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MamaMancini's Reports Fiscal Year 2018 Financial Results

Fiscal 2018 Revenue Up 53%; Q4 Revenue Up 45%;
2018 Operating Income $1.06 million vs. $0.46 million in 2017;
2018 Gross Profit Increased 28% vs. 2017;
2018 Net Earnings $320,000 vs a Net Loss of $301,000 in 2017;
 Q4 Net Earnings $114,000; 
2018 Cash Flow from Operations $1.315 million
vs $0.357 million in 2017;
Company Pays Down Manatuck Hill Debt by $1.35m in fiscal year;
Sales per placement in food stores increases 35% from prior year.

For Immediate Release

EAST RUTHERFORD, NJ, May 15, 2018 (GLOBE NEWSWIRE) -- MamaMancini's Holdings, Inc. (the "Company" or "MamaMancini's") (OTCQB: MMMB), a marketer of specialty pre-prepared, frozen and refrigerated all-natural food products (as defined by the United States Department of Agriculture), today announced financial results for the fourth quarter and fiscal year 2018, ended January 31, 2018.

Fiscal Year Highlights:

  • Fiscal year 2018 revenue increased 53% to $27.5 million compared to fiscal 2017 revenue of $18.0 million.
  • Fiscal year 2018 gross margin was 34%, impacted by product mix to larger customers (with resulting lower operating expenses), one-time integration issues, and commodity prices, compared to 40% in 2017.
  • Total operating expenses for the fiscal year 2018 increased 21% versus the comparable fiscal 2017. As a percentage of sales, operating expenses decreased to 29.8% of net sales from 37.4% in fiscal 2017.
  • Income from operations for fiscal 2018 improved to $1.063 million versus $456,000 in the prior year; an increase of approximately $620,000.
  • Placements on grocer's shelves increased at the end of the fiscal 2018 to 43,800, up from 38,700 as of January 31, 2017.  Sales per placement per retail food shelf location increased 35% from prior year. 
  • EBITDA for fiscal 2018 was $1.601 million compared to $ 0.898 million in fiscal 2017.
  • Net Income for fiscal year 2018 was $319,740, compared with a net loss of $301,080 in fiscal 2017.
  • Net income available to common stockholders for fiscal year 2018 was $228,175   or $0.01 per diluted share, compared to a net loss of $506,001, or $(0.02) per diluted share, in fiscal 2017.
  • Cash Flow from Operations was $1,315,240 the year vs. $357,234 for the prior year.

Fourth Quarter Highlights:

  • Fourth quarter of fiscal year 2018 revenue increased 45% to $7.8 million compared to $5.4 million in prior year period.
  • Gross margin for the fourth quarter was 33%, compared to an estimated 40% for fiscal 2017.  The gross margin percentage of sales decrease in this fiscal year was mainly due to a change in product mix to larger accounts which resulted in lower marketing, merchandising, freight, sales commissions, and promotional expenses than smaller accounts.  Gross margin is expected to increase as a percentage of sales to 38% in the first quarter of fiscal 2019 due to better cost management and production efficiencies after the integration of Joseph Epstein Foods Enterprises, Inc. (JEFE).
  • Net income was $113,591 and net income available to common stockholders was $113,591, or $0.00 per diluted share, during the fourth quarter of fiscal 2018.
  • Operating results for the fourth quarter of fiscal 2017 are unaudited and subject to final review and are not included in the fourth quarter comparisons above.

Carl Wolf, Chief Executive Officer of MamaMancini's, commented, "In terms of financial and operating results, we had a very solid year in fiscal 2018. Revenue for the year increased 53% to $27.5 million versus $18 million in fiscal 2017. Income from operations increased significantly on a year-over-year basis to $1.1 million from $0.5 million in the previous fiscal year. Net income available to common shareholders for fiscal 2018 was $228,175, or $0.01 per fully diluted share, compared to a net loss of $506,001, or $(0.02) per fully diluted share, in fiscal 2017. We are pleased with the traction that we are continuing to achieve on our strategic business plan.

While product mix to larger accounts during the year and integration of the Joseph Epstein Foods Enterprises (“JEFE”) acquisition impacted our gross margin, which came in at 34% versus 40% last year, we see this as a temporary impact and expect fiscal 2019 gross margin to be more in line with our historical levels of around 38%. With the JEFE acquisition now fully integrated, we are looking forward to consistent operational efficiencies going forward.”

Mr. Wolf concluded, “As we go through fiscal 2019, we will continue to focus on selling our products into the food service area, on the perimeter of the retail grocery store, where fresh, minimally or non-processed, healthy foods are offered, and where the superior revenue and margin opportunities exist. We will continue to develop new products that will meet the needs of the rapidly growing sector of consumers that seek superior nutritional profiles, with all-natural ingredients and minimal prep time to serve their families. We believe this strategy will enable MamaMancini’s to continue to attract new large national accounts, and to gain a substantial number of new customers around the country.”

The Company’s strategy of developing larger customers and exiting underperforming accounts that do not generate attractive returns has achieved improving operating results. The Company expects some seasonality in sales growth in summer months, but a continuation of significant revenue growth on a yearly basis for the foreseeable future as it continues to develop larger accounts and introduce new product lines. As a result, the company is anticipating fiscal 2019 revenues and operating results to increase significantly over prior year and report continued increased profitability.

Conference Call
The Company has scheduled a conference call for Wednesday, May 16, 2018 at 9:00 a.m. ET, to review the results of fiscal year 2018.

Interested parties may participate on the conference call by dialing (844) 889-4326 or (412) 317-9264. A replay of the conference call will be available by dialing (877) 344-7529 or (412) 317-0088, confirmation code 10119588, through May 23, 2018.

About MamaMancini's 
MamaMancini's is a marketer and distributor of a line of beef meatballs and turkey meatballs, all with sauce; five cheese-stuffed beef and turkey meatballs, all with sauce; original beef and turkey meatloaves; chicken parmesan; stuffed peppers; and other similar Italian cuisine products. The Company's sales have been growing on a consistent basis as the Company expands its distribution channel, which includes major retailers and distributors such as Costco, Publix, Shop Rite, Jewel, Sam's Club, Lunds and Byerlys, SuperValu, Safeway, Albertsons, Spartan Nash, Whole Foods Market, Hy-Vee, Shaw's, Kings, Roche Bros., Key Foods, Stop & Shop, Giant, Giant Eagle, Foodtown, Kroger, Shoppers, Schnucks Markets, Fresh Direct, King Kullen, Lowes, Central Market, Weis Markets, Ingles, Food City, The Fresh Market, Market Basket, Meatball Obsession, Monterrey Provisions, Porky Products, Sysco, DPI, United Natural Foods, Bozzutos, Burris Foods, and C&S. The Company sells a variety of its products on air and online on QVC, the world's largest direct-to-consumer marketer.

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 filings with the Securities and Exchange Commission.

Financial Tables to Follow

MamaMancini’s Holdings, Inc.
Consolidated Balance Sheets

    January 31, 2018     January 31, 2017  
             
Assets                
                 
Current Assets:                
Cash   $ 581,322     $ 670,807  
Accounts receivable, net     3,084,715       1,817,820  
Inventories     824,276       806,623  
Prepaid expenses     261,980       180,260  
Total current assets     4,752,293       3,475,510  
                 
Property and equipment, net     2,499,875       1,563,381  
                 
Deposits     20,177       20,177  
Total Assets   $ 7,272,345     $ 5,059,068  
                 
Liabilities and Stockholders’ Deficit                
                 
Liabilities:                
Current Liabilities:                
Accounts payable and accrued expenses   $ 3,456,918     $ 2,124,880  
Line of credit, net     2,688,764       1,363,145  
Term loan     106,938       140,004  
Note payable – net     1,403,082       1,401,906  
Total current liabilities     7,655,702       5,029,935  
                 
Term loan - net of current     651,677       513,328  
Note payable - net of current portion     250,000       1,548,819  
Notes payable - related party     649,656       649,656  
Total long-term liabilities     1,551,333       2,711,803  
                 
Total Liabilities     9,207,035       7,741,728  
                 
Commitments and contingencies                
                 
Stockholders’ Deficit:                
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of January 31, 2018 and 2017, 0 and 23,400 shares outstanding as of January 31, 2018 and 2017            
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; 31,753,437 and 27,810,717 shares issued and outstanding, respectively     318       278  
Additional paid in capital     16,344,794       15,825,029  
Common stock subscribed, $0.00001 par value; 66,667 shares, respectively     1       1  
Accumulated deficit     (18,130,303 )     (18,358,478 )
                 
Less: Treasury stock, 230,000 shares, respectively     (149,500 )     (149,500 )
Total Stockholders’ Deficit     (1,934,690     (2,682,670
                 
Total Liabilities and Stockholders’ Deficit   $ 7,272,345     $ 5,059,068  

MamaMancini’s Holdings, Inc.
 Consolidated Statements of Operations

    For the Years Ended  
    January 31, 2018     January 31, 2017  
             
Sales - net of slotting fees and discounts   $ 27,543,335     $ 18,048,792  
                 
Cost of sales     18,282,660       10,830,104  
                 
Gross profit     9,260,675       7,218,688  
                 
Operating expenses                
Research and development     138,000       153,296  
General and administrative expenses     8,059,533       6,609,409  
Total operating expenses     8,197,533       6,762,705  
                 
Income from operations     1,063,142       455,983  
                 
Other expenses                
Interest expense     (679,974 )     (728,537 )
Amortization of debt discount     (63,428 )     (28,526 )
Total other expenses     (743,402 )     (757,063 )
                 
Net income (loss)     319,740       (301,080 )
                 
Less: preferred dividends     (91,565 )     (204,921 )
                 
Net income (loss) available to common stockholders   $ 228,175     $ (506,001 )
                 
Net income (loss) per common share - basic and diluted   $ 0.01     $ (0.02 )
                 
Weighted average common shares outstanding                
- basic     29,811,521       27,100,316  
- diluted     32,205,577       27,100,316  

  

MamaMancini’s Holdings, Inc.
Consolidated Statements of Cash Flows

    For the Years Ended  
    January 31, 2018     January 31, 2017  
             
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net income (loss)   $ 319,740     $ (301,080 )  
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                
Depreciation     538,322       441,585    
Amortization of debt discount     63,428       28,526    
Share-based compensation     428,240       598,200    
Changes in operating assets and liabilities:                
(Increase) Decrease in:                
Accounts receivable     (1,266,895 )     (341,238 )  
Inventories     (17,653 )     (248,871 )  
Prepaid expenses     (81,720 )     29,093    
Increase (Decrease) in:                
Accounts payable and accrued expenses     1,332,038       151,019    
Net Cash Provided by (Used in) Operating Activities     1,315,500       357,234    
                 
CASH FLOWS FROM INVESTING ACTIVITIES:                
Cash paid for fixed assets     (1,474,816 )     (552,869 )  
Net Cash Used in Investing Activities     (1,474,816 )     (552,869 )  
                 
CASH FLOWS FROM FINANCING ACTIVITIES:                
Repayment of note payable – related party     -       (7,344 )  
Repayment of note payable     (1,350,000 )     (486,279 )  
Debt issuance costs     (24,697 )     (50,000 )  
Borrowings (repayments) of line of credit, net     1,339,245       403,524    
Borrowings from term loan     251,671       340,000    
Repayment of term loan     (146,388 )     (126,668 )  
Net Cash Provided by Financing Activities     69,831       73,233    
                 
Net Decrease in Cash     (89,485 )     (122,402   )
                 
Cash - Beginning of Period     670,807       793,209    
                 
Cash - End of Period   $ 581,322     $ 670,807    
                 
SUPPLEMENTARY CASH FLOW INFORMATION:                
Cash Paid During the Period for:                
Income taxes   $ -     $ -    
Interest   $ 464,958     $ 721,821    
                 
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:                
                 
Stock issued for Series A Preferred dividends   $ 91,565     $ 271,914    
Debt issuance costs included in principal balance of note   $ 89,104     $ 358,523    

Contact:
                    
                    Carl Wolf
                    Chairman and CEO 
                    MamaMancini’s Holdings, Inc.
                    Stock Symbol: MMMB
                    973-985-0280
                    
                    www.mamamancinis.com
                    carl@mamamancinis.com

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