Mama’s Creations(US:MAMA)2019-09-13 03:13Financial Data and Key Metrics Changes - Revenue for Q2 fiscal 2020 increased by 44% to $8.1 million compared to $5.6 million in the same year-ago quarter [19] - Net income for Q2 fiscal 2020 totaled $0.4 million or $0.01 per share, compared to a net loss of $0.2 million or loss of $0.01 per share in the same year-ago quarter [23] - Gross profits totaled $2.7 million in Q2 fiscal 2020, with gross profit as a percentage of revenue at 33.2%, down from 36.5% in the same year-ago quarter [20] Business Line Data and Key Metrics Changes - The revenue increase was driven by increased sales with the largest customers and new customer placements, with a merchandising event contributing less than 5% of total sales [19][40] - Operating expenses totaled $2.2 million in Q2 fiscal 2020, up from $1.9 million in the same year-ago quarter, but decreased as a percentage of sales from 34.2% to 27.6% [21][22] Market Data and Key Metrics Changes - The company announced product placement and special merchandising events in over 2,500 tier one grocery retailer locations nationwide, including major retailers like Publix and Sam's Club [15][30] - The company expects these locations to generate an additional $800,000 to $1.1 million in quarterly revenue beginning in Q3 fiscal 2020 [16] Company Strategy and Development Direction - The company is focused on expanding its manufacturing capabilities and enhancing marketing efforts to drive sales growth [17][27] - The introduction of new products, such as pasta bowls, is part of the strategy to capture additional market share [30][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong foundation laid for the remainder of fiscal 2020, anticipating significant shareholder value creation [35] - The company is optimistic about the potential for growth in Canada and other markets, with positive initial feedback on product samples [32] Other Important Information - Cash and cash equivalents totaled $635,000 as of July 31, 2019, compared to $347,000 as of July 31, 2018, with no anticipated need for additional capital [24] - Payables outstanding improved to 32 days as of July 31, 2019, down from 53.3 days a year earlier [25] Q&A Session Summary Question: Can you break down the $2.5 million increase in sales revenue? - The merchandising event contributed less than 5% of total sales, with new and existing customers driving the majority of the increase [40] Question: What does the recent announcement of 2,500 grocery retail locations bring the total number to? - The company is maintaining the total at 45,000, emphasizing the importance of the type of locations rather than just the number [42] Question: What is the lead time for customer acceptance from the new retail locations? - The company has already shipped to each of those customers, indicating actual results rather than proposed shipments [45] Question: Was the increase in postage and freight a one-time event? - The increase is expected to be in line with higher sales, but the company has identified ways to reduce costs moving forward [47] Question: Are there any new products expected by the end of this year or into next fiscal year? - The company is working on a plant-based product, but no announcements will be made until it is confirmed [49]