per diluted share, in the third quarter of fiscal 2023.
Adjusted EBITDA, a non-GAAP measure, also reflected positive momentum, increasing by 67.6% to $3.5 million from $2.1 million in the same quarter of the previous year.
Operational Highlights and Management Commentary
Mama`s Creations Inc has been actively pursuing growth through various strategic initiatives. The company announced a corporate name change to better reflect its transition into a national deli prepared foods platform. It also launched its first direct-to-consumer e-commerce platform and made key leadership team appointments to drive operational excellence.
"We continued our systematic cadence of operational execution in the third quarter with strong double-digit revenue growth and the year-over-year expansion of our gross margin profile by 460 basis points to 30.1%, validating our strategy and internal focus on our 3 Cs, Cost, Controls and Culture," said Adam L. Michaels, Chairman and CEO of Mama’s Creations.
Michaels also highlighted the company's strategic capital expenditure investments and the potential for margin enhancement, as well as the positive impact of trade promotions with club stores.
Balance Sheet and Cash Flow
The balance sheet of Mama`s Creations Inc remained solid with cash and cash equivalents totaling $5.6 million as of October 31, 2023, an increase from $4.4 million at the end of the previous fiscal year. The company also managed to reduce its total debt to $9.9 million, demonstrating prudent financial management and operational cash flow generation.
Looking Forward
With a focus on capturing market share in the fresh, deli prepared foods segment, Mama`s Creations Inc is well-positioned to benefit from shifting consumer preferences and retail investments in fresh-prepared options. The company's commitment to its strategic pillars and transparent culture is expected to drive continued momentum and shareholder value into 2024 and beyond.
Investors and stakeholders are invited to join the company's earnings conference call to discuss these financial results and receive a corporate update.
For detailed financial tables and further information, readers are encouraged to view the full 8-K filing.
Explore the complete 8-K earnings release (here) from Mama`s Creations Inc for further details.
