Mama’s Creations, Inc. — Form 10-K Summary
Reporting period: Fiscal year ended January 31, 2024, compared with fiscal year ended January 31, 2023. This filing reports annual results; it does not provide a separate fiscal fourth-quarter income statement. The company markets and manufactures refrigerated deli-prepared foods and reported distribution in more than 8,000 stores. It changed its name from MamaMancini’s Holdings, Inc. to Mama’s Creations in July 2023.
Financial performance and liquidity
| Metric | FY2024 | FY2023 |
|---|---|---|
| Net sales, after slotting fees and discounts | $103.3 million | $93.2 million |
| Gross profit | $30.3 million | $19.4 million |
| Gross margin | 29% | 21% |
| Operating expenses | $21.4 million | $16.6 million |
| Income from operations | $8.9 million | $2.8 million |
| Net income | $6.6 million | $2.3 million |
| Diluted earnings per share | $0.17 | $0.06 |
| Cash from operating activities | $11.6 million | $5.5 million |
At January 31, 2024, cash and cash equivalents were $11.0 million, working capital was $6.9 million (up from $3.8 million), and current liabilities were $16.7 million. Net cash increased $6.6 million during the year. Investing activities used $1.4 million, including $786,000 for machinery and equipment and $646,000 net cash for the Chef Inspirational Foods (CIF) acquisition. Financing activities used $3.5 million.
Debt included approximately $4.6 million outstanding under the M&T Bank term loan, with a January 2027 maturity, and no balance on the $5.5 million revolving credit line. Related-party promissory notes totaled $4.2 million at year-end. The company also reported $1.4 million of finance lease liabilities and $2.9 million of operating lease liabilities. Management stated it expected cash resources to meet requirements through April 26, 2025 at current and projected operating levels, but noted growth may require additional funding.
Changes versus the prior year
- Net sales increased 11%, attributed to higher sales volumes, new products at existing customers, pricing actions, and the CIF acquisition, which expanded the company’s ability to sell to retailers, wholesalers, and distributors.
- Gross margin rose to 29% from 21%. Management cited lower or normalized commodity costs, pricing, improved manufacturing utilization and efficiency, freight optimization, and CIF.
- Operating expenses rose 29% and increased to 21% of sales from 18%. Management cited higher payroll and related expenses, including stock-based compensation, CIF-related amortization, insurance, and advertising. Freight-related expenses decreased.
- Net income rose to $6.6 million from $2.3 million. Income tax provision increased to $2.0 million from $9,000; the filing reports federal net operating loss carryovers declined from $2.7 million to zero.
- Operating cash flow more than doubled. The company repaid $1.7 million of term-loan principal, $890,000 on the revolving line, and $750,000 on a related-party note.
Outlook, risks, and notable items
- Strategy: Management is pursuing broader distribution, product innovation, cross-selling across its brands, and complementary acquisitions. It describes a long-term ambition to reach $1 billion in sales through organic growth and acquisitions; this is an aspiration, not a quantified near-term forecast. The filing provides no formal revenue or earnings guidance.
- Acquisition obligations: The remaining 76% of CIF was acquired in June 2023 for approximately $3.7 million, including a $1.2 million cash payment due in June 2024 and $1.5 million payable in company common stock in June 2025. T&L and Olive Branch seller notes require $750,000 principal payments in December 2024 and December 2025, plus interest.
- Customer concentration: Three customers accounted for approximately 26%, 11%, and 10% of FY2024 gross sales. Four customers represented approximately 58% of year-end gross receivables. Losing a major customer or a change in purchasing terms could materially affect results.
- Operating risks: Key risks include food safety incidents and recalls, regulatory or labeling changes (including use of “natural” claims), commodity and freight cost volatility, supply-chain disruptions, competition and pricing pressure, customer concentration, and execution of growth and acquisition plans. The company says approximately 95% of products are internally produced.
- Other disclosures: The company reported no material litigation, no goodwill impairment, and no material cybersecurity incidents known as of the report date. Management concluded disclosure controls and internal control over financial reporting were effective; the external auditor did not audit internal controls and reported no critical audit matters. The company does not anticipate common-stock dividends in the foreseeable future.
Key facts investors should verify
- Whether sales growth and improved gross margin persist, and how much is attributable to pricing, volume, acquisition effects, and cost changes.
- Customer concentration and the durability of major customer relationships, including collections on concentrated receivables.
- Cash generation and liquidity after scheduled CIF and seller-note payments, capital spending, and any funding needed for growth.
- The scale and profitability contribution of CIF and the company’s ability to integrate acquisitions and cross-sell products.
- Operating expense growth, including payroll, advertising, insurance, and acquisition-related amortization, relative to sales growth.
- Food-safety, product-liability, regulatory, and “natural” labeling exposures, as well as commodity and supply-chain risks.