Mama’s Creations Reports Second Quarter Fiscal 2026 Financial Results

Rhea-AI Summary

Mama's Creations (NASDAQ: MAMA) reported strong Q2 fiscal 2026 results with revenue growing 24% year-over-year to $35.2 million. The company achieved a net income of $1.3 million, or $0.03 per diluted share, up 11% from the prior year.

In a significant development, MAMA acquired Crown 1 Enterprises from Sysco Corporation for $17.5 million in an all-cash transaction. Crown 1 generates approximately $56 million in annual revenue and operates a 42,000 sq. ft. USDA facility near MAMA's existing operations. The acquisition was funded through a $20.0 million private placement and supported by a $27.4 million credit facility.

The company's gross profit increased 28% to $8.8 million, maintaining a healthy margin of 24.9%. Operating expenses rose to $7.1 million, while Adjusted EBITDA grew 18% to $3.3 million. Cash position strengthened to $9.4 million as of July 31, 2025.

Positive

• Revenue growth of 24% YoY to $35.2M, outpacing category by nearly 10x
• Strategic acquisition of Crown 1 adds $56M in revenue at attractive 0.3x multiple
• Gross profit increased 28% YoY with margin expansion to 24.9%
• Strong cash position of $9.4M, up from $7.2M in January 2025
• Reduced total debt to $2.7M from $6.8M year-over-year
• Secured first National Costco Multi-Vendor Mailer opportunity

Negative

• Operating expenses increased 34.3% YoY, rising to 20.1% of sales from 18.6%
• Net income margin declined to 3.6% from 4.0% year-over-year
• Crown 1 acquisition currently operates at lower margins than MAMA's core business
• Continued chicken commodity headwinds affecting margins
• 75% increase in marketing spend impacting operating expenses

Insights

Financial Analyst

MAMA's Q2 shows strong revenue growth and strategic acquisition that significantly increases scale while maintaining healthy profitability.

MAMA delivered 24% revenue growth in Q2, reaching $35.2 million compared to $28.4 million in the prior year. This growth substantially outpaced the category (nearly 10x according to management) and was primarily volume-driven through both cross-selling to existing customers and new door expansion. Gross margin improved to 24.9% from 24.2% despite persistent chicken commodity headwinds, demonstrating operational efficiency improvements.

The acquisition of Crown 1 Enterprises from Sysco for $17.5 million represents a transformative move at an attractive 0.3x revenue multiple. Crown 1 adds $56 million in annual revenue (based on 12 months ended June 30, 2025), a 42,000 sq. ft. USDA facility near their existing Farmingdale plant, and access to premium retail customers MAMA hadn't previously penetrated.

The financial structure of the deal is notable - fully funded through a $20 million private placement with existing institutional investors and supported by an amended $27.4 million credit facility. Post-acquisition, MAMA's revenue run-rate approaches $200 million, significantly advancing their $1 billion 2030 vision while maintaining conservative leverage.

Management's integration strategy mirrors their successful Creative Salads playbook, targeting procurement synergies (especially in chicken), throughput efficiencies, shared services, and margin improvement. They expect to bring Crown's currently lower margins toward MAMA's levels within 12-18 months.

The company maintained its focus on profitability with net income increasing 11.2% to $1.3 million ($0.03 EPS) and Adjusted EBITDA growing 17.9% to $3.3 million. Cash position strengthened to $9.4 million from $7.2 million at fiscal year-end, while total debt decreased significantly year-over-year to $2.7 million from $6.8 million.

M&A Integration Specialist

The Crown 1 acquisition represents exceptional value creation potential with clear integration pathways. The $17.5 million purchase price for a $56 million revenue business (0.3x revenue multiple) is substantially below industry averages for food manufacturing acquisitions, which typically range from 0.8-1.5x revenue.

Geographic proximity between facilities (approximately 10 miles) significantly reduces integration complexity and risk. This proximity enables shared management oversight, flexible production allocation, streamlined logistics, and potential future facility specialization—all proven drivers of successful food manufacturing integrations.

MAMA's synergy roadmap follows a time-tested sequence: first procurement scale advantages (particularly in chicken inputs), followed by production throughput optimization, then shared overhead consolidation. This matches successful integration patterns in protein-focused food manufacturing where ingredient costs represent the largest immediate opportunity.

The financing structure deserves recognition—utilizing a $20 million private placement with existing institutional investors rather than assuming significant debt preserves balance sheet flexibility for future opportunities. With post-acquisition debt levels remaining conservative, MAMA maintains optionality for additional bolt-on acquisitions.

Management's margin improvement target timeline of 12-18 months reflects realistic expectations based on the complexity of food manufacturing integration. Their track record with the Creative Salads acquisition provides a credible basis for confidence in their execution capabilities. The initial focus on integration before pursuing the next acquisition demonstrates disciplined sequencing that maximizes value creation potential while minimizing operational disruption.

Continued Sales Momentum Drove 24% YoY Revenue Growth; Acquisition of Crown 1 Enterprises to Further Expand Customer Base, Operating Scale, and Revenue with $56 Million in Sales in 12 Months Ended June 30, 2025

EAST RUTHERFORD, NJ, Sept. 08, 2025 (GLOBE NEWSWIRE) -- Mama’s Creations, Inc. (Nasdaq: MAMA), a leading national marketer and manufacturer of fresh deli prepared foods, today reported its financial results for the second quarter ended July 31, 2025.

Financial Summary:

		Three Months Ended July 31,
$ in millions		2025				2024				% Increase
Revenues		$	35.2			$	28.4				24.0	%
Gross Profit		$	8.8			$	6.9				27.5	%
Operating Expenses		$	7.1			$	5.3				34.3	%
Net Income		$	1.3			$	1.1				11.2	%
Earnings per Share (Diluted)		$	0.03			$	0.03				6.9	%
Adj. EBITDA (non-GAAP)		$	3.3			$	2.7				17.9	%

Second Quarter Fiscal 2026 & Subsequent Operational Highlights:

• Acquired the assets of Crown 1 Enterprises (“Crown 1”), a full-service manufacturer of value-added proteins and ready-to-eat meals, from Sysco Corporation for $17.5 million.
  • All-cash, accretive acquisition fully funded through a $20.0 million private placement, further supported by an amended $27.4 million long-term credit facility with M&T Bank.
  • Adds ~$56 million in revenue (12 months ended June 30, 2025) with a recently upgraded and expanded 42k sq. ft. USDA facility ~10 miles from Farmingdale, NY.
  • Brings premium, incremental customers where MAMA did not yet maintain a presence.
  • Significant new operational capabilities, including incremental grill capacity, with meaningful cross-selling potential and cost synergies.
• Sold in a variety of new items using the entire chicken breast, including BJ’s Fajita Chicken Strips, Costco Chicken Stuffed Meatballs, Sam’s Chicken Paninis and Publix Meals for One – as well as an expanded partnership with Wal-Mart on our chicken offering and successful expansions at Sheetz and Amazon Fresh.
• Received confirmation for the Company’s first ever National Costco Multi-Vendor Mailer (MVM) with Beef Meatballs in the fourth quarter.
• Invited to attend leading investor conferences nationally, including the Stephens NASH25 Investment Conference, the Lake Street Capital Markets BIG8 Conference and the Craig-Hallum Alpha Select Conference.
• Cash and cash equivalents as of July 31, 2025 totaled $9.4 million, as compared to $7.2 million as of January 31, 2025. The change in cash and cash equivalents was primarily driven by improved profitability and ongoing working capital optimization.
  

Management Commentary
“Our second quarter showed broad-based momentum across our protein offerings: revenue growth outpaced the category by nearly 10x; we prudently deployed high-ROI trade investment; and we saw continued geographic balance with volume-led growth, supported by new branded placements and incremental doors. We also implemented targeted pricing by early Q2, while operational work in chicken improved yields and cut overtime meaningfully, helping us deliver our margin targets before trade investments.

“Most recently, we signed a definitive agreement to acquire Crown 1 from Sysco. Crown adds ~$56M of revenue, a 42,000-sq-ft USDA facility in Bay Shore, NY (about 10 miles from our Farmingdale plant), and access to premium retail partners we have not been able to penetrate to date. The deal was struck at an attractive ~0.3× revenue multiple for $17.5M all-cash, fully financed through a private placement with existing institutional investors, further supported by a long-term credit facility with M&T Bank. We expect a straightforward integration given the proximity and common grill platforms.

“Beyond the immediate fit, Crown unlocks cross-sell opportunities on both sides and tangible near-term operating efficiencies. Our plan targets meaningful cost synergies by next fiscal year through procurement scale (notably chicken), throughput and overhead efficiencies, and shared services – similar to the playbook we executed post-Creative Salads acquisition. While Crown’s current margins are lower, through best practice sharing, scale efficiencies and operational optimization, we expect to bring Crown’s gross margin toward Mama’s levels within 12 to 18 months, with consolidated gross margin initially in the low-20% range and trending higher as synergies and mix improvements materialize.

“Pro forma, Crown moves our revenue run-rate toward ~$200M and advances our 2030 $1B vision. Leverage remains conservative, capex discipline continues, and we’ll focus first on rapid integration before the next bolt-on. With added capacity, premium customer access, and continued innovation, we’re positioned to drive profitable growth and margin expansion in the coming quarters,” concluded Michaels.

Second Quarter Fiscal 2026 Financial Results
Revenue for the second quarter of fiscal 2026 increased 24% to $35.2 million, as compared to $28.4 million in the same year-ago quarter. The increase was largely attributable to volume gains driven by same-customer cross-selling of new items, accelerating velocities of existing items and new customer door expansion. Targeted pricing actions were successfully put in place and implemented to ensure the Company maintained gross margin targets.

Gross profit increased 28% to $8.8 million, or 24.9% of total revenues, in the second quarter of fiscal 2026, as compared to $6.9 million, or 24.2% of total revenues, in the same year-ago quarter. The difference in gross margin rate was primarily attributable to operational efficiency improvements across the organization, partially offset by continued chicken commodity headwinds.

Operating expenses totaled $7.1 million in the second quarter of fiscal 2026, as compared to $5.3 million in the same year-ago quarter. As a percentage of sales, operating expenses increased in second quarter fiscal 2026 to 20.1% from 18.6%. Operating expenses in the second quarter benefited from increased operating leverage and ongoing operational efficiency improvements, partially offset by a 75% year-over-year increase in marketing spend – an area of historical underinvestment – to help drive repeatable and profitable brand growth.

Net income for the second quarter of fiscal 2026 increased 11% to $1.3 million, or $0.03 per diluted share, as compared to net income of $1.1 million, or $0.03 per diluted share, in the same year-ago quarter. Second quarter net income totaled 3.6% of revenue, as compared to 4.0% in the same year-ago quarter.

Adjusted EBITDA, a non-GAAP measure, increased 18% to $3.3 million for the second quarter of fiscal 2026, as compared to $2.7 million in the same year-ago quarter.

Cash and cash equivalents as of July 31, 2025, grew to $9.4 million, as compared to $7.2 million as of January 31, 2025, primarily driven by improved profitability and ongoing working capital optimization. As of July 31, 2025, total debt stood at $2.7 million, as compared to $6.8 million as of July 31, 2024.

Conference Call
Management will host an investor conference call at 4:30 p.m. Eastern time today, Monday, September 8, 2025 to discuss the Company’s second quarter fiscal 2026 financial results, provide a corporate update, and conclude with Q&A from telephone participants. To participate, please use the following information:

Q2 FY2026 Earnings Conference Call
Date: Monday, September 8, 2025
Time: 4:30 p.m. Eastern time
U.S. Dial-in: 1-877-451-6152
International Dial-in: 1-201-389-0879
Conference ID: 13755525
Webcast: MAMA Q2 FY2026 Earnings Conference Call

Please join at least five minutes before the start of the call to ensure timely participation.

A playback of the call will be available through Wednesday, October 8, 2025. To listen, please call 1-844-512-2921 within the United States and Canada or 1-412-317-6671 when calling internationally, using replay pin number 13755525. A webcast replay will also be available using the webcast link above.

About Mama’s Creations, Inc.
Mama’s Creations, Inc. (Nasdaq: MAMA) is a leading marketer and manufacturer of fresh deli prepared foods, found in over 12,000 grocery, mass, club and convenience stores nationally. The Company’s broad product portfolio, born from MamaMancini’s rich history in Italian foods, now consists of a variety of high quality, fresh, clean and easy to prepare foods to address the needs of both our consumers and retailers. Our vision is to become a one-stop-shop deli solutions platform, leveraging vertical integration and a diverse family of brands to offer a wide array of prepared foods to meet the changing demands of the modern consumer. For more information, please visit https://mamascreations.com.

Use of Non-GAAP Financial Measures

This press release includes the following non-GAAP measure – adjusted EBITDA, which is not a measure of financial performance under GAAP and should not be considered as an alternative to net income as a measure of financial performance. The company believes this non-GAAP measure, when considered together with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to the company’s results of operations. However, this non-GAAP measure has significant limitations in that it does not reflect all the costs and other items associated with the operation of the company’s business as determined in accordance with GAAP. In addition, the company’s non-GAAP measures may be calculated differently and are therefore not comparable to similar measures by other companies. Therefore, investors should consider non-GAAP measures in addition to, and not as a substitute for, or superior to, measures of financial performance in accordance with GAAP. For a definition and reconciliation of EBITDA to net income, its corresponding GAAP measure, please see the reconciliation table shown in this press release below.

US-GAAP NET INCOME TO ADJUSTED EBITDA RECONCILIATION
(Unaudited)
(in thousands)

		Three Months Ended
		July 31,
		2025				2024
Net income		$	1,277			$	1,148
Depreciation			583				314
Amortization			417				528
Taxes			368				401
Interest, net			52				59
Stock-based compensation			335				316
M&A related costs			230				0
Adjusted EBITDA (Non-GAAP)		$	3,262			$	2,766

Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include information about management’s view of the Company’s future expectations, plans and prospects, including future business opportunities or strategies and are generally preceded by words such as “anticipate,” “believe,” “eventually,” “expect,” “future,” “may,” “look forward to,” “plan,” “projected,” “should,” “will,” and other words that convey the uncertainty of future events or outcomes. You are cautioned that such statements are subject to a multitude of known and unknown 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. Certain of these risk factors and others are included in documents the Company files with the Securities and Exchange Commission, including but not limited to, the Company’s Annual Report on Form 10-K for the year ended January 31, 2025, as well as subsequent reports filed with the Securities and Exchange Commission.

The Company has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory, and other factors, contingencies, and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. You are urged not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except as may be required by applicable law or regulation, the Company’s does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.
Investor Relations Contact:
Lucas A. Zimmerman
Managing Director
MZ Group - MZ North America
(949) 259-4987
MAMA@mzgroup.us
www.mzgroup.us

Mama’s Creations, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)

		July 31, 2025				January 31, 2025
			(Unaudited)
Assets:
Current Assets:
Cash and cash equivalents		$	9,384			$	7,150
Accounts receivable, net			6,740				8,131
Inventories, net			6,433				4,817
Prepaid expenses and other current assets			881				1,779
Total Current Assets			23,438				21,877
Property, plant, and equipment, net			9,377				9,387
Intangible assets, net			2,685				3,436
Goodwill			8,633				8,633
Operating lease right of use assets, net			6,492				3,376
Deferred tax asset			516				258
Deposits			95				95
Total Assets		$	51,236			$	47,062
Liabilities and Stockholders’ Equity:
Liabilities:
Current Liabilities:
Accounts payable and accrued expenses		$	11,128			$	12,052
Term loan, net of unamortized debt discount of $16 and $22, respectively			1,536				1,530
Operating lease liabilities			1,113				848
Finance leases payable			309				345
Promissory notes – related parties			750				2,250
Total Current Liabilities			14,836				17,025
Term loan – net of current			451				1,342
Operating lease liabilities – net of current			5,321				2,600
Finance leases payable – net of current			1,041				1,199
Total long-term liabilities			6,813				5,141
Total Liabilities			21,649				22,166
Commitments and contingencies (Notes 10 and 11)
Stockholders’ Equity:
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued, 0 shares outstanding			-				-
Series B Preferred stock, $0.00001 par value; 200,000 shares authorized; 0 and 0 issued or outstanding			-				-
Preferred stock, $0.00001 par value; 19,680,000 shares authorized; 0 shares issued or outstanding			-				-
Common stock, $0.00001 par value; 250,000,000 shares authorized; 38,054,000 and 37,826,000 shares issued as of July 31, and January 31, 2025, respectively, 37,824,000 and 37,596,000 shares outstanding as of July 31, and January 31, 2025, respectively			-				-
Additional paid-in capital			27,059				24,882
Retained earnings			2,678				164
Less: Treasury stock, 230,000 shares at cost			(150	)			(150	)
Total Stockholders’ Equity			29,587				24,896
Total Liabilities and Stockholders’ Equity		$	51,236			$	47,062

Mama’s Creations, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share data)

		For the Three Months Ended July 31,								For the Six Months Ended July 31,
		2025				2024				2025				2024
Net sales		$	35,203			$	28,382			$	70,458			$	58,220
Costs of sales			26,432				21,503				52,503				43,878
Gross profit			8,771				6,879				17,955				14,342
Operating expenses:
Research and development			55				93				128				197
Selling, general and administrative expenses			7,016				5,174				14,549				11,760
Total operating expenses			7,071				5,267				14,677				11,957
Income from operations			1,700				1,612				3,278				2,385
Other income (expenses)
Interest expense			(77	)			(122	)			(165	)			(249	)
Interest income			25				63				55				155
Amortization of debt discount			(3	)			(4	)			(6	)			(10	)
Total other expenses			(55	)			(63	)			(116	)			(104	)
Net income before income tax provision			1,645				1,549				3,162				2,281
Income tax expense			(368	)			(401	)			(648	)			(580	)
Net income		$	1,277			$	1,148			$	2,514			$	1,701
Net income per common share
– basic		$	0.03			$	0.03			$	0.07			$	0.05
– diluted		$	0.03			$	0.03			$	0.06			$	0.04
Weighted average common shares outstanding
– basic			37,687				37,336				37,643				37,298
– diluted			39,744				39,604				39,708				39,535

Mama’s Creations, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)

		For the Six Months Ended July 31,
		2025				2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	2,514			$	1,701
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			1,137				606
Amortization of debt discount			6				10
Amortization of right of use assets			589				270
Amortization of intangibles			751				768
Stock-based compensation			640				521
Change in deferred tax asset			(258	)			113
Changes in operating assets and liabilities:
Accounts receivable			1,391				(267	)
Inventories			(1,616	)			462
Prepaid expenses and other current assets			625				(522	)
Accounts payable and accrued expenses			(925	)			(2,161	)
Operating lease liability			(520	)			(267	)
Net Cash Provided by Operating Activities			4,334				1,234
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets			(1,053	)			(2,740	)
Net Cash Used in Investing Activities			(1,053	)			(2,740	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of term loan			(891	)			(776	)
Repayment of related party note			-				(1,200	)
Repayment of finance lease obligations			(193	)			(196	)
Proceeds from exercise of stock options			37				44
Net Cash Used in Financing Activities			(1,047	)			(2,128	)
Net Increase (Decrease) in Cash			2,234				(3,634	)
Cash and cash equivalents at beginning of period			7,150				11,022
Cash and cash equivalents at end of period		$	9,384			$	7,388
SUPPLEMENTARY CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes		$	659			$	871
Interest		$	152			$	223
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Finance lease asset additions		$	—			$	169
Payment of related party debt		$	1,500			$	—
Right-of-use asset recognized		$	4,156			$	873
Write-off of right-of-use asset		$	451			$	897
Issuance of stock for director settlement		$	—			$	450
Receipt of fixed assets for deposits previously paid		$	74			$	533

FAQ

What were MAMA's Q2 2026 earnings results?

MAMA reported Q2 2026 revenue of $35.2 million (up 24% YoY), net income of $1.3 million (up 11% YoY), and earnings of $0.03 per diluted share.

How much did Mama's Creations pay for Crown 1 Enterprises?

MAMA acquired Crown 1 Enterprises from Sysco Corporation for $17.5 million in an all-cash transaction, representing approximately 0.3x revenue multiple.

What is Crown 1's annual revenue and how will it impact MAMA?

Crown 1 generates approximately $56 million in annual revenue and will increase MAMA's revenue run-rate to nearly $200 million. The acquisition includes a 42,000 sq. ft. USDA facility and access to new premium retail partners.

How did MAMA finance the Crown 1 acquisition?

The acquisition was funded through a $20.0 million private placement and supported by an amended $27.4 million long-term credit facility with M&T Bank.

What is MAMA's current cash position and debt level?

As of July 31, 2025, MAMA had $9.4 million in cash and cash equivalents (up from $7.2M in January 2025) and total debt of $2.7 million (down from $6.8M year-over-year).

When does MAMA expect to improve Crown 1's margins?

MAMA expects to bring Crown 1's gross margins toward MAMA's levels within 12 to 18 months through best practice sharing, scale efficiencies, and operational optimization.