Mama’s Creations Inc (NASDAQ:MAMA), a leading national marketer and manufacturer of fresh deli prepared foods, stock plunges 12.58% (As on December 17, 11:16:35 AM UTC-4, Source: Google Finance) after the company misses estimates for the third quarter of FY 25. Following completion of strategic CapEx projects in September 2024, the company has achieved a sequential step change in the preliminary unaudited gross margin profile in November 2024, which indicates a full reversal of the ~400 basis points of construction headwinds with significant room for further improvement. Cash and cash equivalents as of October 31, 2024 were $9.3 million, as compared to $11.0 million as of January 31, 2024. The change in cash and cash equivalents was primarily driven by $5.0 million in capital investments and $2.5 million of debt paydown during the quarter, largely offset by working capital improvements as third quarter cash flow from operations increased 23.7% year-over-year. As of October 31, 2024, total debt stood at $6.3 million.

MAMA in the third quarter of FY 25 has reported the adjusted earnings per share of 1 cents, missing the analysts’ estimates for the adjusted earnings per share of 6 cents. The company had reported the adjusted revenue growth of 10 percent to $31.5 million in the third quarter of FY 25, missing the analysts’ estimates for revenue of $32.41 million. The increase was largely attributable to successful pricing actions, as well as volume gains driven by increased demand, successful trade promotions, same-customer cross selling of new items and new customer door expansion. Gross profit totaled $7.1 million, or 22.6% of total revenues, in the third quarter of fiscal 2025, as compared to $8.6 million, or 30.1% of total revenues, in the same year-ago quarter. Net income for the third quarter of fiscal 2025 totaled $0.4 million as compared to net income of $2.0 million, in the same year-ago quarter. Third quarter net income totaled 1.3% of revenue, as compared to 7.0% in the same year-ago quarter. Adjusted EBITDA, a non-GAAP measure, totaled $1.7 million for the third quarter of fiscal 2025, as compared to $3.5 million in the same year-ago quarter. Operating expenses were $6.6 million in the third quarter of fiscal 2025, as compared to $5.9 million in the same year-ago quarter. As a percentage of sales, operating expenses were 20.8%, as compared to 20.7% in the same year-ago quarter.