[Management View]
Mama's Creations reported record Q1 FY2026 revenue of $35.3 million, an 18% YoY increase, driven by over 90% volume growth. Gross margin reached 26.1%, supported by operational efficiencies and a record 6% of gross revenue invested in trade promotion. The company emphasized its "Four C's" strategy—Cost, Controls, Culture, and Catapult—highlighting operational improvements, expanded distribution, and a focus on branded deli manufacturing for M&A opportunities.

[Outlook]
Management reaffirmed confidence in achieving double-digit growth for FY2026, supported by fixed-price contracts for over 50% of chicken needs and ongoing operational efficiencies. No major CapEx projects are planned, with resources prioritized for strategic acquisitions. The company aims to increase trade promotion spend to 10% of revenue while maintaining gross margins in the high 20% range.

[Financial Performance]
- Revenue: $35.3M (+18% YoY)
- Gross Profit: $9.2M (+23.1% YoY)
- Net Income: $1.2M (+123% YoY)
- Adjusted EBITDA: $2.8M (+12% YoY)
- Cash and Equivalents: $12M (up from $7.2M in Q4 FY2025)
- Total Debt: $4.6M (down from $8.3M YoY)

[Q&A Highlights]

**Question 1:** How should we think about growth rates for the rest of FY2026?
**Answer:** Management remains confident in achieving double-digit growth, citing strong demand from retailers and consumers. However, growth must be profitable, with a focus on value-driven product development and customer expansion.

**Question 2:** Can gross margins improve further despite chicken price volatility?
**Answer:** Gross margins are expected to remain stable in the high 20% range. Fixed-price chicken contracts and operational efficiencies, such as trimming and tumbling processes, have mitigated cost pressures. Management highlighted a theoretical gross margin of 32% if trade promotion spend were excluded.

**Question 3:** What is the timeline for achieving 100% in-house chicken trimming?
**Answer:** Full in-house trimming is achievable within FY2026. Operational capacity is already in place, and the focus is on accelerating sales of new chicken-based products to utilize this capability.

**Question 4:** Are there any major CapEx projects planned?
**Answer:** No significant CapEx projects are planned for FY2026. Small equipment purchases, such as a new stuffing machine, are being made to support growing product demand. Resources are being allocated toward M&A opportunities.

**Question 5:** Has the M&A strategy been refined?
**Answer:** The focus remains on branded deli manufacturing targets with in-house production capabilities. Geographic location is less critical due to improved logistics efficiency. The pipeline is robust, with several opportunities under active consideration.

**Question 6:** What is the outlook for Costco and the broader club channel?
**Answer:** Costco remains a key partner, with ongoing promotions and new product rotations planned. The broader club channel, including BJ's and Sam's Club, offers significant growth potential, with new non-commodity products like roasted sweet potatoes and tortellini gaining traction.

**Question 7:** How is the Walmart rollout progressing?
**Answer:** Walmart's four-count chicken items are performing well, with expanded distribution planned. Discussions are ongoing for additional SKUs, supported by successful digital marketing campaigns with double-digit ROAS.

**Question 8:** How has SKU strategy evolved under current leadership?
**Answer:** The total number of SKUs has been reduced by over 50% to focus on profitable and strategic items. New SKUs, such as chicken-based products for convenience stores, have been introduced to target specific channels and demographics.

[Sentiment Analysis]
Analysts expressed optimism about the company's growth trajectory, operational improvements, and strategic focus on M&A. Management conveyed confidence in achieving financial and operational goals, emphasizing disciplined execution and adaptability.

[Quarterly Comparison]
| Metric | Q1 FY2026 | Q1 FY2025 | YoY Change (%) |
|-----------------------|-----------------|-----------------|----------------|
| Revenue | $35.3M | $29.8M | +18% |
| Gross Profit | $9.2M | $7.5M | +23.1% |
| Net Income | $1.2M | $0.6M | +123% |
| Adjusted EBITDA | $2.8M | $2.5M | +12% |
| Cash and Equivalents | $12M | $7.2M | +66.7% |
| Total Debt | $4.6M | $8.3M | -44.6% |

[Risks and Concerns]
1. Commodity price volatility, particularly in chicken, remains a risk despite fixed-price contracts.
2. Dependence on trade promotion to drive growth could pressure margins if ROI diminishes.
3. Execution risks associated with M&A and integration of potential acquisitions.

[Final Takeaway]
Mama's Creations delivered a strong Q1 FY2026 performance, marked by record revenue, operational efficiencies, and disciplined financial management. The company's focus on profitable growth, strategic M&A, and expanded distribution positions it well for sustained success. While commodity price volatility and execution risks remain, management's proactive measures and robust pipeline inspire confidence in its ability to navigate challenges and capitalize on opportunities.