Q3 2024 Mama's Creations Inc Earnings Call

Participants

Adam Michaels; Chairman & CEO; Mama's Creations, Inc.

Anthony Gruber; CFO; Mama's Creations, Inc.

Ryan Meyers; Analyst; Lake Street Capital Markets, LLC

Eric Des Lauriers; Analyst; Craig-Hallum Capital Group LLC

Howard Halpern; Analyst; Taglich Brothers, Inc.

Presentation

Operator

Good afternoon, ladies and gentlemen. Thank you for standing by, and welcome to Mama's creations Third 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 open for questions.
This conference is being recorded today, December 12, 2023, in the earnings press release accompanying this conference call was issued after the market closed today. On our call today is Mama's creations, Chairman and CEO, Adam Michaels, and CFO, Anthony Gruber. Before we get started, I'll read a disclaimer about forward-looking statements. This conference call may contain in addition to historical information forward-looking statements within the meaning of federal securities laws regarding momo's creations. Forward-looking statements include, but are not limited to statements that express the Company's intentions, belief, 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 base 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 and are likely to differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors discussion from time to time in this report and in other documents, which the company files with the US 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 in 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 I believe better reflects performance of the business on an 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 Mama's creations website under the Investors tab.
And finally, this conference call contains time sensitive information. It reflects management's best analysis only as of the date in 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 call.
At this time, I'd like to turn the call over to Chairman and CEO, Adam Michaels. Adam, the floor is yours.

Adam Michaels

Thank you, operator, and thank you to everyone for joining us today. I'd like to welcome you to our Third Quarter Fiscal 24 financial results conference call. I'm very excited to be speaking with you all today coming out of what was another strong quarter of consistently improving top and bottom line growth, representing even more evidence of what we believe is Monmouth's true potential.
Over the long term, we continued our reliable cadence of operational execution in the third quarter with strong double digit revenue growth and a year-over-year expansion of our gross margin profile by 460 basis points to 30.1%, validating our strategy and internal focus on our three C's cost controls and culture. Both revenue and net income were up over 15% consecutively from the second quarter of fiscal 24 and we are now beginning to see the cumulative results from our efforts over the last year, ranging from our acquisition of CIF to formalizing and improving countless processes throughout the Company. Taken together, I believe we remain on track to continue our cadence of planned persistent and profitable growth in the years to come. Our team has worked together to drive a significant turnaround in the business in the last year, changing everything but no including the name we made countless small changes at every level of the Company from operations to logistics to administration implementing operational KPI.'s under the mantra of what gets measured gets improved. The results can be clearly seen in our growth gross margin profile, which improved from 11.9% in Q2 fiscal 23% to 30.1% today, as well as in our bottom line with our net income transforming from negative $700,000 in Q2 fiscal 23 to over $2 million today.
Looking ahead into the next fiscal year, we see even more opportunities to further margin enhancement, particularly by leveraging strategic CapEx investments to build new in-house capabilities earlier in the value chain, improving automation at our production facilities and further building the capacity to support potential new Tier one national customers. Taken together these initiatives will position us to invest surplus gross margin into higher and more profitable trade promotion, which will serve as the Rocket Fuel for the next leg in our revenue growth trajectory, early tests and trade promotion have driven promising results, and we look forward to rightsizing our trade promotion investments in the quarters to come at its core. Our strategy and growth are being fueled by macro trends that continue to point in our favor. We are well positioned to capture share, driven by the rapid shift in consumer preference towards deli Prepared Foods, which as a sector continued to grow in both price and volume with the effects of the pandemic. Normalizing food retailers are now investing heavily to increase space for the fresh prepared grab-and-go options to differentiate themselves and appeal to the next generation of shoppers, capturing share from restaurants with healthy, high-quality meals and creative new flavors at a favorable price point relative to takeout research from the Food Marketing Institute, I. reports, Gen Xers and millennials consume grocery deli Prepared Foods more often, and both report, they expect to increase food service purchases in the future. More than half of shoppers recently surveyed, say grocery deli Prepared Foods represent a good value compared to eating out at a quick service or fast casual restaurant or ordering takeout grocers have noticed this undeniable macro trend with 64% of grocery executives polled by Deloitte saying that the fresh department is the most strategically important area for their sales growth during the next 12 to 36 months with I. reporting that three-quarters of food retailers are planning to increase the space they allocate to foodservice. In-home dining has become a source of a spike for consumers seeking to avoid the ever-present impacts of inflation with trailing 12 month in-home food inflation running at 2.1% as compared to more than double that at 5.4% for out-of-home locations. On top of what has already been aggressive inflation since COVID began, we firmly believe Prepared Foods will continue to grow and take market share from the frozen center aisle and especially home occasions, creating a generational opportunity for deli prepared food providers such as Mama's creations.
As I've said before, realizing our goal of shaping Mama's Creations into a one-stop shop for deli. Prepared Foods has required a step change in our corporate structure in many ways. Throughout the third quarter, we remain laser focused on the continuous foundational improvement of our three strategy, cost controls and culture starting with cost, as is plainly visible in our margin profile, our new approach to cost management has driven noticeable savings across the organization, which has enabled our gross margin to grow from 12% when I started to the 30% range. As you saw today, our new ability to load share and produce leading products across our two facilities rather than having them each single sourced has established the framework to enable a much greater level of flexibility and agility that will ultimately provide us with both redundancy and production and lower costs. In addition, our significant investments in automation will position us to grow production capacity to support anticipated future Tier one customer wins as well as to notably enhance margins, which ultimately positions us to reinvest those gains in trade promotion, the rocket fuel for our growth, we are already harvesting the fruits or shall I say proteins of our labor. For example, our gross margin saw an over 300 basis point improvement year over year through significant procurement efficiencies, a further nearly 200 basis points through labor efficiencies as load sharing between facilities helped to drive reduced overtime. While most other companies would be a static for such results, our team only sees it as justification to double down on our 3C strategy to capture more savings for us to reinvest.
On the controls front, I'm proud to say that we delivered on-time in-full with the transitioning of our T&L creative sales division over to our NetSuite ERP system. This means that our full company is now on the Net Suite platform, providing us with a vastly improved degree of actionable insights into the details of our operations while not as sexy. We also implemented our new SEC reporting systems where Ciba, which automates processing allows us to close our books faster and frees up our finance team to focus on more value added activities, having our financial operational and sales analytics at the touch of a button is truly transformational, something we saw after integrating that suite had MamaMancini's and Olive Branch, as I've said before, what gets measured gets improved. We have proven it together over the past several quarters and these analytical capabilities that we are investing in in house will continue to pay dividends for years to come.
Another form of proof of our strategy comes from the response of our customers to our products. We recently heard from our QVC customers who once again voted MamaMancini's products as number one in the I could eat this every day, best source and best smart swap categories during the recent 2023 QVC Customer Choice of Food Awards. It is truly an honor to receive this level of recognition for the fifth year in a row beating out countless superb food products offered on QVC. A testament to the joy of our products continue to bring to our QVC loyal consumers. QVC continues to be a tremendous profitable and incremental channel for us, which also serves as an efficient R&D and innovation real-time testing platform.
Finally, and most importantly, I am proudest of the cultural evolution. My teammates and I are creating this quarter, we launched our first ever employee engagement survey with an impressive 80% participation rate. I've seen early results with our amazing VP of HR app uniques, and she is already sharing with our leadership team, the three specific actions we are going to commit to for our people. Abi also helped us implement our first ever performance management system. I was lucky enough to have a mentor early in my career, Jon Katzenbach, and he taught me that you can't change a culture. You change behaviors and behavioral change leads to cultural change. I am living that with my 250 colleagues every day at moments, and I couldn't be more excited for the renewed culture we are building together. We continue to invest in our people to further grow capabilities. And while not every hire gets a press release, we had several exciting appointments recently concurrent with the retirement of COO, Matt Brown. At the end of fiscal third quarter, we announced the planned evolution of our leadership team with two new Vice President of Operation appointments. Eric Solis was promoted to the role of Vice President of Operations, East Rutherford. Eric maintains over 25 years of operational experience, including over 10 years managing operations at our facility in East Rutherford, New Jersey. In addition, Ray gear was promoted to the role of Vice President of Operations, Farmingdale Ray draws on over 30 years of operations experience, including nearly 10 years managing operations at our facility in Farmingdale, New York. I am fully confident that these tested leaders now managing operations further supported by the superbly talented P&L, creative colleagues, founder, and the morale and our tenured Chief Administrative Officer, Steve Burns, and we are well positioned to continue to realize exciting new operational synergies between our new facilities.
I want to share our congratulations to Eric and Ray and thank Anthony and Steve for their continued leadership with the successful evolution of our finance and operations organization, I committed to my fellow shareholders that building our sales and marketing organization would be our next area of focus. I'm proud to report that we again are successfully building differentiated capabilities ahead of schedule. We have nearly completed the buildout of our sales organization growing from a single dedicated sales employee to five today, further supported by our Chief Marketing Officer and Head of trade strategy and execution. Together, their goal is to continue to drive up our average items carried accelerate our existing velocities and opened new doors, building broad-based distribution. With our new team and capabilities, we increase the likelihood of opening up entirely new channels whether that is the convenience channel, e-commerce channel, our major mass retailers such as Walmart or Target the opening, these will be impactful to our growth trajectory. Hence, our strategic CapEx investments to prepare for whatever the future may hold.
In summary, I firmly believe that we are well positioned to leverage the build-out of our supercharge sales team and a compelling product portfolio to take market share, continue to grow our SKUs per customer and ultimately become the premier one-stop shop deli solution provider in the United States. As we continue to improve our internal processes firm-wide to become brilliant at the basics, we are building a more resilient and flexible organization that I believe can deliver sustainable value to our fellow shareholders for years to come with that, I'd like to turn the call over to Anthony Gruber, our Chief Financial Officer, to walk through some key financial details for the third quarter of fiscal 23. Anthony?

Anthony Gruber

Thank you, Adam? Revenue for the third quarter of fiscal 2024 increased 11.5%, $28.7 million as compared to $25.7 million in the same year ago quarter. The increase was largely attributable to volume gains driven by same customer cross-selling, the acquisition of new customers and successful pricing actions. Gross profit increased 31.6% to $8.6 million or 30.1% of total revenues in the third quarter of fiscal 2024 as compared to $6.6 million or 25.5% of total revenues in the same year ago quarter. The increase in gross margin was primarily attributable to successful pricing actions. The normalization of commodity costs and improvements in procurement, manufacturing and logistics efficiencies.
Operating expenses totaled $5.9 million in the third quarter of fiscal 2024 as compared to $5.1 million in the same year-ago quarter. As a percentage of sales, operating expenses increased in the third quarter of fiscal 2024 to 20.7% from 19.7%. Operating expenses as a percentage of sales increased due to the addition of several new key hires, we brought new and differentiated capabilities to the organization. This figure includes a tripling of our marketing expenditures this quarter as we achieved many firsts for the Company and build out a best-in-class marketing program.
Net income for the third quarter of fiscal 2024 increased 83% to $2 million, or $0.05 per diluted share as compared to a net income of $1.1 million or $0.03 per diluted share in the same year ago quarter. This quarter's net income totaled 7% of revenue, in line with management expectations in the mid single digit range. Adjusted EBITDA, a non-GAAP term increased 67.6% to $3.5 million for the third quarter of fiscal 2024 as compared to an adjusted EBITDA of $2.1 million in the same year ago quarter. Cash and cash equivalents as of October 31st, 2023, were $5.66 million as compared to $4.4 million as of January 31, 2023. The increase in cash and cash equivalents was driven by $1.5 million in cash flow from operations in the third quarter of fiscal 2023 was $1 million of which was used to pay down the company's debt. As of October 31, 2023, total debt stood just under $10 million.
Looking ahead, we believe that our normalized gross margin profile will continue to hover in the high 20% range. Our long-term goal, leveraging strategic CapEx investments, procurement efficiencies and continuous operational efficiencies would be targeting margins consistently maintained in the low 30% range while rightsizing our trade promotion investments.
One factor that I'd like to call out that we are quite proud of is that top of the on top of the 460 basis point improvement in gross margins, we still were able to double our trade investment in the quarter.
Turning to net income, while we continue to target mid single digit net income margins, our long-term goal would be to improve to approximately 10% with adjusted EBITDA margins in the [10s percentage range].
This completes my prepared comments. Now before we begin for our question and answer session, I'd like to turn the call back to Adam for some closing remarks. Adam?

Adam Michaels

Thank you, Anthony. Our ambition is to fortify and expand upon the robust groundwork and strategy presented here today, positioning us to continue to drive profitable growth and margin expansion we will seek to reinvest our surplus gross margins as rocket fuel for our trade promotion budget, which we expect will ultimately snowball into increasingly robust revenue growth.
Looking ahead, our near term sales goals will be achieved by launching highly incremental products to further increase the SKUs per customer, introducing our products to new Tier one customers via our supercharged sales team, putting in place, high ROI trade promotion programs to accelerate existing product velocities and further enhancing our margin through continuous operational improvements at every level of the organization. We believe that this approach will not only position Mama's creations as a one-stop shop deli solution 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?

Question and Answer Session

Operator

(Operator Instructions) Ryan Meyers, Lake Street Capital.

Ryan Meyers

Hey, guys, thanks for taking my questions. Congrats on another solid quarter. Obviously, it looks like we saw sequential revenue growth once again along with sequential EBITDA growth. I'm just wondering if you can comment on how we should be thinking about Q4 and what sort of seasonality we should be expecting?

Adam Michaels

Yeah, thanks, Ryan, and a great team effort. Yeah, I think like we spoke about last year and before Q4 is usually our softest quarter so I think not many people are shopping on Thanksgiving Day and Christmas Day, and hopefully people are going to take some vacation. So we do know like you saw last year it tends to be a little softer. I think we're still shooting for, we said know, we're going to continue to grow faster than the market and continuing to gain share. We're seeing that in the high single digits now between all of that and we think we can continue to beat that.

Ryan Meyers

Got it. That's helpful. And then just wondering if you can comment a little bit more on the new sales hiring or what kind of productivity have you seen out of them? And then maybe if you can quantify how much new business they generated and during the quarter? And then if you have any sort of comments on how much business you think they can generate next year, whether it's in terms of new customers or just overall revenue growth would be helpful to understand.

Adam Michaels

No, it's actually incredible, Ryan. I wish everybody on this call could have joined me. So last week we had our sales meeting, our entire sales team and the extended team got together to plan out next year and to talk about customers, it was yes, you're going to ask the questions about the numbers, and I'm totally great with that, and I'll add to that. But it's the culture, the energy that I've never had before literally when I started, we had one salesperson. And so that was it was great to see that excitement from what's going to happen. Everything is going to happen. So brought in this great guy are who lived his whole life in the C-store. We have a whopping total of [and $0] in the C-store. We're going to open that up next year, Andrew, with e-commerce, the work that Lauren Sella is overseeing and all of our marketing efforts. These are real capabilities that we've never had before as a company, and I expect to see significant growth next year. Again, I continue to believe we're going to do where market is and continue to grow share. These folks are going to help us do that more confidently and at a higher rate than I would have without them. So new customers, new channels, our going to be incredible. And again, Nick, who's who's leading all of our trade programming, we didn't have those capabilities before the the level of analysis we're doing now on our allies on every single program we're doing it's unheard of in some more. And so we know exactly what we're doing. We know what to do more of an equally because you're not going to get it all right, if you get it.
All right, you're not trying hard enough. We know which ones aren't going to work and why we're not going to double down on them next year. So it's been a perfect it is actually exceeded my expectations. This whole sales team coming together and I love it.

Ryan Meyers

That's great to hear. And then last question for me. I know average SKU per customer was seven last quarter. Did that trend higher during the quarter? And what is that currently standing up?

Adam Michaels

Yes, it's good. So a year ago, this time it was at six. We actually got it up to a little over seven now. So what's happening is we're seeing new customers come in, you know, when new customers come in. Remember, this is a weighted average. So when a new customer comes in and like we said they usually come in with just a couple of SKUs, ironically, that suppresses the average items carried. And even we overcame that and still got over seven for that, the other thing is some of the customers that did really well this this quarter tended to have fewer items because they had much more volume to it. But we continue to make progress we did better than we did before, and I expect to do even more with our new sales team.

Ryan Meyers

That's helpful. Thanks for taking my questions.

Adam Michaels

Thanks, Ryan.

Operator

Eric Des Lauriers, Craig-Hallum.

Eric Des Lauriers

Great. Thank you for taking my questions and congrats on another really impressive quarter here. Derek My first question is a bit of a follow-up to the last question. So we've seen year over year revenue growth accelerate from 5.9% in Q1 to now 11.5% in Q3. I was wondering if you could just help us and I understand the drivers of that, some of that acceleration. Obviously, there's a number of things going on here. Presumably increasing SKUs for store is having the biggest impact there. But if you could just kind of to help flesh that out a bit, are there any sort of velocity changes or new geographies to call out in addition to the increasing fuse for storage effects?

Adam Michaels

Yes, absolutely. So a couple of things. So first, what's great is our both of our major businesses, right? The legacy Mancini business and the new creative salads business, both of them grew double digits, which was great. So this is a we're all rowing. The boat together, that was great to see actually a super majority of the growth was volume driven, which is awesome. So I was really happy to see that. So this is actual real sales. This is not a pricing thing, even though we were able to improve our gross margins in price. So we saw that as well, and we did get some great new customers that brought in one that I'm really excited about that. I'm sure you guys you guys know, Albertsons, we just opened up a whole new division in North Cal, which is one of their biggest divisions with some of our chicken products. Again, this is something that I love to see. So we had Albertsons. We've been an Albertsons. Albertsons has been our customer for a while on the legacy man sine side, what I what I told you guys is, yes, customers now let's leverage all these creative salads products, all the chicken or the pennies. We got this great with the move is now getting in, again, a legacy customer. We now have communities that are literally flying off the shelf.
It's incredible on Cub Foods holiday markets. So a lot of new customers exactly to your point. And then we just spoke about a I see getting more items into the stores. And I think one thing that's been great. And I mentioned earlier that the work that Lauren Sella is doing as our Chief Marketing Officer, we've been testing right test, learn, test, testing a number of programs this past quarter, they're seeing very, very promising results. It's the marketing that is going to help us from a velocity standpoint. If you're in the actually if you're anywhere on the East Coast. If you guys know Z100 Elvis Duran in the morning show I think it's one of the most popular morning shows on the East Coast. Lauren did a program with them actually dam and sine, the two of them went to the studios and they don't stop talking about it. They don't stop talking about the meatballs. So that is really starting to help move and get momentum. People are talking about it and that's helping with velocities. So I really would tell you it's the trifecta I share with you new customers I share with you strength in average items carried and now with the marketing driving velocities. So I think it's all three working together, and this is healthy growth. Again, this is a volume driven growth in both of our major businesses.

Eric Des Lauriers

That's great to hear. And I appreciate that color. It sounds like and everything is moving in the right direction here is not we're not always on. And I kind of I guess my next question's on the margin impacts from CIF. And if I look back, it looks like that was sort of expected to have 100 to 200 basis points of potential gross margin improvement here. And I'm just wondering how to sort of combine that information with your sort of your target to keep gross margins ideally in the high 20s and sort of reinvest in trade promotion. Is this one to two percentage points incremental to that high 20s or is this now we're staying at high 20s and now we essentially have another 100 to 200 basis points of surplus margin to reinvest.

Adam Michaels

Yeah. So first, I need to apologize for over delivering on the high 20s. I'm sorry about that, but I'll keep disappointing. I think that there's two or three things. I think the first thing is the CIF acquisition has been tremendous around low. Jeff Siegel, the whole team I could go through. Everybody has just done an amazing job and we're one team now we don't even talk about CIF anymore. We're one team. Second thing is yes, we absolutely see that the one, like we said, the one to two points. Again, we have over-delivered our thesis on what I brought to the Board on the opportunity. So I feel great about saying that the third, I think, is even more important than numbers. The talent that we brought in. These are folks. So there are folks from Seattle that were had capabilities that we didn't have before.
We're back in our freight. I've mentioned to you freight when we first started 200 basis points, 280 as crazy as numbers are, we got another 50 points -- 50 basis points of improvement this quarter. That's real capabilities that Rebecca brought to the team, what we're able to do in accounts receivables, it is yes, it's great that the CF acquisition got us more sales and got us more margin the real secret is it got us great talent and real capabilities in our business. And that's what I'm proudest of.

Eric Des Lauriers

That's great to hear from my last couple of questions. I guess I guess versus just a clarifying question. Did you say earlier, I think it was on the previous question and then you had hired a sort of new head of the C-store channel. I just wanted to clarify that first.

Adam Michaels

We did, yes, yes, yes. Or it is just killing. It really already literally has only been here a month or two and already connecting with the right brokers, the right distributors, the energy that he brought to the meeting, she he actually pushed me. He was yelling at me that I was calling the number too conservatively has that he would like his first week here and is already calling me out, which I love. So yes, we have a new guy running C-stores, e-commerce now we are building a team that's going to win.

Eric Des Lauriers

So you have this new C-store hire from your press release sort of launch of your direct to consumer e-commerce. I mean you called out sort of the club opportunity in the press release and then mentioned mass market. And in your prepared remarks here, just kind of help us like frame these opportunities here. I think you said C-store could could even drive near term results here. How should we think about these? I guess, I guess one, just in terms of a potential scale relative to the size of your sort of traditional grocery channel? And then perhaps in terms of whether it's priority or just when we might be able to see some potential results here. I'm just trying to understand these opportunities as they come up.

Adam Michaels

Yes. Look, I think our puts enough pressure on ourselves, as does everyone the team, we're not looking so yes, for our fiscal '24 plan, we built a bottom-up model. Obviously, we won't be sharing at that bottoms up customer by customer model, but we have it. Let's put this into perspective, we're pretty much not in five of the top 10 customers, the three biggest customers in this country target Walmart and banner program. We're not. So I think that you put in perspective for us, the level of distribution. And again, I'm proud with over 8,000 points of distribution. I'm very proud of that over [$100 million] business. That's wonderful wherein like like still probably I don't even think we're in the bottom of the first. We're probably in like maybe we have one out in the top of the first. That's how early, we are in the process. So I think there's tremendous value. But again, we're not going to rush. I'm here for the long haul Anthony's here for the long haul and we're going to do things very organized for you to it very profitably.
So at that, you know, look at the growth that we're having and the profits are just getting better the business is getting healthier and healthier. I think if you look at our peers or in my old world of Mondelez, all the companies that I would look at to acquire yes, it's super easy to get growth. I mean, we're losing [$100 million], but don't worry about it. Someone else will pay for it. We are growing smartly. We're growing profitably and we're accelerating our profit. That's the type of growth that you're going to see from this business.

Eric Des Lauriers

Well, it's certainly very impressive what you've all been able to do over the past year or so, and certainly looking forward to many opportunities to come. Thank you for taking my questions.

Adam Michaels

Thanks a lot, Eric.

Operator

Howard Halpern, Taglich Brothers.

Howard Halpern

Congratulations, guys. On a great quarter.

Adam Michaels

Thanks, Howard.

Howard Halpern

Scanning the SKU that's out there I saw, could you describe what was the primary driver with a growth in the Midwest year-over-year and sequentially, because it seemed like it was a nice a nice bump in the quarter.

Adam Michaels

Yeah I know it's great. And probably I'm the only CEO that's happy to see that we're losing share on the East Coast because we're doing so much better on the Midwest and the West Coast, Dallas, primarily two or three things. One, Costco continues to get stronger and stronger for us, and I spoke about this earlier around this trifecta. So first this year, we got the largest order ever it's actually shipping now in the Northeast over $1 million order two. We've had multiple rotations now in some regions. We've already been this year already. Northeast Midwest Pacific, Northwest LA region, which are missing others. And then a third and I'm super excited, we're producing it now. You'll just see it next month if you're out in west coast where we got our sausage and peppers into the LA region of Costco, which is wonderful. So this is the first time ever. We've had a non-menthol product in Costco. So we hit the the triple threat this year, which was awesome directly to your question, Costco, we had a nice another rotation in the Midwest and our Midwest sales. Okay. Randy, I believe is also in the Midwest. And we continue to do well at Roundy's, which is if you guys know a Kroger banner underneath the Kroger banner is Roundy's. So those are the answers are for Okay.

Howard Halpern

What are you seeing in terms of, you know, how you talk about growth in stores building out today? It's part of their store. Is there an opportunity for the I know the bonus comp to go in that section of grocery stores going forward?

Adam Michaels

Well, you must be speaking to Scott Shaffer for on our sales team. So actually it's great that you mentioned that. So Jewel is an Albertsons per banner. Jewel is crushing it with our meatballs and a cup. So just as a reminder, we've developed nibbles on a comp basis our boxing everybody out. So you get all of the the production flat. We actually, Scott, we actually sold into Joule. I shared with the leadership team the other day, we actually got a and an end cap. So in our refrigerated and cap, which is really hard to get and they had both our beef meatballs and our turkey meatballs on that end cap. So yes, our directly to your point, while the intention was to have the cups in a C-store only really they're actually starting to do well in the grocery space on with Joule and with others. And then also there's a lot of interest from the community on club channel for a multipack, which we're investigating as well. So it's happening. Howard, it's great.

Howard Halpern

And all that eventually to could lead to increased volumes on the e-commerce side?

Adam Michaels

Yes, we got to actually Lauren and see that now that Lauren must have been happy now too. So yes, if you go onto our website, shop.mamascreations.com, you can actually get meatballs in a cup on our website. So yes, because it should help drive e-commerce sales as well.

Howard Halpern

Okay. And just SG&A question, are we now at a new the new level is that is this sufficient to help fuel that double-digit growth that you hopefully will achieve over the next few years?

Adam Michaels

Yeah, you know what let's say. I don't want how can I say this respectfully with sitting next to Anthony, my CFO. I don't want necessarily Anthony to be driving what capabilities we need to. Obviously, we're going to manage the business well, and we're going to grow and we're going to maintain our profitability. But I want to bring in great talent, and I'm never going to go five point that I'll make decisions. We as a leadership team, make the decisions on who to bring in, but I want to bring capabilities. And that said, we had a great year this year.
You see the talent we brought in from sales and marketing and logistics, I think we were down to maybe one or two more people that could really accelerate our business. So I think we're mostly there, but I want to bring in the right talent. I want to also think you have the right amount of marketing, you know, Howard, well, that marketing is a below the line number. That means it's going to sort of quote unquote hurt OpEx. I want to do what's right for this company and I don't want to let short term thinking influence our long-term aspirations. We're going to be a [$1 billion] company and we need the marketing do that. But I promise you I'm a big talker, but I get scared best than you guys do. So I will make sure that we continue to stay profitable and continue to grow.

Howard Halpern

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

Adam Michaels

Thanks so much, Howard.

Operator

Thank you. This concludes our question and answer session. And I will now turn the call back to Chairman and CEO, Adam L. Michaels, for his closing remarks.

Adam Michaels

Thank you, operator, and thank you again to each of you 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 my fellow shareholders and execute upon our vision of becoming a national one-stop shop deli solution provider.

Operator

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