Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to MamaMancini's First Quarter Fiscal 2024 Earnings Conference Call. During today’s presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be opened for questions. This conference is being recorded today June, 13, 2023 and the earnings press release accompanying this conference call was issued after the market closed today. On our call today is MamaMancini's Chairman and CEO, Adam L. Michaels; CFO, Anthony Gruber; and COO, Matt Brown. Before we get started, I will read a disclaimer about forward-looking statements. This conference call may contain, in addition to historical information, forward-looking statements within the meanings of the federal securities laws regarding MamaMancini's. Forward-looking statements include, but are not limited to, statements that express the company's intentions, beliefs, expectations, strategies, predictions or any other statements relating to its future earnings, activities, events or conditions. These statements are based on current expectations, estimates and projections about the company's business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may or are likely to differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors discussed from time-to-time in this report and in other documents with the company files with the U.S. Securities and Exchange Commission. In addition, such statements could be affected by risks and uncertainties related to factors beyond the company's control. Matters that may cause actual results to differ materially from those in the forward-looking statements include, among other factors, the loss of key management personnel, availability of capital and any major litigation regarding the company. In addition, throughout today's call, the company may refer to adjusted EBITDA, a non-GAAP financial measure, which it believes better reflects the performance of the business on its ongoing basis. A reconciliation of adjusted EBITDA to its most directly comparable GAAP financial measure is included in today's earnings release, which is available on the MamaMancini's website under the Investor tab. And finally, this conference call contains time-sensitive information that reflects management's best analysis only as of the date and time of this conference call. The company does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events information or circumstances that arise after the date of this conference. At this time, I'd like to turn the call over to Chairman and CEO, Adam L. Michaels. Adam, the floor is yours.

Thank you, operator, and thank you to everyone for joining us today. I'd like to welcome you to our first quarter fiscal 2024 financial results conference call. The first quarter of fiscal '24 was highlighted by our continued sequential improvement in normalized profitability with our net income totaling $1.4 million in the quarter or 6.1% of revenue, in line with our expectations. Having started this journey with my teammates nine short months ago, I am proud of our sequential growth from turnaround losses to growing our normalized net profit margin sequentially, with our first quarter at 4.2%, then 5.7%, excluding the one-time tax benefit and now 6.1%. Three quarters that we are proud of with further headroom to continue to grow our future profitability. We continue to execute on our goal of accelerating and expanding our existing family of brands. This was most recently seen with positive reviews from retailers and consumers with the launch of Mama's Creations, a platform brand for international cuisine at IDD BA 2023 last week. To complement our existing items, we are strategically leveraging incremental consumer driven innovation, such as our in-a-Cup portfolio to enter new occasions, cohorts and channels. In parallel to our organic growth, we continue to consider accretive potential acquisitions to further fill out gaps in our portfolio as needed. Our vision is to become a one-stop shop for deli prepared foods for grocery, mass, club and now the convenience channels, addressing the $40 billion plus foodservice and prepared foods market with our grocer partners. Facing continued macroeconomic headwinds, consumers are eating out less and transitioning to grocery store prepared foods. Despite economic challenges, we saw at IDD BA, the demand remains high for clean ingredient meals that are high quality, affordable and quick to prepare as part of a modern on-the-go…

Thank you, Adam. Revenue for the first quarter of fiscal 2024 increased 5.9% to $23.1 million as compared to $21.8 million in the same year ago quarter. The increase was largely attributable to the strong organic growth driven by successful cross-selling efforts. Gross profit increased 65% to $6.4 million or 27.6% of total revenues in the first quarter of fiscal 2024 as compared to $3.9 million or 17.7% of total revenues in the same year ago quarter. The increase in gross margin was primarily attributable to the normalization of commodity costs, successful pricing actions, and improvements in creating efficiencies across the organization. The company continues to identify procurement and logistics efficiencies and cost savings through stronger buying power created through the acquisitions of T&L and Olive Branch. Operating expenses totaled $4.4 million in the first quarter of fiscal 2024 as compared to $3.6 million in the same year ago quarter. As a percentage of sales, operating expenses increased in the first quarter of fiscal 2024 to 19.2% from 16.5%. Operating expenses as a percentage of sales increased due to the addition of several new key hires throughout the organization who have brought differentiated and much needed capabilities that we were missing. These teammates have already driven significant ROI and their effects will only become more impactful in time. Net income for the fiscal quarter of fiscal 2024 was $1.4 million or $0.04 per diluted share as compared to $0.1 million or zero per diluted share in the same year ago quarter. This quarter's net income totaled 6.1% of revenue, in line with our expectations in the mid-single digit range. Adjusted EBITDA, a non-GAAP term, increased to $2.5 million for the first quarter of fiscal 2024 as compared to an adjusted EBITDA of $0.7 million in the same year ago quarter. Cash and cash equivalents as of April 30, 2023 were $5.3 million as compared to $4.4 million as of January 31, 2023. The increase in cash and cash equivalents was driven by $1.6 million in cash flow from operations in the first fiscal quarter of fiscal 2024. $0.5 million of which was used to pay down the company's long-term debt, which now stands at just $8.8 million. Looking ahead, we believe that our normalized gross margin profile remain in the upper 20% range in the near term. Longer term, with the recent appointment of our new Chief Procurement Officer, Logistics Director, and the continuous optimization of our operations, we could return to a gross margin profile north of 30%. Turning to net income. While we are currently spending mid-single digit net income margins, we believe that over the long term, this could be improved to approximately 10% with adjusted EBITDA margins in the teens percentage range. This completes my prepared comments. I'd now like to turn over the call to Matt Brown, our President and Chief Operating Officer for an operations update. Matt?

Thanks, Anthony. Our operational performance in the first fiscal quarter was greatly improved by implementing expanded systems and controls. One in particular that drove immediate value was real-time bill of material costing. Instead of using static cost models, which involve fixed costs of raw materials, packaging, supply and labor at a particular time we can now dynamically track the cost of goods produced. This shift facilitated by integrating our ERP system with daily material and labor consumption data on a SKU-by-SKU basis has enabled us to accurately assess the profitability of each product in real time, allowing us to take action more quickly. Such valuable insights were instrumental early in the first fiscal quarter when we identify that while our meals for one product line was largely profitable, certain SKUs were less so by closely monitoring the production of these items and assessing the data we were able to successfully increase prices while finding new operational efficiencies on these specific SKUs successfully. Turning to CapEx projects. You may recall the planned acquisition of the spiral oven for our East Rutherford facility. I am pleased to report that the installation was completed last month, and the oven is now operational with impressive performance and throughput. We are also in discussions about future CapEx projects at both our Farmingdale and East Rutherford facilities, which will help meet growing demand and enhance efficiency and labor utilization. As a reminder, all these CapEx projects have already been budgeted for and baked into our annual plan approved by our board back in January. Our investment in people continue to deliver outsized results. In Q1, our focus on freight continued to pay dividends. Freight improved 250 basis points in Q1 versus prior year and an additional 70 basis points over our already impressive Q4 results. In…

Thank you, Matt. Our ambition is to fortify and expand upon the robust groundwork and strategy presented today, positioning us to continue to drive profitable growth and reinvest that rocket fuel into the business, to accelerate our people capabilities, our CapEx efficiency and our marketing and trade. To summarize, this will be achieved by launching highly incremental products to increase the SKUs per customer, introducing our products to new customers via the expansion of our sales team and further enhancing our margins through continuous operating improvements at every level of the organization. We believe that this approach will not only position MamaMancini's as a one-stop shop national deli solutions provider, but drive sustainable shareholder value creation over the long term. With that, I'll turn it over to the operator to begin our question-and-answer session. Operator?

Thank you. Ladies and gentlemen, at this time, we will be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of Ryan Meyers with Lake Street. Please proceed with your question.

Hey, guys. Thanks for taking my question. Congrats again on another awesome quarter. Just wondering, if you could start off talking a little bit about how you guys are thinking about growth in the second half of the year? And then maybe kind of your level of visibility there as we bring on a larger sales force?

Yes. Thanks, Ryan. Great team effort, so thank you for that. Yeah. I think there are a couple of things that we're focused on, and hopefully, you heard some of it today. So the first one, you spoke about right up front, which is building the team, right? So actually ahead of plan with bringing Lauren in as our Chief Marketing Officer. She's already hit the ground running. I mentioned that we just hired a West Coast sales lead. So the first one is, have the right capabilities, and we're probably ahead of plan on that. There's still some to do and we'll do that throughout this quarter, but the first part of that is building the people. The second one is, having the products, right? And what we saw at IDDBA is, we absolutely have the right products. The base products, the traditional meat balls and chicken that we do, no one wanted to miss. Poor Matt is tired. His arm is still hurting him from all the samples he was giving out, but also the new in-a-Cup products, the new chicken strip pouches, it actually beat our expectations when it came to -- that's what the consumers were looking for, right? Everyone's on-the-go, everyone's snacking, everyone's back to that and having that packaging format has really helped. Of course, it also helps that we expanded the international variety of our offerings as well, right? As I don't know, maybe Dan Mancini's could eat seven days a week, 21 meals, but certainly, we want that variety. So we have the products. And then, the third and the last piece is the relationships that we have with these customers. I've mentioned on earlier calls, what's great about the acquisition of T&L was we brought in all these new items. We already have the relationships with the customers nationally. So when we have these meetings, we're not asking for meetings. We meet with them every month, every quarter, so it's very easy, hey, how are the meat balls doing? Hey, how are the pasta dish is doing? And oh, by the way, have you tried the general salads? Have you tried the new in-a-Cup solutions? And they love it. So I think this third piece around having the meeting is already scheduled, already set up, really adds to it. So those three pieces, the people, the products, and we have the relationships already feel -- makes us feel very good about the back half of the year.

Got it. That's great. And then wondering if you could quantify what the average items carried are. I know before it was kind of between five and six or five and six items, just kind of curious how that has trended? And then how much of the cross-selling has been just in on all the branch in MamaMancini's customers or vice versa Mama’s customers buying T&L and all brands, I think it'd be helpful to kind of see where that number has trended to?

No, it's great. And again, I feel awesome about it. So it's something that we track. It's something that we get actually bonused against. We actually went up almost 0.5 point. So now we're over six items carried. And that's on a weighted average basis, which means, obviously, you're not even seeing the full power as we brought in a lot of new products. Obviously, it has lower revenue since it's the first month. If you actually look at it unweighted, meaning how many actual new items went in, it was actually almost two full items that went in per customer. So the metrics that -- again, you guys are going to get tired of hearing me say it, but what gets measured gets improved. The fact that, as a leadership team, we're looking at that on a monthly basis drive a better result. And as I just highlighted, it's actually working. So I really feel good about it getting new items in. And again, these new cups, the new pasta kits that we're doing, the new flavors that we're bringing to the deli is only going to make those numbers bigger. So I feel great with those numbers.

Got it. And then last question for me. You guys talked -- Matt talked a little bit about sort of the real-time billing and material cost in that you guys are able to implement for the ERP, which has allowed you to kind of dynamically track the prices and then proactively increase those prices. So just kind of curious how we have these price increases been received by the customers?

Yeah. It's great. I don't want to say -- you don't see me, but I'm knocking wood. We have gotten almost all. Actually, I can't think of one we haven't gotten our prices in. So if you remember back last year, we were significantly under indexed in our price increases last year versus the overall market, that was about 13%. So we brought all that pricing in. We got it done. We were very passionate as a leadership team to get that all in before January. We did that successfully. I would tell you that there's probably only -- I'm talking actually only two customers and they're small customers that are not in line with where this leadership team wants those numbers to be. And there's actually only two SKUs, out of all of our SKUs that, again, we're not happy with the numbers. We think it should be different. And we're already working on those, getting those in. Actually, I just got some great news earlier this morning. So from a pricing perspective, I think possibly because we weren't priced where we should be in the past, we have not had a problem. And what we're seeing is, it's continuing to sell. So relative to what a consumer is seeing on their overall wallet were still significantly under. And then relative to even our competitors, I still think we're under. So I feel good about that. Obviously, we're tracking. I'm sure you're following all the CPI news today. And tomorrow's pending announcements with the Fed. We see that inflation is slowing down for food. That's a good thing. What's actually very interesting and Anthony Gruber, our CFO, highlighted to me, if you guys noticed in CPI, actually, food at home is actually still ticking up significantly more than food in home, which is going to further -- just as a reminder, our whole thesis is that people with these macro headwinds, people don't want to be eating out. People can't be eating out, and it's going to push them more to eating at home, more to these prepared food options. So again, knock wood, I feel really good with our thesis for what our strategy is, is working perfectly right now.

Got it. That’s awesome. Congrats again on the great quarter and thanks for taking my questions.

Thanks, sir.

[Operator Instructions] Our next question comes from the line of Howard Halpern with Taglich Brothers. Please proceed with your question.

Congratulations, great start to the year.

Thanks, Howard.

The new marketing director, what does Lauren bring to the company and what are the first couple of things that she has hit the ground running with for the company?

Yeah. So the first one you're going to get me in trouble because I'm going to forever undersell how amazing Lauren is. I think the thing that attracted the leadership team to Lauren was really her -- first of all, she's been in food for whole, most of her career, almost her entire career. The second thing, though, that makes it really special is, she had a great mix or she has a great mix of big brands and small brands. So yes, she's worked on the $1 billion rich brands, but she's equally worked on the start-up sub-$100 million taste brand. So I think the leadership team really appreciated the diversity of her experiences. So that's to your first question. The second one, it didn't take her along to be very clear on what her three priorities were, and we agreed as a leadership team. She actually just shared them at our leadership team meeting just yesterday. Her three focus are: one, Mama's creations. What does that look like? What is that brand going to represent in the marketplace? That's number one. Number two is -- and I'm embarrassed to say, I think we're probably the last company -- food company in America that doesn't have an online presence. So should we be getting into e-commerce, if we should be getting in, what should it look like? She's going to be responsible for that. And then the third and all three of these are of equal importance is marketing MamaMancini's. So I would argue again that we are underinvested in our brand marketing, in our trade promotion and her job is going to be building out that marketing plan for MamaMancini's. So those are the three that she's going after.

Okay. And with the last point, we should see a little bit of incremental aggregate increase in G&A expense to fulfill that last call of hers?

Yeah. So a couple of things. One, I hope so. Two, it is actually baked into our plan that we submitted to the Board back in January. So nothing more than what we already have in our algorithm. And the third one, and you guys know the beauty of marketing spend, you could flex, right? You could flex literally intra month. You could -- I'm sure these days flex intraday. So we have -- we know what we have to do. Again, I know I'm a boring guy. I am focused on margin. But I have been clear that I'm focused on margins, so I could reinvest it in building our brand and that's Lauren's responsibility with marketing.

And to an earlier point you made, the unweighted average of two new items really going in that doesn't include Mama's creations, which should be in the second half of the year, correct?

Yeah. Absolutely. Thank you for that. Absolutely. That's a whopping total of zero, new items on Mama's creations. That's equally for all intents and purposes, almost zero on our literally half dozen in-a-Cup variety. So the in-a-Cup solution really special for us. And again, I've said this before, but it's important. This is not just another innovation. And the lease innovation, innovation guy there is. This is an incremental opportunity. It's incremental because from our consumer work, it ages down our consumer, younger audience likes this. It's incremental from an occasion. All of the products that we have today pretty much are center plate, our meal occasions. This is an on-the-go snacking occasion. It's completely incremental. And the third and the one I'm most excited about and you hear us talking about, it’s gone into a new channel. So all of them were at IDDBA come into our booth. So there was a whole channel out there, think [indiscernible], all these different players, we didn't have a solution for them. It's a huge market, that's what we're really excited about, the in-a-Cup solution. And it's not just one. So another piece of feedback I told you earlier, the feedback that we got from retailers is had really like the shelf life longer what Matt and his team was able to do is just incredible to go to 21 days. That's huge. The other thing that the piece of feedback we got from retailers was it's sort of getting lost. It's one product. And if you could think of the sea, the shelf it gets lost. Now we literally have half a dozen products to create a billboard effect, that’s going to actually drive higher velocities. So we feel great about that product. And you’re absolutely right. None of that is in our AIC numbers.

Okay. Well, thanks and keep up the great work.

Thanks, Howard.

There are no further questions in the queue. I'd like to hand the call back to Adam Michaels for closing remarks.

Thank you, operator, and thank you again for joining us on today's earnings conference call. We look forward to continuing to update you on our progress as we strive to deliver value to our shareholders and execute upon our vision of a national one-stop shop deli solution provider. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.