Mama’s Creations(US:MAMA)2023-04-29 18:22Financial Data and Key Metrics Changes - Revenue for Q4 2023 increased 64% to $22.8 million compared to $13.9 million in the same quarter last year [36] - Net income for Q4 2023 was $1.8 million, a significant improvement from a net loss of $1.3 million in the same quarter last year [40] - Gross profit increased 147% to $6.4 million, representing 28.2% of total revenues in Q4 2023, compared to 18.7% in the same year-ago quarter [37] - Operating expenses as a percentage of sales decreased to 19.9% in Q4 2023 from 28.8% in the same year-ago quarter [39] Business Line Data and Key Metrics Changes - All three business segments (MamaMancini's, T&L Creative Salads, and Olive Branch) experienced double-digit organic growth [59] - The organic growth from T&L and Olive Branch exceeded initial expectations by over 150% in their first year post-acquisition [36] Market Data and Key Metrics Changes - The private label food and beverage category is growing at twice the rate of branded products, with 73% of consumers preferring private label brands [18] - The company is well-positioned to benefit from the trend of consumers transitioning to grocery store prepared foods due to economic pressures [19] Company Strategy and Development Direction - The company aims to become a one-stop shop for prepared foods, targeting the $40 billion-plus food service and prepared foods market [17] - A corporate name change to Mama's Creations and a ticker change to MAMA are planned to better reflect the company's identity as a national deli solutions platform [31][32] - The focus is on building a robust sales and marketing organization to drive organic growth and improve market share [54] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about achieving upper-end gross margins in the high 20s, despite potential commodity price fluctuations [58] - The company is targeting a long-term net income margin improvement to approximately 10% and adjusted EBITDA margins in the teens percentage range [34] Other Important Information - The company has implemented new financial and operational controls to enhance agility and efficiency [23] - Recent hires, including a Chief Procurement Officer, are expected to improve inventory management and capital expenditures [52] Q&A Session Summary Question: Is the gross margin of 27.5% the new baseline for the business? - Management indicated that they are targeting upper-end high 20s for gross margins, with ongoing efforts to manage commodity prices [56][58] Question: Can you quantify revenue during the quarter and the contribution from cross-selling? - All three business segments grew double digits, with cross-selling playing a significant role in the growth [59] Question: What are the biggest milestones to watch for in FY '24? - The focus will be on building the sales and marketing organization, similar to the improvements seen in finance and operations [61]